Document:

Execution
        Copy

    

    

    
      

      

    

    TRUST
      DEED

     

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    

    US$10,000,000
      VARIABLE RATE COUPON CONVERTIBLE BONDS DUE 2012

    
 

    April
      12,
      2007

    

    
      

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    CONTENTS

     

    
      	
              Clause

            	 	 	
              Page

            
	 	 	 	 
	
              1.

            	
              Interpretation

            	 	
              1

            
	
              2.

            	
              Amount
                of the Bonds and Covenant to Pay

            	 	
              5

            
	
              3.

            	
              Form
                of the Bonds and Certificates; Issue of the Bonds

            	 	
              6

            
	
              4.

            	
              Stamp
                Duties and Taxes

            	 	
              7

            
	
              5.

            	
              Covenants
                relating to the Conversion Rights

            	 	
              8

            
	
              6.

            	
              Notices
                Relating to the Conversion Rights

            	 	
              10

            
	
              7.

            	
              Adjustments
                to the Conversion Price

            	 	
              12

            
	
              8.

            	
              Application
                of Moneys Received by the Trustee

            	 	
              19

            
	
              9.

            	
              General
                Covenants

            	 	
              20

            
	
              10.

            	
              Remuneration
                and Indemnification of Trustee

            	 	
              22

            
	
              11.

            	
              Provisions
                supplemental to the Trustee Acts

            	 	
              24

            
	
              12.

            	
              Liability
                of the Trustee

            	 	
              30

            
	
              13.

            	
              Waiver
                and Proof of Default

            	 	
              30

            
	
              14.

            	
              Trustee
                not Precluded from Entering into Contracts

            	 	
              31

            
	
              15.

            	
              Modification
                and substitution

            	 	
              31

            
	
              16.

            	
              Appointment,
                Retirement and Removal of the Trustee

            	 	
              33

            
	
              17.

            	
              Communications

            	 	
              34

            
	
              18.

            	
              Further
                Issues

            	 	
              35

            
	
              19.

            	
              Currency
                Indemnity

            	 	
              35

            
	
              20.

            	
              Governing
                Law, Third Party Rights and Jurisdiction

            	 	
              36

            
	
              21.

            	
              Third
                Party Rights

            	 	
              36

            
	
              22.

            	
              Counterparts

            	 	
              37

            
	
              23.

            	
              Termination
                of this Trust Deed

            	 	
              37

            
	 	 	 	 
	
              Schedule

            	 	 
	
              1.

            	
              Form
                of Certificate

            	 	
              38

            
	
              2.

            	
              Form
                of Global Certificate

            	 	
              71

            
	
              3.

            	
              Provisions
                for Meetings of Bondholders

            	 	
              78

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    THIS
      TRUST DEED
      is made
      on April 12, 2007 between:

     

    
      	(1)	
              CHINA
                ARCHITECTURAL ENGINEERING, INC.,
                a
                company incorporated under the laws of the State of Delaware whose
                registered office is at 2711
                Centerville Road, Suite 400, Wilmington, Delaware 19808, c/o Corporation
                Service Company
                (the “Issuer”);
                and

            

    

     

    
      	(2)	
              THE
                BANK OF NEW YORK, LONDON BRANCH,
                a
                company incorporated with limited liability in United Kingdom, whose
                principal office is situated at 40th Floor, One Canada Square, London,
                E14, 5AL, United Kingdom (the “Trustee”,
                which expression, where the context so admits, includes all persons
                for
                the time being the trustee or trustees of this Trust
                Deed).

            

    

     

    WHEREAS:

     

    
      	
              (A)

            	
              The
                Issuer has (pursuant to resolutions of its board of directors dated
                April
                9, 2007) authorised the issue of US$10,000,000 Variable Rate Convertible
                Bonds due 2012 convertible into shares of common stock of the Issuer
                with
                par value of US$0.001 each to be constituted by this Trust
                Deed.

            

    

     

    
      	
              (B)

            	
              The
                Trustee has agreed to act as trustee of this Trust Deed on the following
                terms and conditions.

            

    

     

    THIS
      TRUST DEED WITNESSES AND IT IS HEREBY AGREED AND DECLARED AS
      FOLLOWS:

     

    
      	
              1.

            	
              
                INTERPRETATION

              

            

    

     

    
      	
              1.1

            	
              Definitions
                

            

    

     

    The
      following expressions have the following meanings:

     

    “Accounts”
means,
      in relation to the Issuer and a Fiscal Period, its balance sheet and income
      statements for that Fiscal Period, which shall be consolidated if the Issuer
      has
      Subsidiaries the accounts of which should be consolidated under the laws or
      regulations of the United States of America or under the generally accepted
      accounting principles in the United States of America;

     

    “Agency
      Agreement”
means
      the paying and conversion agency agreement dated April 12, 2007, as supplemented
      from time to time, between the Issuer, the Trustee, the Registrar and the
      Agents, whereby the Registrar and the Agents are appointed and includes any
      other agreements related to it, as supplemented from time to time, approved
      in
      writing by the Trustee appointing Successor Agents and/or a Successor
      Registrar;

     

    “Agents”
means
      the Principal Agent, the Registrar and the other paying, conversion and transfer
      agents appointed under the Agency Agreement, at their specified offices, and
      their Successors;

     

    “Alternative
      Stock Exchange”
has
      the
      meaning set out in Condition 6(C);

     

    “AMEX”
means
      the American Stock Exchange;

     

    “Auditors”
means
      in relation to the Issuer, the firm of auditors appointed by the Board of
      Directors, from time to time, of the Issuer;

     

    “Average
      Closing Price”
has
      the
      meaning set out in Condition 6(C);

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    “Bondholder”
or,
      in
      respect of a Bond, “holder”
means
      a
      person in whose name a Bond is registered in the register of
      Bondholders;

     

    “Bonds”
means
      the bonds, in the denomination of US$1,000 each, in registered form comprising
      the US$10,000,000 Variable Rate Convertible Bonds due 2012 (the “Bonds”)
      constituted by this Trust Deed and for the time being outstanding or, as the
      context may require, a specific number or principal amount of them;

     

    “Capital
      Distribution”
has
      the
      meaning set out in Condition 6(C);

     

    “Certificate”
means
      a
      certificate, substantially in the form set out in Schedule 1, issued in the
      name
      of the holder of one (1) or more Bonds; and, except in Clause 3, includes the
      Global Certificate;

     

    “Clearstream”
means
      Clearstream Banking, société anonyme, incorporated under the laws of the Grand
      Duchy of Luxembourg or any successor securities clearing agency;

     

    “Closing
      Price”
has
      the
      meaning set out in Condition 6(C);

     

    “Conditions”
means
      the terms and conditions of the Bonds set out in Schedule 1 as from time to
      time
      modified in accordance with this Trust Deed, and as modified, in their
      application to the Bonds in respect of which the Global Certificate is issued,
      by the provisions of the Global Certificate, and any reference to a particularly
      numbered Condition shall be construed accordingly;

     

    “Conversion
      Date”
has
      the
      meaning set out in Condition 6(B)(i);

     

    “Conversion
      Notice”
means
      the written notice in a form previously approved by the Trustee required to
      accompany the Certificates deposited for the purposes of conversion of Bonds,
      the initial form of which is set out in Exhibit A to the Agency
      Agreement;

     

    “Conversion
      Period”
has
      the
      meaning set out in Condition 6(A)(i);

     

    “Conversion
      Price”
has
      the
      meaning set out in Condition 6(A)(iii);

     

    “Conversion
      Right”
has
      the
      meaning set out in Condition 6(A)(i);

     

    “Current
      Market Price”
has
      the
      meaning set out in Condition 6(C);

     

    “definitive
      Certificate”
has
      the
      meaning ascribed to it in the Global Certificate;

     

    “Dividend”
has
      the
      meaning set out in Condition 6(C);

     

    “Early
      Redemption Amount”
has
      the
      meaning set out in Condition 9(B);

     

    “Employee
      Share Scheme”
means
      any scheme approved by the shareholders of the Issuer (whether before or after
      the date hereof) and in compliance with the requirements of the listing rules
      of
      the AMEX (or if applicable, the Alternative Stock Exchange) pursuant to which
      Shares or other securities (including rights or options) are or may be issued,
      offered or granted to employees (including directors) or former employees of
      the
      Issuer, its Subsidiaries and/or associated companies, or persons related to
      such
      employees (including directors) or former employees or eligible participants
      of
      such scheme, provided that such issues are in compliance with the Listing
      Rules;

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Equivalent
      Amount”
has
      the
      meaning set out in Condition 6(B)(iii);

     

    “Euroclear”
means
      Euroclear Bank S.A./N.V., or any successor securities clearing
      agency;

     

    “Event
      of Default”
means
      any of the events described in Condition 11; 

     

    “Extraordinary
      Resolution”
has
      the
      meaning set out in Schedule 3;

     

    “Fair
      Market Value”
has
      the
      meaning set out in Condition 6(C); 

     

    “Fiscal
      Period” means,
      as
      the context may require, a period commencing on 1 January and ending on the
      succeeding 31 December, provided that if the Issuer shall change its financial
      year so as to end on a date other than 31 December, the foregoing shall be
      amended as necessary;

     

    “Global
      Certificate”
means
      the single global certificate substantially in the form set out in Schedule
      2
      issued in respect of all the Bonds;

     

    “Liability” means
      any
      loss, damage, cost, charge, claim, demand, expense, judgment, action, proceeding
      or other liability whatsoever (including, without limitation, in respect of
      taxes, duties, levies, imposts and other charges) and including any value added
      tax or similar tax charged or chargeable in respect thereof and legal fees
      and
      expenses on a full indemnity basis;

     

    “Listing
      Rules”
means
      the listing rules of the AMEX;

     

    “non-assessable”,
      in
      relation to securities, including the Shares, means that, when issued, those
      securities are not subject to any further calls by the Issuer for, or any other
      provisions which could require, further payments or contributions from their
      holders;

     

    “outstanding”
means,
      in relation to the Bonds, all the Bonds issued except (a) those which have
      been
      redeemed in accordance with the Conditions, (b) those in respect of which the
      date for redemption has occurred and the redemption moneys and all accrued
      default interest (if any) have been duly paid to or to the order of the Trustee
      as provided in Clause 2 or have been duly paid to the Principal Agent if
      permitted by Clause 2, (c) those in respect of which claims have become
      prescribed under Condition 13, (d) those which have been purchased and cancelled
      by the Issuer or any of their respective Subsidiaries as provided in the
      Conditions, (e) those in respect of which the Conversion Right has been duly
      exercised and discharged (and, for the avoidance of doubt, a Bond in respect
      of
      which a Conversion Date has occurred shall be deemed to remain outstanding
      until
      the Conversion Right has been satisfied and discharged even if the holder is
      removed from the register of Bondholders during the conversion process); (f)
      those mutilated or defaced Bonds which have been surrendered and cancelled
      and
      in respect of which replacements have been issued pursuant to Condition 16,
      (g)
      the Global Certificate to the extent that it shall have been exchanged for
      another Global Certificate in respect of the Bonds or for the Bonds in
      definitive form pursuant to its provisions; and provided that for the purposes
      of (i) ascertaining the right to attend and vote at any meeting of the
      Bondholders, (ii) determining how many Bonds are outstanding for the purposes
      of
      Conditions 11, 12 and 15 and Schedule 3, (iii) the exercise of any discretion,
      power or authority which the Trustee is required, expressly or impliedly, to
      exercise in or by reference to the interests of the Bondholders, and (iv) the
      certification (where relevant) by the Trustee as to whether any event,
      circumstance, matter or thing is in its opinion materially prejudicial to the
      interests of the Bondholders, those Bonds which are beneficially held by or
      on
      behalf of the Issuer or any of their respective Subsidiaries and not yet
      cancelled shall (unless no longer so held) be deemed not to remain
      outstanding;

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    “Principal
      Agent”
means
      The Bank of New York, London Branch at its specified office at 40th Floor,
      One
      Canada Square, London, E14 5AL, United Kingdom or any Successor Principal Agent
      appointed under the Agency Agreement, at its specified office;

     

    “record
      date”
means
      a
      date fixed by or pursuant to the By-laws of the Issuer or otherwise specified
      for the purpose of determining entitlements to dividends or other distributions
      to, or rights of, holders of Shares;

     

    “Registrar”
means
      The Bank of New York at its specified office at 101 Barclay Street, 21st Floor,
      New York, NY 10286, United States of America or any Successor Registrar
      appointed under the Agency Agreement, at its specified office;

     

    “Relevant
      Cash Dividend”
has
      the
      meaning set out in Condition 6(C); 

     

    “Scrip
      Dividend”
has
      the
      meaning set out in Condition 6(C);

     

    “Shares”
means
      the shares of common stock of par value US$0.001 per share that will be listed
      on the AMEX;

     

    “Shareholder”
means
      the person in whose name a Share is registered;

     

    “specified
      office”
means,
      in relation to an Agent or the Registrar, the office identified with its name
      at
      the end of the Conditions or any other office approved by the Trustee and
      notified to the Bondholders pursuant to Clause 9.11;

     

    “Subsidiary”
has
      the
      meaning set out in Condition 5(B)(iii);

     

    “Successor”
means,
      in relation to the Agents or the Registrar, such other or further person as
      may
      from time to time be appointed by the Issuer as an Agent or the Registrar with
      the written approval of, and on terms approved in writing by, the Trustee and
      notice of whose appointment is given to Bondholders pursuant to Clause
      9.11;

     

    “Trading
      Day”
has
      the
      meaning set out in Condition 6(C);

     

    “this
      Trust Deed”
means
      this Trust Deed (as from time to time altered in accordance with this Trust
      Deed) and any other document executed in accordance with this Trust Deed (as
      from time to time so altered) and expressed to be supplemental to this Trust
      Deed; and

     

    “trust
      corporation”
means
      a
      corporation entitled pursuant to any legislation applicable to a trustee in
      any
      jurisdiction to act as trustee and carry on trust business under the laws of
      the
      country of its incorporation.

     

    
      	
              1.2

            	
              Construction
                of Certain References 

            

    

     

    References
      to:

     

    
      	 	
              (a)

            	
              costs,
                charges, remuneration or expenses include any withholding, value
                added,
                turnover or similar tax charged in respect
                thereof;

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              “United
                States dollars”,
                “US$”
                and “United
                States cents” are
                to the lawful currency for the time being of the United States of
                America;

            

    

     

    
      	 	
              (c)

            	
              a
                Schedule or a Clause or a sub-clause, paragraph or sub-paragraph
                is,
                unless otherwise stated, to a schedule hereto or a clause or sub-clause,
                paragraph or sub-paragraph hereof respectively;

            

    

     

    
      	 	
              (d)

            	
              an
                action, remedy or method of judicial proceedings for the enforcement
                of
                rights of creditors include references to the action, remedy or method
                of
                judicial proceedings in jurisdictions other than England as shall
                most
                nearly approximate thereto; and

            

    

     

    
      	 	
              (e)

            	
              references
                in this Trust Deed and the Conditions to the consent or approval
                of the
                Trustee not being unreasonably withheld or delayed shall be construed
                giving due regard to the fact that the Trustee in giving any such
                consent
                or approval is acting as Trustee for the Bondholders and is obliged
                to act
                in their interests.

            

    

     

    
      	
              1.3

            	
              Headings

            

    

     

    Headings
      shall be ignored in construing this Trust Deed.

     

    
      	
              1.4

            	
              Schedules
                

            

    

     

    The
      Schedules are part of this Trust Deed and have effect accordingly.

     

    
      	
              1.5

            	
              Definitions
                in Conditions 

            

    

     

    Terms
      defined in the Conditions shall, unless otherwise defined herein, have the
      same
      meaning when used in the main body of this Trust Deed.

     

    
      	
              2.

            	
              
                AMOUNT
                  OF THE BONDS AND COVENANT TO
                  PAY

              

            

    

     

    
      	
              2.1

            	
              Amount
                of the Bonds

            

    

     

    The
      aggregate principal amount of the Bonds is limited to US$10,000,000 subject
      to
      the increase by the principal amount of any bonds issued pursuant to Condition
      17.

     

    
      	
              2.2

            	
              Covenant
                to pay

            

    

     

    The
      Issuer will on one (1) business day (as defined in Condition 8(F)) prior to
      any
      date when the Bonds or any of them become due to be redeemed unconditionally
      pay
      to or to the order of the Trustee in London in United States dollars in
      immediately available funds the principal amount of the Bonds becoming due
      for
      redemption on that date (to be received by 10:00 a.m. New York time) together
      with any applicable premium and will (subject to the Conditions) until such
      payment (both before and after judgment) unconditionally so pay to or to the
      order of the Trustee interest in United States dollars on the principal amount
      of the Bonds outstanding as set out in the Conditions provided that:

     

    
      	 	
              (a)

            	
              every
                payment of any sum due in respect of the Bonds made to the Principal
                Agent
                as provided in the Agency Agreement shall, to that extent, satisfy
                such
                obligation except to the extent that there is failure in its subsequent
                payment to the relevant Bondholders under the Conditions; and
                

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              a
                payment made after the due date or pursuant to Condition 11 will
                be deemed
                to have been made when the full amount due (including interest or
                default
                interest accrued (if any)) has been received by the Principal Agent
                or the
                Trustee and notice to that effect has been given to Bondholders (if
                required under Clause 9.10) except (if payment is made to Principal
                Agent)
                to the extent that there is failure in the subsequent payment to
                the
                relevant Bondholders under the Conditions.

            

    

     

    The
      Trustee will hold the benefit of this covenant on trust for the
      Bondholders.

     

    
      	
              2.3

            	
              Discharge

            

    

     

    Subject
      to Clause 2.4, any payment to be made in respect of the Bonds by the Issuer
      or
      the Trustee may be made as provided in the Conditions and any payment so made
      will (subject to Clause 2.4) to such extent be a good discharge to the Issuer
      or
      the Trustee, as the case may be.

     

    
      	
              2.4

            	
              Payment
                after a Default

            

    

     

    At
      any
      time after an Event of Default has occurred the Trustee may:

     

    
      	 	
              (a)

            	
              by
                notice in writing to the Issuer, the Agents and the Registrar, require
                the
                Agents and the Registrar, until notified by the Trustee to the contrary,
                so far as permitted by applicable
                law:

            

    

     

    
      	 	
              (i)

            	
              to
                act as agents of the Trustee under this Trust Deed and the Bonds
                on the
                terms of the Agency Agreement (with consequential amendments as necessary
                and except that the Trustee’s liability for the indemnification,
                remuneration and all other expenses of the Agents and the Registrar
                will
                be limited to the amounts for the time being held by the Trustee
                in
                respect of the Bonds on the terms of this Trust Deed) and thereafter
                to
                hold all Certificates and all moneys, documents and records held
                by them
                in respect of Bonds to the order of the Trustee;
                and/or

            

    

     

    
      	 	
              (ii)

            	
              to
                deliver all Certificates and all moneys, documents and records held
                by
                them in respect of the Bonds to the Trustee or as the Trustee shall
                direct
                in such notice or subsequently, provided that this Clause 2.4(a)(ii)
                shall
                not apply to any documents or records which the Principal Agent,
                the
                Registrar or the relevant Agent is not obliged to release by any
                law or
                regulation to which it is subject;
                and

            

    

     

    
      	 	
              (b)

            	
              by
                notice in writing to the Issuer require them to make all subsequent
                payments in respect of the Bonds to or to the order of the Trustee
                and not
                to the Principal Agent.

            

    

     

    
      	
              3.

            	
              
                FORM
                  OF THE BONDS AND CERTIFICATES; ISSUE OF THE
                  BONDS

              

            

    

     

    
      	
              3.1

            	
              The
                Global Certificate

            

    

     

    On
      issue
      of the Bonds, the Global Certificate will be issued in respect of the aggregate
      principal amount of the Bonds and the Issuer shall procure the Registrar to
      make
      such entries of Bonds in the register of Bondholders as appropriate. The Global
      Certificate will be issued and registered in the name of a nominee of, and
      deposited with a common depositary for Euroclear and Clearstream or their
      nominee. The Global Certificate need not be security printed. The Bonds
      evidenced by the Global Certificate shall be subject to its terms in all
      respects and entitled to the same benefits under this Trust Deed as Bonds
      evidenced by individual definitive Certificates.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
              3.2

            	
              The
                definitive Certificates

            

    

     

    The
      definitive Certificates, if issued, will be security printed in accordance
      with
      all applicable legal and stock exchange requirements and will be substantially
      in the form set out in Schedule 1 and endorsed with the Conditions.

     

    
      	
              3.3

            	
              Signature

            

    

     

    The
      Global Certificate (and the definitive Certificates, if issued) will be signed
      manually or in facsimile by one (1) or more directors or officers duly
      authorised for the purpose, or manually or in facsimile by any duly authorised
      attorney of the Issuer, and authenticated manually by or on behalf of the
      Registrar. The Issuer may use the signature of any person who as at the date
      of
      this Trust Deed is an authorised officer or attorney, as the case may be, of
      the
      Issuer even if at the time of issue of any definitive Certificate or the Global
      Certificate he no longer holds such office and the Bonds in respect of which
      the
      Global Certificate or a definitive Certificate is so executed and authenticated
      will be binding and valid obligations of the Issuer.

     

    
      	
              3.4

            	
              Issue

            

    

     

    Issue
      and
      delivery of the Bonds shall be completed on the issue and delivery of the Global
      Certificate to the common depositary referred to in Clause 3.1 (or its
      representative) by, or by the order of, the Issuer and completion of the
      register of Bondholders by or on behalf of the Registrar.

     

    
      	
              3.5

            	
              Entitlement
                to treat holder as owner

            

    

     

    The
      holder of any Bond will (save as otherwise required by law) be treated as its
      absolute owner for all purposes (whether or not it is overdue and regardless
      of
      any notice of ownership, trust or any interest in it or any writing on or the
      theft or loss of the Certificate issued in respect of it) and no person will
      be
      liable for so treating the holder.

     

    
      	
              3.6

            	
              Authentication

            

    

     

    No
      Bond
      shall be entitled to any benefit under this Trust Deed or be valid for any
      purpose, unless and until authenticated by the manual signature of the
      Registrar. The Registrar’s authentication to be borne on the Bonds shall be the
      certificate of authentication substantially as set out in the form of Schedule
      2, and such certificate upon any Bond shall be conclusive evidence, and the
      only
      evidence, that such Bond has been duly authenticated and delivered
      thereunder.

     

    
      	
              4.

            	
              
                STAMP
                  DUTIES AND TAXES

              

            

    

     

    
      	
              4.1

            	
              Stamp
                Duties

            

    

     

    The
      Issuer will pay any stamp, issue, registration, documentary, transfer or other
      taxes and duties, including interest and penalties, payable in respect of the
      creation, issue and offering of the Bonds, the execution or delivery of this
      Trust Deed and the deposit of Certificates for the conversion of Bonds and
      the
      issue and delivery of Shares following such deposit, except for the taxes and
      duties required to be paid by Bondholders under Condition 6(B)(ii). The Issuer
      will also indemnify the Trustee and the Bondholders from and against all stamp,
      issue, registration, documentary or other taxes and duties paid by any of them
      in any jurisdiction in connection with any action taken by or on behalf of
      the
      Trustee or, as the case may be, (where entitled under Condition 14 to do so)
      the
      Bondholders to enforce the obligations of the Issuer under this Trust Deed
      or
      the Bonds.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              4.2

            	
              Change
                of Taxing Jurisdiction

            

    

     

    If
      the
      Issuer becomes subject generally to the taxing jurisdiction of any territory
      or
      any authority of or in that territory having power to tax other than or in
      addition to New York or the United Kingdom or any such authority of or in such
      territory which imposes taxes, duties, assessments or governmental charges
      of
      whatever nature with respect to this Trust Deed or the Bonds then the Issuer
      will notify the Trustee as soon as practicable and (subject to Condition
      6(B)(ii)) give to the Trustee an undertaking satisfactory to the Trustee in
      terms corresponding to the terms of Condition 9 with the substitution for,
      or
      (as the case may require) the addition to, the references in that Condition
      to
      New York and the United Kingdom of references to that other or additional
      territory or authority to whose taxing jurisdiction the Issuer has become so
      subject. In such event, this Trust Deed and the Bonds will be read in accordance
      with the above terms.

     

    
      	
              5.

            	
              
                COVENANTS
                  RELATING TO THE CONVERSION
                  RIGHTS

              

            

    

     

    So
      long
      as any Bond remains outstanding, save with the approval of an Extraordinary
      Resolution of the Bondholders or with the approval of the Trustee where, in
      the
      opinion of the Trustee, it is not materially prejudicial to the interests of
      the
      Bondholders to give such approval, the Issuer will:

     

    
      	
              5.1

            	
              Availability
                of Shares

            

    

     

    Keep
      available, free from pre-emptive or other rights, out of its authorised but
      unissued share capital such number of Shares as would be required to be issued
      on conversion of all the Bonds from time to time remaining outstanding and
      to
      satisfy in full all other rights of conversion into or exchange or subscription
      for Shares and shall ensure that all Shares delivered on conversion of Bonds
      will be duly and validly issued as fully-paid and non-assessable;

     

    
      	
              5.2

            	
              Restricted
                Action

            

    

     

    Not
      make
      any issue, grant or distribution or take any other action the effect of which
      would be to reduce the Conversion Price below the par value of the
      Shares;

     

    
      	
              5.3

            	
              Notice

            

    

     

    Simultaneously
      with the announcement of the terms of any event which give rise to the
      adjustment of Conversion Price pursuant to this Trust Deed and the Conditions,
      give notice to the Bondholders and the Trustee in accordance with Condition
      17
      (such notice to be signed by an authorised officer of the Issuer) advising
      them
      of the date on which the relevant adjustment of the Conversion Price is likely
      to become effective and of the effect of exercising their rights of conversion
      before then;

     

    
      	
              5.4

            	
              Directors’
                Certificate

            

    

     

    If
      an
      event happens as a result of which the Conversion Price may be adjusted pursuant
      to this Trust Deed and the Conditions, as soon as practicable send the Trustee
      a
      certificate signed by two (2) directors of the Issuer on behalf of the Issuer
      setting out particulars of the event, whether an adjustment to the Conversion
      Price falls to be made and, if so, the adjusted Conversion Price and the date
      on
      which such adjustment takes effect and in any case setting out such other
      information as the Trustee may reasonably require;

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              5.5

            	
              Extend
                Offer

            

    

     

    If
      an
      offer is made to all (or as nearly as may be practicable all) Shareholders,
      or
      all (or as nearly as may be practicable all) such Shareholders other than the
      offeror and/or any associate or associates of the offeror to acquire all or
      a
      majority of the issued equity share capital of the Issuer, or if any person
      proposes a scheme with regard to such acquisition, give notice of such offer
      or
      scheme to the Bondholders at the same time as any notice thereof is sent to
      its
      Shareholders (or as soon as practicable thereafter) stating that details
      concerning such offer or scheme may be obtained from the specified offices
      of
      the Agents and the Registrar and, where such an offer or scheme has been
      recommended by the Board of Directors of the Issuer or where such an offer
      has
      become or been declared unconditional in all respects, use its best endeavours
      to procure that a like offer or scheme is extended to the Bondholders and the
      holders of any Shares issued during the period of the offer or scheme arising
      out of Conversion Rights;

     

    
      	
              5.6

            	
              No
                Reduction of Issued Share
                Capital

            

    

     

    Not
      make
      any reduction of its ordinary share capital or any uncalled liability in respect
      thereof or of any share premium account or capital redemption reserve fund
      (except, in each case, as permitted by law or by means of a purchase or
      reduction of the share capital of the Issuer permitted by Clause 5.3 or where
      the reduction has resulted in an adjustment to the Conversion Price under Clause
      7);

     

    
      	
              5.7

            	
              Closing
                of Register of Members

            

    

     

    Unless
      so
      required by applicable law or regulation or in order to determine the
      entitlement of rights to a dividend or other rights attaching to the Shares
      or
      entitlements of the Shareholders, not close its register of Shareholders or
      take
      any other action which prevents the transfer of its Shares generally and ensure
      that the Bonds may be converted legally and the Shares issued on conversion
      may
      (subject to any limitation imposed by law) be transferred (as between transferor
      and transferee) at all times while the register is closed or such other action
      is effective, nor take any action which prevents the conversion of the Bonds
      or
      the issue of Shares in respect of them;

     

    
      	
              5.8

            	
              Listing
                of Shares

            

    

     

    
      	 	
              (a)

            	
              promptly
                list the Shares into which the Bonds are or may be convertible pursuant
                to
                the terms of this Trust Deed and the Conditions on the AMEX or any
                Alternative Stock Exchange and in any event no later than three hundred
                and sixty-five (365) days after the date
                hereof,

            

    

     

    
      	 	
              (b)

            	
              maintain
                such listing on the AMEX or any Alternative Stock Exchange,
                and

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (c)

            	
              will
                forthwith give notice to the Bondholders in accordance with Condition
                18
                of any such listing or delisting of such Shares (as a class) by the
                AMEX
                or any Alternative Stock Exchange; 

            

    

     

    
      	
              5.9

            	
              Expenses

            

    

     

    Pay
      the
      expenses of the issue of, and all expenses of obtaining and maintaining a
      listing for, Shares arising on conversion of the Bonds.

     

    For
      the
      above purposes, “equity
      share capital”
means
      the share capital of a company excluding any part of that capital which, neither
      as respects dividends nor as respects capital, carries any right to participate
      beyond a specified amount in a distribution.

     

    
      	
              6.

            	
              
                NOTICES
                  RELATING TO THE CONVERSION
                  RIGHTS

              

            

    

     

    
      	
              6.1

            	
              Requirement
                to give notice

            

    

     

    If
      after
      the date of this Trust Deed:

     

    
      	 	
              (a)

            	
              the
                Issuer declares, or pays or makes a Capital Distribution, or authorises
                the grant, issue or offer to all or substantially all holders of
                Shares of
                rights or warrants to subscribe for or purchase any shares or securities
                other than Shares or any securities convertible into or exchangeable
                for
                or which confer rights to purchase Shares;
                or

            

    

     

    
      	 	
              (b)

            	
              there
                is a re-classification of the Shares (including a sub-division or
                consolidation of the Issuer’s outstanding Shares) or a consolidation,
                merger or amalgamation to which the Issuer is not the surviving party
                or
                any sale or transfer of all or substantially all of the assets or
                business
                of the Issuer; or

            

    

     

    
      	 	
              (c)

            	
              the
                Issuer authorises the issue of any securities convertible into or
                exchangeable for Shares or rights or warrants to subscribe for or
                purchase
                Shares (other than the warrants issued to ABN AMRO Bank N.V.) or
                securities (other than those referred to in paragraph 6.1(a) above)
                which
                will, or authorises the issue of any Shares which will, (or, if in
                any
                such case a relevant consideration or offering price fixed by the
                Board of
                Directors of the Issuer to be recommended at a relevant general meeting
                of
                shareholders is adopted, will) upon issue give rise to an adjustment
                to
                the Conversion Price pursuant to Clause 7;
                or

            

    

     

    
      	 	
              (d)

            	
              there
                is a voluntary or involuntary dissolution, liquidation
                or winding-up of the Issuer, 

            

    

     

    the
      Issuer shall forthwith give written notice thereof to the Trustee and the
      Principal Agent and, in addition, it will at least five (5) days before the
      applicable (in the case of paragraph (i) below) record date or (in the case
      of
      paragraph (ii) below) record date or date of submission, whichever is earlier,
      or (in the case of paragraph (iii) below) date of submission, or (in the case
      of
      paragraph (iv) below) date of issue or (in the case of paragraph (v) below)
      record date or effective date, whichever is earlier, give notice to the
      Bondholders stating, as the case may require:

     

    
      	 	
              (i)

            	
              the
                record date in the United States for such issuance or event described
                in
                paragraphs 6.1(a), (b) or (c), above;
                or

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (ii)

            	
              the
                date in the United States (1) on which such re-classification,
                consolidation, merger, amalgamation, sale, transfer, dissolution,
                liquidation or winding-up is to be submitted to a general meeting
                of
                Shareholders of the Issuer for approval, and (2) which is the record
                date
                for the same (if applicable), and (3) on which such re-classification,
                consolidation, merger, amalgamation, sale, transfer, dissolution,
                liquidation or winding-up is expected to become effective, and (4)
                as of
                which it is expected that holders of Shares will be entitled, if
                at all,
                to exchange their Shares for securities or other property deliverable
                upon
                such re-classification, consolidation, merger, amalgamation, sale,
                transfer, dissolution, liquidation or winding-up;
                or

            

    

     

    
      	 	
              (iii)

            	
              (in
                the event of the declaration of a Capital Distribution referred to
                in
                paragraph 6.1(a) above, the payment of which must be submitted for
                approval to a general meeting of Shareholders or to a meeting of
                the Board
                of Directors of the Issuer before such Capital Distribution may be
                paid or
                made) the date of such submission;
                or

            

    

     

    
      	 	
              (iv)

            	
              (in
                the event of an issue referred to in paragraph 6.1(c) above) the
                date of
                such issue; or

            

    

     

    
      	 	
              (v)

            	
              (in
                the event of such re-classification, consolidation, merger, amalgamation,
                sale, transfer, dissolution, liquidation or winding-up described
                in
                paragraph 6.1(b) or (c) above not being submitted to a general meeting
                of
                shareholders of the Issuer for approval) (1) the record date for
                the same
                (if applicable), and (2) the date when the same becomes
                effective;

            

    

     

    provided
      that if the exact date of any such submission referred to in paragraph (ii)
      or
      (iii) above is not known at the time of such notice to the Trustee and the
      Principal Agent, such notice shall indicate the approximate date thereof and
      the
      Issuer shall give a second notice to the Trustee and the Principal Agent as
      soon
      as practicable, specifying the exact date of submission, and provided further
      that if the period referred to in paragraph (i) above or the effective date
      or
      exchange date referred to in paragraph (ii) above or the date of issue or
      effective date referred to in paragraph (iv) or (v) above is not known at the
      time of such first notice to the Trustee and the Principal Agent, the Issuer
      shall give a second notice (which shall be in writing) to the Trustee and the
      Principal Agent, at least fourteen (14) days before the commencement of such
      period or (as the case may be) before such date specifying such period (and
      the
      date of its commencement) and/or such date and shall also (in a case within
      paragraph (i), (ii) or (v) above) cause such second notice to be given to
      Bondholders at least fourteen (14) days before the commencement of the
      applicable period or (as the case may be) before the effective date or exchange
      date except where such period or date has already been specified in the first
      notice to the Bondholders. However, in the case of any issue referred to in
      paragraph 6.1(c) above, the Issuer need not give any notice mentioned above
      before the date on which the relevant consideration per Share for such issue
      is
      fixed by the Issuer but in such case the Issuer shall promptly upon the fixing
      of such consideration give notice in accordance with this Clause; and provided
      further that the Issuer need not give any notice mentioned above before the
      date
      on which it otherwise discloses or gives notice of such event to any other
      party.

     

    
      	
              6.2

            	
              Where
                Adjustment to Conversion Price
                Required

            

    

     

    If
      the
      event referred to in the notice required pursuant to Clause 6.1 would result
      in
      an adjustment to the Conversion Price, such notice shall also state the
      Conversion Price in effect at the time such notice is required to be given
      and
      the Conversion Price which will result after giving effect to such event or,
      if
      such adjusted Conversion Price is not then determinable, the fact that an
      adjustment in the Conversion Price may result. Without prejudice to Clause
      5.2,
      if, after giving effect to the event covered by any such notice and to any
      adjustment in the Conversion Price, the Shares could not or might not, under
      applicable law then in effect, be legally issued on conversion of Bonds as
      fully-paid and non-assessable, such notice shall also state such fact and the
      extent to which, by reason of such provisions, effect will not be given to
      such
      adjustment.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
              6.3

            	
              Notice
                of Adjustment or Reset

            

    

     

    If,
      while
      any Conversion Right is or is capable of being or becoming exercisable, there
      shall be any adjustment to the Conversion Price (which for the purpose of this
      sub-Clause shall include any reset of the Conversion Price pursuant to Condition
      6(D)), the Issuer shall (a) as soon as practicable notify the Trustee and the
      Agents of particulars of the event giving rise to the adjustment, the Conversion
      Price prior to such adjustment, the adjusted Conversion Price, the date on
      which
      the adjustment takes effect and such other information as the Trustee may
      require, and (b) promptly after the adjustment takes effect, give notice to
      the
      Bondholders stating that the Conversion Price has been adjusted and setting
      out
      the event giving rise to the adjustment, the Conversion Price in effect before
      the adjustment, the adjusted Conversion Price and the effective date of the
      adjustment. However, a notice pursuant to another sub-Clause of this Clause
      6
      correctly stating any information required to be given pursuant to this
      sub-Clause shall, as to such information, satisfy the requirements of this
      sub-Clause.

     

    
      	
              6.4

            	
              Notification
                of Closed Periods

            

    

     

    The
      Issuer shall give not less than fifteen (15) days’ nor more than sixty (60)
      days’ notice to the Trustee and the Agents of (a) any days during the Conversion
      Period on which the Issuer’s register of shareholders is to be closed by reason
      of New York law or applicable rules and regulation or for the purpose of
      determining the entitlements of rights to any dividend or other rights attaching
      to the Shares, and (b) any other day during the Conversion Period on which
      it is
      aware that its register of shareholders is to be closed. The notice shall state
      the reason for such closure and whether the Issuer intends to give notice to
      Bondholders of the closure.

     

    
      	
              6.5

            	
              Notification
                of end of Conversion
                Period

            

    

     

    The
      Issuer shall give not less than twenty-eight (28) days’ nor more than forty-two
      (42) days’ notice to the Bondholders in writing prior to the end of the
      Conversion Period, which notice shall specify the Conversion Rights of the
      Bondholders and the Conversion Price then in effect (as adjusted pursuant to
      Clause 7 of this Trust Deed, if applicable).

     

    
      	
              7.

            	
              
                ADJUSTMENTS
                  TO THE CONVERSION
                  PRICE

              

            

    

     

    
      	
              7.1

            	
              The
                Conversion Price will be subject to adjustment in the following events
                as
                follows:

            

    

     

    
      	 	
              (a)

            	
              Consolidation,
                Subdivision or Reclassification:
                If and whenever there shall be an alteration to the nominal value
                of the
                Shares as a result of consolidation, subdivision or reclassification,
                the
                Conversion Price shall be adjusted by multiplying the Conversion
                Price in
                force immediately before such alteration by the following
                fraction:

            

    

     

    
      
        	
                A

              
	
                B

              

      

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the nominal amount of one (1) Share immediately after such alteration;
                  and

              
	 	 
	
                B

              	
                is
                  the nominal amount of one (1) Share immediately before such
                  alteration.

              

      

    

     

    Such
      adjustment shall become effective on the date the alteration takes
      effect.

     

    
      	 	
              (b)

            	
              Capitalisation
                of Profits or Reserves:
                If and whenever the Issuer shall issue any Shares credited as fully
                paid
                to the holders of Shares (the “Shareholders”)
                by way of capitalisation of profits or reserves (including any share
                premium account) including, Shares paid up out of distributable profits
                or
                reserves and/or share premium account issued (except any Scrip Dividend)
                and which would not have constituted a Capital Distribution, the
                Conversion Price shall be adjusted by multiplying the Conversion
                Price in
                force immediately before such issue by the following
                fraction:

            

    

     

    
      
        	
                A

              
	
                B

              

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the aggregate nominal amount of the issued Shares immediately before
                  such
                  issue; and

              
	 	 
	
                B

              	
                is
                  the aggregate nominal amount of the issued Shares immediately after
                  such
                  issue.

              

      

    

     

    Such
      adjustment shall become effective on the date of issue of such Shares or if
      a
      record date is fixed therefor, immediately after such record date.

     

    
      	 	
              (c)

            	
              Capital
                Distributions:
                If and whenever the Issuer shall pay or make any Capital Distribution
                to
                the Shareholders (except to the extent that the Conversion Price
                falls to
                be adjusted under paragraph (b) above), the Conversion Price shall
                be
                adjusted by multiplying the Conversion Price in force immediately
                before
                such Capital Distribution by the following
                fraction:

            

    

    

      
        	
                A
                  -
                  B

              
	
                A

              

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the Current Market Price of one (1) Share on the last Trading Day
                  preceding the date on which the Capital Distribution is publicly
                  announced; and

              
	 	 
	
                B

              	
                is
                  the Fair Market Value on the date of such announcement of the portion
                  of
                  the Capital Distribution attributable to one (1)
                  Share.

              

      

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    Such
      adjustment shall become effective on the date that such Capital Distribution
      is
      actually made or if a record date is fixed therefor, immediately after such
      record date.

     

    When
      the
      Capital Distribution is by means of distribution of a cash dividend such cash
      dividend shall be regarded as a Capital Distribution and shall be fully taken
      into account in the determination of the Fair Market Value of the portion of
      the
      Capital Distribution attributable to one (1) Share. 

     

    
      	 	
              (d)

            	
              Rights
                Issues of Shares or Options over Shares:
                If and whenever the Issuer shall issue Shares to all or substantially
                all
                Shareholders as a class by way of rights, or issue or grant to all
                or
                substantially all Shareholders as a class by way of rights, of options,
                warrants or other rights to subscribe for or purchase or otherwise
                acquire
                any Shares, in each case at less than the Current Market Price per
                Share
                on the last Trading Day preceding the date of the announcement of
                the
                terms of the issue or grant, the Conversion Price shall be adjusted
                by
                multiplying the Conversion Price in force immediately before such
                issue or
                grant by the following fraction:

            

    

    

      
        	
                A
                  +
                  B

              
	
                A
                  +
                  C

              

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the number of Shares in issue immediately before such
                  announcement;

              
	 	 
	
                B

              	
                is
                  the number of Shares which the aggregate amount (if any) payable
                  for the
                  Shares issued by way of rights or for the options or warrants or
                  other
                  rights issued by way of rights and for the total number of Shares
                  comprised therein would subscribe for, purchase or otherwise acquire
                  at
                  such Current Market Price per Share; and

              
	 	 
	
                C

              	
                is
                  the aggregate number of Shares issued or, as the case may be, comprised
                  in
                  the grant.

              

      

    

     

    Such
      adjustment shall become effective on the date of issue of such Shares or issue
      or grant of such options, warrants or other rights (as the case may
      be).

     

    
      	 	
              (e)

            	
              Rights
                Issues of Other Securities:
                If and whenever the Issuer shall issue any securities (other than
                Shares
                or options, warrants or other rights to subscribe for, purchase or
                otherwise acquire Shares) to all or substantially all Shareholders
                as a
                class by way of rights or grant to all or substantially all Shareholders
                as a class by way of rights, of options, warrants or other rights
                to
                subscribe for, purchase or otherwise acquire any securities (other
                than
                Shares or options, warrants or other rights to subscribe for, purchase
                or
                otherwise acquire Shares), the Conversion Price shall be adjusted
                by
                multiplying the Conversion Price in force immediately before such
                issue or
                grant by the following fraction:

            

    

    

      
        	
                A
                  -
                  B

              
	
                A

              

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the Current Market Price of one (1) Share on the last Trading Day
                  preceding the date on which such issue or grant is publicly announced;
                  and

              

      

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      
        	
                B

              	
                is
                  the Fair Market Value on the date of such announcement of the portion
                  of
                  the rights attributable to one (1)
                  Share.

              

      

    

     

    Such
      adjustment shall become effective on the date of issue of the securities or
      grant of such rights, options or warrants (as the case may be).

     

    
      	 	
              (f)

            	
              Issues
                at less than Conversion Price:
                If and whenever the Issuer shall issue (otherwise than as mentioned
                in
                paragraph (d) above) any Shares (other than Shares issued on the
                exercise
                of Conversion Rights or on the exercise of any other rights of conversion
                into, or exchange or subscription for, Shares) or shall issue or
                grant
                (otherwise than as mentioned in paragraph (d) above) options, warrants
                or
                other rights to subscribe for, purchase or otherwise acquire Shares
                in
                each case at a price per Share which is less than the Conversion
                Price in
                effect at the time of such issue, then, in such event, the Conversion
                Price shall be reduced, concurrently with such issue or grant, to
                a price
                equal to the consideration per share for which such Shares are or
                will be
                issued. If such Shares are issued for no consideration, then the
                consideration per share shall be deemed to be the then current par
                value
                of each Share.

            

    

     

    Determination
      of Consideration: For
      purpose of this Clause 7.1(f), the consideration received by the Issuer for
      the
      issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the directors of the Issuer (the “Directors”);
                provided, however, that no value shall be attributed to any services
                performed by any employee, officer or director of the Issuer;
                and

            

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with other shares or securities
                or other assets of the Issuer for consideration which covers both
                the
                proportion of such consideration so received with respect to such
                Shares,
                shall be computed as provided in paragraphs (A) and (B) above, as
                determined in good faith by the
                Directors.

            

    

     

    References
      to additional Shares in the above formula shall, in the case of an issue by
      the
      Issuer of options, warrants or other rights to subscribe or purchase Shares,
      mean such Shares to be issued assuming that such options, warrants or other
      rights are exercised in full at the initial exercise price on the date of issue
      of such options, warrants or other rights.

     

    Such
      adjustment shall become effective on the date of issue of such additional Shares
      or, as the case may be, the issue of such options, warrants or other rights.
      

     

    
      	 	
              (g)

            	
              Other
                Issues at less than Conversion Price:
                Save in the case of an issue of securities arising from a conversion
                or
                exchange of other securities in accordance with the terms applicable
                to
                such securities themselves falling within this Clause 7.1(g), if
                and
                whenever the Issuer or any of its Subsidiaries (otherwise than as
                mentioned in paragraphs (d), (e) or (f), or (at the direction or
                request
                of or pursuant to any arrangements with the Issuer or any of its
                Subsidiaries) any other company, person or entity shall issue any
                securities (other than the Bonds) which by their terms of issue carry
                rights of conversion into, or exchange or subscription for, Shares
                to be
                issued by the Issuer upon conversion, exchange or subscription at
                a
                consideration per Share which is less than the Conversion Price in
                effect
                at the time of issue of such securities, then, in such event, the
                Conversion Price shall be reduced, concurrently with such issue,
                to a
                price equal to the consideration per share receivable by the Issuer
                for
                the Shares to be issued on conversion or exchange or on exercise
                of the
                right of subscription determined by reference to the maximum number
                of
                Shares to be issued on conversion, exchange or subscription at the
                minimum
                conversion, exchange or subscription price. If such Shares are issued
                for
                no consideration, then the consideration per share shall be deemed
                to be
                the then current par value of each
                Share.

            

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    Determination
      of Consideration: For
      purpose of this Clause 7.1(g), the consideration receivable by the Issuer for
      the issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the Directors; provided, however, that
                no
                value shall be attributed to any services performed by any employee,
                officer or director of the Issuer;
                and

            

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with
                other shares or securities or other assets of the Issuer for consideration
                which
                covers both the proportion of such consideration so received with
                respect
                to such Shares, shall be computed as provided in paragraphs (A) and
                (B)
                above, as determined in good faith by the
                Directors.

            

    

     

    Such
      adjustment shall become effective on the date of issue of such
      securities

     

    
      	 	
              (h)

            	
              Modification
                of Rights of Conversion etc.:
                If and whenever there shall be any modification of the rights of
                conversion, exchange or subscription attaching to any such securities
                as
                are mentioned in Clause 7.1(g) (other than in accordance with the
                terms of
                such securities) so that the consideration per Share (for the number
                of
                Shares available on conversion, exchange or subscription following
                the
                modification) is reduced and is less than the Conversion Price in
                effect
                at the time of such modification, the Conversion Price shall be reduced,
                concurrently with such modification, to a price equal to the modified
                consideration per share receivable by the Issuer for the Shares to
                be
                issued on conversion or exchange or on exercise of the right of
                subscription determined by reference to the maximum number of Shares
                to be
                issued on conversion, exchange or subscription at the minimum conversion,
                exchange or subscription price. If such Shares are issued for no
                consideration, then the consideration per share shall be deemed to
                be the
                then current par value of each
                Share.

            

    

     

    Determination
      of Consideration: For
      purpose of this Clause 7.1(h), the consideration receivable by the Issuer for
      the issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the Directors; provided, however, that
                no
                value shall be attributed to any services performed by any employee,
                officer or director of the Issuer;
                and

            

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with other shares or securities
                or other assets of the Issuer for consideration which covers both
                the
                proportion of such consideration so received with respect to such
                Shares,
                shall be computed as provided in paragraphs (A) and (B) above, as
                determined in good faith by the
                Directors.

            

    

     

    Such
      adjustment shall become effective on the date of modification of the rights
      of
      conversion, exchange or subscription attaching to such securities.

     

    
      	 	
              (i)

            	
              Other
                Offers to Shareholders:
                If and whenever the Issuer or any of its Subsidiaries or (at the
                direction
                or request of or pursuant to any arrangements with the Issuer or
                any of
                its Subsidiaries) any other company, person or entity issues, sells
                or
                distributes any securities in connection with which an offer to which
                the
                Shareholders generally are entitled to participate in arrangements
                whereby
                such securities may be acquired by them (except where the Conversion
                Price
                falls to be adjusted under Clause 7.1(d), Clause 7.1(e), Clause 7.1(f)
                or
                Clause (g), the Conversion Price shall be adjusted by multiplying
                the
                Conversion Price in force immediately before such issue by the following
                fraction:

            

    

     

    
      
        	
                A
                  -
                  B

              
	
                A

              

      

    

    

      
        	
                Where:

              	 
	 	 
	
                A

              	
                is
                  the Current Market Price of one (1) Share on the last Trading Day
                  preceding the date on which such issue is publicly announced;
                  and

              
	 	 
	
                B

              	
                is
                  the Fair Market Value on the date of such announcement of the portion
                  of
                  the rights attributable to one (1)
                  Share.

              

      

    

     

    Such
      adjustment shall become effective on the date of issue of the
      securities.

     

    
      	 	
              (j)

            	
              Other
                Events:
                If the Issuer determines that a downward adjustment should be made
                to the
                Conversion Price as a result of one (1) or more events or circumstances
                not referred to in this Clause 7.1, the Issuer shall, at its own
                expense,
                consult an independent investment bank of international repute (acting
                as
                expert), selected by the Issuer and approved in writing by the Trustee
                (such approval not to be unreasonably withheld or delayed), to determine
                as soon as practicable what adjustment (if any) to the Conversion
                Price is
                fair and reasonable to take account thereof, if the adjustment would
                result in a reduction in the Conversion Price, and the date on which
                such
                adjustment should take effect and upon such determination by the
                independent investment bank such adjustment (if any) shall be made
                and
                shall take effect in accordance with such determination, provided
                that
                where the events or circumstances giving rise to any adjustment pursuant
                to this Clause 7.1 have already resulted or will result in an adjustment
                to the Conversion Price or where the events or circumstances giving
                rise
                to any adjustment arise by virtue of events or circumstances which
                have
                already given rise or will give rise to an adjustment to the Conversion
                Price, such modification (if any) shall be made to the operation
                of the
                provisions of this Clause 7.1 as may be advised by the independent
                investment bank to be in their opinion appropriate to give the intended
                result. Neither the Agents nor the Trustee should have the responsible
                for
                determining the Conversion Price or the adjustment to the Conversion
                Price.

            

    

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    
      	
              7.2

            	
              (a)

            	
              No
                adjustment will be made to the Conversion Price (i) when Shares or
                other
                securities (including rights or options) are issued, offered or granted
                to
                employees (including directors) of the Issuer or any of its Subsidiaries
                pursuant to any Employee Share Scheme (and which Employee Share Scheme
                (a)
                is in compliance with the listing rules of the AMEX or, if applicable,
                the
                listing rules of an Alternative Stock Exchange; and (b) does not
                amount
                to, relate to, or entitle such persons to receive, Shares in excess
                of ten
                percent (10%) of the average number of issued and outstanding Shares
                during any twelve (12) months); or (ii) as a result of the issuance
                on the
                date hereof of the Warrants issued to ABN AMRO Bank, N.V. or any
                exercise
                of such Warrants; or (iii) as a result of the exercise of the outstanding
                warrants issued on 17 October, 2006, to purchase 232,088 Shares at
                US$1.60
                per share.

            

    

     

    
      	 	
              (b)

            	
              Where
                more than one (1) event which gives or may give rise to an adjustment
                to
                the Conversion Price occurs within such a short period of time that
                in the
                opinion of an independent investment bank of international repute
                (acting
                as expert), selected by the Issuer and approved in writing by the
                Trustee
                (such approval shall not be unreasonably withheld or delayed), the
                foregoing provisions would need to be operated subject to some
                modification in order to give the intended result, such modification
                shall
                be made to the operation of the foregoing provisions as may be advised
                by
                such independent investment bank to be in their opinion appropriate
                in
                order to give such intended result. No adjustment involving an increase
                in
                the Conversion Price will be made, except in the case of a consolidation
                of the Shares as referred to in Clause 7.1(a) above or a Conversion
                Price
                reset as referred to in Clause 7.2 below.

            

    

     

    
      	 	
              (c)

            	
              The
                Trustee shall not be under any duty to monitor whether any event
                or
                circumstance has happened or exists which may require an adjustment
                to be
                made to the Conversion Price and will not be responsible to Bondholders
                for any loss arising from any failure by it to do
                so.

            

    

     

    
      	 	
              (d)

            	
              If
                any doubt arises as to an adjustment of the Conversion Price pursuant
                to
                Clause 7.1, the Trustee may, at the cost and expense of the Issuer,
                consult with any reputable investment bank in the United States and
                may
                act on the opinion or advice of or any certificate or information
                obtained
                from any such investment bank, and such determination, opinion, advice,
                certification or action (or absence thereof) shall be conclusive
                and
                binding upon the Issuer and the
                Bondholders.

            

    

     

    
      	
              7.3

            	
              Conversion
                Price Reset

            

    

     

    If
      the
      Average Closing Price for the period of twenty (20) consecutive Trading Days
      immediately prior to any of April 12, 2009 and February 18, 2012 (each a
“Reset
      Date”)
      is
      lower than the Conversion Price on the relevant Reset Date, the Conversion
      Price
      will be adjusted so that such Average Closing Price shall be the Conversion
      Price in effect from, and including, the relevant Reset Date. The Issuer shall
      notify the Bondholders, Trustee and the Paying Agent of such adjustment within
      ten (10) business days after the relevant Reset Date, in accordance with
      Condition 18. Such adjusted Conversion Price shall be rounded upwards, if
      necessary, to the nearest one-tenth (1/10) of a United States cent.

     

    Provided
      that:

     

    
      	 	
              (a)

            	
              any
                such adjustment to the Conversion Price pursuant to this Clause 7.2
                shall
                be limited so that the Conversion Price adjusted in accordance with
                this
                Clause 7.2 shall not be less than seventy percent (70%) of the initial
                Conversion Price (taking account of any adjustments required under
                Clause
                7.1 above which may have occurred prior to the relevant Reset
                Date);

            

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              subject
                to (i) above the provisions of Clause 7.1 shall apply, mutatis mutandis,
                to this Clause 7.2 to ensure that appropriate adjustments shall be
                made to
                any Closing Price to reflect any adjustments made to the Conversion
                Price
                in accordance with Clause 7.1; and

            

    

     

    
      	 	
              (c)

            	
              for
                the avoidance of doubt, any adjustments to the Conversion Price made
                pursuant to this Clause 7.2 shall only be downward
                adjustments.

            

    

     

    
      	
              8.

            	
              
                APPLICATION
                  OF MONEYS RECEIVED BY THE
                  TRUSTEE

              

            

    

     

    
      	
              8.1

            	
              Declaration
                of Trust

            

    

     

    All
      moneys received by the Trustee in respect of the Bonds or amounts payable under
      this Trust Deed will, despite any appropriation of all or part of them by the
      Issuer, be held by the Trustee upon trust to apply them (subject to Clause
      8.2):

     

    
      	 	
              (a)

            	
              firstly,
                in payment of all costs, charges, expenses and liabilities properly
                incurred by the Trustee (including remuneration payable to the Trustee)
                in
                carrying out its functions under this Trust Deed;
                

            

    

     

    
      	 	
              (b)

            	
              secondly,
                in payment of all costs, charges, expenses and liabilities properly
                incurred by the Agents, except the Registrar, (including remuneration
                payable to the Agents) in carrying out its functions under the Agency
                Agreement;

            

    

     

    
      	 	
              (c)

            	
              thirdly,
                in payment of all costs, charges, expenses and liabilities properly
                incurred by the Registrar, (including remuneration payable to the
                Registrar) in carrying out its functions under the Agency
                Agreement;

            

    

     

    
      	 	
              (d)

            	
              fourthly,
                in payment of any amounts of principal, interest, and premium (if
                any)
                owing in respect of the Bonds pari
                passu
                and rateably; 

            

    

     

    
      	 	
              (e)

            	
              fifthly,
                in payment of any other amounts owing in respect of the Bonds;
                and

            

    

     

    
      	 	
              (f)

            	
              sixthly,
                in payment of any balance (if any) to the Issuer for
                itself.

            

    

     

    If
      the
      Trustee holds any moneys which represent principal, interest, default interest
      and premium (if any) in respect of Bonds in respect of which claims have become
      prescribed under Condition 13, the Trustee will hold them on trust and apply
      them as set out in this Clause 8.1.

     

    
      	
              8.2

            	
              Accumulation

            

    

     

    If
      the
      amount of the moneys at any time available for payment in respect of the Bonds
      under Clause 8.1 is less than ten percent (10%) of the principal amount of
      the
      Bonds then outstanding, the Trustee may, at its sole discretion, invest such
      moneys. The Trustee may retain such investments and accumulate the resulting
      income until the investments and the accumulations, together with any other
      funds for the time being under its control and available for such payment,
      amount to at least ten percent (10%) of the principal amount of the Bonds then
      outstanding and then such investments, accumulations and funds (after deduction
      of, or provision for, any applicable taxes) will be applied as specified in
      Clause 8.1.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	
              8.3

            	
              Investment

            

    

     

    Moneys
      held by the Trustee may be invested in its name or under its control in any
      investments or other assets anywhere whether or not they produce income or
      deposited in its name or under its control at such bank or other financial
      institution in such currency as the Trustee may, in its absolute discretion,
      think fit, acting in accordance with the Trustees Act. If they are deposited
      at
      a bank or institution that is the Trustee or a subsidiary, holding or associated
      company of the Trustee, it needs only account for an amount of interest
      calculated at the rate per annum equal to the best rate payable by it on a
      deposit of like amount to an independent customer. The Trustee may at any time
      vary or transpose any such investments or assets or convert any moneys so
      deposited into any other currency, and will not be responsible for any resulting
      loss, whether by depreciation in value, change in exchange rates or
      otherwise.

     

    
      	
              9.

            	
              
                GENERAL
                  COVENANTS

              

            

    

     

    So
      long
      as any Bond is outstanding, the Issuer will:

     

    
      	
              9.1

            	
              Books
                of Account

            

    

     

    Keep,
      and
      procure that its Subsidiaries keep, proper books of account and, at any time,
      so
      far as permitted by applicable law and to the extent it does not result in
      any
      additional disclosure obligations under the listing rules of the AMEX or if
      applicable, the Alternative Stock Exchange, allow, and procure that each of
      its
      Subsidiaries will allow, the Trustee and anyone appointed by it, by prior
      appointment access to the books of account of the Issuer and/or the relevant
      Subsidiary respectively at all reasonable times during normal business
      hours;

     

    
      	
              9.2

            	
              Notice
                of Events of Default

            

    

     

    Notify
      the Trustee in writing immediately on becoming aware of the occurrence of any
      Event of Default;

     

    
      	
              9.3

            	
              Information

            

    

     

    So
      far as
      permitted by applicable law, give the Trustee such certificates, information
      and
      evidence as it requires for the purpose of the discharge of the duties, powers,
      trusts, authorities and discretions vested in it by this Trust Deed or by
      operation of law;

     

    
      	
              9.4

            	
              Financial
                Statements etc.

            

    

     

    Send
      to
      the Trustee, as promptly as practicable (and, in the case of each annual Fiscal
      Period, in any event within six (6) months after the close of each Fiscal
      Period), three (3) copies or translations, in each case in English, of the
      following:

     

    
      	 	
              (a)

            	
              in
                the case of the first semi-annual Fiscal Period falling within each
                of the
                annual Fiscal Periods, the semi-annual interim report containing
                unaudited
                consolidated Accounts of the Issuer in respect of such Fiscal Period
                which
                Accounts are prepared on a basis substantially consistent with the
                most
                recent audited Accounts, or which indicate the way in which their
                basis of
                preparation is different; and

            

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              in
                the case of each annual Fiscal Period, the annual report containing
                audited Accounts of the Issuer as at the end of, and for, such Fiscal
                Period, reported on by the Auditors and prepared in accordance with
                generally accepted accounting principles in the United States of
                America;

            

    

     

    provided
      that if and to the extent that the Accounts are not prepared or adjusted on
      a
      basis consistent with that used for the preceding corresponding Fiscal Period,
      that fact shall be stated;

     

    
      	
              9.5

            	
              Information
                Material to Bondholders

            

    

     

    Send
      to
      the Trustee three (3) copies or translations, in each case in English, of all
      notices, statements and documents which are issued to the holders of its shares
      or its creditors generally as soon as practicable (but not later than thirty
      (30) days) after their date of issue and make available to the Agents (without
      cost to the Agents) as many further copies or translations as they may request
      in order to satisfy requests from Bondholders for them;

     

    
      	
              9.6

            	
              Other
                Information

            

    

     

    Send
      to
      the Trustee together with the Accounts referred to in Clause 9.4 a list in
      English of all documents issued, during or in respect of the relevant annual
      Fiscal Period, by Issuer to its Shareholders, which list shall indicate the
      principal subject of each of such documents, and (if the Trustee so requires
      at
      any time) provide a certified copy or translation, in each case in English,
      of
      any document described in such list within thirty (30) days after being
      requested so to do;

     

    
      	
              9.7

            	
              Certificate
                of Directors

            

    

     

    Send
      to
      the Trustee, at the same time that its annual audited Accounts are being
      provided pursuant to Clause 9.4 above, and also within fourteen (14) days after
      any written request by the Trustee, a certificate of the Issuer signed by two
      (2) directors of the Issuer to the effect that, having made all reasonable
      enquiries, to the best of the knowledge, information and belief of the Issuer
      as
      at a date (the “Certification
      Date”)
      being
      not more than five (5) days before the date of the certificate 

     

    
      	 	
              (a)

            	
              no
                Event of Default had occurred since the date of this Trust Deed or
                the
                Certification Date of the last such certificate (if any) or, if such
                an
                event had occurred, giving details of it;
                and

            

    

     

    
      	 	
              (b)

            	
              the
                Issuer has complied with all its obligations under this Trust
                Deed.

            

    

     

    The
      Trustee shall be entitled to rely upon certificates of the Issuer;

     

    
      	
              9.8

            	
              Notices
                to Bondholders

            

    

     

    Send
      to
      the Trustee at least seven (7) days (or such shorter period as may be agreed
      by
      the Trustee) prior to the date of publication, a copy of the form of each notice
      to be given to Bondholders and once given, two (2) copies of each such notice,
      such notice to be in a form approved by the Trustee (such approval shall not
      be
      unreasonably withheld or delayed) and (if applicable) complying with the
      requirements of the AMEX or an Alternative Stock Exchange except for any
      announcement, notice or circular to be made by the Issuer pursuant to the
      requirements of the listing rules or at the request of the AMEX or an
      Alternative Stock Exchange, of which three (3) copies of each such announcement,
      notice or circular, shall be sent by the Issuer to the Trustee as promptly
      as
      practicable after its date of issue;

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    
      	
              9.9

            	
              Further
                Acts

            

    

     

    So
      far as
      permitted by applicable law, do such further things as may be necessary in
      the
      opinion of the Trustee to give effect to this Trust Deed;

     

    
      	
              9.10

            	
              
                NOTICE
                  OF LATE PAYMENT

              

            

    

     

    Forthwith
      upon request by the Trustee give notice to the Bondholders of any unconditional
      payment to the Principal Agent or the Trustee of any sum due in respect of
      the
      Bonds made after the due date for such payment;

     

    
      	
              9.11

            	
              Change
                in Agents

            

    

     

    Give
      at
      least fourteen (14) days’ prior notice to the Bondholders of any future
      appointment, resignation or removal of any Agent or of the Registrar or of
      any
      change by any Agent or by the Registrar of its specified office and not make
      any
      such appointment or removal without the Trustee’s prior written
      approval;

     

    
      	
              9.12

            	
              Early
                Redemption

            

    

     

    Give
      prior notice to the Trustee of any proposed early redemption pursuant to
      Condition 9(B), 9(C), 9(D) or 9(E);

     

    
      	
              9.13

            	
              Change
                of Control or Delisting

            

    

     

    Give
      notice (which shall be in writing) to the Trustee and the Bondholders in
      accordance with Condition 18 by not later than the fourteenth day following
      the
      first day on which it becomes aware of the occurrence of a Relevant Event (as
      defined in Condition 9(D));

     

    
      	
              9.14

            	
              Compliance

            

    

     

    Comply
      with, perform and observe all the provisions of the Agency Agreement, the Trust
      Deed and the Conditions; and

     

    
      	
              9.15

            	
              Bonds
                held by the Issuer etc.

            

    

     

    Send
      to
      the Trustee as soon as practicable after being so requested by the Trustee
      a
      certificate of the Issuer signed by its director stating the number of Bonds
      held as at the date of such certificate by or on behalf of the Issuer or its
      Subsidiaries.

     

    
      	
              10.

            	
              Remuneration
                and Indemnification of
                Trustee

            

    

     

    
      	
              10.1

            	
              Payment
                of Remuneration

            

    

     

    The
      Issuer shall pay to the Trustee remuneration for its services as trustee as
      from
      the date of this Trust Deed, such remuneration to be at such rate to be agreed
      between the Issuer and the Trustee and on such date and on such terms as shall
      be separately agreed between the Issuer and the Trustee. 

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    
      	
              10.2

            	
              Additional
                Remuneration

            

    

     

    In
      the
      event of the occurrence of an Event of Default the Trustee considering it
      expedient or necessary or being requested by the Issuer to undertake duties
      which the Trustee and the Issuer agree to be of an exceptional nature or
      otherwise outside the scope of the normal duties of the Trustee under this
      Trust
      Deed. or should the Trustee perform any additional or any ancillary functions
      outside of those previously agreed with the Issuer, the Issuer shall pay to
      the
      Trustee such additional remuneration as shall be agreed between them. It is
      acknowledged and agreed that the Trustee shall not be obliged to undertake
      any
      additional duties unless the Trustee is satisfied (at its absolute discretion)
      that all its additional remuneration will be paid.

     

    
      	
              10.3

            	
              Tax

            

    

     

    The
      Issuer shall in addition pay to the Trustee an amount equal to the amount of
      any
      value added tax or similar tax chargeable in any jurisdiction in respect of
      its
      remuneration under this Trust Deed. 

     

    
      	
              10.4

            	
              Disputes

            

    

     

    In
      the
      event of the Trustee and the Issuer failing to agree (in a case to which Clause
      10.2 above applies) upon whether such duties shall be of an exceptional nature
      or otherwise outside the scope of the normal duties of the Trustee under this
      Trust Deed, or upon such additional remuneration, such matters shall be
      determined by a merchant bank (acting as an expert and not as an arbitrator)
      selected by the Trustee and approved by the Issuer or, failing such approval,
      nominated (on the application of the Trustee) by the President for the time
      being of The Law Society of England and Wales (the expenses involved in such
      nomination and the fees of such merchant bank being payable by the Issuer)
      and
      the determination of any such merchant bank shall be final and binding upon
      the
      Trustee, the Bondholders and the Issuer. 

     

    
      	
              10.5

            	
              Payment
                of Liabilities

            

    

     

    The
      Issuer shall also pay or discharge all Liabilities properly incurred by the
      Trustee in relation to the preparation and execution of, the exercise of its
      powers, authorities and discretions and the performance of its duties under,
      and
      in any other manner in relation to, this Trust Deed, including but not limited
      to all expenses and any stamp, issue, registration, documentary and other taxes
      or duties paid or payable by the Trustee in connection with any action taken
      or
      contemplated by or on behalf of the Trustee for enforcing, or resolving any
      doubt concerning, or for any other purpose in relation to, this Trust Deed.
      

     

    
      	
              10.6

            	
              Interest

            

    

     

    All
      amounts payable pursuant to Clause 10.5 above and/ or Clause 10.9 shall be
      payable (subject to and in accordance by the Issuer on the date specified in
      a
      demand by the Trustee and in the case of payments actually made by the Trustee
      prior to such demand shall (if not paid within ten (10) days after such demand
      and the Trustee so requires) carry interest at a rate of two percent (2%) per
      annum above the cost of funds from the date that payment is made by the Trustee
      until the date the Issuer reimburses the Trustee and in all other cases shall
      (if not paid on the date specified in such demand and the Trustees so requires)
      carry interest at such rate from the date specified in such demand until payment
      by the Issuer to the Trustee. All remuneration payable to the Trustee shall
      carry interest at such rate from the due date therefor.

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    
      	
              10.7

            	
              No
                Set-off or Withholding

            

    

     

    The
      Issuer hereby further undertakes to the Trustee that all monies payable by
      the
      Issuer to the Trustee under this Clause 10 shall be made without set-off,
      counterclaim, deduction or withholding unless compelled by law in which event
      the Issuer will pay such additional amounts as will result in the receipt by
      the
      Trustee of the amounts which would otherwise have been payable by the Issuer
      to
      the Trustee under this Clause in the absence of any such set-off, counterclaim,
      deduction or withholding.

     

    
      	
              10.8

            	
              Survival
                of Clauses

            

    

     

    Unless
      otherwise specifically stated in any discharge of this Trust Deed, the
      provisions of this Clause 10 shall continue in full force and effect
      notwithstanding such discharge.

     

    
      	
              10.9

            	
              Indemnity

            

    

     

    Without
      prejudice to the right of indemnity by law given to trustees, the Issuer shall
      indemnify the Trustee and its directors, officers and employees and every
      Appointee (as defined in Clause 11(y)) and keep it or him indemnified against
      all Liabilities to which it or he may be or become subject or which may be
      paid
      or incurred by it or him or which may be claimed against it or him as a result
      of or in connection with the Trustee acting as trustee under this Trust Deed
      (including, without limitation, in the execution or purported execution of
      any
      of its trusts, powers, authorities and discretions under this Trust Deed and
      Agency Agreement) or its or his functions under any such appointment or in
      respect of any other matter or thing done or omitted in any way relating to
      this
      Trust Deed or any such appointment (including all liabilities incurred in
      disputing or defending any of the foregoing), except those resulting from its
      or
      his gross negligence, wilful default or fraud.

     

    
      	
              10.10

            	
              Force
                Majeure

            

    

     

    Notwithstanding
      anything to the contrary in this Trust Deed or in any other transaction
      document, the Trustee shall not in any event be liable for any failure or delay
      in the performance of its obligations hereunder if it is prevented from so
      performing its obligations by any existing or future law or regulation, any
      existing or future act of governmental authority, Act of God, flood, war whether
      declared or undeclared, terrorism, riot, rebellion, civil commotion, strike,
      lockout, other industrial action, general failure of electricity or other
      supply, aircraft collision, technical failure, accidental or mechanical or
      electrical breakdown, computer failure or failure of any money transmission
      system or any reason which is beyond the control of the Trustee.

     

    
      	
              11.

            	
              
                PROVISIONS
                  SUPPLEMENTAL TO THE TRUSTEE
                  ACTS

              

            

    

     

    Section
      1
      of the Trustee Act 2000 shall not apply to the duties of the Trustee in relation
      to the trusts constituted by these presents. Where there are any inconsistencies
      between the Trustee Acts and the provisions of these presents, the provisions
      of
      these presents shall, to the extent allowed by law, prevail and, in the case
      of
      any such inconsistency with the Trustee Act 2000, the provisions of these
      presents shall constitute a restriction or exclusion for the purposes of that
      Act. The Trustee shall have all the powers conferred upon trustees by the
      Trustee Acts and by way of supplement thereto it is expressly declared as
      follows:

     

    
      	 	
              (a)

            	
              Advice:
                The Trustee, whenever it considers it reasonably necessary and expedient
                in the interest of the Bondholders, shall engage and consult, at
                the
                expense of the Issuer, with any legal or professional adviser and
                notice
                of appointment of any legal or professional adviser shall be given
                to the
                Issuer as soon as practicable. The Trustee may act on the opinion
                or
                advice of, or information obtained from, any lawyer, valuer, accountant
                (including the Auditors), banker or other expert whether obtained
                by or
                addressed to the Issuer, the Trustee, the Principal Agent or otherwise,
                and notwithstanding any monetary or other limit on liability contained
                therein, will not be responsible to anyone for any Liability occasioned
                by
                so acting. Any such opinion, advice or information may be sent or
                obtained
                by letter, telex, fax or electronic mail and the Trustee will not
                be
                liable to anyone for acting in good faith on any opinion, advice
                or
                information purporting to be conveyed by such means, notwithstanding
                any
                limitation on liability (monetary or otherwise) in relation to such
                person’s opinion or advice and even if it contains some error or is not
                authentic.

            

    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              Trustee
                to Assume Performance: The Trustee need not notify anyone of the
                execution
                of this Trust Deed or do anything to find out if an Event of Default
                has
                occurred. Until it has actual knowledge or express notice to the
                contrary,
                the Trustee may assume that no such event has occurred and that each
                of
                the Issuer and the Principal Agent is performing all its obligations
                under
                this Trust Deed and the Bonds.

            

    

     

    
      	 	
              (c)

            	
              Resolutions
                of Bondholders: The Trustee will not be responsible for having acted
                in
                good faith on a resolution in writing or any resolution purporting
                to have
                been passed at a meeting of Bondholders in respect of which minutes
                have
                been made and signed even if it is later found that there was a defect
                in
                the constitution of the meeting or the passing of the resolution
                or that
                the resolution was not valid or binding on the
                Bondholders.

            

    

     

    
      	 	
              (d)

            	
              Illegality/Expenditure
                of Trustee Funds: No provision of these presents shall require the
                Trustee
                to do anything which may: (i) be illegal or contrary to applicable
                law or
                regulation; (ii) cause it to expend or risk its own funds or otherwise
                incur any financial liability in the performance of any of its duties
                or
                in the exercise of any of its own rights, powers, authorities or
                discretions, if it shall have grounds for believing that repayment
                of such
                funds or satisfactory indemnity against, or security for, such risk
                or the
                liability is not assured to it.

            

    

     

    
      	 	
              (e)

            	
              Certificate
                signed by Directors: If the Trustee, in the exercise of its functions,
                requires to be satisfied or to have information as to any fact or
                the
                expediency of any act, it may call for and accept as sufficient evidence
                of that fact or the expediency of that act a certificate signed by
                a
                director of the Issuer as to that fact or to the effect that, in
                their
                opinion, that act is expedient and the Trustee need not call for
                further
                evidence and will not be responsible for any loss occasioned by acting
                on
                such a certificate.

            

    

     

    
      	 	
              (f)

            	
              Deposit
                of Documents: The Trustee may appoint as custodian, on any terms,
                any bank
                or entity whose business includes the safe custody of documents or
                any
                lawyer or firm of lawyers believed by it to be of good repute and
                may
                deposit this Trust Deed and any other documents with such custodian
                and
                pay all sums due in respect thereof. The Trustee shall not be responsible
                for or required to insure against any Liability incurred in connection
                with such deposit and may pay all sums required to be paid on account
                of,
                or in respect of, any such deposit.

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (g)

            	
              Discretion:
                The Trustee will have absolute and uncontrolled discretion as to
                the
                exercise of its functions (the exercise of which, as between the
                Bondholders and the Trustee shall be conclusive and binding on the
                Bondholders) and will not be responsible for any Liability which
                may
                result from their exercise or non-exercise. Whenever in this Trust
                Deed,
                the Agency Agreement or by law, the Trustee shall have discretion
                or
                permissive power it may decline to exercise the same in the absence
                of
                approval by the Bondholders and need not exercise the same unless
                it has
                been indemnified and/or provided with security to its
                satisfaction.

            

    

     

    
      	 	
              (h)

            	
              Agents:
                Whenever it considers it reasonably necessary and expedient in the
                interests of the Bondholders, the Trustee may, in the conduct of
                its trust
                business, instead of acting personally, employ and pay an agent selected
                by it, whether or not a lawyer or other professional person, to transact
                or conduct, or concur in transacting or conducting, any business
                and to do
                or concur in doing all acts required to be done by the Trustee (including
                the receipt and payment of money). Provided that the Trustee shall
                have
                exercised reasonable care in the selection of such agent, the Trustee
                shall not be responsible to the Bondholders for any misconduct on
                the part
                of any such person appointed by it hereunder or be bound to supervise
                the
                proceedings or acts of any such person.

            

    

     

    
      	 	
              (i)

            	
              Delegation:
                Whenever it considers it reasonably necessary and expedient in the
                interests of the Bondholders, the Trustee may delegate by power of
                attorney or otherwise to any person or persons or fluctuating body
                of
                persons on any terms (including power to sub-delegate) all or any
                of its
                trusts, powers, authorities, discretions or functions under this
                Trust
                Deed. Provided that the Trustee shall have exercised reasonable care
                in
                the selection of such delegate, the Trustee shall not be under any
                obligation to the Bondholders to supervise the proceedings or be
                in any
                way responsible for any loss incurred by reason of any misconduct
                or
                default on the part of any such delegate or
                sub-delegate.

            

    

     

    
      	 	
              (j)

            	
              Nominees:
                In relation to any asset held by it under this Trust Deed, the Trustee
                may
                appoint any person to act as its nominee on any
                terms.

            

    

     

    
      	 	
              (k)

            	
              Confidentiality:
                Unless required by law or ordered to do so by a court of competent
                jurisdiction, the Trustee shall not be required to disclose to any
                Bondholder any confidential financial or other information made available
                to the Trustee by the Issuer and no Bondholder shall be entitled
                to take
                any action to obtain from the Trustee any such
                information.

            

    

     

    
      	 	
              (l)

            	
              Determinations
                Conclusive: As between itself and the Bondholders, the Trustee may
                determine all questions and doubts arising in relation to any of
                the
                provisions of this Trust Deed or any of the Bonds. Such determinations,
                whether made upon such a question actually raised or implied in the
                acts
                or proceedings of the Trustee, will be conclusive and shall bind
                the
                Trustee and the Bondholders.

            

    

     

    
      	 	
              (m)

            	
              Currency
                Conversion: Where it is necessary or desirable to translate or convert
                any
                sum from one (1) currency to another, it will (unless otherwise provided
                hereby or required by law) be converted or translated at such rate
                or
                rates, in accordance with such method and as at such date as may
                be
                specified by the Trustee but having regard to current rates of exchange,
                if available. Any rate, method and date so specified will be binding
                on
                the Issuer and the Bondholders.

            

    

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (n)

            	
              Payment
                for and Delivery of Bonds: The Trustee will not be responsible for
                the
                receipt or application by the Issuer of the proceeds of the issue
                of the
                Bonds, any exchange of Bonds or the delivery of Bonds to the persons
                entitled to them.

            

    

     

    
      	 	
              (o)

            	
              Conversion
                Price: The Trustee shall have no duty or responsibility to determine
                whether facts exist which may require an adjustment of the Conversion
                Price or to determine the nature or extent of any such adjustment
                when
                made or the method used or to be used in making
                it.

            

    

     

    
      	 	
              (p)

            	
              The
                Shares: The Trustee shall have no duty or responsibility at any time
                in
                respect of the validity or value (or the kind or amount) of the Shares
                or
                any
                other property which may at any time be issued or delivered on the
                conversion of any Bonds or the sale or other disposal of any Shares.
                The
                Trustee shall not be responsible for any failure of the Issuer to
                make
                available or deliver any Shares, share certificates or any other
                securities or property or make any payment on the exercise of any
                Conversion Right.

            

    

     

    
      	 	
              (q)

            	
              Responsibility:
                The Trustee assumes no responsibility for the correctness of Recital
                (A)
                to this Trust Deed (which shall be taken as a statement by the Issuer)
                or
                other statements, warranties or representations of the Issuer, nor
                shall
                the Trustee by the execution of this Trust Deed be deemed to make
                any
                representation as to the validity, sufficiency, enforceability or
                admissibility in evidence of the Bonds, this Trust Deed or the Agency
                Agreement.

            

    

     

    
      	 	
              (r)

            	
              Enforcement:
                The Trustee shall not be under any obligation to take proceedings
                against
                the Issuer to enforce payment of the Bonds after the Bonds have become
                due
                and payable nor to declare the Bonds due and payable unless it shall
                have
                been so requested in writing by holders of not less than twenty-five
                percent (25%) in principal amount of the Bonds then outstanding (which
                request has not been revoked) or shall have been so directed by an
                Extraordinary Resolution and it shall have been indemnified and/or
                secured
                to its satisfaction.

            

    

     

    
      	 	
              (s)

            	
              Satisfaction
                of Trustee in Condition 9(C): For the purposes of Condition 8(C),
                the
                Trustee shall be satisfied by the Issuer that the Issuer will be
                obliged
                to pay additional amounts as provided in that Condition by the delivery
                to
                it of (a) a certificate signed by two (2) directors of the Issuer
                and (b)
                an opinion of independent legal or tax advisors of recognised standing
                to
                the effect that the amendment or change giving rise to the payment
                of
                additional amounts have occurred.

            

    

     

    
      	 	
              (t)

            	
              Consolidation,
                amalgamation etc: The Trustee shall not be responsible for any
                consolidation, amalgamation, merger, reconstruction or scheme of
                the
                Issuer or any sale or transfer of all or substantially all of the
                assets
                of the Issuer or the form or substance of any plan relating thereto
                or the
                consequences thereof to any
                Bondholder.

            

    

     

    
      	 	
              (u)

            	
              Forged
                Bonds and Documents: The Trustee shall not be liable to the Issuer
                or any
                Bondholder if without gross negligence, wilful default or fraud on
                its
                part it has accepted as valid or has not rejected any Bonds purporting
                to
                be such and subsequently found to be forged or not authentic nor
                shall it
                be liable for any action taken or omitted to be taken in reliance
                on any
                document, certificate or communication believed by it to be genuine
                and to
                have been presented or signed by the proper
                parties.

            

    

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (v)

            	
              Consent:
                Any consent or approval to be given by the Trustee for the purposes
                of
                this Trust Deed may be given on such terms and subject to such conditions
                (if any) as the Trustee thinks fit and notwithstanding any contrary
                provision in this Trust Deed may be given retrospectively. The Issuer
                shall observe and perform any such terms and conditions and the Trustee
                may at any time waive or agree to a variation of such terms and
                conditions.

            

    

     

    
      	 	
              (w)

            	
              Acceleration:
                The Trustee shall not be obliged to declare the Bonds immediately
                due and
                payable under Condition 11 unless it has been indemnified and/or
                secured
                to its satisfaction in respect of all costs, claims and liabilities
                which
                it has incurred to that date and to which it may thereby and as a
                consequence thereof in its opinion render itself, or have rendered
                itself,
                liable.

            

    

     

    
      	 	
              (x)

            	
              Bonds
                held by the Issuer etc.: In the absence of actual knowledge or
                express notice to the contrary, the Trustee may assume without enquiry
                (other than requesting a certificate under Clause 9.15) that no Bonds
                are
                for the time being held by or on behalf of the Issuer or its
                Subsidiaries.

            

    

     

    
      	 	
              (y)

            	
              Responsibility
                for agents etc.: If the Trustee exercises reasonable care in selecting
                any
                custodian, agent, delegate or nominee appointed under this clause
                (an
                “Appointee”) (in each case, after written notice have been given to the
                Issuer to the extent reasonably practicable), it will not have any
                obligation to supervise the Appointee or be responsible for any loss,
                liability, cost, claim, action, demand or expense incurred by reason
                of
                the Appointee’s misconduct or default or the misconduct or default of any
                substitute appointed by the Appointee. 

            

    

     

    
      	 	
              (z)

            	
              Reliance
                on Certificates: The Trustee may rely without liability to Bondholders
                on
                any certificate prepared by the directors of the Issuer and accompanied
                by
                a certificate or report prepared by an internationally recognised
                firm of
                accountants (including the Auditors) pursuant to the Conditions and/or
                this Trust Deed, whether or not addressed to the Trustee and whether
                or
                not the internationally recognised firm of accountants’ liability in
                respect thereof is limited by a monetary cap or otherwise limited
                or
                excluded and shall be obliged to do so where the certificate or report
                is
                delivered pursuant to the obligation of the Issuer to procure such
                delivery under the Conditions; any such certificate or report shall
                be
                conclusive and binding on the Issuer, the Trustee and the
                Bondholders.

            

    

     

    
      	 	
              (aa)

            	
              Compliance:
                The Conditions shall be binding on the Issuer and the Bondholders.
                The
                Trustee shall be entitled to enforce the obligations of the Issuer
                under
                the Bonds and the Conditions as if the same were set out and contained
                in
                this Trust Deed which shall be read and construed as one (1) document
                with
                the Bonds. The provisions contained in Schedule 3 shall have effect
                in the
                same manner as if herein set forth.

            

    

     

    
      	 	
              (bb)

            	
              Error
                of Judgment: The Trustee shall not be liable for any error of judgment
                made in good faith by any officer or employee of the Trustee assigned
                by
                the Trustee to administer its corporate trust
                matters.

            

    

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    
      	(cc)  	
              Professional
                Charges: Any Trustee being a banker, lawyer, broker or other person
                engaged in any profession or business shall be entitled to charge
                and be
                paid all usual professional and other charges for business transacted
                and
                acts done by him or his partner or firm on matters arising in connection
                with the trusts of this Trust Deed and also his properly incurred
                charges
                in addition to disbursements for all other work and business done
                and all
                time spent by him or his partner or firm on matters arising in connection
                with this Trust Deed, including matters which might or should have
                been
                attended to in person by a trustee not being a banker, lawyer, broker
                or
                other professional person.

            

    

     

    
      	(dd)
               	
              Consequential
                loss: Notwithstanding any contrary provision of this Trust Deed,
                the
                Trustee shall not in any event be liable for special, indirect, punitive
                or consequential loss or damage of any kind whatsoever (including
                but not
                limited to lost profits), whether or not foreseeable, even if the
                Trustee
                has been advised of the likelihood of such loss or damage and regardless
                of whether the claim for such is made in negligence, breach of contract,
                fraud, breach of fiduciary obligation or
                otherwise.

            

    

     

    
      	(ee)  	
              Other
                Obligations: The Trustee shall not be responsible for the validity
                or
                enforceability of any obligations owed to it as Trustee hereof other
                than
                by the Issuer the benefit of which obligations have been taken by
                the
                Trustee in the interests of the
                Bondholders.

            

    

     

    
      	(ff)
               	
               Reliance:
                Any certificate or report of the Auditors or any other expert or
                other
                person called for by or provided to the Trustee (whether or not addressed
                to the Trustee) in accordance with or for the purposes of these Conditions
                or this Trust Deed may be relied upon by the Trustee as sufficient
                evidence of the facts therein and shall, in absence of manifest error,
                be
                conclusive and binding on all parties and the Trustee shall not be
                responsible for any loss occasioned by acting on any such certificate
                or
                report. The Trustee shall be entitled to rely on any report of
                accountants, financial advisers or investment bank where the Issuer
                procures the delivery of the same pursuant to its obligations to
                do so
                under the Conditions and such report shall be binding on the Issuer
                and
                the holders of the Bonds in the absence of manifest or proven
                error.

            

    

     

    
      	(gg)  	
              Certificates
                from clearing systems: The Trustee may call for any certificate or
                other
                document to be issued by Clearstream, Luxembourg or Euroclear (or
                any
                alternative clearing system on behalf of whom the Global Certificate
                may
                be held) as to the principal amount of Bonds evidenced by the Global
                Certificate standing to the account of any person. Any such certificate
                or
                other document shall, in the absence of manifest error, be conclusive
                and
                binding for all purposes. The Trustee shall not be liable to any
                person by
                reason of having accepted as valid or not having rejected any certificate
                or other document to such effect purporting to be issued by Clearstream
                or
                Euroclear (or any such alternative clearing system) and subsequently
                found
                to be forged or not authentic or not to be
                correct.

            

    

     

    
      	(hh)   	
              Exercise
                of power: In connection with the exercise by it of any of its trusts,
                powers, authorities, duties and discretions under this Trust Deed
                (including, without limitation, any modification, waiver, authorisation
                or
                determination), the Trustee shall have regard to the interests of
                all of
                the Bondholders and shall not have regard to any interests arising
                from
                circumstances particular to individual Bondholders (whatever their
                number)
                (except where expressly provided otherwise), and, in particular but
                without limitation, shall not have regard to the consequences of
                such
                exercise for individual Bondholders resulting from their being for
                any
                purpose domiciled or resident in, or otherwise connected with, or
                subject
                to the jurisdiction of, any particular territory or any political
                sub-division thereof and the Trustee shall not be entitled to require,
                nor
                shall any Bondholder be entitled to claim, from the Issuer (except
                to the
                extent provided for in Condition 10), the Trustee or any other person
                any
                indemnification or payment in respect of any tax consequence of any
                such
                exercise upon individual
                Bondholders.

            

    

     

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    
      	(ii)  	
              Transaction
                Documents: The Trustee shall not be responsible for the execution,
                delivery, legality, effectiveness, adequacy, genuineness, validity,
                performance, enforceability or admissibility in evidence of this
                Trust
                Deed or any other document relating thereto and shall not be liable
                for
                any failure to obtain any licence, consent or other authority for
                the
                execution, delivery, legality, effectiveness, adequacy, genuineness,
                validity, performance, enforceability or admissibility in evidence
                of this
                Trust Deed or any other document relating
                thereto.

            

    

     

    
      	(jj)   	
              Legal
                Opinion: The Trustee shall not be responsible to any person for failing
                to
                request, require or receive any legal opinion relating to the Bonds
                or for
                checking or commenting upon the content of any such legal opinion
                and
                shall not be responsible for any Liability incurred
                thereby.

            

    

     

    
      	(kk)  	
              Taking
                Action by Trustee: The Trustee shall not be bound to take any action
                in
                connection with this Trust Deed or any obligations arising pursuant
                thereto, including, without prejudice to the generality of the foregoing,
                forming any opinion or employing any financial adviser, where it
                is not
                reasonably satisfied that the Issuer will be able to indemnify it
                against
                all Liabilities which may be incurred in connection with such action
                and
                may demand prior to taking any such action that there be paid to
                it in
                advance such sums as it reasonably considers (without prejudice to
                any
                further demand) shall be sufficient so to indemnify it and on such
                demand
                being made the Issuer shall be obliged to make payment of all such
                sums in
                full.

            

    

     

    
      	12.	
              
                
                  LIABILITY
                    OF THE TRUSTEE

                

              

            

    

     

    If
      the
      Trustee fails to show the degree of care and diligence required of it as trustee
      having regard to the provisions hereof, nothing in this Trust Deed shall relieve
      or indemnify it from or against any liability which would otherwise attach
      to it
      in respect of any gross negligence, wilful default or fraud of which it may
      be
      guilty.

     

    
      
        	13.	
                
                  WAIVER
                    AND PROOF OF
                    DEFAULT

                

              

      

    

     

    
      
        	13.1	
                Waiver

              

      

    

     

    The
      Trustee may, without the consent of the Bondholders and without prejudice to
      its
      rights in respect of any subsequent breach, from time to time and at any time,
      if in its opinion the interests of the Bondholders will not be materially
      prejudiced thereby, waive or authorise, on such terms as seem expedient to
      it,
      any breach or proposed breach by the Issuer of this Trust Deed or the Conditions
      or determine that an Event of Default will not be treated as such provided
      that
      the Trustee will not do so in contravention of an express direction given by
      an
      Extraordinary Resolution or a request made pursuant to Condition 11. No such
      direction or request will affect a previous waiver, authorisation or
      determination. Any such waiver, authorisation or determination will be binding
      on the Bondholders and, if the Trustee so requires, will be notified to the
      Bondholders as soon as practicable.

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    
      
        	13.2	
                Proof
                  of Default

              

      

    

     

    Proof
      that the Issuer has failed to pay a sum due to the holder of any one (1) Bond
      will (unless the contrary be proved) be sufficient evidence that it has made
      the
      same default as regards all other Bonds which are then payable.

     

    
      
        	14.	
                
                  TRUSTEE
                    NOT PRECLUDED FROM ENTERING INTO
                    CONTRACTS

                

              

      

    

     

    The
      Trustee and any other person, whether or not acting for itself, may acquire,
      hold or dispose of any Bond or other security (or any interest therein) of
      the
      Issuer or any other person, may enter into or be interested in any contract
      or
      transaction with any such person and may act on, or as depositary or agent
      for,
      any committee or body of holders of any securities of any such person in each
      case with the same rights as it would have had if the Trustee were not acting
      as
      Trustee and need not account for any profit.

     

    
      
        	15.	
                
                  MODIFICATION
                    AND
                    SUBSTITUTION

                

              

      

    

     

    
      
        	15.1	
                Modification

              

      

    

     

    
      	(a)  	
              The
                Trustee may (but is not obliged to) agree without the consent of
                the
                Bondholders to any modification to this Trust Deed (which for the
                avoidance of doubt includes the Bonds) and the Agency Agreement,
                which in
                the Trustee’s opinion, is of a formal, minor or technical nature or to
                correct a manifest or (to the satisfaction of the Trustee) proven
                error.
                The Trustee may (but is not obliged to) agree to any modification
                to this
                Trust Deed which is in its opinion proper to make if, in its opinion,
                such
                modification will not be materially prejudicial to the interests
                of the
                Bondholders. Unless the Trustee agrees otherwise, any such modification
                shall be notified to the Bondholders as soon as practicable
                thereafter.

            

    

     

    
      	(b)  	
              Any
                amendment or supplement to this Trust Deed shall be made by an instrument
                in writing signed by all the parties to this Trust Deed. A waiver
                or
                consent by the Trustee with respect to action required or forbidden
                by
                this Trust Deed shall be effective only if sent in writing by the
                Trustee
                and only for that occasion.

            

    

     

    
      
        
          	15.2	
                  Substitution

                

        

      

    

     

    The
      Trustee may (but is not obliged to), without the consent of the Bondholders,
      agree to the substitution of any other company (the “Substituted
      Obligor”)
      in
      place of the Issuer (or of any previous substitute under this sub-Clause) as
      the
      principal debtor under this Trust Deed and the Bonds provided that:

     

    
      	(a)  	
              no
                payment in respect of the Bonds is at the relevant time
                overdue;

            

    

     

    
      	(b)  	
              a
                deed is executed or undertaking given by the Substituted Obligor
                to the
                Trustee, agreeing to be bound by this Trust Deed and the Bonds (with
                consequential amendments as the Trustee may deem appropriate) as
                if the
                Substituted Obligor had been named in this Trust Deed and the Bonds
                as the
                principal debtor in place of the
                Issuer;

            

    

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    
      	(c)  	
              if
                the Substituted Obligor is subject generally to the taxing jurisdiction
                of
                a territory or any authority of or in that territory with power to
                tax
                (the “Substituted
                Territory”)
                other than the territory to the taxing jurisdiction of which (or
                to any
                such authority of or in which) the Issuer is subject generally (the
                “Issuer’s
                Territory”),
                the Substituted Obligor has given (unless the Trustee otherwise agrees)
                to
                the Trustee an undertaking satisfactory to the Trustee in terms
                corresponding to Condition 10 with the substitution for the references
                in
                that Condition to the Issuer’s Territory of references to the Substituted
                Territory whereupon this Trust Deed and the Bonds will be read
                accordingly;

            

    

     

    
      	(d)  	
              any
                two (2) directors of the Substituted Obligor certifies that it will
                be
                solvent immediately after such
                substitution;

            

    

     

    
      	(e)  	
              (unless
                the Issuer’s successor in business is the Substituted Obligor as the
                principal debtor under this Trust Deed and the Bonds) the obligations
                of
                the Substituted Obligor as the principal debtor under this Trust
                Deed and
                the Bonds are unconditionally and irrevocably guaranteed by the
                Issuer;

            

    

     

    
      	(f)  	
              a
                certificate signed by two (2) duly authorised signatories of the
                Issuer
                stating that the circumstances referred to in this Clause prevail
                and
                legal opinions addressed to the Trustee from independent legal advisors
                of
                recognised standing in each jurisdiction referred to in (c) above,
                in form
                and substance satisfactory to the Trustee, as to the fulfilment of
                the
                conditions set out in full in this Clause have been delivered to
                the
                Trustee and the Trustee shall not be liable to anyone for relying
                on such
                certificates and legal opinions;
                and

            

    

     

    
      	(g)  	
              the
                Issuer shall have given, unless the Trustee agrees otherwise, at
                least
                fourteen (14) days’ prior notice of such substitution to the Bondholders,
                stating that copies, or pending execution the agreed text, of all
                documents in relation to the substitution which are referred to above,
                or
                which might otherwise reasonably be regarded as material to Bondholders,
                will be available for inspection at the specified office of the Principal
                Agent.

            

    

     

    References
      in Condition 11 to obligations under the Bonds shall be deemed to include
      obligations under the supplemental trust deed, and the events listed in
      Condition 11 shall be deemed to include any guarantee referred to in (e) above
      not being (or being claimed by the Issuer not to be) in full force and effect
      and the provisions in Condition 11(A)(iv), (v), (vi), (vii), (viii) and (ix)
      shall be deemed to apply to the Issuer as guarantor.

     

    
      
        	15.3	
                Release
                  of substituted
                  Issuer

              

      

    

     

    An
      agreement by the Trustee pursuant to Clause 15.2
      will, if
      so expressed, release the Issuer (or a previous substitute) from any or all
      of
      its obligations (save for any guarantee obligations) under this Trust Deed
      and
      the Bonds. Notice of the substitution will be given by the Issuer to the Trustee
      (who will give such notice to the Bondholders) within fourteen (14) days of
      the
      execution of such documents and compliance with such requirements.

     

    
      
        	15.4	
                Completion
                  of Substitution

              

      

    

     

    On
      completion of the formalities set out in Clause 15.2,
      the
      Substituted Obligor will be deemed to be named in this Trust Deed and the Bonds
      as the principal debtor in place of the Issuer (or of any previous substitute)
      and this Trust Deed and the Bonds will be deemed to be amended as necessary
      to
      give effect to the substitution.

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

    
      
        	16.	
                
                  APPOINTMENT,
                    RETIREMENT AND REMOVAL OF THE
                    TRUSTEE

                

              

      

    

     

    
      
        	16.1	
                Appointment

              

      

    

     

    The
      Issuer has the power of appointing new trustees but no one may be so appointed
      unless previously approved by an Extraordinary Resolution. A trustee will at
      all
      times be a trust corporation and it may be the sole Trustee. Any appointment
      of
      a new Trustee will be notified by the Issuer to the Bondholders as soon as
      practicable.

     

    
      
        	16.2	
                Retirement
                  and Removal

              

      

    

     

    Any
      Trustee may retire at any time on giving at least sixty (60) days’ written
      notice to the Issuer without giving any reason and without being responsible
      for
      any costs occasioned by such retirement and the Bondholders may by an
      Extraordinary Resolution remove any Trustee provided that the retirement or
      removal of a sole trust corporation will not become effective until a trust
      corporation is appointed as successor Trustee. If a sole trust corporation
      gives
      notice of retirement or an Extraordinary Resolution is passed for its removal,
      the Issuer, will use all reasonable endeavours to procure that another trust
      corporation be appointed as Trustee as soon as practicable and if, after thirty
      (30) days’ of such notice having been given the Issuer, has failed to do so, the
      Trustee shall be entitled (at the expense of the Issuer) but not obliged to
      appoint another trust corporation selected by the Trustee as its successor.
      The
      protections, indemnities and immunities in this Trust Deed in favour of the
      Trustee shall continue to benefit the Trustee notwithstanding such Trustee’s
      removal or retirement.

     

    
      
        	16.3	
                Co-Trustees

              

      

    

     

    The
      Trustee may, despite Clause 16.1,
      by
      written notice to the Issuer appoint anyone to act as an additional Trustee
      jointly with the Trustee:

     

    
      	(a)  	
              if
                the Trustee considers such appointment to be in the interests of
                the
                Bondholders;

            

    

     

    
      	(b)  	
              to
                conform with any legal requirement, restriction or condition in a
                jurisdiction in which a particular act is to be performed;
                or

            

    

     

    
      	(c)  	
              to
                obtain a judgment or to enforce a judgment or any provision of this
                Trust
                Deed in any jurisdiction.

            

    

     

    Subject
      to the provisions of this Trust Deed the Trustee may confer on any person so
      appointed such functions as it thinks fit. The Trustee shall not be responsible
      for supervision and management of the additional Trustee. The Trustee may by
      written notice to the Issuer and that person remove that person. At the
      Trustee’s request, the Issuer will forthwith do all things as may be required to
      perfect such appointment or removal and it irrevocably appoints the Trustee
      to
      be its attorney in its name and on its behalf to do so.

     

    
      
        	16.4	
                Competence
                  of a Majority of
                  Trustees

              

      

    

     

    If
      there
      are more than two (2) Trustees the majority of them will be competent to perform
      the Trustee’s functions provided the majority includes a trust
      corporation.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    
      
        	16.5	
                Successor

              

      

    

     

    Any
      corporation into which the Trustee may be merged or converted or with which
      it
      may be consolidated, or any corporation resulting from any merger, conversion
      or
      consolidation to which the Trustee shall be a party, or any corporation
      succeeding to all or substantially all the corporate trust business of the
      Trustee, shall be the successor to the Trustee hereunder (provided it is a
      trust
      corporation) without the execution or filing of any papers or any further act
      on
      the part of any of the parties hereto.

     

    
      
        	17.	
                
                  COMMUNICATIONS

                

              

      

    

     

    Any
      notice or other communication hereunder shall be in writing. It shall be served
      by letter sent by registered post or courier or by fax:

     

    In
      the
      case of the Issuer, to it at:

     

    China
      Architectural Engineering, Inc.

    105
      Baishi Rd., Jiuzhou West Avenue

    Zhuhai,
      519070

    China

     

    Telephone
      no. : +86-756-853-8908

    Fax
      no. : +86-756-853-8922

    Attention : Luo
      Ken
      Yi

     

    In
      the
      case of the Trustee, to it at:

     

    The
      Bank
      of New York, London Branch

    40th
      Floor, One Canada Square

    London,
      E14 5AL, United Kingdom

     

    Fax
      no.:
 +44
      20
      7964 6369

    Attention:
       Global
      Corporate Trust

     

    With
      a
      copy to:

     

    The
      Bank
      of New York

    Level
      12,
      3 Pacific Place

    1
      Queen’s
      Road East

    Hong
      Kong

     

    Fax
      no.:
 852
      2295
      3283

    Attention:
       Corporate
      Trust

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    Communications
      will take effect, in the case of a letter sent by registered post, on the
      seventh business day in New York receipt after posting; in the case of a letter
      sent by courier, at the time of delivery; in the case of fax, at the time of
      despatch if the correct error-free transmission report is received; provided
      that if such communication would take effect outside business hours then it
      shall be deemed to be received on the next business day in the place of receipt.
      

     

    For
      the
      purposes of this Clause 17,
      “business
      day”
means
      a
      day (other than Saturday, Sunday or public holidays) on which commercial banks
      and foreign exchange markets are open for business in the relevant
      location(s).

     

    
      
        	18.	
                
                  FURTHER
                    ISSUES

                

              

      

    

     

    
      
        	18.1	
                Supplemental
                  Trust Deed

              

      

    

     

    If
      the
      Issuer issues further securities as provided in Condition 16, it shall, before
      their issue, execute and deliver to the Trustee a deed supplemental to this
      Trust Deed containing such provisions (corresponding to any of the provisions
      of
      this Trust Deed) as the Trustee may require.

     

    
      
        	18.2	
                Meetings
                  of Bondholders

              

      

    

     

    If
      the
      Trustee so directs, Schedule 3 shall apply equally to Bondholders and to holders
      of any securities issued pursuant to the Conditions as if references in it
      to
“Bonds”
      and
“Bondholders”
      were
      also to such securities and their holders respectively.

     

    
      
        
          	19.	
                  
                    CURRENCY
                      INDEMNITY

                  

                

        

      

      
      

    

    
      
        
           

          
            	19.1	
                    Currency of
                      Account and
                      Payment

                  

          

        

      

    

     

    United
      States dollars (the “Contractual
      Currency”)
      is the
      sole currency of account and payment for all sums payable by the Issuer under
      or
      in connection with this Trust Deed and the Bonds, including
      damages.

     

    
      
        	19.2	
                Extent
                  of discharge

              

      

    

     

    An
      amount
      received or recovered in a currency other than the Contractual Currency (whether
      as a result of, or of the enforcement of, a judgment or order of a court of
      any
      jurisdiction, in the winding-up or dissolution of the Issuer or otherwise),
      by
      the Trustee or any Bondholder in respect of any sum expressed to be due to
      it
      from the Issuer will only discharge the Issuer to the extent of the Contractual
      Currency amount which the recipient is able to purchase with the amount so
      received or recovered in that other currency on the date of that receipt or
      recovery (or, if it is not practicable to make that purchase on that date,
      on
      the first date on which it is practicable to do so).

     

    
      
        	19.3	
                Indemnity

              

      

    

     

    If
      that
      Contractual Currency amount is less than the Contractual Currency amount
      expressed to be due to the recipient under this Trust Deed or the Bonds, the
      Issuer will indemnify it against any loss sustained by it as a result. In any
      event, the Issuer will indemnify the recipient against the cost of making any
      such purchase.

     

    
      
        	19.4	
                Indemnity
                  separate

              

      

    

     

    The
      indemnities in this Clause 19
      and in
      Clause 10.9 constitute separate and independent obligations from the other
      obligations in this Trust Deed, will give rise to a separate and independent
      cause of action, will apply irrespective of any indulgence granted by the
      Trustee and/or any Bondholder and will continue in full force and effect despite
      any judgment, order, claim or proof for a liquidated amount in respect of any
      sum due under this Trust Deed and/or the Bonds or any other judgment or
      order.

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    
      
        	20.	
                
                  GOVERNING
                    LAW, THIRD PARTY RIGHTS AND
                    JURISDICTION

                

              

      

    

     

    
      
        	20.1	
                Governing
                  Law

              

      

    

     

    This
      Trust Deed shall be governed by and construed in accordance with English
      law.

     

    
      	20.2       
	
              The
                Issuer irrevocably agrees for the benefit of the Trustee and the
                Bondholders that the courts of England are to have exclusive jurisdiction
                to settle any dispute which may arise out of or in connection with
                these
                presents and accordingly submit to the exclusive jurisdiction of
                the
                English courts. The Issuer waives any objection to the courts of
                England
                on the grounds that they are an inconvenient or inappropriate forum.
                The
                Trustee and the Bondholders may take any suit, action or proceedings
                arising out of or in connection with these presents (together referred
                to
                as “Proceedings”)
                against the Issuer in any other court of competent jurisdiction and
                concurrent Proceedings in any number of
                jurisdictions.

            

    

     

    
      	20.3        
              	
              The
                Issuer irrevocably and unconditionally appoints The London Law Agency
                at
                its registered office for the time being and in the event of its
                ceasing
                so to act will appoint such other person as the Trustee may approve
                and as
                the Issuer may nominate in writing to the Trustee for the purpose
                to
                accept service of process on its behalf in England in respect of
                any
                Proceedings. The Issuer:

            

    

     

    
      	(a)  	
              agrees
                to procure that, so long as any of the Bonds remain liable to
                prescription, there shall be in force an appointment of such a person
                approved by the Trustee with an office in London with authority to
                accept
                service as aforesaid;

            

    

     

    
      	(b)  	
              agrees
                that failure by any such person to give notice of such service of
                process
                to the Issuer shall not impair the validity of such service or of
                any
                judgment based thereon;

            

    

     

    
      	(c)  	
              consents
                to the service of process in respect of any Proceedings by the airmailing
                of copies, postage prepaid, to the Issuer in accordance with clause
                17;
                and

            

    

     

    
      	(d)  	
              agrees
                that nothing in these presents shall affect the right to serve process
                in
                any other manner permitted by law.

            

    

     

    
      
        	21.	
                
                  THIRD
                    PARTY RIGHTS

                

              

      

    

     

    A
      person
      who is not a party to these presents has no rights under the Contracts (Rights
      of Third Parties) Act 1999 to enforce any term of these presents, but this
      does
      not affect any right or remedy of a third party which exists or is available
      apart from that Act.

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

     

    
      
        
          	22.	
                  
                    COUNTERPARTS

                  

                

        

      

    

     

    This
      Trust Deed (and any supplemental trust deed thereto) may be executed in
      counterparts, each of which shall be deemed to be an original and all of which
      when so executed shall constitute one (1) and the same instrument.

     

    
      
        	23.	
                
                  TERMINATION
                    OF THIS TRUST
                    DEED

                

              

      

    

     

    This
      Trust Deed shall terminate forthwith when none of the Bonds remains
      outstanding.

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      1

     

    FORM
      OF CERTIFICATE

     

    On
      the
      front:

     

    
      	
              Amount

            	
              ISIN

            	
              Common
                Code

            	
              Certificate
                Number

            

    

     

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    (incorporated
      under the laws of the State of Delaware)

    US$10,000,000

    Variable
      Rate Convertible Bonds due 2012

     

    The
      Bond
      or Bonds in respect of which this Certificate is issued, the identifying numbers
      of which are noted above, are in registered form and form part of a series
      designated as specified in the title (the Bonds)
      of
      China Architectural Engineering, Inc. (the Issuer)
      and
      constituted by the Trust Deed referred to on the reverse hereof. The Bonds
      are
      subject to, and have the benefit of, that Trust Deed and the terms and
      conditions (the Conditions)
      set out
      on the reverse hereof.

     

    The
      Issuer hereby certifies that [  ]
      of [ ]
      is, as at the date hereof, entered in the register of Bondholders as the holder
      of Bonds in the principal amount of US$10,000,000 (Ten Million United States
      dollars). For value received, the Issuer promises to pay the person who appears
      at the relevant time on the register of Bondholders as holder of the Bonds
      in
      respect of which this Certificate is issued such amount or amounts as shall
      become due in respect of such Bonds and otherwise to comply with the
      Conditions.

     

    The
      Bonds
      in respect of which this Certificate is issued are convertible into fully-paid
      shares of common stock with a par value of US$0.001 each of the Issuer subject
      to and in accordance with the Conditions and the Trust Deed.

     

    This
      Certificate is evidence of entitlement only. Title to the Bonds passes only
      on
      due registration on the register of Bondholders and only the duly registered
      holder is entitled to payments on Bonds in respect of which this Certificate
      is
      issued.

     

    This
      Certificate shall not be valid for any purpose until authenticated by or on
      behalf of the Principal Agent.

     

    The
      Certificate is governed by, and shall be construed in accordance with, English
      law.

     

    IN
      WITNESS whereof the Issuer has caused this Certificate to be signed on its
      behalf.

     

    Dated
      [  ]
      

     

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

     

    By:

     

    Director/Authorised
      Signatory

     

    
      
        
        

      

      
        38

        
          

        

      

       

    

    Certificate
      of Authentication

     

    Certified
      that the above-named holder is as at the date hereof entered in the register
      of
      Bondholders as holder of the above-mentioned principal amount of Bonds with
      identifying numbers:

     

    _____________

     

    _____________

     

    _____________

     

    _____________

     

    The
      Bank of New York as Registrar

    (without
      warranty, recourse or liability)

     

     

    By:

    
 

    Authorised
      Signatory

     

    Dated:

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

    TERMS
      AND CONDITIONS OF THE BONDS

     

    The
      following is the text of the Conditions of the Bonds which (subject to
      modification and except for the paragraphs in italics) will be endorsed on
      the
      Certificates issued in respect of the Bonds.

     

    The
      issue
      of the US$10,000,000 aggregate principal amount of Variable Rate Convertible
      Bonds due 2012 (the Bonds,
      which
      term shall include, unless the context requires otherwise, any further Bonds
      issued in accordance with Condition 17 and consolidated and forming a single
      series therewith) of China Architectural Engineering, Inc. (the Issuer)
      and the
      right of conversion into Shares (as defined in Condition 6(A)(v)) were
      authorised by resolutions of the board of directors of the Issuer passed on
      April 9, 2007. The Bonds are constituted by a trust deed dated April 12, 2007
      (the Trust Deed)
      made
      between the Issuer and the The Bank of New York, London Branch as trustee for
      the holders of the Bonds (the Trustee,
      which
      term shall, where the context so permits, include all other persons or companies
      for the time being acting as trustee or trustees under the Trust Deed) and
      are
      subject to the paying and conversion agency agreement dated April 12, 2007
      (the
Agency
      Agreement)
      with
      the Trustee, The Bank of New York, London Branch as principal paying, conversion
      and transfer agent (the Principal
      Agent),
      The
      Bank of New York as registrar (the Registrar)
      and the
      other paying, conversion and transfer agents appointed under it (each a
Paying
      Agent,
      Conversion
      Agent,
      Transfer
      Agent,
      and
      together with the Registrar and the Principal Agent, the Agents)
      relating to the Bonds. References to the Principal
      Agent,
      Registrar
      and
Agents
      below
      are references to the principal agent, registrar and agents for the time being
      for the Bonds. The statements in these terms and conditions of the Bonds (these
      Conditions)
      include
      summaries of, and are subject to, the detailed provisions of the Trust Deed.
      Unless otherwise defined, terms used in these Conditions have the meaning
      specified in the Trust Deed. Copies of the Trust Deed and of the Agency
      Agreement are available for inspection during normal business hours at the
      registered office of the Trustee being as at the date hereof at 40th Floor,
      One
      Canada Square, London, E14 5AL, United Kingdom and at the specified offices
      of
      each of the Agents. The Bondholders are bound by, and are deemed to have notice
      of, all the provisions of the Trust Deed and the Agency Agreement applicable
      to
      them.

     

    
      	
              1.

            	
              Status
                

            

    

     

    The
      Bonds
      constitute direct, unsubordinated, unconditional and (subject to the provisions
      of Condition 5)
      unsecured obligations of the Issuer and shall at all times rank pari
      passu
      and
      without any preference or priority among themselves. The payment obligations
      of
      the Issuer under the Bonds shall, save for such exceptions as may be provided
      by
      applicable legislation and subject to Condition 5, at all times rank at least
      equally with all of its other present and future unsecured and unsubordinated
      obligations (other than any obligations preferred by mandatory provisions of
      applicable law). 

     

    
      	
              2.

            	
              Form

                and Denomination

            

    

     

    The
      Bonds
      are issued in registered form in the denomination of US$1,000
      each. A Bond certificate (each a Certificate)
      will be
      issued to each Bondholder in respect of its registered holding of Bonds. Each
      Bond and each Certificate will be numbered serially with an identifying number
      which will be recorded on the relevant Certificate and in the Register (as
      defined in Condition 4(A)) which the Issuer will procure to be kept by the
      Registrar.

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    
      	
              3.

            	
              Title

            

    

     

    Title
      to
      the Bonds passes only by transfer and registration in the register of
      Bondholders as described in Condition 4. The holder of any Bond will (except
      as
      otherwise required by law) be treated as its absolute owner for all purposes
      (whether or not it is overdue and regardless of any notice of ownership, trust
      or any interest in it or any writing on, or the theft or loss of, the
      Certificate issued in respect of it) and no person will be liable for so
      treating the holder.
      In these
      Conditions, Bondholder
      and (in
      relation to a Bond) holder
      mean the
      person in whose name a Bond is registered.

     

    
      	
              4.

            	
              Transfers
                of Bonds; Issue of
                Certificates

            

    

     

    
      	
              A.

            	
              Register

            

    

     

    The
      Issuer will cause to be kept at the specified office outside
      the United Kingdom of the Registrar and in accordance with the terms of the
      Agency Agreement a register on which shall be entered the names and addresses
      of
      the holders of the Bonds and the particulars of the Bonds held by them and
      of
      all transfers of the Bonds (the Register).
      Each
      Bondholder shall be entitled to receive only one (1) Certificate in respect
      of
      its entire holding of Bonds.

     

    
      	
              B.

            	
              Transfer

            

    

     

    Subject
      to the terms of the Agency Agreement, a Bond may be transferred by delivery
      of
      the Certificate issued in respect of that Bond, with the form of transfer on
      the
      back duly completed and signed by the holder or his attorney duly authorised
      in
      writing, to the specified office of the Registrar or any of the
      Agents.
      No
      transfer of a Bond will be valid unless and until entered on the
      Register.

     

    
      	
              C.

            	
              Delivery
                of New Certificates

            

    

     

    Each
      new
      Certificate to be issued upon a transfer of Bonds will, within three
      (3)
      business days of receipt by the Registrar or, as the case may be, any other
      relevant Agent of the form of transfer, be made available for collection at
      the
      specified office of the Registrar or such other relevant Agent or, if so
      requested in the form of transfer, be mailed by uninsured mail at the risk
      of
      the holder entitled to the Bonds (but free of charge to the holder) to the
      address specified in the form of transfer.

     

    Where
      only part of a principal amount of the Bonds (being that of one (1) or more
      Bonds) in respect of which a Certificate is issued is to be transferred or
      converted, a new Certificate in respect of the Bonds not so transferred or
      converted will, within three (3) business days of delivery of the original
      Certificate to the Registrar or other relevant Agent, be made available for
      collection at the specified office of the Registrar or such other relevant
      Agent
      or, if so requested in the form of transfer, be mailed by uninsured mail at
      the
      risk of the holder of the Bonds not so transferred or converted (but free of
      charge to the holder) to the address of such holder appearing on the
      Register.

     

    For
      the
      purposes of Condition 4, business
      day
      shall
      mean a day other than a Saturday or Sunday on which banks are open for business
      in the city in which the specified office of the Registrar (if a Certificate
      is
      deposited with it in connection with a transfer or conversion) or the Agent
      with
      whom a Certificate is deposited in connection with a transfer or conversion,
      is
      located.

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

     

    
      	
              D.

            	
              Formalities
                Free of Charge

            

    

     

    Registration
      of transfer of Bonds will be effected without charge by or on behalf of the
      Issuer or any of the Agents, but upon payment (or the giving of such indemnity
      as the Issuer or any of the Agents may require) in respect of any tax or other
      governmental charges which may be imposed in relation to such
      transfer.

     

    
      	
              E.

            	
              Closed
                Periods

            

    

     

    No
      Bondholder may require the transfer of a Bond to be registered (i) during the
      period of seven (7)
      days
      ending on (and including) the dates for payment of any principal and/or premium
      (if any) pursuant to the Conditions; (ii) after a Conversion Notice (as defined
      in Condition 6(B)) has been delivered with respect to a Bond; or (iii) after
      a
      Tax Redemption Notice (as defined in Condition 9(C)) or a Relevant Event
      Redemption Notice (as defined in Condition 9(D)) has been deposited in respect
      of such Bond.

     

    
      	
              F.

            	
              Regulations

            

    

     

    All
      transfers of Bonds and entries on the register of Bondholders will be made
      subject to the detailed regulations concerning transfer of Bonds scheduled
      to
      the Agency Agreement.
      The
      regulations may be changed by the Issuer, with the prior written approval of
      the
      Trustee and the Registrar. A copy of the current regulations will be mailed
      (free of charge) by the Registrar to any Bondholder upon request.

     

    
      	
              5.

            	
              Negative
                Pledge

            

    

     

    
      	
              A.

            	
              Negative
                Pledge

            

    

     

    The
      Issuer undertakes that, so long as any of the Bonds remains outstanding (as
      defined in the Trust Deed) or any amount is due under or in respect of any
      Bond
      or otherwise under the Trust Deed, it will not, and will procure that none
      of
      its Subsidiaries will, create or permit to subsist or arise any Encumbrance
      upon
      the whole or any part of their respective present or future assets or revenues
      to secure any Relevant Indebtedness of the Issuer or any Subsidiary of the
      Issuer or to secure any guarantee of or indemnity in respect of any such
      Relevant Indebtedness unless, at the same time or prior thereto, the
      Issuer’s
      obligations under the Bonds are secured by the same Encumbrance or have the
      benefit from a guarantee or indemnity in substantially identical terms thereto
      or, at the option of the Issuer, by such other security, guarantee, indemnity
      or
      other arrangement as the Bondholders may approve by Extraordinary Resolution
      (as
      defined in the Trust Deed). 

     

    
      	
              B.

            	
              Interpretation

            

    

     

    In
      these
      Conditions:

     

    
      	 	
              (i)

            	
              any
                reference to an Encumbrance
                is
                to a mortgage, charge, pledge, lien or other encumbrance or security
                interest securing any obligation of any
                person;

            

    

     

    
      	 	
              (ii)

            	
              any
                reference to Relevant
                Indebtedness
                is
                to any future or present indebtedness in the form of or represented
                by
                debentures, loan stock, bonds, notes, bearer participation certificates,
                depository receipts, certificates of deposit or other similar securities
                or instruments or by bills of exchange drawn or accepted for the
                purpose
                of raising money which are, or are issued with the intention on the
                part
                of the Issuer or any Subsidiary of the Issuer that they should be,
                quoted,
                listed, ordinarily dealt in or traded on any stock exchange or over
                the
                counter or on any other securities market (whether or not initially
                distributed by way of private placement); and

            

    

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (iii)

            	
              any
                reference to a Subsidiary
                of
                any person is to any company or other business entity of which that
                person
                owns or controls (either directly or through one (1) or more other
                Subsidiaries) more than fifty percent (50%) of the issued share capital
                or
                other ownership interest having ordinary voting power to elect directors,
                managers or trustees of such company or other business entity or
                any
                company or other business entity which at any time has its accounts
                consolidated with those of that person or which, under United States
                or
                other relevant law, regulations or generally accepted accounting
                principles from time to time, should have its accounts consolidated
                with
                those of that person.

            

    

     

    
      	
              6.

            	
              Conversion

            

    

     

    
      	
              A.

            	
              Conversion
                Right

            

    

     

    
      	
              (i)

            	
              Conversion
                Period:
                Subject as hereinafter provided, Bondholders have the right to convert
                their Bonds into Shares at any time during the Conversion Period
                referred
                to below.

            

    

     

    The
      right
      of a Bondholder to convert any Bond
      into
      Shares is called the Conversion
      Right.
      Subject
      to and upon compliance with, the provisions of this Condition, the Conversion
      Right attaching to any Bond may be exercised, at the option of the holder
      thereof, at any time on and after 365 days after April 12, 2007 up to the close
      of business (at the place where the Certificate evidencing such Bond is
      deposited for conversion) on March 28, 2012 (but, except as provided in
      Condition 6(A)(iv), in no event thereafter) or if such Bond shall have been
      called for redemption before the Maturity Date (as defined in Condition 9(A)),
      then up to the close of business (at the place aforesaid) on a date no later
      than seven (7) business days (in the place aforesaid) prior to the date fixed
      for redemption thereof (the Conversion
      Period).

     

    The
      number of Shares to be issued on conversion of a Bond will be determined by
      dividing the principal amount of the Bond to be converted by the Conversion
      Price in effect at the Conversion Date (both as hereinafter defined). A
      Conversion Right may only be exercised in respect of one (1) or more Bonds.
      If
      more than one (1) Bond held by the same holder is converted at any one (1)
      time
      by the same holder, the number of Shares to be issued upon such conversion
      will
      be calculated on the basis of the aggregate principal amount of the Bonds to
      be
      converted. 

     

    
      	
              (ii)

            	
              Fractions
                of Shares:
                Fractions of Shares will not be issued on conversion and no cash
                adjustments will be made in respect thereof. Notwithstanding the
                foregoing, in the event of a consolidation or re-classification of
                Shares
                by operation of law or otherwise occurring after April 12, 2007 which
                reduces the number of Shares outstanding, the Issuer will upon conversion
                of Bonds pay in cash (in US dollars by means of a US dollar cheque
                drawn
                on a bank in New York) a sum equal to such portion of the principal
                amount
                of the Bond or Bonds evidenced by the Certificate deposited in connection
                with the exercise of Conversion Rights, aggregated as provided in
                Condition 6(A)(i), as corresponds to any fraction of a Share not
                issued as
                a result of such consolidation or re-classification aforesaid if
                such sum
                exceeds US$10.00.

            

    

     

    
      	
              (iii)

            	
              Conversion
                Price:
                The price at which Shares will be issued upon conversion (the Conversion
                Price)
                will initially be the price per Share at which Shares are sold in
                the IPO
                (the IPO
                Price)
                but will be subject to adjustment in the manner provided in Conditions
                6(C) and 6(D). IPO means a public offering of the Common Stock of
                the
                Issuer on the American Stock Exchange (AMEX)
                with minimum gross proceeds of US$2,000,000. If no IPO has occurred
                prior
                to conversion, the Conversion Price will be deemed to be US$2.00
                as of the
                Closing Date, subject to adjustment in the manner provided in Conditions
                6(C) and 6(D).

            

    

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

     

    
      	
              (iv)

            	
              Revival
                and/or survival after Default:
                Notwithstanding the provisions of Condition 6(A)(i), if (a) the Issuer
                shall default in making payment in full in respect of any Bond which
                shall
                have been called for redemption on the date fixed for redemption
                thereof,
                (b) any Bond has become due and payable prior to the Maturity Date
                by
                reason of the occurrence of any of the events under Condition 11
                or (c)
                any Bond is not redeemed on the Maturity Date in accordance with
                Condition
                9(A), the Conversion Right attaching to such Bond will revive and/or
                will
                continue to be exercisable up to, and including, the close of business
                (at
                the place where the Certificate evidencing such Bond is deposited
                for
                conversion) on the date upon which the full amount of the moneys
                payable
                in respect of such Bond has been duly received by the Principal Agent
                or
                the Trustee and notice of such receipt has been duly given to the
                Bondholders and, notwithstanding the provisions of Condition 6(A)(i),
                any
                Bond in respect of which the Certificate and Conversion Notice (as
                defined
                below) are deposited for conversion prior to such date shall be converted
                on the relevant Conversion Date (as defined below) notwithstanding
                that
                the full amount of the moneys payable in respect of such Bond shall
                have
                been received by the Principal Agent or the Trustee before such Conversion
                Date or that the Conversion Period may have expired before such Conversion
                Date.

            

    

     

    
      	
              (v)

            	
              Meaning
                of Shares:
                As
                used in these Conditions, the expression Shares
                means shares of common stock of the Issuer or shares of any class
                or
                classes resulting from any subdivision, consolidation or re-classification
                of those shares, which as between themselves have no preference in
                respect
                of dividends or of amounts payable in the event of any voluntary
                or
                involuntary liquidation or dissolution of the Issuer, in each case,
                listed
                on the American Stock Exchange (the AMEX)
                .

            

    

     

    
      	
              B.

            	
              Conversion
                Procedure

            

    

     

    
      	
              (i)

            	
              Conversion
                Notice:
                To exercise the Conversion Right attaching to any Bond, the holder
                thereof
                must complete, execute and deliver at his own expense during normal
                business hours at the specified office of any Conversion Agent a
                notice of
                conversion (a Conversion
                Notice)
                in duplicate in the form (for the time being current) obtainable
                from the
                specified office of each Agent, together with the relevant Certificate
                and
                any amounts required to be paid by the Bondholder under Condition
                6(B)(ii).

            

    

     

    The
      conversion date
      in
      respect of a Bond (the Conversion
      Date)
      must
      fall at a time when the Conversion Right attaching to that Bond is expressed
      in
      these Conditions to be exercisable (subject to the provisions of Condition
      6(A)(iv) above) and will be deemed to be the Stock Exchange Business Day (as
      defined below) immediately following the date of the surrender of the
      Certificate in respect of such Bond and delivery of such Conversion Notice
      and,
      if applicable, any payment or indemnity required to be made or given under
      these
      Conditions in connection with the exercise of such Conversion Right. A
      Conversion Notice once delivered shall be irrevocable and may not be withdrawn
      unless the Issuer consents in writing to such withdrawal. Stock
      Exchange Business Day
      means
      any day (other than a Saturday or Sunday) on which the AMEX or the Alternative
      Stock Exchange (as defined in Condition 6(C) below), as the case may be, is
      open
      for business of dealing in securities.

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

     

    
      	
              (ii)

            	
              Stamp
                Duty etc.:
                As conditions precedent to conversion, a Bondholder delivering a
                Certificate in respect of a Bond for conversion must pay any taxes
                and
                capital, stamp, issue and registration duties arising on conversion
                (other
                than any taxes or capital or stamp duties payable in the United States,
                the People’s Republic of China or England and, if relevant, in the place
                of the Alternative Stock Exchange, by the Issuer in respect of the
                allotment and issue of Shares and listing of the Shares on the AMEX
                or the
                Alternative Stock Exchange on conversion) (the Taxes)
                and such Bondholder must also pay all, if any, taxes arising by reference
                to any disposal or deemed disposal of a Bond in connection with such
                conversion. The Issuer will pay all other expenses arising on the
                issue of
                Shares on conversion of Bonds. The Bondholder (and, if applicable,
                the
                person other than the Bondholder to whom the Shares are to be issued)
                must
                provide the Conversion Agent with details of the relevant tax authorities
                to which the Conversion Agent must pay monies received in settlement
                of
                Taxes payable pursuant to this Condition 6(B)(ii). The Conversion
                Agent is
                under no obligation to determine whether a Bondholder is liable to
                pay any
                Taxes including capital, stamp, issue, registration or similar taxes
                and
                duties or the amounts payable (if any) in connection with this Condition
                6(B)(ii).

            

    

     

    
      	
              (iii)

            	
              Registration:
                As soon as practicable, and in any event not later than seven (7)
                Trading
                Days (as defined below) after the Conversion Date, the Issuer will,
                procure that the relevant number of Shares are allotted to and registered
                in the name of the nominee of a depositary common to Euroclear and
                Clearstream for credit to the securities account designated for the
                purpose in the Conversion Notice for so long as the Shares are listed
                on
                the AMEX.

            

    

     

    If
      the
      Conversion Date in relation to any Bond shall be on or after a date with effect
      from which an adjustment to the Conversion Price takes retroactive effect
      pursuant to any of the provisions referred to in Condition 6(C) and the Trust
      Deed,
      and the
      relevant Registration Date (as defined below) falls on a date when the relevant
      adjustment has not yet been reflected in the then current Conversion Price,
      the
      provisions of this sub-paragraph (iii) shall be applied, mutatis
      mutandis,
      to such
      number of Shares as is equal to the excess of the number of Shares which would
      have been required to be issued on conversion of such Bond if the relevant
      retroactive adjustment had been given effect as at the said Registration Date
      over the number of Shares previously issued (or which the Issuer was previously
      bound to issue) pursuant to such conversion.

     

    The
      person or persons specified for that purpose will become the holder on record
      of
      the number of Shares issuable upon conversion with effect from the date he
      is or
      they are registered as such in the Issuer’s register of members (the
Registration
      Date).
      The
      Shares issued upon conversion of the Bonds will in all respects rank
pari
      passu
      with the
      Shares in issue on the relevant Registration Date. Save as set out in these
      Conditions, a holder of Shares issued on conversion of Bonds shall not be
      entitled to any rights the record date for which precedes the relevant
      Registration Date. Upon delivery of the Shares in satisfaction of the Conversion
      Right of any Converting Bondholder and the completion of such registration
      in
      accordance with this Condition 6(B), the right of such Converting Bondholder
      to
      repayment of the principal amount of the Bonds so converted shall
      extinguish.

     

    If
      the
      record date for the payment of any dividend or other distribution in respect
      of
      the Shares is on or after the Conversion Date in respect of any Bond, but before
      the Registration Date (disregarding any retroactive adjustment of the Conversion
      Price referred to in this sub-paragraph (iii) prior to the time such retroactive
      adjustment shall have become effective), the Issuer will pay to the converting
      Bondholder or his designee an amount (the Equivalent
      Amount)
      equal
      to any such dividend or other distribution to which he would have been entitled
      had he on that record date been such a shareholder of record and will make
      the
      payment at the same time as it makes payment of the dividend or other
      distribution, or as soon as practicable thereafter, but, in any event, not
      later
      than seven (7) days thereafter. The Equivalent Amount shall be paid by means
      of
      a U.S. dollar cheque drawn on a bank in New York and sent to the address
      specified in the relevant Conversion Notice.

     

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

    

     

    
      	
              C.

            	
              Adjustments
                to Conversion Price

            

    

     

    The
      Conversion Price will be subject to adjustment in the following events as set
      out in the Trust Deed:

     

    
      	
              (1)

            	
              Consolidation,
                Subdivision or Reclassification:
                If
                and whenever there shall be an alteration to the nominal value of
                the
                Shares as a result of consolidation, subdivision or reclassification,
                the
                Conversion Price shall be adjusted by multiplying the Conversion
                Price in
                force immediately before such alteration by the following
                fraction:

            

    

    
    

     

    
      	
              A

            
	
              B

            

    

     

     Where:

     

    
      	
              A

            	
                is
                the nominal amount of one (1) Share immediately after such alteration;
                and

            
	 	 
	
              B

            	
                is
                the nominal amount of one (1) Share immediately before such
                alteration.

            

    

     

    Such
      adjustment shall become effective on the date the alteration takes
      effect.

     

    
      	
              (2)

            	
              Capitalisation
                of Profits or Reserves: If
                and whenever the Issuer shall issue any Shares credited as fully
                paid to
                the holders of Shares (the Shareholders)
                by way of capitalisation of profits or reserves (including any share
                premium account) including, Shares paid up out of distributable profits
                or
                reserves and/or share premium account issued (except any Scrip Dividend
                (as defined below)) and which would not have constituted a Capital
                Distribution (as defined below), the Conversion Price shall be adjusted
                by
                multiplying the Conversion Price in force immediately before such
                issue by
                the following fraction:

            

    

    
    

     

    
      	
              A

            
	
              B

            

    

     

    
      	
              Where:

            	
                

            

    

     

    
      	
              A

            	
              is
                the aggregate nominal amount of the issued Shares immediately before
                such
                issue; and

            
	 	 
	
              B

            	
              is
                the aggregate nominal amount of the issued Shares immediately after
                such
                issue.

            

    

     

    Such
      adjustment shall become effective on the date of issue of such Shares
      or
      if a record date is fixed therefor, immediately after such record
      date.

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

     

    
      	
              (3)

            	
              Capital
                Distributions: If
                and whenever the Issuer shall pay or make any Capital Distribution
                to the
                Shareholders (except to the extent that the Conversion Price falls
                to be
                adjusted under Condition 6(C)(2) above), the Conversion Price shall
                be
                adjusted by multiplying the Conversion Price in force immediately
                before
                such Capital Distribution by the following
                fraction:

            

    

    
    

     

    
      	
              A
                -
                B

            
	
              A

            

    

     

    
      	
              Where:

            	
                

            

    

     

    
      	
              A

            	
              is
                the Current Market Price of one (1) Share on the last Trading Day
                preceding the date on which the Capital Distribution is publicly
                announced; and

            
	 	 
	
              B

            	
              is
                the Fair Market Value (as defined below) on the date of such announcement
                of the portion of the Capital Distribution attributable to one (1)
                Share.

            

    

     

    Such
      adjustment shall become effective on the date that such Capital Distribution
      is
      actually made or if a record date is fixed therefor, immediately after such
      record date.

     

    When
      the
      Capital Distribution is by means of distribution of a cash dividend such cash
      dividend shall be regarded as a Capital Distribution and shall be fully taken
      into account in the determination of the Fair Market Value of the portion of
      the
      Capital Distribution attributable to one (1) Share. 

     

    
      	
              (4)

            	
              Rights
                Issues of
                Shares or Options over Shares: If
                and whenever the Issuer shall issue Shares to all or substantially
                all
                Shareholders as a class by way of rights, or issue or grant to all
                or
                substantially all Shareholders as a class by way of rights, of options,
                warrants or other rights to subscribe for or purchase or otherwise
                acquire
                any Shares, in each case at less than the Current Market Price per
                Share
                on the last Trading Day preceding the date of the announcement of
                the
                terms of the issue or grant, the Conversion Price shall be adjusted
                by
                multiplying the Conversion Price in force immediately before such
                issue or
                grant by the following fraction:

            

    

    
    

     

    
      	
              A
                +
                B

            
	
              A
                +
                C

            

    

     

    
      	
              Where:

            	
                

            

    

     

    
      	
              A

            	
              is
                the number of Shares in issue immediately before such
                announcement;

            
	 	 
	
              B

            	
              is
                the number of Shares which the aggregate amount (if any) payable
                for the
                Shares issued by way of rights or for the options or warrants or
                other
                rights issued by way of rights and for the total number of Shares
                comprised therein would subscribe for, purchase or otherwise acquire
                at
                such Current Market Price per Share; and

            
	 	 
	
              C

            	
              is
                the aggregate number of Shares issued or, as the case may be, comprised
                in
                the grant.

            

    

     

    
      
        
        

      

      
        47

        
          

        

      

      
        
        

      

    

     

    Such
      adjustment shall become effective on the date of issue of such Shares
      or
      issue or grant of such options, warrants or other rights (as the case may
      be).

     

    
      	
              (5)

            	
              Rights
                Issues of Other Securities: If
                and whenever the Issuer shall issue any securities (other than Shares
                or
                options, warrants or other rights to subscribe for, purchase or otherwise
                acquire Shares) to all or substantially all Shareholders as a class
                by way
                of rights or grant to all or substantially all Shareholders as a
                class by
                way of rights, of options, warrants or other rights to subscribe
                for,
                purchase or otherwise acquire any securities (other than Shares or
                options, warrants or other rights to subscribe for, purchase or otherwise
                acquire Shares), the Conversion Price shall be adjusted by multiplying
                the
                Conversion Price in force immediately before such issue or grant
                by the
                following fraction:

            

    

    
    

     

    
      	
              A
                -
                B

            
	
              A

            

    

     

    
      	
               
Where:

            	
                

            

    

     

    
      	
              A

            	
              is
                the Current Market Price of one (1) Share on the last Trading Day
                preceding the date on which such issue or grant is publicly announced;
                and

            
	 	 
	
              B

            	
              is
                the Fair Market Value on the date of such announcement of the portion
                of
                the rights attributable to one (1)
                Share.

            

    

     

    Such
      adjustment shall become effective on the date of issue of the securities or
      grant of such rights, options or warrants (as the case may be).

     

    
      	
              (6)

            	
              Issues
                at less than Conversion Price: If
                and whenever the Issuer shall issue (otherwise than as mentioned
                in
                Condition 6(C)(4) above) any Shares (other than Shares issued on
                the
                exercise of Conversion Rights or on the exercise of any other rights
                of
                conversion into, or exchange or subscription for, Shares) or shall
                issue
                or grant (otherwise than as mentioned in Condition 6(C)(4) above)
                options,
                warrants or other rights to subscribe for, purchase or otherwise
                acquire
                Shares in each case at a price per Share which is less than the Conversion
                Price in effect at the time of such issue, then, in such event, the
                Conversion Price shall be reduced, concurrently with such issue or
                grant,
                to a price equal to the consideration per share for which such Shares
                are
                or will be issued. If such Shares are issued for no consideration,
                then
                the consideration per share shall be deemed to be the then current
                par
                value of each Share.

            

    

     

    Determination
      of Consideration: For
      purpose of this Condition 6(C)(6), the consideration received by the Issuer
      for
      the issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the directors of the Issuer (the Directors);
                provided, however, that no value shall be attributed to any services
                performed by any employee, officer or director of the Company;
                and

            

    

     

    
      
        
        

      

      
        48

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with other shares or securities
                or other assets of the Issuer for consideration which covers both
                the
                proportion of such consideration so received with respect to such
                Shares,
                shall be computed as provided in Clauses (A) and (B) above, as determined
                in good faith by the Directors.

            

    

     

    References
      to additional
      Shares in the above formula shall, in the case of an issue by the Issuer of
      options, warrants or other rights to subscribe or purchase Shares, mean such
      Shares to be issued assuming that such options, warrants or other rights are
      exercised in full at the initial exercise price on the date of issue of such
      options, warrants or other rights.

     

    Such
      adjustment shall become effective on the date of issue of such additional Shares
      or, as the case may be, the issue of such options, warrants or other rights.
      

     

    
      	
              (7)

            	
              Other
                Issues at less than Conversion Price:
                Save in the case of an issue of securities arising from a conversion
                or
                exchange of other securities in accordance with the terms applicable
                to
                such securities themselves falling within this Condition 6(C)(7),
                if and
                whenever the Issuer or any of its Subsidiaries (otherwise than as
                mentioned in Conditions 6(C)(4), 6(C)(5) or 6(C)(6)), or (at the
                direction
                or request of or pursuant to any arrangements with the Issuer or
                any of
                its Subsidiaries) any other company, person or entity shall issue
                any
                securities (other than the Bonds) which by their terms of issue carry
                rights of conversion into, or exchange or subscription for, Shares
                to be
                issued by the Issuer upon conversion, exchange or subscription at
                a
                consideration per Share which is less than the Conversion Price in
                effect
                at the time of issue of such securities, then, in such event, the
                Conversion Price shall be reduced, concurrently with such issue,
                to a
                price equal to the consideration per share receivable by the Issuer
                for
                the Shares to be issued on conversion or exchange or on exercise
                of the
                right of subscription determined by reference to the maximum number
                of
                Shares to be issued on conversion, exchange or subscription at the
                minimum
                conversion, exchange or subscription price. If such Shares are issued
                for
                no consideration, then the consideration per share shall be deemed
                to be
                the then current par value of each
                Share.

            

    

     

    Determination
      of Consideration: For
      purpose of this Condition 6(C)(7), the consideration receivable by the Issuer
      for the issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the Directors; provided, however, that
                no
                value shall be attributed to any services performed by any employee,
                officer or director of the Company;
                and

            

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with other shares or securities
                or other assets of the Issuer for consideration which
                covers both the proportion of such consideration so received with
                respect
                to such Shares, shall be computed as provided in Clauses (A) and
                (B)
                above, as determined in good faith by the
                Directors.

            

    

     

    
      
        
        

      

      
        49

        
          

        

      

      
        
        

      

    

     

    Such
      adjustment shall become effective on the date of issue of such
      securities

     

    
      	
              (8)

            	
              Modification
                of Rights of Conversion etc.:
                If
                and whenever there shall be any modification of the rights of conversion,
                exchange or subscription attaching to any such securities as are
                mentioned
                in Condition 6(C)(7) (other than in accordance with the terms of
                such
                securities) so that the consideration per Share (for the number of
                Shares
                available on conversion, exchange or subscription following the
                modification) is reduced and is less than the Conversion Price in
                effect
                at the time of such modification, the Conversion Price shall be reduced,
                concurrently with such modification, to a price equal to the modified
                consideration per share receivable by the Issuer for the Shares to
                be
                issued on conversion or exchange or on exercise of the right of
                subscription determined by reference to the maximum number of Shares
                to be
                issued on conversion, exchange or subscription at the minimum conversion,
                exchange or subscription price. If such Shares are issued for no
                consideration, then the consideration per share shall be deemed to
                be the
                then current par value of each
                Share.

            

    

     

    Determination
      of Consideration: For
      purpose of this Condition 6(C)(8), the consideration receivable by the Issuer
      for the issue of any such Shares shall be computed as follows:

     

    
      	 	
              (A)

            	
              in
                so far as such consideration consists of cash, it shall be computed
                at the
                aggregate amount of cash received by the
                Issuer;

            

    

     

    
      	 	
              (B)

            	
              in
                so far as such consideration consists of property other than cash,
                it
                shall be computed at the fair value thereof at the time of such issue,
                as
                determined in good faith by the Directors; provided, however, that
                no
                value shall be attributed to any services performed by any employee,
                officer or director of the Company;
                and

            

    

     

    
      	 	
              (C)

            	
              in
                the event the Shares are issued together with other shares or securities
                or other assets of the Issuer for consideration which covers both
                the
                proportion of such consideration so received with respect to such
                Shares,
                shall be computed as provided in Clauses (A) and (B) above, as determined
                in good faith by the Directors.

            

    

     

    Such
      adjustment shall become effective on the date of modification of the rights
      of
      conversion, exchange or subscription attaching to such securities.

     

    
      
        
        

      

      
        50

        
          

        

      

      
        
        

      

    

     

    
      	
              (9)

            	
              Other
                Offers to Shareholders:
                If
                and whenever the Issuer or any of its Subsidiaries or (at the direction
                or
                request of or pursuant to any arrangements with the Issuer or any
                of its
                Subsidiaries) any other company, person or entity issues, sells or
                distributes any securities in connection with which an offer to which
                the
                Shareholders generally are entitled to participate in arrangements
                whereby
                such securities may be acquired by them (except where the Conversion
                Price
                falls to be adjusted under Condition 6(C)(4), Condition 6(C)(5),
                Condition
                6(C)(6) or Condition 6(C)(7)), the Conversion Price shall be adjusted
                by
                multiplying the Conversion Price in force immediately before such
                issue by
                the following fraction:

            

    

    
    

     

    
      	
              A
                -
                B

            
	
              A

            

    

     

    
      	
                Where:

            	
                

            

    

     

    
      	
              A

            	
              is
                the Current Market Price of one (1) Share on the last Trading Day
                preceding the date on which such issue is publicly announced;
                and

            
	 	 
	
              B

            	
              is
                the Fair Market Value on the date of such announcement of the portion
                of
                the rights attributable to one (1)
                Share.

            

    

     

    Such
      adjustment shall become effective on the date of issue of the
      securities.

     

    
      	
              (10)

            	
              Other
                Events: If the Issuer determines that a downward adjustment should
                be made
                to the Conversion Price as a result of one (1) or more events or
                circumstances not referred to in this Condition 6, the Issuer shall,
                at
                its own expense, consult an independent investment bank of international
                repute (acting as expert), selected by the Issuer and
                approved in writing by the Trustee (such approval not to be unreasonably
                withheld or delayed), to determine as soon as practicable what adjustment
                (if any) to the Conversion Price is fair and reasonable to take account
                thereof, if the adjustment would result in a reduction in the Conversion
                Price, and the date on which such adjustment should take effect and
                upon
                such determination by the independent investment bank such adjustment
                (if
                any) shall be made and shall take effect in accordance with such
                determination, provided that where the events or circumstances giving
                rise
                to any adjustment pursuant to this Condition 6 have already resulted
                or
                will result in an adjustment to the Conversion Price or where the
                events
                or circumstances giving rise to any adjustment arise by virtue of
                events
                or circumstances which have already given rise or will give rise
                to an
                adjustment to the Conversion Price, such modification (if any) shall
                be
                made to the operation of the provisions of this Condition 6 as may
                be
                advised by the independent investment bank to be in their opinion
                appropriate to give the intended
                result.

            

    

     

    For
      the
      purposes of these Conditions:

     

    Alternative
      Stock Exchange
      means at
      any time, in the case of the Shares, if they are not at that time listed and
      traded on the AMEX, the principal stock exchange or securities market on which
      the Shares are then listed or quoted or dealt in.

     

    Average
      Closing Price
      is the
      arithmetic average of the Closing Price per Share for each Trading Day during
      the Relevant Period. 

     

    
      
        
        

      

      
        51

        
          

        

      

      
        
        

      

    

     

    Capital
      Distribution
      means
      any dividend or distribution of cash or assets in specie or other property,
      and
      whenever paid or made and however described (and for these purposes a
      distribution of assets in specie includes without limitation an issue of shares
      or other securities credited as fully or partly paid (other than Shares credited
      as fully paid to the extent any adjustment to the Conversion Price is made
      in
      respect thereof under Condition 6(C)(2)) by way of capitalisation of
      reserves).

     

    Closing
      Price
      for the
      Shares for any Trading Day shall be the price quoted by the AMEX or, as the
      case
      may be, the equivalent quotation sheet of an Alternative Stock Exchange for
      such
      day. 

     

    Current
      Market Price
      means,
      in respect of a Share on a particular date, the average of the Closing Prices
      for one (1) Share (being a Share carrying full entitlement to dividend) for
      the
      five (5) consecutive Trading Days ending on the Trading Day immediately
      preceding such date, provided that if at any time during the said five (5)
      Trading Day period the Shares shall have been quoted ex-dividend and during
      some
      other part of that period the Shares shall have been quoted cum-dividend
      then:

     

    
      	
              (i)

            	
              if
                the Shares
                to be issued in such circumstances do not rank for the dividend in
                question, the quotations on the dates on which the Shares shall have
                been
                quoted cum-dividend shall for the purpose of this definition be deemed
                to
                be the amount thereof reduced by an amount equal to the amount of
                that
                dividend per Share; or

            

    

     

    
      	
              (ii)

            	
              if
                the Shares to be issued in such circumstances rank for the dividend
                in
                question, the quotations on the dates on which the Shares shall have
                been
                quoted ex-dividend shall for the purpose of this definition be deemed
                to
                be the amount thereof increased by such similar
                amount;

            

    

     

    and
      provided further that if the Shares on each of the said five (5) Trading Days
      have been quoted cum-dividend in respect of a dividend which has been declared
      or announced but the Shares to be issued do not rank for that dividend, the
      quotations on each of such dates shall for the purpose of this definition be
      deemed to be the amount thereof reduced by an amount equal to the amount of
      that
      dividend per Share. 

     

    Dividend
      means
      any dividend or distribution, whether of cash, assets or other property, and
      whenever paid or made and however described (and for these purposes a
      distribution of assets includes, without limitation, an issue of Shares or
      other
      securities credited as fully or partly paid up) provided that:

     

    
      	
              (i)

            	
              where
                a cash Dividend is announced which is to be, or may at the election
                of a
                holder or holders of Shares be, satisfied by the issue or delivery
                of
                Shares or other property or assets, then, the Dividend in question
                shall
                be treated as a Dividend of (a) the cash Dividend so announced, or
                (b) the
                Current Market Price on the date of announcement of such Dividend,
                of such
                Shares or the Fair Market Value of other property or assets to be
                issued
                or delivered in satisfaction of such Dividend (or which would be
                issued if
                all holders of Shares elected therefor, regardless of whether any
                such
                election is made) if the Current Market Price of such Shares or the
                Fair
                Market Value of other property or assets is greater than the cash
                Dividend
                so announced; and

            

    

     

    
      	(ii)	
              any
                issue of Shares falling within Condition 9(E)(b) shall be
                disregarded.

            

    

     

    Fair
      Market Value
      means,
      with respect to any assets, security, option, warrants or other right on any
      date, the fair market value of that asset, security, option, warrant or other
      right as determined by an independent investment bank of international repute
      (acting as expert) selected by the Issuer and
      approved in writing by the Trustee, provided that (i) the fair market value
      of a
      cash dividend paid or to be paid per Share shall be the amount of such cash
      dividend per Share determined as at the date of announcement of such dividend;
      (ii) where options, warrants or other rights are publicly traded in a market
      of
      adequate liquidity (as determined by such investment banks) the fair market
      value of such options, warrants or other rights shall equal the arithmetic
      mean
      of the daily closing prices of such options, warrants or other rights during
      the
      period of five (5) Trading Days on the relevant market commencing on the first
      such Trading Day such options, warrants or other rights are publicly traded.
      

     

    
      
        
        

      

      
        52

        
          

        

      

      
        
        

      

    

     

    Relevant
      Cash Dividend
      means
      any cash dividend specifically declared by the Issuer.

     

    Total
      Current Dividend
      means
      any and all cash dividends or other distributions charged or provided for in
      the
      accounts of the Issuer, prior to the deduction of any withholding tax and any
      corporate tax attributable to that dividend, in the period starting from the
      beginning of the fiscal year in which the record date set for the dividend
      that
      may result in an adjustment falls and ending on and including that record date
      (including the dividend that may result in an adjustment), other than any
      dividend or portion thereof which previously resulted in an adjustment under
      this Condition 6(C).

     

    Trading
      Day
      means a
      day when the AMEX or, as the case may be an Alternative Stock Exchange, is
      open
      for business of dealing in securities, provided that if no Closing Price is
      reported for one (1) or more consecutive dealing days such day or days will
      be
      disregarded in any relevant calculation and shall be deemed not have existed
      when ascertaining any period of dealing days.

     

    No
      adjustment will be made to the Conversion Price (i) when Shares or other
      securities (including rights or options) are issued, offered or granted to
      employees (including directors) of the Issuer or any of its Subsidiaries
      pursuant to any Employee Share Scheme (as defined in the Trust Deed) (and which
      Employee Share Scheme (a) is in compliance with the listing rules of the AMEX
      or, if applicable, the listing rules of an Alternative Stock Exchange; and
      (b)
      does not amount to, relate to, or entitle such persons to receive, Shares in
      excess of ten percent (10%) of the average number of issued and outstanding
      Shares during any twelve (12) months); or (ii) as a result of the issuance
      on
      the date hereof of the Warrants issued to ABN AMRO Bank, N.V. or any exercise
      of
      such Warrants; or (iii) as a result of the exercise of the outstanding warrants
      issued on 17 October, 2006, to purchase 232,088 Shares at US$1.60 per
      share.

     

    On
      any
      adjustment, the relevant Conversion Price, if not an integral multiple of one
      (1) United States cent, shall be rounded down to the nearest United State cent.
      No adjustment shall be made to the Conversion Price where such adjustment
      (rounded down if applicable) would be less than one percent (1%) of the
      Conversion Price then in effect. Any adjustment not required to be made, and
      any
      amount by which the Conversion Price has not been rounded down, shall be carried
      forward and taken into account in any subsequent adjustment. Notice of any
      adjustment shall be given to Bondholders in accordance with Condition 18 as
      soon
      as practicable after the determination thereof.

     

    Where
      more than one (1) event which gives or may give rise to an adjustment to the
      Conversion Price occurs within such a short period of time that in the opinion
      of an independent investment bank of international repute (acting as expert),
      selected by the Issuer and
      approved in writing by the Trustee (such approval not to be unreasonably
      withheld or delayed), the foregoing provisions would need to be operated subject
      to some modification in order to give the intended result, such modification
      shall be made to the operation of the foregoing provisions as may be advised
      by
      such independent investment bank to be in their opinion appropriate in order
      to
      give such intended result. No adjustment involving an increase in the Conversion
      Price will be made, except in the case of a consolidation of the Shares as
      referred to in Condition 6(C)(1) above or a Conversion Price reset as referred
      to in Condition 6(D) below. 

     

    
      
        
        

      

      
        53

        
          

        

      

      
        
        

      

    

     

    The
      Trustee shall not be under any duty to monitor whether any event or circumstance
      has happened or exists which may require an adjustment to be made to the
      Conversion Price and will not be responsible to Bondholders for any loss arising
      from any failure by it to do so.

     

    If
      any
      doubt arises as to an adjustment of the Conversion Price pursuant to Condition
      6(C), the Trustee may, at the cost and expense of the Issuer, consult with
      any
      reputable investment bank in the United States and may act on the opinion or
      advice of or any certificate or information obtained from any such investment
      bank, and such determination, opinion, advice, certification or action (or
      absence thereof) shall be conclusive and binding upon the Issuer and the
      Bondholders.

     

    
      	
              D.

            	
              Conversion
                Price Reset

            

    

     

    If
      the
      average
      of
      the Closing Prices (the Average
      Closing Price)
      for the
      period of twenty (20) consecutive Trading Days immediately prior to any of
      April
      12, 2009 and February 18, 2012 (each a Reset
      Date)
      is
      lower than the Conversion Price on the relevant Reset Date, the Conversion
      Price
      will be adjusted so that such Average Closing Price shall be the Conversion
      Price in effect from, and including, the relevant Reset Date. The Issuer shall
      notify the Bondholders, Trustee and the Paying Agent of such adjustment within
      ten (10) business days after the relevant Reset Date, in accordance with
      Condition 18. Such adjusted Conversion Price shall be rounded upwards, if
      necessary, to the nearest one-tenth (1/10) of a United States cent.

     

    Provided
      that:

     

    
      	(i)	
              any
                such adjustment to the Conversion Price pursuant to this Condition
                6(D)
                shall be limited so that the Conversion Price adjusted in accordance
                with
                this Condition 6(D) shall not be less than seventy percent (70%)
                of the
                initial Conversion Price (taking account of any adjustments required
                under
                Condition 6(C) above which may have occurred prior to the relevant
                Reset
                Date);

            

    

     

    
      	(ii)	
              subject
                to (i) above the provisions of Condition 6(C) shall apply,
                mutatis mutandis,
                to this Condition 6(D) to ensure that appropriate adjustments shall
                be
                made to any Closing Price to reflect any adjustments made to the
                Conversion Price in accordance with Condition 6(C);
                and

            

    

     

    
      	(iii)	
              for
                the avoidance of doubt, any adjustments to the Conversion Price made
                pursuant to this Condition 6(D) shall only be downward
                adjustments.

            

    

     

    
      	
              E.

            	
              Undertakings

            

    

     

    The
      Issuer has
      undertaken in the Trust Deed, inter
      alia,
      that so
      long as any Bond remains outstanding, save with the approval of an Extraordinary
      Resolution (as defined in the Trust Deed):

     

    
      	
              (i)

            	
              it
                will obtain
                on or before the first anniversary of the Closing Date, and thereafter
                maintain, a listing on AMEX or the New York Stock Exchange or NASDAQ
                for
                all the issued Shares and for all the Shares issued on the exercise
                of the
                Conversion Rights attaching to the Bonds;
                and

            

    

     

    
      	
              (ii)

            	
              it
                will pay the expenses of the issue of, and all expenses of obtaining
                and
                maintaining such listing for, the Shares arising on conversion of
                the
                Bonds.

            

    

     

    The
      Issuer has also given certain other undertakings in the Trust Deed for the
      protection of the Conversion Rights.

     

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

     

    
      	
              F.

            	
              Notice
                of Change in Conversion
                Price

            

    

     

    The
      Issuer shall give notice to the Bondholders in accordance with Condition
      18
      of any
      change in the Conversion Price. Any such notice relating to a change in the
      Conversion Price shall set forth the event giving rise to the adjustment, the
      Conversion Price prior to such adjustment, the adjusted Conversion Price and
      the
      effective date of such adjustment.

     

    
      	
              7.

            	
              Interest

            

    

     

    The
      Bonds
      bear interest from April 12, 2007 at the rate of (i) six percent (6%) per annum
      for the first year after the Closing Date and (ii) three percent (3%) per annum
      thereafter, of the principal amount of the Bonds. Interest is payable
      semi-annually in arrears on April 4 and October 4 of each year (each an
Interest
      Payment Date)
      commencing October 4, 2007. Each Bond will cease to bear interest (a) (subject
      to Condition 6(A)(v)) from and including the Interest Payment Date last
      preceding its Conversion Date (as defined below) (or if such Conversion Date
      falls on or before the first Interest Payment Date, the Issue Date) subject
      to
      conversion of the relevant Bond in accordance with the provisions of Condition
      6(B), or (b) from the due date for redemption thereof unless, upon surrender
      in
      accordance with Condition 9, payment of the full amount due is improperly
      withheld or refused or default is otherwise made in respect of any such payment.
      In such event, interest will continue to accrue at the rate aforesaid (after
      as
      well as before any judgment) up to but excluding the date on which all sums
      due
      in respect of any Bond are received by or on behalf of the relevant holder.
      If
      interest is required to be calculated for a period of less than one (1) year,
      it
      will be calculated on the basis of a 360-day year of twelve 30-day months.
      Interest payable under this Condition 7 will be paid in accordance with the
      Condition 8(A).

     

    
      	
              8.

            	
              Payments

            

    

     

    
      	
              A.

            	
              Principal,
                premium and interest

            

    

     

    Payment
      of principal
      and
      premium will be made by transfer to the registered account of the Bondholder
      or
      by United States dollar cheque drawn on a bank in New York mailed to the
      registered address of the Bondholder in accordance with Condition 18 if it
      does
      not have a registered account. Payment of principal will only be made after
      surrender of the relevant Certificate at the specified office of any of the
      Agents.

     

    Interest
      on Bonds due on an Interest Payment Date will be paid on the due date for the
      payment of interest to the holder shown on the Register at the close of business
      on the fifteenth day before the due date for the payment of interest (the
Interest
      Record Date).
      Payments of interest on each Bond will be made by transfer to the registered
      account of the Bondholder or by United States dollar cheque drawn on a bank
      in
      New York mailed to the registered address of the Bondholder if it does not
      have
      a registered account.

     

    References
      in these Conditions, the Trust Deed and the Agency Agreement to principal in
      respect of any Bond shall, where the context so permits, be deemed to include
      a
      reference to any premium payable thereon.

     

    
      	
              B.

            	
              Registered
                Accounts

            

    

     

    For
      the
      purposes of this Condition, a Bondholder’s
      registered account means the U.S. dollar account maintained by or on behalf
      of
      it with a bank in New York, details of which appear on the Register at the
      close
      of business on the second business day (as defined below) before the due date
      for payment, and a Bondholder’s registered address means its address appearing
      on the Register at that time. 

     

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

       

      
        	
                C.

              	
                Fiscal
                  Laws

              

      

       

      All
        payments are subject in all cases to any applicable laws and regulations
        in the
        place of payment, but without prejudice to the provisions of Condition 10.
        No
        commissions or expenses shall be charged to the Bondholders in respect of
        such
        payments.

       

      
        	
                D.

              	
                Payment
                  Initiation

              

      

       

      Where
        payment is to be made by transfer to a registered account, payment instructions
        (for value on the due date or, if that it not a business day (as defined
        below),
        for value on the first following day which is a business day) will be initiated
        and, where payment is to be made by cheque, the cheque will be mailed (at
        the
        risk and, if mailed at the request of the holder otherwise than by ordinary
        mail, expense of the holder) on the due date for payment (or, if it is not
        a
        business day, the immediately following business day) or, in the case of
        a
        payment of principal or premium (if any), if later, on the business day on
        which
        the relevant Certificate is surrendered at the specified office of an
        Agent.

       

      
        	
                E.

              	
                Default
                  Interest and Delay In
                  Payment

              

      

       

      If
        the
        Issuer fails to pay any sum in respect of the Bonds when the same becomes
        due
        and payable under these Conditions, interest shall accrue on the Bonds
        and
        any overdue sum at the rate of fifteen percent (15%) per annum from the due
        date. Such default interest shall accrue on the basis of the actual number
        of
        days elapsed and a 360-day year.

       

      Bondholders
        will not be entitled to any interest or other payment for any delay after
        the
        due date in receiving the amount due if the due date is not a business day,
        if
        the Bondholder is late in surrendering its Certificate (if required to do
        so) or
        if a cheque mailed in accordance with this Condition arrives after the due
        date
        for payment.

       

      
        	
                F.

              	
                Business
                  Day

              

      

       

      In
        this
        Condition, business
        day
        means a
        day other than a Saturday or Sunday on which commercial banks are open for
        business in New York, London and, in the case of the surrender of a Certificate,
        in the place where the Certificate is surrendered. 

       

      
        	
                G.

              	
                Annotation
                  of Register

              

      

       

      If
        an
        amount which is due on the Bonds is not paid in full, the Registrar will
        annotate the Register with a record of the amount (if any) in fact
        paid.

       

      
        	
                H.

              	
                Rounding

              

      

       

      When
        making payments to Bondholders, fractions of one (1) United States cent will
        be
        rounded down to nearest United States cent.

       

      
        	
                9.

              	
                Redemption,
                  Purchase and Cancellation

              

      

       

      
        	
                A.

              	
                Maturity

              

      

       

      Unless
        previously redeemed, converted or purchased and cancelled as provided herein,
        the Issuer will redeem each Bond at one hundred
        and
        fifty point eighty-seven percent (150.87%) of its principal amount on April
        4,
        2012 (the Maturity
        Date).
        The
        Issuer may not redeem the Bonds at its option prior to that date except as
        provided in Condition 9(B) or Condition 9(C) below (but without prejudice
        to
        Condition 10).

       

      
        
          
          

        

        
          56

          
            

          

        

        
          
          

        

      

       

      
        	
                B.

              	
                Redemption
                  at the Option of the
                  Issuer

              

      

       

      At
        any
        time prior to the Maturity Date, the Issuer may, having given not less than
        thirty (30) nor more than sixty (60) days’ notice to the Bondholders, the
        Trustee and the Principal Agent (which notice will be irrevocable), redeem
        all
        and not some only of the Bonds at a redemption price equal to the Early
        Redemption Amount on the redemption date if more than ninety percent (90%)
        in
        principal amount of the Bonds has already been converted, redeemed or purchased
        and cancelled. 

       

      The
        Early
        Redemption Amount
        of a
        Bond, for each US$1,000 principal amount of the Bonds, is determined so that
        it
        represents for the Bondholder a gross yield of twelve percent (12%) per annum,
        calculated on a semi-annual basis. The applicable Early Redemption Amount
        for
        each US$1,000 principal amount of Bonds is calculated in accordance with
        the
        following formula, rounded (if necessary) to two (2) decimal places with
        0.005
        being rounded upwards (provided that if the date fixed for redemption is
        the
        Semi-Annual Date (as set out below), such Early Redemption Amount shall be
        as
        set out in the table below in respect of such Semi-Annual Date): 

       

      Early
        Redemption Amount = Previous Redemption Amount x (1 + r/2)d/p 

       

      Previous
        Redemption Amount = the Early Redemption Amount for each US$1,000 principal
        amount of the Bonds on the Semi-Annual Date immediately preceding the date
        fixed
        for redemption as set out below:

       

      
        	
                Semi-Annual
                  Date

              	 	
                Early
                  Redemption 

                Amount
                  (US$) 

              	 
	
                October
                  4,
                  2007

              	 	 	
                1,030.00

              	 
	
                April
                  4,
                  2008

              	 	 	
                1,060.90

              	 
	
                October
                  4,
                  2008

              	 	 	
                1,108.64

              	 
	
                April
                  4,
                  2009

              	 	 	
                1,158.53

              	 
	
                October
                  4,
                  2009

              	 	 	
                1,210.66

              	 
	
                April
                  4,
                  2010

              	 	 	
                1,265.14

              	 
	
                October
                  4,
                  2010

              	 	 	
                1,322.07

              	 
	
                April
                  4,
                  2011

              	 	 	
                1,381.57

              	 
	
                October
                  4,
                  2011

              	 	 	
                1,443.74

              	 
	
                April
                  4,
                  2012

              	 	 	
                1,508.71

              	 

      

       

      r
        = 12%
        expressed as a fraction.

       

      
        	d	
                = number
                  of days from and including the immediately preceding Semi-Annual
                  Date (or
                  if the Bonds are to be redeemed on or before October 4, 2007 from
                  and
                  including April 12, 2007) to, but excluding, the date fixed for
                  redemption, calculated on the basis of a 360-day year consisting
                  of twelve
                  (12) months of thirty (30) days each and, in the case of an incomplete
                  month, the number of days elapsed. 

              

      

       

      p
        = 180

       

      
        
          
          

        

        
          57

          
            

          

        

        
          
          

        

      

       

      
        	
                C.

              	
                Redemption
                  for Taxation Reasons

              

      

       

      
        	
                (i)

              	
                At
                  any time the Issuer may, having given not less than thirty (30)
                  nor more
                  than sixty (60) days’ notice (a Tax
                  Redemption Notice)
                  to the Bondholders in accordance with Condition 18 (which notice
                  shall be
                  irrevocable) redeem all, but not some only, of the Bonds at a redemption
                  price equal to the Early Redemption Amount on the redemption date
                  (the
                  Tax
                  Redemption Date)
                  if (i) the Issuer satisfies the Trustee immediately prior to the
                  giving of
                  such Tax Redemption Notice that the Issuer has or will become obliged
                  to
                  pay additional amounts as referred to in Condition 10 as a result
                  of any
                  change in, or amendment to, the laws or regulations of the United
                  States
                  or, as the case may be, the People’s Republic of China (the PRC),England
                  or any political subdivision or any authority thereof or therein
                  having
                  power to tax, or any change in the general application or official
                  interpretation of such laws or regulations, which change or amendment
                  becomes effective on or after April 12, 2007 and (ii) such obligation
                  cannot be avoided by the Issuer taking reasonable measures available
                  to
                  it, provided that no Tax Redemption Notice shall be given earlier
                  than
                  ninety (90) days prior to the earliest date on which the Issuer
                  would be
                  obliged to pay such additional amounts were a payment in respect
                  of the
                  Bonds then due. Prior to the publication of any Tax Redemption
                  Notice
                  pursuant to this paragraph, the Issuer shall deliver to the Trustee
                  (a) a
                  certificate signed by two (2) directors of the Issuer stating that
                  the
                  obligation referred to in (i) above cannot be avoided by the Issuer
                  taking
                  reasonable measures available to it and (b) an opinion of independent
                  legal or tax advisors of recognised standing to the effect that
                  such
                  change or amendment has occurred (irrespective of whether such
                  amendment
                  or change is then effective) and the Trustee shall be entitled
                  to accept
                  such certificate and opinion as sufficient evidence thereof in
                  which event
                  it shall be conclusive and binding on the
                  Bondholders.

              

      

       

      
        	
                (ii)

              	
                If
                  the Issuer gives a Tax Redemption Notice pursuant to Condition
                  9(C)(i),
                  each Bondholder will have the right to elect that his Bond(s) shall
                  not be
                  redeemed and that the provisions of Condition 10 shall not apply
                  in
                  respect of any payment of principal, premium (if any) or interest
                  to be
                  made in respect of such Bond(s) which falls due after the relevant
                  Tax
                  Redemption Date whereupon no additional amounts shall be payable
                  in
                  respect thereof pursuant to Condition 10 and payment of all amounts
                  shall
                  be made subject to the deduction or withholding of any tax required
                  to be
                  deducted or withheld (provided that such election shall only be
                  in respect
                  of the deduction or withholding then required to be made and the
                  Issuer
                  shall comply with the provisions of Condition 10 in respect of
                  any further
                  deductions or withholding). To exercise a right pursuant to this
                  Condition
                  9(C), the holder of the relevant Bond must complete, sign and deposit
                  at
                  the specified office of any Paying Agent a duly completed and signed
                  notice of exercise, in the form for the time being current, obtainable
                  from the specified office of any Paying Agent together with the
                  Certificate evidencing the Bonds on or before the day falling ten
                  (10)
                  days prior to the Tax Redemption
                  Date.

              

      

       

      
        	
                D.

              	
                Redemption
                  for Delisting or Change of
                  Control

              

      

       

      Following
        the occurrence of a Relevant Event (as defined below), the holder of each
        Bond
        will have the right at such holder’s option, to require the Issuer to redeem all
        or some only of that holder’s Bonds on the Relevant Event Redemption Date (as
        defined below) at their Early Redemption Amount. To exercise such right,
        the
        holder of the relevant Bond must complete, sign and deposit, at his own expense,
        at the specified office of any Paying Agent a duly completed and signed notice
        of redemption, in the form for the time being current, obtainable from the
        specified office of any Paying Agent (the Relevant
        Event Redemption Notice)
        together with the Certificate evidencing the Bonds to be redeemed by not
        later
        than sixty (60) days following a Relevant Event, or, if later, sixty (60)
        days
        following the date upon which notice thereof is given to Bondholders by the
        Issuer in accordance with Condition 18. The Relevant
        Event Redemption Date
        shall be
        the fourteenth day after the expiry of such period of sixty (60) days as
        referred to above.

       

      
        
          
          

        

        
          58

          
            

          

        

        
          
          

        

      

       

      A
        Relevant Event Redemption Notice, once delivered, shall be irrevocable (and
        may
        not be withdrawn unless the Issuer consents to such withdrawal) and the Issuer
        shall redeem the Bonds the subject of Relevant Event Redemption Notices
        delivered as aforesaid on the Relevant Event Redemption Date.

       

      The
        Trustee shall not be required to take any steps to ascertain whether a Relevant
        Event or any event which could lead to the occurrence of a Relevant Event
        has
        occurred.

       

      The
        Issuer shall give notice to Bondholders in accordance with Condition 18 by
        not
        later than fourteen (14) days following the first day on which it becomes
        aware
        of the occurrence of a Relevant Event, which notice shall specify the procedure
        for exercise by holders of their rights to require redemption of the Bonds
        pursuant to this Condition 9(E) and shall give brief details of the Relevant
        Event.

       

      A
        Relevant
        Event
        occurs:

       

      
        	
                (i)

              	
                when
                  the Shares
                  cease to be listed or admitted to trading, or for twenty (20) or
                  more
                  Trading Days occurring consecutively, trading in respect of the
                  Shares is
                  suspended, temporarily or otherwise, on the AMEX (and if applicable,
                  the
                  Alternative Stock Exchange); or

              

      

       

      
        	
                (ii)

              	
                when
                  there is a Change of Control. 

              

      

       

      For
        the
        purposes of this Condition 9(E):

       

      Control
        means
        the acquisition or control of more than fifty percent (50%) of the voting
        rights
        of the issued share capital of the Issuer or the right to appoint and/or
        remove
        all or the majority of the members of the Issuer’s board of directors or other
        governing body, whether obtained directly or indirectly, and whether obtained
        by
        ownership of share capital, the possession of voting rights, contract or
        otherwise.

       

      A
        Change
        of Control
        occurs
        when: 

       

      
        	
                (i)
                  

              	
                any
                  Person or Persons acting together acquires Control of the Issuer
                  if such
                  Person or Persons does not or do not have, and would not be deemed
                  to
                  have, Control of the Issuer on the Closing Date;
                  

              

      

       

      
        	
                (ii)
                  

              	
                the
                  Issuer consolidates with or merges into or sells or transfers all
                  or
                  substantially all of the Issuer’s assets to any other Person, unless the
                  consolidation, merger, sale or transfer will not result in the
                  other
                  Person or Persons acquiring Control over the Issuer or the successor
                  entity; or

              

      

       

      
        	
                (iii)
                  

              	
                one
                  (1) or more Persons (other than any Person referred to in sub-paragraph
                  (i) above) acquires the legal or beneficial ownership of all or
                  substantially all of the Issuer’s issued share
                  capital.

              

      

       

      Person
        includes
        any individual, company, corporation, firm, partnership, joint venture,
        undertaking, association, organisation, trust, state or agency of a state
        (in
        each case whether or not being a separate legal entity) but does not include
        the
        Issuer’s board of directors or any other governing board and does not include
        the Issuer’s wholly-owned direct or indirect Subsidiaries.

       

      
        
          
          

        

        
          59

          
            

          

        

        
          
          

        

      

       

      
        	
                E.

              	
                Redemption
                  at the Option of the Bondholder

              

      

       

      In
        the
        event that either (i) the Issuer’s Shares (including the Shares issuable upon
        conversion of the Bonds and exercise of 800,000 warrants to purchase 800,000
        Shares (the Warrants))
        are
        not listed on the AMEX or (ii) the Shares issuable upon conversion of the
        Bonds
        and exercise of the Warrants are not registered on an effective United States
        Securities Act of 1933 resale registration statement with the United States
        Securities and Exchange Commission, in each case, within one (1) year after
        the
        Closing Date, the holder of each Bond shall have the right, at such holder’s
        option, to require the Issuer to redeem all or some of the Bonds held by
        that
        holder, at any time on or after the first anniversary of the Closing Date,
        at
        106.09% of its principal amount of the Bonds.

       

      At
        any
        time on or after the third anniversary of the Closing Date, the holder of
        each
        Bond shall have the right, at such holder’s option, to require the Issuer to
        redeem all or some of the Bonds held by that holder at 126.51% of its principal
        amount of the Bonds.

       

      To
        exercise either such optional redemption right, the holder of the relevant
        Bond
        must complete, sign and deliver at the specified office or any Paying Agent
        a
        duly completed and signed notice of redemption, in the then current form
        obtainable from the specified office of any Paying Agent together with the
        Certificate evidencing the Bonds to be redeemed not earlier than sixty (60)
        days
        and not later than thirty (30) days prior to the date chosen by the Bondholder
        for redemption (which shall be a business day).

       

      
        	
                F.

              	
                Purchases

              

      

       

      The
        Issuer or any of its Subsidiaries may at any time and from time to time purchase
        Bonds at any price in the open market or otherwise.

       

      
        	
                G.

              	
                Cancellation

              

      

       

      All
        Bonds
        which are redeemed, converted or purchased by the Issuer or any of its
        Subsidiaries, will forthwith be cancelled. Certificates in respect of all
        Bonds
        cancelled will be forwarded to or to the order of the Registrar and such
        Bonds
        may not be reissued or resold.

       

      
        	
                H.

              	
                Redemption
                  Notices

              

      

       

      All
        notices to Bondholders given by or on behalf of the Issuer pursuant to this
        Condition 9 will be given in accordance with Condition 18 and will specify
        the
        Conversion Price as at the date of the relevant notice, the Conversion Period,
        the Closing Price of the Shares as at the latest practicable date prior to
        the
        publication of the notice, the price of redemption or Early Redemption Amount
        of
        the Bonds, the date for redemption, the manner in which redemption will be
        effected and the aggregate principal amount of the Bonds outstanding as at
        the
        latest practicable date prior to the publication of the notice.

       

      
        	
                10.

              	
                Taxation

              

      

       

      All
        payments made by the Issuer under or in respect of the Trust Deed or the
        Bonds
        will be made free from any restriction or condition and be made without
        deduction or withholding for or on account of any present or future taxes,
        duties, assessments or governmental charges of whatever nature imposed or
        levied
        by or on behalf of the
        United States, the PRC or England or
        any
        political subdivisions thereof or any authority thereof or therein having
        power
        to tax, unless deduction or withholding of such taxes, duties, assessments
        or
        governmental charges is compelled by law. In such event, the Issuer will
        pay
        such additional amounts as will result in the receipt by the Bondholders
        of the
        net amounts after such deduction or withholding equal to the amounts which
        would
        otherwise have been receivable by them had no such deduction or withholding
        been
        required except that no such additional amount shall be payable in respect
        of
        any Bond:

       

      
        	
                (i)

              	
                to
                  a holder (or to a third party on behalf of a holder) who is subject
                  to
                  such taxes, duties, assessments or governmental charges in respect
                  of such
                  Bond by reason of his having some connection with the United States
                  or the
                  PRC or any political subdivisions thereof otherwise than merely
                  by holding
                  such Bond or by the receipt of principal, interest or premium (if
                  any) in
                  respect of the Bond;

              

      

      
         

        
          
            
            

          

          
            60

            
              

            

          

          
            
            

          

        

      

       

      
        	
                (ii)

              	
                (in
                  the case of a payment of principal) if the Certificate in respect
                  of such
                  Bond is surrendered more than thirty (30) days after the relevant
                  date
                  except to the extent that the holder would have been entitled to
                  such
                  additional amount on surrendering the relevant Certificate for
                  payment on
                  the last day of such period of thirty (30) days;
                  

              

      

       

      
        	
                (iii)

              	
                where
                  such withholding or deduction is imposed on a payment to an individual
                  and
                  is required to be made pursuant to European Council Directive 2003/48/EC
                  or any law implementing or complying with, or introduced in order
                  to
                  conform to, such Directive; or 

              

      

       

      
        	
                (iv)

              	
                presented
                  for payment by or on behalf of a Bondholder who would have been
                  able to
                  avoid such withholding or deduction by presenting the relevant
                  Bond to
                  another Paying Agent in a Member State of the European Union.
                  

              

      

       

      For
        the
        purposes hereof, relevant
        date
        means
        whichever is the later of (a) the date on which such payment first becomes
        due
        and (b) if the full amount payable has not been received by the Trustee or
        the
        Principal Agent on or prior to such due date, the date on which, the full
        amount
        having been so received, notice to that effect shall have been given to the
        Bondholders and cheques despatched or payment made. 

       

      References
        in these Conditions to principal, interest and premium (if any) shall be
        deemed
        also to refer to any additional amounts which may be payable under this
        Condition or any undertaking or covenant given in addition thereto or in
        substitution therefor pursuant to the Trust Deed.

       

      If
        the Issuer becomes obliged to pay additional amounts in accordance with this
        Condition 10, the Issuer shall have the right to redeem the Bonds in accordance
        with the provisions of Condition 9(C)(i), subject to the right of each
        Bondholder under the provisions of Condition 9(C)(ii) to elect that his Bond(s)
        shall not be so redeemed and that the provisions of Condition 10 shall not
        apply
        in respect of any payment to be made in respect of such Bond(s) which falls
        due
        after the relevant Tax Redemption Date.

       

      
        	
                11.

              	
                Events
                  of Default

              

      

       

      
        	
                A.

              	
                Events
                  of Default

              

      

       

      The
        Trustee at its sole discretion may, and if so requested in writing by the
        holders of not less than twenty-five percent (25%) in principal amount of
        the
        Bonds then outstanding or if so directed by an Extraordinary Resolution shall
        (subject to being indemnified and/or secured by the holders to its
        satisfaction), give notice to the Issuer, that the Bonds are, and they shall
        accordingly thereby become, immediately due and repayable at the Early
        Redemption Amount (subject as provided below and without prejudice to the
        right
        of Bondholders to exercise the Conversion Right in respect of their Bonds
        in
        accordance with Condition 6) if:

       

      
        	 	
                (i)

              	
                a
                  default is made in the payment of any principal or Early Redemption
                  Amount
                  due in respect of the Bonds; 

              

      

      
         

        
          
            
            

          

          
            61

            
              

            

          

          
            
            

          

        

      

       

      
        	 	
                (ii)

              	
                any
                  failure by the Issuer to deliver the Shares as and when the Shares
                  are
                  required to be delivered following conversion of Bonds and such
                  failure
                  continues for seven (7) days; 

              

      

       

      
        	 	
                (iii)

              	
                the
                  Issuer does not perform or comply with one (1) or more of its other
                  obligations in the Bonds or the Trust Deed which default is incapable
                  of
                  remedy or, if in the opinion of the Trustee capable of remedy,
                  is not in
                  the opinion of the Trustee remedied within twenty-one (21) days
                  after
                  written notice by the Trustee of such default shall have been delivered
                  to
                  the Issuer; 

              

      

       

      
        	 	
                (iv)

              	
                the
                  Issuer or any of its Subsidiaries (as defined below) is (or is,
                  or could
                  be, deemed by law or a court to be) insolvent or bankrupt or unable
                  to pay
                  its debts, stops, suspends or threatens to stop or suspend payment
                  of all
                  or a material part of (or of a particular type of) its debts, proposes
                  or
                  makes any agreement for the deferral, rescheduling or other readjustment
                  of all of (or all of a particular type of) its debts (or of any
                  part which
                  it will or might otherwise be unable to pay when due), proposes
                  or makes a
                  general assignment or an arrangement or composition with or for
                  the
                  benefit of the relevant creditors in respect of any of such debts
                  or a
                  moratorium is agreed or declared in respect of or affecting all
                  or any
                  part of (or of a particular type of) the debts of the Issuer or
                  any of its
                  Subsidiaries; an administrator or liquidator of the Issuer or any
                  of its
                  Subsidiaries or the whole or any material part of the assets and
                  turnover
                  of the Issuer or any of its Subsidiaries is appointed (or application
                  for
                  any such appointment is made); 

              

      

       

      
        	 	
                (v)

              	
                (a)
                  any other present or future indebtedness (whether actual or contingent)
                  of
                  the Issuer or any of its Subsidiaries for or in respect of moneys
                  borrowed
                  or raised becomes, or becomes capable of being declared, due and
                  payable
                  prior to its stated maturity by reason of any actual or potential
                  default,
                  event of default or the like (howsoever described), or (b) any
                  such
                  indebtedness is not paid when due or, as the case may be, within
                  any
                  applicable grace period, or (c) the Issuer or any of its Subsidiaries
                  fails to pay when due any amount payable by it under any present
                  or future
                  guarantee for, or indemnity in respect of, any moneys borrowed
                  or raised,
                  provided that the aggregate amount of the relevant indebtedness,
                  guarantees and indemnities in respect of which one (1) or more
                  of the
                  events mentioned above in this paragraph (v) have occurred equals
                  or
                  exceeds US$5,000,000 or its equivalent in any other currency on
                  the day on
                  which such indebtedness becomes due and payable or is not paid
                  or any such
                  amount becomes due and payable or is not paid under any such guarantees
                  or
                  indemnity; 

              

      

       

      
        	 	
                (vi)

              	
                a
                  distress, attachment, execution, seizure before judgment or other
                  legal
                  process is levied, enforced or sued out on or against any of the
                  property,
                  assets or turnover of the Issuer or any of its
                  Subsidiaries;

              

      

       

      
        	 	
                (vii)

              	
                an
                  order is made or an effective resolution passed for the winding-up
                  or
                  dissolution, judicial management or administration of the Issuer
                  or any of
                  its
                  Subsidiaries (except for a members’ voluntary solvent winding-up), or the
                  Issuer or any Subsidiaries ceases or threatens to cease to carry
                  on all or
                  substantially all of its business or operations and except for
                  the purpose
                  of and followed by a reconstruction, amalgamation, reorganisation,
                  merger
                  or consolidation (a) on terms approved by an Extraordinary Resolution,
                  or
                  (b) in the case of any Subsidiary, whereby the undertaking and
                  assets of
                  such Subsidiary are transferred to or otherwise vested in the Issuer
                  or
                  any of its Subsidiaries; 

              

      

       

      
        
          
          

        

        
          62

          
            

          

        

        
          
          

        

      

       

      
        	 	
                (viii)

              	
                an
                  encumbrancer takes possession or an administrative or other receiver,
                  manager, administrator or other similar officer is appointed of
                  the whole
                  or any material part of the property, assets or turnover of the
                  Issuer or
                  any of its Subsidiaries (as the case may be) and is not discharged
                  within
                  thirty (30) days;

              

      

       

      
        	 	
                (ix)

              	
                (a)
                  any step is taken by any person with a view to the seizure, compulsory
                  acquisition, expropriation or nationalisation of all or a material
                  part of
                  the assets of the Issuer or any of its Subsidiaries; or (b) the
                  Issuer or
                  any of its Subsidiaries is prevented from exercising normal control
                  over
                  all or any substantial part of its property, assets and
                  turnover;

              

      

       

      
        	 	
                (x)

              	
                any
                  action, condition or thing (including the obtaining or effecting
                  of any
                  necessary consent, approval, authorisation, exemption, filing,
                  licence,
                  order, recording or registration) at any time required to be taken,
                  fulfilled or done in order (a) to enable the Issuer lawfully to
                  enter
                  into, exercise its rights and perform and comply with its obligations
                  under the Bonds and the Trust Deed, (b) to ensure that those obligations
                  are legally binding and enforceable and (c) to make the Bonds and
                  the
                  Trust Deed admissible in evidence in the courts of the United States
                  or
                  the PRC is not taken, fulfilled or
                  done;

              

      

       

      
        	 	
                (xi)

              	
                it
                  is or will become unlawful for the Issuer to perform or comply
                  with any
                  one (1) or more of its obligations under any of the Bonds or the
                  Trust
                  Deed; or

              

      

       

      
        	 	
                (xii)

              	
                any
                  event occurs which under the laws of any relevant jurisdiction
                  has an
                  analogous effect to any of the events referred to in any of the
                  foregoing
                  paragraphs;

              

      

       

      provided
        that, in the case of any such event other than those described in paragraph
        (i),
        (ii), (iii), (x) or (xi), the Trustee shall have certified in writing to
        the
        Issuer that such event is in its opinion materially prejudicial to the interests
        of Bondholders. 

       

      
        	
                B.

              	
                Default
                  Cure Amount

              

      

       

      Notwithstanding
        receipt of any payment after the acceleration of the Bonds, a
        Bondholder
        may
        exercise its Conversion Right by depositing a Conversion Notice with a
        Conversion Agent or Paying Agent during the period from and including the
        date
        of a default notice with respect to an event specified in Condition 11(A)(ii)
        (at which time the Issuer will notify the Bondholders of the number of Shares
        per Bond to be delivered upon conversion, assuming all the then outstanding
        Bonds are converted) to and including the 30th business day after such
        payment.

       

      If
        any
        converting Bondholder deposits a Conversion Notice pursuant to this Condition
        11(B) on the business day prior to, or during, a Closed Period, the Bondholder’s
        Conversion Right shall continue until the business day following the last
        day of
        the Closed Period, which shall be deemed the Conversion Date, for the purposes
        of such Bondholder’s exercise of its Conversion Right pursuant to this Condition
        11(B).

       

      If
        the
        Conversion Right attached to any Bond is exercised pursuant to this Condition
        11(B), the Issuer will deliver Shares (which number will be disclosed to
        such
        Bondholder as soon as practicable after the Conversion Notice is given) in
        accordance with the Conditions, except that the Issuer shall have twelve
        (12)
        business days before it is required to register the converting Bondholder
        (or
        its designee) in its register of members as the owner of the number of
Shares
        to
        be delivered pursuant to this Condition and an additional five (5) business
        days
        from such registration date to make payment in accordance with the following
        paragraph.

       

      
        
          
          

        

        
          63

          
            

          

        

        
          
          

        

      

       

      If
        the
        Conversion Right attached to any Bond is exercised pursuant to this Condition
        11(B), or if the Bonds have become due and payable pursuant to Condition
        11(A)(ii), the Issuer shall, at the request of the converting Bondholder,
        pay to
        such Bondholder an amount in United States dollars (the Default
        Cure Amount),
        equal
        to the product of (x) (i) the number of Shares that are required to be delivered
        by the Issuer to satisfy the Conversion Right in relation to such converting
        Bondholder minus (ii) the number of Shares that are actually delivered by
        the
        Issuer pursuant to such Bondholders’ Conversion Notice and (y) the Share Price
        (as defined below) on the Conversion Date; provided that if such Bondholder
        has
        received any payment under the Bonds pursuant to this Condition 11(B), the
        amount of such payment shall be deducted from the Default Cure
        Amount.

       

      The
        Share
        Price
        means
        the closing price of the Shares as quoted by the AMEX or, as the case may
        be,
        the Alternative Stock Exchange on the Conversion Date or, if no reported
        sales
        take place on such date, the average of the reported closing bid and offered
        prices, in either case as reported by the AMEX or other applicable securities
        exchange on which the Shares are listed for such day as furnished by a reputable
        and independent broker-dealer selected from time to time by the Trustee at
        the
        expense of the Issuer for such purpose.

       

      
        	
                12.

              	
                Consolidation,
                  Amalgamation or Merger

              

      

       

      The
        Issuer will not consolidate with, amalgamate with, merge with or into, or
        sell,
        convey, transfer, lease or otherwise dispose of all or substantially all
        of its
        property and assets (as an entirety or substantially an entirety in one
        transaction or a series of related transactions) to any entity
        unless:

       

      
        	
                (i)

              	
                the
                  entity formed by such amalgamation or consolidation or into which
                  the
                  Issuer is merged or which acquired or leased such property and
                  assets of
                  the Issuer shall be a corporation organised and validly existing
                  under the
                  laws of its place of incorporation, and shall, by a trust deed
                  supplemental to the Trust Deed and an agency agreement supplemental
                  to the
                  Agency Agreement and such other undertakings or documents as the
                  Trustee
                  may require, executed and delivered in form and content acceptable
                  to the
                  Trustee, expressly assume all of the obligations of the Issuer
                  in respect
                  of all of the Bonds and under the Trust Deed and the Agency Agreement
                  and
                  indemnify each Bondholder against any tax, assessment or governmental
                  charge payable by withholding or deduction thereafter imposed on
                  such
                  holder solely as a consequence of such consolidation, amalgamation,
                  merger, sale, conveyance, transfer lease or other disposal with
                  respect to
                  the payment of principal, premium and interest on the
                  Bonds;

              

      

       

      
        	
                (ii)

              	
                the
                  supplemental Trust Deed referred to in paragraph (i) above will
                  ensure
                  that (a) the holder of each Bond then outstanding will have the
                  right
                  (during the period in which such Bond shall be convertible) to
                  convert
                  such Bond into the class and amount of shares and other securities
                  and
                  property receivable upon such consolidation, amalgamation, merger,
                  sale,
                  conveyance, transfer lease or other disposal by a holder of the
                  number of
                  Shares which would have become liable to be issued upon conversion
                  of such
                  Bond immediately prior to such consolidation, amalgamation, merger,
                  sale,
                  conveyance, transfer, lease or other disposal (such supplemental
                  Trust
                  Deed will provide for adjustments which will be as nearly equivalent
                  as
                  may be practicable to the adjustments provided for in the provisions
                  of
                  Condition 6(C), (b) the rights of Bondholders shall not be adversely
                  affected as a result of such transaction and (c) that there shall
                  be no
                  right to exercise a redemption of the Bonds under Condition 9(C)
                  as a
                  result of (A) any change in the domicile or place of incorporation
                  of the
                  Issuer or (B) the successor entity not being incorporated in the
                  State of
                  Delaware and the provisions of Condition 10 shall also be supplemented
                  or
                  modified as the Trustee deems appropriate;
                  and

              

      

       

      
        
          
          

        

        
          64

          
            

          

        

        
          
          

        

      

       

      
        	
                (iii)

              	
                immediately
                  after giving effect to such transaction, no default or event of
                  default
                  (including an Event of Default) shall have occurred and be continuing.
                  

              

      

       

      The
        above
        provisions of this Condition 12 will apply,
        mutatis
        mutandis,
        to any
        subsequent consolidations, amalgamations, mergers, sales or
        transfers.

       

      
        	
                13.

              	
                Prescription

              

      

       

      Claims
        in
        respect of amounts due in respect of the Bonds will become prescribed unless
        made within ten (10) years (in the case of principal) and five (5) years
        (in the
        case of default interest or premium (if any)) from the relevant date (as
        defined
        in Condition 9) in respect thereof.

       

      
        	
                14.

              	
                Enforcement

              

      

       

      At
        any
        time after the Bonds have become due and repayable, the Trustee may, at its
        sole
        discretion and without further notice, take such proceedings against the
        Issuer
        as it may think fit to enforce repayment of the Bonds and to enforce the
        provisions of the Trust Deed, but it will not be bound to take any such
        proceedings unless (a) it shall have been so requested in writing by the
        holders
        of not less than twenty-five percent (25%) in principal amount of the Bonds
        then
        outstanding or shall have been so directed by an Extraordinary Resolution
        and
        (b) it shall have been indemnified and/or secured to its satisfaction. No
        Bondholder will be entitled to proceed directly against the Issuer unless
        the
        Trustee, having become bound to do so, fails to do so within a reasonable
        period
        and such failure shall be continuing.

       

      
        	
                15.

              	
                Meetings
                  of Bondholders, Modification and
                  Waiver

              

      

       

      
        	
                A.

              	
                Meetings

              

      

       

      The
        Trust
        Deed contains provisions for convening meetings of Bondholders to consider
        any
        matter affecting their interests, including the sanctioning by Extraordinary
        Resolution of a modification of the Bonds or the provisions of the Trust
        Deed.
        The quorum at any such meeting for passing an Extraordinary Resolution will
        be
        two (2) or more persons holding or representing over fifty percent (50%)
        in
        principal amount of the Bonds for the time being outstanding or, at any
        adjourned such meeting, two (2) or more persons being or representing
        Bondholders whatever the principal amount of the Bonds so held or represented
        unless the business of such meeting includes consideration of proposals,
        inter
        alia,
        (i) to
        modify the due date for any payment in respect of the Bonds, (ii) to reduce
        or
        cancel the amount of principal, interest, premium, or default interest
        (including any Early Redemption Amount) or Equivalent Amount payable in respect
        of the Bonds or changing the method of calculation of the Early Redemption
        Amount, (iii) to change the currency of payment of the Bonds, (iv) to modify
        (except by a unilateral and unconditional reduction in the Conversion Price)
        or
        cancel the Conversion Rights, or (v) to modify the provisions concerning
        the
        quorum required at any meeting of the Bondholders or the majority required
        to
        pass an Extraordinary Resolution, in which case the necessary quorum for
        passing
        an Extraordinary Resolution will be two (2) or more persons holding or
        representing not less than two-thirds (2/3), or at any adjourned such meeting
        not less than one-third (1/3), in principal amount of the Bonds for the time
        being outstanding. An Extraordinary Resolution passed at any meeting of
        Bondholders will be binding on all Bondholders, whether or not they are present
        at the meeting. The Trust Deed provides that a written resolution signed
        by or
        on behalf of the holders of not less than ninety percent (90%) of the aggregate
        principal amount of Bonds outstanding shall be as valid and effective as
        a duly
        passed Extraordinary Resolution.

       

      
        
          
          

        

        
          65

          
            

          

        

        
          
          

        

      

       

      
        	
                B.

              	
                Modification
                  and Waiver

              

      

       

      The
        Trustee may agree, without the consent of the Bondholders, to (i) any
        modification (except as mentioned in Condition 15(A) above) to, or the waiver
        or
        authorisation of any breach or proposed breach of, the Bonds, the Agency
        Agreement or the Trust Deed which is in its opinion proper to make if, in
        the
        opinion of the Trustee, it is not materially prejudicial to the interests
        of the
        Bondholders or (ii) any modification to the Bonds or the Trust Deed which,
        in
        the Trustee’s opinion, is of a formal, minor or technical nature or to correct a
        manifest error or (to the satisfaction of the Trustee) proven error to comply
        with mandatory provisions of law. Any such modification, waiver or authorisation
        will be binding on the Bondholders and, unless the Trustee agrees otherwise,
        any
        such modifications will be notified by the Issuer to the Bondholders as soon
        as
        practicable thereafter. 

       

      
        	
                C.

              	
                Substitution

              

      

       

      The
        Trustee may (but is not obliged to), without the consent of the Bondholders,
        agree to the substitution of any other company in place of the Issuer (or
        of any
        previous substitute under this Condition 15(C)) as the principal debtor under
        the Bonds and the Trust Deed, subject to the Bonds being unconditionally
        and
        irrevocably guaranteed by the Issuer to the Trustee’s satisfaction and certain
        other conditions set out in the Trust Deed being complied with.

       

      
        	
                D.

              	
                Interests
                  of Bondholders

              

      

       

      In
        connection with the exercise of its functions (including but not limited
        to
        those in relation to any proposed modification, authorisation, waiver,
        determination or substitution) the Trustee shall have regard to the general
        interests of the Bondholders as a class but shall not have regard to any
        interests arising from circumstances particular to individual Bondholders
        (whatever their number) and, in particular but without limitation, shall
        not
        have regard to the consequences of such exercise for individual Bondholders
        (whatever their number) resulting from their being for any purpose domiciled
        or
        resident in, or otherwise connected with, or subject to the jurisdiction
        of, any
        particular territory or any political sub-division thereof and the Trustee
        shall
        not be entitled to require, nor shall any Bondholder be entitled to claim,
        from
        the Issuer or the Trustee or any other person, any indemnification or payment
        in
        respect of any tax consequences of any such exercise upon individual Bondholders
        except to the extent provided for in Condition 10 and/or any undertakings
        given
        in addition thereto or in substitution therefor pursuant to the Trust
        Deed.

       

      In
        the event of the passing of an Extraordinary Resolution in accordance with
        Condition 15(A), a modification, waiver or authorisation in accordance with
        Condition 15(B) or a substitution in accordance with Condition 15(C), the
        Issuer
        will procure that the Bondholders be notified in accordance with Condition
        18.

       

      
        
          
          

        

        
          66

          
            

          

        

        
          
          

        

      

       

      
        	
                16.

              	
                Replacement
                  of Certificates

              

      

       

      If
        any
        Certificate is mutilated, defaced, destroyed, stolen or lost, it may be replaced
        at the specified office of the Registrar or any Agent upon payment by the
        claimant of such costs as may be incurred in connection therewith and on
        such
        terms as to evidence and indemnity as the Issuer and such Agent may require.
        Mutilated or defaced Certificates must be surrendered before replacements
        will
        be issued.

       

      
        	
                17.

              	
                Further
                  Issues

              

      

       

      The
        Issuer may from time to time, without the consent of the Bondholders, create
        and
        issue further bonds having the same terms and conditions as the Bonds in
        all
        respects and so that such further issue shall be consolidated and form a
        single
        series with the Bonds. Such further bonds may, with the consent of the Trustee,
        be constituted by a deed supplemental to the Trust Deed.

       

      
        	
                18.

              	
                Notices

              

      

       

      All
        notices to Bondholders shall be validly given if mailed to them at their
        respective addresses in the Register of Bondholders maintained by the Registrar
        or published in a leading newspaper having general circulation in the United
        States or, if such publication shall not be practicable, in an English language
        newspaper of general circulation in Asia. Any such notice shall be deemed
        to
        have been given on the later of the date of such publication and the seventh
        day
        after being so mailed, as the case may be. 

       

      Notices
        to be given by (i) any Bondholder shall be in writing and given by lodging
        the
        same, together with the relative Certificate, with the Registrar, or (ii)
        if the
        Certificates are held in a clearing system, may be given through the clearing
        system in accordance with its standard rules and procedures.

       

      
        	
                19.

              	
                Agents

              

      

       

      The
        names
        of the initial Agents and the Registrar and their specified offices are set
        out
        below. The Issuer reserves the right, subject to the prior written approval
        of
        the Trustee, at any time to vary or terminate the appointment of any Agent
        or
        the Registrar and to appoint additional or other Agents or a replacement
        Registrar. The Issuer will at all times maintain (a) a Principal Agent, (b)
        a
        Paying Agent with a specified office in a European Union member state that
        will
        not be obliged to withhold or deduct tax pursuant to European Council Directive
        2003/48/EC or any law implementing or complying with, or introduced in order
        to
        conform, to such Directive, and (c) a Registrar which will maintain the register
        of Bondholders outside the United Kingdom. Notice of any such termination
        or
        appointment, of any changes in the specified offices of any Agent or the
        Registrar and of any change in the identity of the Registrar or the Principal
        Agent will be given promptly by the Issuer to the Bondholders and in any
        event
        not less than forty-five (45) days’ notice will be given.

       

      
        	
                20.

              	
                Indemnification

              

      

       

      The
        Trust
        Deed contains provisions for the indemnification of the Trustee and for its
        relief from responsibility, including provisions relieving it from taking
        any
        action unless indemnified and/or secured to its satisfaction. The Trustee
        is
        entitled to enter into business transactions with the Issuer and any entity
        related to the Issuer without accounting for any profit.

       

      
        	20.	
                Rights
                  of Third Parties

              

      

       

      No
        person
        shall have any right to enforce any term or condition of the Bonds under
        the
        Contracts (Rights of Third Parties) Act 1999, but this does not affect any
        right
        or remedy of any person which exists or is available apart from that
        Act.

       

      
        
          
          

        

        
          67

          
            

          

        

        
          
          

        

      

       

      21. Governing
        Law and Submission to Jurisdiction 

       

      The
        Trust
        Deed and the Bonds and all matters arising from or connected with the Trust
        Deed
        and the Bonds are governed by, and shall be construed in accordance with,
        English law.

       

      The
        Issuer has irrevocably agreed that the courts of England have exclusive
        jurisdiction to settle any dispute which may arise out of or in connection
        with
        the Bonds and accordingly has submitted to the exclusive jurisdiction of
        the
        English courts. 

       

      The
        Issuer has waived any objection to the courts of England on the grounds that
        they are an inconvenient or inappropriate forum. The Bondholder may take
        any
        suit, action or proceedings arising out of or in connection with the Bonds
        (Proceedings)
        against
        the Issuer in any other court of competent jurisdiction and concurrent
        Proceedings in any number of jurisdictions.

       

      The
        Issuer as irrevocably and unconditionally appointed The
        London Law Agency
        at the
        latter's registered office for the time being as its agent for service of
        process in England in respect of any Proceedings and have undertaken that
        in the
        event of such agent ceasing so to act it will appoint such other person as
        the
        Trustee may approve as its agent for that purpose.

       

      
        
          
          

        

        
          68

          
            

          

        

        
          
          

        

      

       

      PRINCIPAL
        PAYING, CONVERSION AND TRANSFER AGENT

       

      

      40th
        Floor, One Canada Square

      London,
        E14, 5AL, United Kingdom

      Fax
        no.:
        +44 20 7964 6369

      Attention:
        Global Corporate Trust

       

      with
        a
        copy to:

       

      The
        Bank
        of New York

      Level
        12,
        3 Pacific Place

      1
        Queen’s
        Road East

      Hong
        Kong

      Fax
        no.:
        852 2295 3283

      Attention:
        Corporate Trust

      

      REGISTRAR

       

      The
        Bank
        of New York

      101
        Barclay Street, 21st Floor, New York

      NY
        10286,
        United States of America

      Fax
        no:
        +1 212 815 5802/5803

      Attention:
        Global Corporate Trust

      

      with
        a
        copy to:

       

      The
        Bank
        of New York

      Level
        12,
        3 Pacific Place

      1
        Queen’s
        Road East

      Hong
        Kong

      Fax
        no.:
        852 2295 3283

      Attention:
        Corporate Trust

       

      
        
          
          

        

        
          69

          
            

          

        

        
          
          

        

      

       

      Form
        of Transfer

       

      FOR
        VALUE
        RECEIVED the undersigned hereby transfers to

       

      
        
          
            

          

        

      

       

       

      
        

      

       

      (Please
        Print or Typewrite Name and Address of Transferee)

       

      US$_____
        principal amount of the Bonds in respect of which this Certificate is issued,
        and all rights in respect thereof.

       

      All
        payments in respect of the Bonds hereby transferred are to be made (unless
        otherwise instructed by the transferee) to the following account:

       

      
        	Name of bank:	
              
	 	
                
 
	US$ account number:	 
	 	
                
 
	For the account of:	 
	 	
                
 

      

       
        
          	Dated:	 
	 	
                  
 
	 	
                  
 
	 	
                  Certifying
                    Signature

                
	 	 
	Name: 	 
	 	
                  
 

        

      

       

      Notes:

       

      
        	
                (i)

              	
                A
                  representative of the Bondholder should state the capacity in which
                  he
                  signs, e.g. executor.

              

      

       

      
        	
                (ii)

              	
                The
                  signature of the person effecting a transfer shall conform to any
                  list of
                  duly authorised specimen signatures supplied by the registered
                  holder or
                  be certified by a recognised bank, notary public or in such other
                  manner
                  as the Agent or the Registrar may
                  require.

              

      

       

      
        
          
          

        

        
          70

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
        2

       

      FORM
        OF GLOBAL CERTIFICATE

      ISIN:
        [·]

      Common
        Code: [·]

      

      CHINA
        ARCHITECTURAL ENGINEERING, INC.

      (incorporated
        under the laws of the State of Delaware)

      US$10,000,000

      Variable
        Rate Convertible Bonds due 2012

       

      GLOBAL
        CERTIFICATE

       

      The
        Bonds
        in respect of which this Global Certificate is issued are in registered form
        and
        form part of the series designated as specified in the title (the “Bonds”)
        of
        China Architectural Engineering, Inc. (the “Issuer”).

       

      The
        Issuer hereby certifies that [·]
        is, as
        at the date hereof, entered in the register of Bondholders as the holder
        of
        Bonds in the principal amount of US$10,000,000 (Ten million United States
        dollars) or such other amount as is shown on the register of Bondholders
        as
        being represented by this Global Certificate and is duly endorsed (for
        information purposes only) in the third column of Schedule A to this Global
        Certificate. For value received, the Issuer promises to pay the person who
        appears at the relevant time on the register of Bondholders as holder of
        the
        Bonds in respect of which this Global Certificate is issued such amount or
        amounts as shall become due in respect of such Bonds and otherwise to comply
        with the Conditions, as referred to below.

       

      The
        Bonds
        are constituted by a trust deed (the “Trust
        Deed”)
        dated
        [•]
        2007
        and made between the Issuer and The Bank of New York, London Branch as trustee
        (the “Trustee”)
        and
        are subject to, and have the benefit of, the Trust Deed and the terms and
        conditions (the “Conditions”
or
        the
“Terms
        and Conditions”)
        set
        out in Schedule 1 to the Trust Deed, as modified by the provisions of this
        Global Certificate. Terms defined in the Trust Deed have the same meanings
        when
        used herein.

       

      The
        Bonds
        in respect of which this Global Certificate is issued are convertible into
        fully-paid shares of common stock of par value US$0.001 each of the Issuer
        subject to and in accordance with the Conditions and the Trust
        Deed.

       

      Owners
        of
        interests in the Bonds in respect of which this Global Certificate is issued
        will be entitled to have title to the Bonds registered in their names and
        to
        receive individual definitive Certificates if either Euroclear or Clearstream
        (or any other clearing system (an “Alternative
        Clearing System”)
        as
        shall have been designated by the Issuer and approved by the Trustee on behalf
        of which the Bonds evidenced by this Global Certificate may be held) is closed
        for business for a continuous period of fourteen (14) days (other than by
        reason
        of holidays, statutory or otherwise) or announces an intention permanently
        to
        cease business or does in fact do so.

       

      In
        such
        circumstances, the Issuer will at its own expense cause sufficient individual
        definitive Certificates to be executed and delivered to the Registrar for
        completion, authentication and dispatch to all Bondholders. A person with
        an
        interest in the Bonds in respect of which this Global Certificate is issued
        must
        provide the Registrar with a written order containing instructions and such
        other information as the Issuer and the Registrar may require to complete,
        execute and deliver such individual definitive Certificates.

       

      
        
          
          

        

        
          71

          
            

          

        

        
          
          

        

      

       

      Registrar
        with a written order containing instructions and such
        other information as the Issuer and the Registrar may require to complete,
        execute and deliver such individual definitive certificates.

       

      This
        Global Certificate is evidence of entitlement only. Title to the Bonds passes
        only on due registration in the register of Bondholders and only the duly
        registered holder is entitled to payments on Bonds in respect of which this
        Global Certificate is issued.

       

      The
        Conditions are modified as follows in so far as they apply to the Bonds in
        respect of which this Global Certificate is issued.

       

      The
        Registrar will not register the exchange of interests in this Global Certificate
        for individual definitive Certificates for a period of fifteen (15) calendar
        days preceding the due date for any payment of principal, interest and premium
        (if any) in respect of the Bonds.

       

      Meetings

       

      The
        registered holder of this Global Certificate will be treated as being two
        (2)
        persons for the purposes of any quorum requirements of a meeting of Bondholders
        and, at any such meeting, as having one (1) vote in respect of each US$1,000
        in
        principal amount of Bonds for which this Global Certificate is issued. The
        Trustee may allow a person with an interest in Bonds in respect of which
        this
        Global Certificate has been issued to attend and speak at a meeting of
        Bondholders on appropriate proof of his identity and interest.

       

      Cancellation

       

      Cancellation
        of any Bond by the Issuer following its redemption, conversion or purchase
        by
        the Issuer will be effected by a reduction in the principal amount of the
        Bonds
        in the register of Bondholders.

       

      Trustee’s
        Powers

       

      In
        considering the interests of Bondholders while this Global Certificate is
        registered in the name of a nominee for a clearing system, the Trustee may,
        to
        the extent it considers it appropriate to do so in the circumstances but
        without
        being obliged to do so, (a) have regard to any information as may have been
        made
        available to it by or on behalf of the relevant clearing system or its operator
        as to the identity of its accountholders (either individually or by way of
        category) with entitlements in respect of the Bonds and (b) may consider
        such
        interests on the basis that such accountholders were the holders of the Bonds
        in
        respect of which this Global Certificate is issued.

       

      Conversion

       

      Subject
        to the requirements of Euroclear and Clearstream (or any Alternative Clearing
        System), the Conversion Right attaching to a Bond in respect of which this
        Global Certificate is issued, may be exercised by the presentation (which
        may be
        by facsimile transmission) thereof to or to the order of the Principal Agent
        of
        one (1) of more Conversion Notices duly completed by or on behalf of a holder
        of
        a book-entry interest in such Bond. Deposit of this Global Certificate with
        the
        Principal Agent together with the relevant Conversion Notice(s) shall not
        be
        required. The exercise of the Conversion Right shall be notified by the
        Principal Agent to the Registrar and the holder of this Global
        Certificate.

       

      Payment

       

      Payments
        of principal, interest and premium (if any) in respect of Bonds represented
        by
        this Global Certificate will be made without presentation or if no further
        payment falls to be made in respect of the Bonds, against presentation and
        surrender of this Global Certificate to or to the order of the Principal
        Agent
        or such other Paying Agent as shall have been notified to the Bondholders
        for
        such purpose.

       

      
        
          
          

        

        
          72

          
            

          

        

        
          
          

        

      

       

      Notices

       

      So
        long
        as the Bonds are represented by this Global Certificate and this Global
        Certificate is held on behalf of Euroclear or Clearstream or the Alternative
        Clearing System, notices to Bondholders may be given by delivery of the relevant
        notice to Euroclear or Clearstream or the Alternative Clearing System, for
        communication by it to entitled accountholders in substitution for notification
        as required by the Conditions.

       

      Bondholders’
        Redemption

       

      The
        Bondholders’ redemption options in Conditions 9(D) and 9(E) may be exercised by
        the holder of this Global Certificate giving notice (which may be made by
        facsimile transmission) to the Principal Agent of the principal amount of
        Bonds
        in respect of which the option is exercised and presenting this Global
        Certificate for endorsement or exercise within the time limits specified
        in
        those Conditions.

       

      Registration
        of Title

       

      Certificates
        in definitive form for individual holdings of Bonds will not be issued in
        exchange for interests in Bonds in respect of which the Global Certificate
        is
        issued, except if either Euroclear or Clearstream (or any alternative clearing
        system on behalf of which the Bonds evidenced by the Global Certificate may
        be
        held) is closed for business for a continuous period of fourteen (14) days
        (other than by reason of holidays, statutory or otherwise) or announces an
        intention permanently to cease business or does in fact do so.

       

      Transfers

       

      Transfers
        of interests in the Bonds will be effected through the records of Euroclear
        and
        Clearstream and their respective participants in accordance with the rules
        and
        procedures of Euroclear and Clearstream and their respective direct and indirect
        participants.

       

      Enforcement

       

      For
        the
        purposes of enforcement of the provisions of the Trust Deed against the Trustee,
        the persons named in a certificate of the holder of the Bonds in respect
        of
        which this Global Certificate is issued shall be recognised as the beneficiaries
        of the trust set out in the Trust Deed, to the extent of the principal amounts
        of their interest in the Bonds set out in the certificate of the holder,
        as if
        they were themselves the holders of Bonds in such principal
        amounts.

       

      For
        all
        purposes the Bonds in respect of which this Global Certificate is issued,
        each
        person who is for the time being shown in the records of Euroclear or of
        Clearstream as the holder of a particular principal amount of such Bonds
        (in
        which regard any certificate or other document issued by Euroclear or
        Clearstream as to the principal amount of Bonds represented by a Global
        Certificate standing to the account of any person shall be conclusive and
        binding for all purposes) shall be recognised as the holder of such principal
        amount of Bonds.

       

      Third
        Party Rights

       

      No
        rights
        are conferred on any person under the Contracts (Rights of Third Parties)
        Act
        1999 to enforce any term of this Global Certificate but this does not affect
        any
        right or remedy of any person which exists or is available apart from that
        Act.

       

      
        
          
          

        

        
          73

          
            

          

        

        
          
          

        

      

       

      This
        Global Certificate shall not be valid for any purpose until authenticated
        by or
        on behalf of the Principal Agent.

       

      This
        Global Certificate is governed by, and shall be construed in accordance with,
        English law.

       

      In
        witness
        whereof
        the Issuer has caused this Global Certificate to be signed on its
        behalf.

       

      Dated
        [·]
        2007

       

      CHINA
        ARCHITECTURAL ENGINEERING, INC.

       

      By: 

      
        

      

      Director/Authorised
        Signatory

       

      Certificate
        of Authentication

       

      Certified
        that the above-named holder is as at the date hereof entered in the register
        of
        Bondholders as holder of the above-mentioned principal amount of
        Bonds.

       

      The
        Bank of New York as Registrar

      (without
        warranty, recourse or liability)

       

      By: 

      
        

      

      Authorised
        Signatory

       

      Dated:

       

      
        
          
          

        

        
          74

          
            

          

        

        
          
          

        

      

       

      Schedule
        A

       

      Schedule
        of Reductions in Principal Amount of Bonds in respect of which
        this

      Global
        Certificate is Issued

       

      The
        following reductions in the principal amount of Bonds in respect of which
        this
        Global Certificate is issued have been made as a result of: (i) exercise
        of the
        Conversion Rights attaching to Bonds or (ii) redemption of Bonds or (iii)
        issue
        of definitive Certificates in respect of the Bonds or (iv) purchase and
        cancellation of the Bonds:

       

      

      
        	
                Date
                  of Conversion / Redemption / Issue of definitive Certificates /
                  Purchase
                  and cancellation of the Bonds

              	 	
                Amount
                  of decrease in principal amount of this Global
                  Certificate

              	 	
                Principal
                  Amount of this Global Certificate following such
                  decrease

              	 	
                Notation
                  made by or on behalf of the Registrar

              
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

      

       

      
        
          
          

        

        
          75

          
            

          

        

        
          
          

        

      

       

      PRINCIPAL
        PAYING, CONVERSION AND TRANSFER AGENT

       

      The
        Bank
        of New York, London Branch

      40th
        Floor, One Canada Square

      London,
        E14, 5AL, United Kingdom

      Fax
        no.:
        +44 20 7964 6369

      Attention:
        Global Corporate Trust

      

       

      with
        a
        copy to:

       

      The
        Bank
        of New York

      Level
        12,
        3 Pacific Place

      1
        Queen’s
        Road East

      Hong
        Kong

      Fax
        no.:
        852 2295 3283

      Attention:
        Corporate Trust

       

      REGISTRAR

      

      The
        Bank
        of New York

      101
        Barclay Street, 21st Floor, New York

      NY
        10286,
        United States of America

      Fax
        no:
        +1 212 815 5802/5803

      Attention:
        Global Corporate Trust

      

      with
        a
        copy to:

       

      The
        Bank
        of New York

      Level
        12,
        3 Pacific Place

      1
        Queen’s
        Road East

      Hong
        Kong

      Fax
        no.:
        852 2295 3283

      Attention:
        Corporate Trust

       

      
        
          
          

        

        
          76

          
            

          

        

        
          
          

        

      

       

      Form
        of Transfer

       

      FOR
        VALUE
        RECEIVED the undersigned hereby transfers the following principal amounts
        of
        Bonds in respect of which the Global Certificate is issued, and all rights
        in
        respect thereof, to the transferee(s) listed below:

       

      
        	
                Principal
                  Amount transferred

              	
                Name,
                  address and account for 

                payments
                  of transferee

              
	 	 
	
                Dated
                  : 

                
                  

                

              	
                Certifying
                  Signature : 

                
                  

                

              
	
                Name
                  : 

                
                  

                

              	 

      

       

      Notes:

       

      
        	
                (i)

              	
                A
                  representative of the Bondholder should state the capacity in which
                  he
                  signs e.g. executor.

              

      

       

      
        	
                (ii)

              	
                The
                  signature of the person effecting a transfer shall conform to any
                  list of
                  duly authorised specimen signatures supplied by the registered
                  holder or
                  be certified by a recognised bank, notary public or in such other
                  manner
                  as the Principal Agent or the Registrar may
                  require.

              

      

      
        
          
          

        

        
          77

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
        3

       

      PROVISIONS
        FOR MEETINGS OF BONDHOLDERS

       

      
        	
                21.

              	
                A
                  holder of a Bond may by an instrument in writing (a “form
                  of proxy”)
                  in the form available from the specified office of any Agent in
                  English
                  signed by the holder or, in the case of a corporation, executed
                  under its
                  common seal or signed on its behalf by an attorney or a duly authorised
                  officer of the corporation and delivered to the Agent not later
                  than
                  twenty-four (24) hours before the time fixed for any meeting, appoint
                  any
                  person (a “proxy”)
                  to act on his or its behalf in connection with any meeting or proposed
                  meeting of Bondholders.

              

      

       

      
        	22.	
                A
                  holder of a Bond which is a corporation may by delivering to any
                  Agent not
                  later than twenty-four (24) hours before the time fixed for any
                  meeting a
                  resolution of its directors or other governing body in English
                  authorise
                  any person to act as its representative (a “representative”)
                  in connection with any meeting or proposed meeting of
                  Bondholders.

              

      

       

      
        	
                23.

              	
                A
                  proxy or representative so appointed shall so long as such appointment
                  remains in force be deemed, for all purposes in connection with
                  any
                  meeting or proposed meeting of Bondholders specified in such appointment,
                  to be the holder of the Bonds to which such appointment relates
                  and the
                  holder of the Bond shall be deemed for such purposes not to be
                  the
                  holder.

              

      

       

      
        	
                24.

              	
                Each
                  of the Issuer and the Trustee may at any time convene a meeting
                  of
                  Bondholders. If the Trustee receives a written request by Bondholders
                  holding at least ten percent (10%) in principal amount of the Bonds
                  for
                  the time being outstanding and is indemnified to its satisfaction
                  against
                  all costs and expenses, the Trustee shall convene a meeting of
                  Bondholders. Every meeting shall be held at a time and place approved
                  by
                  the Trustee.

              

      

       

      
        	
                25.

              	
                At
                  least twenty-one (21) days’ notice (exclusive of the day on which the
                  notice is given and of the day of the meeting) shall be given to
                  the
                  Bondholders to convene a meeting of Bondholders. A copy of the
                  notice
                  shall be given by the party convening the meeting to the other
                  parties.
                  The notice shall specify the day, time and place of meeting, be
                  given in
                  the manner provided in the Conditions and shall specify, unless
                  the
                  Trustee otherwise agrees, the nature of the resolutions to be proposed
                  and
                  shall include a statement to the effect that the holders of Bonds
                  may
                  appoint proxies by executing and delivering a form of proxy in
                  English to
                  the specified office of an Agent not later than twenty-four (24)
                  hours
                  before the time fixed for the meeting or, in the case of corporations,
                  may
                  appoint representatives by resolution in English of their directors
                  or
                  other governing body and by delivering an executed copy of such
                  resolution
                  to the Agent not later than twenty-four (24) hours before the time
                  fixed
                  for the meeting.

              

      

       

      
        	
                26.

              	
                A
                  person (who may, but need not, be a Bondholder) nominated in writing
                  by
                  the Trustee may act as chairman of a meeting but if no such nomination
                  is
                  made or if the person nominated is not present within fifteen (15)
                  minutes
                  after the time fixed for the meeting the Bondholders present shall
                  choose
                  one (1) of their number to be chairman, failing which, the Issuer
                  may
                  appoint the chairman. The chairman of an adjourned meeting need
                  not be the
                  same person as was chairman of the original
                  meeting.

              

      

       

      
        	
                27.

              	
                At
                  a meeting two (2) or more persons present in person holding Bonds
                  or being
                  proxies or representatives and holding or representing in the aggregate
                  not less than ten percent (10%) in principal amount of the Bonds
                  for the
                  time being outstanding shall (except for the purpose of passing
                  an
                  Extraordinary Resolution) form a quorum for the transaction of
                  business
                  and no business (other than the choosing of a chairman) shall be
                  transacted unless the requisite quorum be present at the commencement
                  of
                  business. The quorum at a meeting for passing an Extraordinary
                  Resolution
                  shall (subject as provided below) be two (2) or more persons present
                  in
                  person holding Bonds or being proxies or representatives and holding
                  or
                  representing in the aggregate over fifty percent (50%) in principal
                  amount
                  of the Bonds for the time being outstanding provided that the quorum
                  at
                  any meeting the business of which includes any of the matters specified
                  in
                  the proviso to paragraph 16
                  shall be two (2) or more persons so present holding Bonds or being
                  proxies
                  or representatives and holding or representing in the aggregate
                  not less
                  than two-thirds (2/3) in principal amount of the Bonds for the
                  time being
                  outstanding.

              

      

       

      
        
          
          

        

        
          78

          
            

          

        

        
          
          

        

      

       

      
        	
                28.

              	
                If
                  within fifteen (15) minutes from the time fixed for a meeting a
                  quorum is
                  not present the meeting shall, if convened upon the requisition
                  of
                  Bondholders or if the Issuer and the Trustee agree, be dissolved.
                  In any
                  other case it shall stand adjourned to such date, not less than
                  fourteen
                  (14) nor more than forty-two (42) days later, and to such place
                  as the
                  chairman may decide. At such adjourned meeting two (2) or more
                  persons
                  present in person holding Bonds or being proxies or representatives
                  (whatever the principal amount of the Bonds so held or represented)
                  shall
                  form a quorum and may pass any resolution and decide upon all matters
                  which could properly have been dealt with at the meeting from which
                  the
                  adjournment took place had a quorum been present at such meeting
                  provided
                  that at any adjourned meeting at which is to be proposed an Extraordinary
                  Resolution for the purpose of effecting any of the modifications
                  specified
                  in the proviso to paragraph 16
                  the quorum shall be two (2) or more persons so present holding
                  Bonds or
                  being proxies or representatives and holding or representing in
                  the
                  aggregate not less than one-third (1/3) in principal amount of
                  the Bonds
                  for the time being outstanding.

              

      

       

      
        	
                29.

              	
                The
                  chairman may with the consent of (and shall if directed by) a meeting
                  adjourn the meeting from time to time and from place to place but
                  no
                  business shall be transacted at an adjourned meeting which might
                  not
                  lawfully have been transacted at the meeting from which the adjournment
                  took place.

              

      

       

      
        	
                30.

              	
                At
                  least ten (10) days’ notice of any meeting adjourned through want of a
                  quorum shall be given in the same manner as for an original meeting
                  and
                  such notice shall state the quorum required at the adjourned meeting.
                  No
                  notice need, however, otherwise be given of an adjourned
                  meeting.

              

      

       

      
        	
                31.

              	
                Each
                  question submitted to a meeting shall be decided in the first instance
                  by
                  a show of hands and in case of equality of votes the chairman shall
                  both
                  on a show of hands and on a poll have a casting vote in addition
                  to the
                  vote or votes (if any) which he may have as a Bondholder or as
                  a holder of
                  a voting certificate or as a proxy or
                  representative.

              

      

       

      
        	
                32.

              	
                Unless
                  a poll is (before or on the declaration of the result of the show
                  of
                  hands) demanded at a meeting by the chairman, the Issuer, the Trustee
                  or
                  by one (1) or more persons holding one (1) or more Bonds or being
                  proxies
                  or representatives and holding or representing in the aggregate
                  not less
                  than two percent (2%) in principal amount of the Bonds for the
                  time being
                  outstanding, a declaration by the chairman that a resolution has
                  been
                  carried or carried by a particular majority or lost or not carried
                  by a
                  particular majority shall be conclusive evidence of the fact without
                  proof
                  of the number or proportion of the votes recorded in favour of
                  or against
                  such resolution.

              

      

       

      
        
          
          

        

        
          79

          
            

          

        

        
          
          

        

      

       

      
        	
                33.

              	
                If
                  a poll is demanded, it shall be taken in such manner and (subject
                  as
                  provided below) either at once or after such an adjournment as
                  the
                  chairman directs and the result of such poll shall be deemed to
                  be the
                  resolution of the meeting at which the poll was demanded as at
                  the date of
                  the taking of the poll. The demand for a poll shall not prevent
                  the
                  continuation of the meeting for the transaction of any business
                  other than
                  the question on which the poll has been
                  demanded.

              

      

       

      
        	
                34.

              	
                A
                  poll demanded on the election of a chairman or on any question
                  of
                  adjournment shall be taken at the meeting without
                  adjournment.

              

      

       

      
        	
                35.

              	
                The
                  Issuer and the Trustee (through their respective representatives)
                  and
                  their respective financial and legal advisers may attend and speak
                  at any
                  meeting of Bondholders. No one else may attend or speak at a meeting
                  of
                  Bondholders unless he is the holder of a Bond or is a proxy or
                  a
                  representative.

              

      

       

      
        	
                36.

              	
                On
                  a show of hands every holder who is present in person or any person
                  who is
                  present and is a proxy or a representative shall have one (1) vote
                  and on
                  a poll every person who is so present shall have one (1) vote in
                  respect
                  of each Bond produced or in respect of which he is a proxy or a
                  representative. Without prejudice to the obligations of proxies,
                  a person
                  entitled to more than one (1) vote need not use them all or cast
                  them all
                  in the same way.

              

      

       

      
        	
                37.

              	
                A
                  proxy need not be a Bondholder.

              

      

       

      
        	
                38.

              	
                A
                  meeting of Bondholders shall, subject to the Conditions, in addition
                  to
                  the powers given above, but without prejudice to any powers conferred
                  on
                  other persons by this Trust Deed, have power exercisable by Extraordinary
                  Resolution:

              

      

       

      
        	 	
                38.1

              	
                to
                  sanction any proposal by the Issuer for any modification, abrogation,
                  variation or compromise of, or arrangement in respect of, the rights
                  of
                  the Bondholders against the Issuer whether or not such rights arise
                  under
                  this Trust Deed;

              

      

       

      
        	 	
                38.2

              	
                to
                  sanction the exchange or substitution for the Bonds of, or the
                  conversion
                  of the Bonds into, shares, bonds, or other obligations or securities
                  of
                  the Issuer or any other entity;

              

      

       

      
        	 	
                38.3

              	
                to
                  assent to any modification of this Trust Deed or the Bonds which
                  shall be
                  proposed by the Issuer or the
                  Trustee;

              

      

       

      
        	 	
                38.4

              	
                to
                  authorise anyone to concur in and do anything necessary to carry
                  out and
                  give effect to an Extraordinary
                  Resolution;

              

      

       

      
        	 	
                38.5

              	
                to
                  give any authority, direction or sanction required to be given
                  by
                  Extraordinary Resolution;

              

      

       

      
        	 	
                38.6

              	
                to
                  appoint any persons (whether Bondholders or not) as a committee
                  or
                  committees to represent the interests of the Bondholders and to
                  confer on
                  them any powers or discretions which the Bondholders could themselves
                  exercise by Extraordinary
                  Resolution;

              

      

       

      
        	 	
                38.7

              	
                to
                  approve the substitution of any entity for the Issuer (or any previous
                  substitute) as principal debtor under this Trust Deed;
                  

              

      

       

      
        	 	
                38.8

              	
                to
                  approve a proposed new Trustee and to remove a Trustee;
                  and

              

      

       

      
        
          
          

        

        
          80

          
            

          

        

        
          
          

        

      

       

      
        	 	
                38.9

              	
                to
                  discharge or exonerate the Trustee from any liability in respect
                  of any
                  act or omission for which it may become responsible under this
                  Trust Deed
                  or the Bonds,

              

      

       

      provided
        that the special quorum provisions contained in the proviso to
        paragraph 5
        and, in
        the case of an adjourned meeting, in the proviso to paragraph 6
        shall
        apply for the purpose of making any modification to the provisions contained
        in
        this Trust Deed or the Bonds which would have the effect of:

       

      
        	 	
                18.9.1

              	
                modifying
                  the due date for any payment in respect of the Bonds;
                  or

              

      

       

      
        	 	
                18.9.2

              	
                reducing
                  or cancelling the amount of principal, interest, premium, or default
                  interest (including any Early Redemption Amount) or Equivalent
                  Amount
                  payable in respect of the Bonds or changing the method of calculation
                  of
                  the Early Redemption Amount; or

              

      

       

      
        	 	
                18.9.3

              	
                changing
                  the currency of payment of the Bonds;
                  or

              

      

       

      
        	 	
                18.9.4

              	
                modifying
                  (except by a unilateral and unconditional reduction in the Conversion
                  Price) or cancelling the Conversion Rights or the options specified
                  in
                  Conditions 9(D) or 9(E); or

              

      

       

      
        	 	
                18.9.5

              	
                modifying
                  the provisions contained in this Schedule concerning the quorum
                  required
                  at a meeting of Bondholders or the majority required to pass an
                  Extraordinary Resolution or sign a resolution in writing;
                  or

              

      

       

      
        	 	
                18.9.6

              	
                amending
                  this proviso.

              

      

       

      
        	
                39.

              	
                An
                  Extraordinary Resolution passed at a meeting of Bondholders duly
                  convened
                  and held in accordance with this Trust Deed shall be binding on
                  all the
                  Bondholders, whether or not present at the meeting, and each of
                  them shall
                  be bound to give effect to it accordingly. The passing of such
                  a
                  resolution shall be conclusive evidence that the circumstances
                  of such
                  resolution justify the passing of
                  it.

              

      

       

      
        	
                40.

              	
                The
                  expression “Extraordinary
                  Resolution”
                  means a resolution passed at a meeting of Bondholders duly convened
                  and
                  held in accordance with these provisions by a majority consisting
                  of not
                  less than three-quarters (3/4) of the votes cast at such
                  meeting.

              

      

       

      
        	
                41.

              	
                A
                  resolution in writing signed by or on behalf of the holders of
                  not less
                  than ninety percent (90%) in principal amount of the Bonds who
                  for the
                  time being are entitled to receive notice of a meeting in accordance
                  with
                  these provisions shall for all purposes be as valid as an Extraordinary
                  Resolution passed at a meeting of Bondholders convened and held
                  in
                  accordance with these provisions. Such resolution in writing may
                  be in one
                  (1) document or several documents in like form each signed by or
                  on behalf
                  of one (1) or more of the
                  Bondholders.

              

      

       

      
        	
                42.

              	
                Minutes
                  shall be made of all resolutions and proceedings at every meeting
                  and, if
                  purporting to be signed by the chairman of that meeting or of the
                  next
                  succeeding meeting of Bondholders, shall be conclusive evidence
                  of the
                  matters in them. Until the contrary is proved every meeting for
                  which
                  minutes have been so made and signed shall be deemed to have been
                  duly
                  convened and held and all resolutions passed or proceedings transacted
                  at
                  it to have been duly passed and
                  transacted.

              

      

       

      
        
          
          

        

        
          81

          
            

          

        

        
          
          

        

      

       

      
        	
                43.

              	
                Subject
                  to all other provisions contained in this Trust Deed, the Trustee
                  may
                  without the consent of the Bondholders prescribe such further regulations
                  regarding the holding of meetings and attendance and voting at
                  them or
                  regarding the making of resolutions in writing as the Trustee may
                  in its
                  sole discretion determine including (without limitation) such regulations
                  and requirements as the Trustee thinks reasonable to satisfy itself
                  that
                  persons who purport to make any requisition in accordance with
                  this Trust
                  Deed are entitled to do so and that those who purport to attend
                  or vote at
                  a meeting or to sign a written resolution are entitled to do
                  so.

              

      

       

      

      
        
          
          

        

        
          82

          
            

          

        

        
          
          

        

      

       

      This
        deed
        is delivered on the day and year first before written.

       

      The
        Issuer

      

        
          	
                  SEALED
                    with the COMMON
                    SEAL

                	
                  )

                
	 	
                  )

                
	
                  of
                    CHINA
                    ARCHITECTURAL

                	
                  )

                
	
                  ENGINEERING,
                    INC.

                	
                  )

                
	 	
                  )

                
	 	
                  )

                
	
                  and
                    SIGNED
                    by

                	
                  )

                
	[SIGNATURE
                  OF AUTHORIZED PERSON] 	
                  )

                
	 	
                  )

                
	 	
                  )

                
	
                  in
                    the presence of:-

                	
                  )

                
	 	 
	
                  The
                    Trustee 

                	 
	 	 
	
                  SEALED
                    with the COMMON
                    SEAL

                	
                  )

                
	 	
                  )

                
	
                  of
                    THE
                    BANK OF NEW YORK,

                	
                  )

                
	
                  LONDON
                    BRANCH

                	
                  )

                
	 	
                  )

                
	
                   

                	
                  )

                
	
                  and
                    SIGNED
                    by

                	
                  )

                
	[SIGNATURE
                  OF
                  AUTHORIZED PERSON]	
                  )

                
	 	
                  )

                
	 	
                  )

                
	
                  in
                    the presence of:-

                	
                  )

                

        

      

      

      
        
          
          

        

        
          83Execution
      Copy

     

    
      

      

    

     

    PAYING
      AND CONVERSION AGENCY AGREEMENT

    

     

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    

    

    

    April
      12,
      2007

     

    
      

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

       

    

    

    CONTENTS

     

    
      	
              Clause

            	 	 	
              Page

            
	
              1.

            	
              DEFINITIONS

            	 	
              1

            
	
              2.

            	
              APPOINTMENTS

            	 	
              2

            
	
              3.

            	
              AUTHENTICATION;
                TRANSFER OF GLOBAL CERTIFICATE

            	 	
              2

            
	
              4.

            	
              PAYMENT
                BY THE ISSUER

            	 	
              3

            
	
              5.

            	
              PAYMENT
                BY THE AGENTS

            	 	
              4

            
	
              6.

            	
              CONVERSION

            	 	
              6

            
	
              7.

            	
              EARLY
                REDEMPTION

            	 	
              11

            
	
              8.

            	
              CANCELLATION
                OF BONDS

            	 	
              12

            
	
              9.

            	
              ISSUE
                OF REPLACEMENT CERTIFICATES

            	 	
              13

            
	
              10.

            	
              DUTIES
                OF THE TRANSFER AGENTS IN RESPECT OF TRANSFERS

            	 	
              15

            
	
              11.

            	
              DUTIES
                OF THE REGISTRAR

            	 	
              15

            
	
              12.

            	
              DOCUMENTS
                AND CERTIFICATES FOR THE REGISTRAR

            	 	
              16

            
	
              13.

            	
              INFORMATION
                AND REGULATIONS CONCERNING THE BONDS

            	 	
              17

            
	
              14.

            	
              REMUNERATION

            	 	
              17

            
	
              15.

            	
              FUNDS
                HELD BY PRINCIPAL AGENT

            	 	
              18

            
	
              16.

            	
              MISCELLANEOUS

            	 	
              18

            
	
              17.

            	
              CHANGES
                IN AGENTS

            	 	
              22

            
	
              18.

            	
              NOTICES

            	 	
              24

            
	
              19.

            	
              GOVERNING
                LAW AND JURISDICTION

            	 	
              26

            
	
              20.

            	
              COUNTERPARTS

            	 	
              27

            
	
              21.

            	
              TERMINATION
                OF THIS AGREEMENT

            	 	
              27

            
	
              22.

            	
              CONTRACTS
                (RIGHTS OF THIRD PARTIES) ACT 1999

            	 	
              27

            
	
              23.

            	
              INVALIDITY

            	 	
              27

            
	
              EXHIBIT
                A CONVERSION NOTICE

            	 	
              29

            
	
              EXHIBIT
                B CONVERSION AGENT NOTIFICATION

            	 	
              32

            
	
              EXHIBIT
                C NOTIFICATION FROM ISSUER

            	 	
              34

            
	
              EXHIBIT
                D REGULATIONS CONCERNING THE TRANSFER AND REGISTRATION OF
                BONDS

            	 	
              36

            
	
              EXHIBIT
                E FORM OF BONDHOLDER REDEMPTION NOTICE

            	 	
              38

            
	
              EXHIBIT
                F FORM OF BONDHOLDER’S TAX ELECTION NOTICE

            	 	
              40

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

       

    

     

    THIS
      PAYING AND CONVERSION AGENCY AGREEMENT
      (this
“Agreement”)
      is
      made on April 12, 2007

     

    AMONG:

     

    
      	
              (1)

            	
              CHINA
                ARCHITECTURAL ENGINEERING, INC.,
                a company incorporated under the laws of the State of Delaware whose
                registered office is at 2711
                Centerville Road, Suite 400, Wilmington, Delaware 19808, c/o Corporation
                Service Company (the
                “Issuer”);
                

            

    

     

    
      	
              (2)

            	
              THE
                BANK OF NEW YORK, LONDON BRANCH
                at
                its specified office at 40th Floor, One Canada Square, London, E14
                5AL,
                United Kingdom as principal paying, conversion and transfer agent
                (the
                “Paying
                Agent”,
                “Conversion
                Agent”,
                “Transfer
                Agent”,
                as applicable, and collectively, the “Principal
                Agent”
                which expression shall, unless the context otherwise requires, include
                its
                successors as such principal paying, conversion and transfer agent,
                which
                expression shall, unless the context otherwise requires, include
                any
                future agent appointed in accordance with this Agreement);
                

            

    

     

    
      	
              (3)

            	
              THE
                BANK OF NEW YORK
                at
                its specified office at 101 Barclay Street, 21st Floor, New York,
                NY
                10286, United States of America as registrar (the “Registrar”,
                which expression shall, unless the context otherwise requires, include
                its
                successors as such registrar); and

            

    

     

    
      	
              (4)

            	
              THE
                BANK OF NEW YORK, LONDON BRANCH
                at
                its specified office at 40th Floor, One Canada Square, London, E14
                5AL,
                United Kingdom, as trustee for the persons for the time being holding
                the
                Bonds referred to below (the “Trustee”,
                which expression shall include its successors as such trustee or
                any joint
                trustee).

            

    

     

    WHEREAS:

     

    
      	
              (A)

            	
              The
                Issuer has agreed to issue US$10,000,000 Variable Rate Convertible
                Bonds
                due 2012 of the Issuer (the “Bonds”)
                which will be convertible at the option of the holder thereof into
                fully
                paid shares of common stock of par value of US$0.001 each (the
                “Shares”)
                that will be listed on the American Stock Exchange (the “AMEX”).

            

    

     

    
      	
              (B)

            	
              The
                Bonds are to be constituted by a trust deed (the “Trust
                Deed”)
                dated April 12, 2007 and made between the Issuer and the
                Trustee.

            

    

     

    
      	
              (C)

            	
              The
                Bonds will be issued in registered form in the denomination of US$1,000
                each.

            

    

     

    NOW
      IT IS HEREBY AGREED
      as
      follows:

     

    
      	
              1.

            	
              
                DEFINITIONS

              

            

    

     

    Terms
      defined or construed in the Bonds or the Trust Deed shall, unless the context
      otherwise requires, have the same meanings when used herein. In
      addition:

     

    “Agents”
means
      the Principal Agent, the Registrar and the other paying, conversion and transfer
      agents referred to above;

     

    “Alternative
      Clearing System”
means
      a
      clearing system as shall have been designated by the Issuer and approved by
      the
      Trustee;

    
      
        
        

      

      
        1

        
          

        

      

       

    

     

    “Business
      Day”
means
      a
      day (other than a Saturday, Sunday or a public holiday) on which commercial
      banks and foreign exchange markets are open for business in New York, England
      and the city in which the specified office of the Principal Agent is
      located;

     

    “Register”
has
      the
      meaning set out in Clause 11.1; and

     

    any
      “successor”
to
      an
      Agent means a successor to that Agent appointed at its specified office in
      accordance with the terms of this Agreement.

     

    
      	
              2.

            	
              
                APPOINTMENTS

              

            

    

     

    The
      Issuer appoints the Agents as its agents in respect of the Bonds in accordance
      with the provisions of the Conditions and this Agreement at their respective
      offices referred to in this Agreement and the Agents accept such appointments.
      Subject as provided in Clause 17, references to the Agents are to them acting
      solely through their respective specified offices. The obligations and duties
      of
      the Agents under this Agreement are several and not joint.

     

    
      	
              3.

            	
              
                AUTHENTICATION;
                  TRANSFER OF GLOBAL
                  CERTIFICATE

              

            

    

     

    
      	
              3.1

            	
              The
                Global Certificate 

            

    

     

    Immediately
      before issuance, the Issuer shall deliver to the Registrar a duly executed
      Global Certificate representing the Bonds. The Registrar (or its agent on its
      behalf) shall authenticate the Global Certificate upon the written order of
      the
      Issuer and arrange for its delivery to a common depositary for Euroclear and
      Clearstream.

     

    Title
      to
      the Bonds evidenced by the Global Certificate may be registered in the name
      of,
      and the Global Certificate may be deposited with, such Alternative Clearing
      System other than Euroclear or Clearstream (or a nominee thereof) as the Issuer
      may from time to time designate with the prior written approval of the Trustee,
      and shall bear such legend as may be appropriate.

     

    
      	
              3.2

            	
              Transfers
                of Interests in the Global
                Certificate

            

    

     

    Any
      transfer or exchange of an interest in the Bonds evidenced by the Global
      Certificate shall be effected in accordance with the rules and procedures of
      Euroclear or Clearstream, or any relevant Alternative Clearing System, as
      applicable.

     

    
      	
              3.3

            	
              Exchange
                of Interests in the Global Certificate for Definitive
                Certificates

            

    

     

    
      	 	
              (a)

            	
              Definitive
                Certificates in respect of interests in any Bonds will not be issued
                in
                exchange for interests in the Bonds evidenced by the Global Certificate
                except in the circumstances provided in Clause 3.3(b), provided that,
                in
                the event that the Issuer designates an Alternative Clearing System
                and
                such designation is approved in writing by the Trustee, title to
                all or
                some of the Bonds may be transferred to an Alternative Clearing System
                or
                its nominee and definitive Certificates may be issued to evidence
                such
                transfer.

            

    

     

    
      	 	
              (b)

            	
              In
                the event that either Euroclear or Clearstream (or any Alternative
                Clearing System on behalf of which the Bonds evidenced by the Global
                Certificate may be held) is closed for business for a continuous
                period of
                fourteen (14) days (other than by reason of holidays, statutory or
                otherwise) or announces an intention permanently to cease business
                or does
                in fact do so, the Issuer will cause sufficient definitive Certificates
                to
                be executed and delivered to the Registrar in sufficient quantities
                as
                advised by the Registrar and the Registrar will authenticate the
                same for
                despatch to individual Bondholders in accordance with the Conditions,
                Clause 3.3(c) and Exhibit D hereto.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (c)

            	
              Upon
                one (1) of the events set forth in Clause 3.3(b) occurring, a holder
                of
                Bonds represented by the Global Certificate will provide the Registrar
                with a written order containing instructions and such other information
                as
                the Issuer and the Registrar may require to complete, execute and
                deliver
                such definitive Certificates.

            

    

     

    
      	 	
              (d)

            	
              Upon
                receipt of the Certificates referred to in Clause 3.3(b) and the
                written
                order referred to in Clause 3.3(c), the Registrar shall arrange for
                the
                execution and delivery to or upon the order of the person or persons
                named
                in such order of an individual definitive Certificate representing
                Bonds
                registered in the name or names requested by such person or persons
                and
                the Registrar shall alter the entries in the Register in respect
                of the
                Bonds accordingly. Payment will only be made to the person whose
                name
                appears on the Register.

            

    

     

    
      	
              3.4

            	
              Transfer
                or Exchange of Definitive
                Certificates

            

    

     

    Subject
      to the provisions of this Clause 3 and Exhibit D, the holder of Bonds
      represented by definitive Certificates may transfer or exchange such Bonds.
      Subject to compliance with such provisions, the relevant Transfer Agent and
      the
      Registrar shall register the transfer of Bonds represented by definitive
      Certificates in accordance with Clauses 10 and 11 below.

     

    
      	
              3.5

            	
              Proxies
                and Authorisations

            

    

     

    Subject
      to the provisions of this Agreement, the registered holder of Bonds represented
      by the Global Certificate may grant proxies and otherwise authorise any person,
      including participants in Euroclear and Clearstream and persons that may hold
      interests through such participants, to take any action that a holder is
      entitled to take under this Agreement or the Bonds.

     

    
      	
              3.6

            	
              No
                Transfer Periods

            

    

     

    Notwithstanding
      anything herein to the contrary, no Bondholder may require the transfer of
      a
      Bond during the periods set forth in Condition 4(E).

     

    
      	
              4.

            	
              
                PAYMENT
                  BY THE ISSUER

              

            

    

     

    
      	
              4.1

            	
              Payment
                to the Principal Agent

            

    

     

    In
      order
      to provide for the payment of the principal, premium, interest and/or default
      interest (if any) in respect of the Bonds as the same shall become due, the
      Issuer shall, by 12:00 noon (New York time), unconditionally pay or procure
      to
      be paid, to the Principal Agent:

     

    
      	 	
              (a)

            	
              on
                maturity or early redemption of any Bonds in an account specified
                by the
                Principal Agent for value at least one (1) Business Day prior to
                the
                redemption date thereof (or, in the case of the Bonds becoming due
                and
                payable pursuant to Condition 11, forthwith upon being required by
                the
                Trustee so to make such payment), an amount sufficient (together
                with any
                funds then held by the Principal Agent which are available for such
                purpose) to pay the amount due on redemption of all Bonds so to be
                redeemed (or the amount due pursuant to Condition 11);
                and

            

    

    
      
        
        

      

      
        3

        
          

        

      

       

    

     

    
      	 	
              (b)

            	
              for
                value at least one (1) Business Day before each due date for the
                payment
                of interest or other sums payable in respect of the Bonds in accordance
                with the Conditions, other than sums referred to in sub-Clause 4.1(a)
                above, an amount sufficient (together with any funds then held by
                the
                Principal Agent which are available for such purpose) to pay the
                interest
                or other sums payable then becoming due on the outstanding
                Bonds.

            

    

     

    All
      amounts deposited with the Trustee or any Paying Agent for the payment of Bonds
      to the Bondholders but which have not been so paid due to the subsequent
      conversion of such Bonds or otherwise shall be immediately returned to the
      Issuer upon the Issuer’s written request, provided that no interest shall accrue
      on such amounts and be payable to the Issuer by the Trustee or any Paying
      Agent.

     

    
      	
              4.2

            	
              Notification
                of payment

            

    

     

    The
      Issuer shall procure that on or before 12:00 noon (New York time) on the second
      Business Day prior to each due date for payment of principal, premium, interest
      and/or default interest in respect of the Bonds, the bank through which such
      payment is to be made will send to the Principal Agent confirmation that it
      has
      received from the Issuer an irrevocable instruction to make the relevant payment
      (by SWIFT). 

     

    In
      this
      Clause 4, the date on which a payment in respect of the Bonds becomes due means
      the first date on which the holder of a Bond could claim the relevant payment
      by
      transfer to an account under the Conditions, but disregarding the necessity
      for
      it to be a Business Day in any particular place of presentation.

     

    
      	
              4.3

            	
              Notification
                in the event of
                non-payment

            

    

     

    The
      Principal Agent shall forthwith notify (in writing and by facsimile
      transmission) the Trustee, the other Agents and the Issuer if it has not, by
      10:00 a.m. (New York time) on the due date for payment of principal, premium,
      interest and/or default interest (if any) on the Bonds or any of them, received
      unconditionally in the manner provided in this Clause 4 the full amount of
      the
      moneys payable on such due date on or in respect of all such Bonds, as the
      case
      may be.

     

    
      	
              5.

            	
              
                PAYMENT
                  BY THE AGENTS

              

            

    

     

    
      	
              5.1

            	
              Payment

            

    

     

    Unless
      the Paying Agents receive a notification from the Principal Agent under Clause
      4.3, they will, subject to and in accordance with the Conditions, pay or cause
      to be paid on behalf of the Issuer on and after each due date therefor the
      amounts due in respect of the Bonds and will be entitled to claim any amounts
      so
      paid from the Principal Agent. If any payment provided for in Clause 4.1 is
      made
      late but otherwise in accordance with this Agreement, the Paying Agents will
      nevertheless make such payments in respect of the Bonds. However, unless and
      until the full amount of any such payment has been made to the Principal Agent,
      none of the Paying Agents will be bound to make such payments until either
      the
      Principal Agent has received the full amount of moneys then due and payable
      in
      respect of the Bonds or other arrangements satisfactory to the Principal Agent
      have been made. If payment of any amount is made to the Principal Agent later
      than the due date for payment of such amount to the Bondholders, the Principal
      Agent shall as soon as practicable after receipt thereof give notice to the
      Bondholders in accordance with Condition 18 that such payment has been made.
      All
      payments to be made by the Paying Agents hereunder shall be made without
      charging any commission or fee to the Bondholders. Nothing contained herein
      shall require a Paying Agent to make a payment unless and until the Paying
      Agent
      has received immediately available funds sufficient to make said
      payment.

    
      
        
        

      

      
        4

        
          

        

      

       

    

     

    
      	
              5.2

            	
              Reimbursements
                of Agents

            

    

     

    The
      Principal Agent will on demand promptly reimburse each Paying Agent for payments
      in respect of the Bonds made by it in accordance with the Conditions and this
      Agreement. The Issuer shall on demand by the Principal Agent reimburse the
      Principal Agent for the relevant amount and pay interest to the Principal Agent
      on such amount that is outstanding from the date on which it is paid out by
      that
      Paying Agent to the date of reimbursement by the Issuer at the rate per annum
      then prevailing at the date of such funding equal to the cost to the relevant
      Paying Agent of funding the amount paid out plus two percent (2%) per annum
      as
      certified by the Principal Agent.

     

    
      	
              5.3

            	
              Method
                of payment to Principal
                Agent

            

    

     

    All
      sums
      payable to the Principal Agent hereunder will be paid in United States dollars
      and in immediately available or same day funds to such account, with such bank
      in New York City as the Principal Agent may from time to time notify in advance
      to the Issuer in writing.

     

    
      	
              5.4

            	
              Surrender
                of Certificates to Paying
                Agents

            

    

     

    The
      Paying Agents shall accept surrender of Certificates from Bondholders as a
      condition precedent to payment of principal and premium (if any) in accordance
      with the Conditions. At close of business on the second business day (as defined
      in Condition 8(F)) before the due date for payment in respect of Bonds, and,
      if
      Certificates are surrendered later than that, on any business day (as defined
      in
      Condition 8(F)) thereafter on which Certificates are surrendered, each Paying
      Agent to whom Certificates have been surrendered will notify the Registrar
      and
      the Principal Agent of the identifying numbers of Certificates surrendered
      to it
      at that time. Each Paying Agent will cancel Certificates surrendered to it
      and
      forward the cancelled Certificates to the Principal Agent for
      destruction.

     

    
      	
              5.5

            	
              Fees
                and expenses of the Agents

            

    

     

    The
      Principal Agent will account to each of the other Agents for their fees and
      expenses in respect of the services performed by them under this Agreement
      promptly after receipt thereof from the Issuer and the Issuer shall have no
      responsibility for the apportionment of any such payments.

    
      
        
        

      

      
        5

        
          

        

      

       

    

     

    
      	
              5.6

            	
              Agents
                of the Trustee 

            

    

     

    The
      Principal Agent, the Registrar or the other Agents shall, on demand by the
      Trustee by notice in writing given to them at any time after any Event of
      Default or Potential Event of Default has occurred, until notified by the
      Trustee to the contrary, so far as permitted by applicable law:

     

    
      	 	
              (a)

            	
              act
                thereafter as agents of the Trustee under the Trust Deed and the
                Bonds on
                the terms of this Agreement (with consequential amendments as necessary
                and except that the Trustee’s liability for the indemnification,
                remuneration and all other expenses of the Agents and the Registrar
                will
                be limited to the amounts for the time being held by the Trustee
                in
                respect of the Bonds on the trust of the Trust Deed) and thereafter
                hold
                all Certificates and all moneys, documents and records held by them
                in
                respect of the Bonds to the order of the Trustee;
                and/or

            

    

     

    
      	 	
              (b)

            	
              deliver
                up all Certificates and all moneys, documents and records held by
                them in
                respect of the Bonds to the Trustee or as the Trustee shall direct
                in such
                notice or subsequently, provided that this Clause 5.6(b) shall not
                apply
                to any documents or records which the Principal Agent, the Registrar
                or
                the relevant Agent is obliged not to release by any law or regulation
                to
                which it is subject.

            

    

     

    
      	
              5.7

            	
              Notices
                of change of the Trustee

            

    

     

    The
      Issuer shall forthwith give notice to the Principal Agent of any change in
      the
      person or persons who act as the Trustee under the Trust Deed.

     

    
      	
              6.

            	
              Conversion

            

    

     

    
      	
              6.1

            	
              
                CONVERSION
                  DUTIES OF CONVERSION
                  AGENTS

              

            

    

     

    The
      Conversion Agent shall during normal business hours (local time in the place
      where the specified office of the relevant Conversion Agent is located) (a)
      accept deposit on behalf of the Issuer of (i) any Certificates in respect of
      Bonds which the holder(s) thereof desires to convert (and in respect of which
      Bond a Conversion Notice is deposited with that Conversion Agent prior to the
      Conversion Date) together with a Conversion Notice (in duplicate) duly completed
      and signed (where necessary) or (ii) in the case of Bonds represented by the
      Global Certificate, a Conversion Notice only (which may, in such case, be
      delivered by facsimile transmission), together, in each case of (i) and (ii),
      with any amount payable by the relevant holder under Condition 6(B)(ii); and
      (b)
      the Issuer shall pay all stamp, issue, documentary, transfer, registration,
      excise or other taxes or duties (if any) specified in the Trust Deed or the
      Bonds to be payable by the Issuer. The Conversion Agent shall be entitled to
      assume, without duty to enquire, each converting Bondholder has, as a condition
      precedent to exercising its Conversion Right, paid all stamp, issue,
      registration, and similar taxes or duties or transfer costs (if any) (other
      than
      any amounts payable by the Issuer in accordance with the Conditions) which
      it is
      required to pay in accordance with the Conditions (including without limitation,
      Condition 6(B)(ii)). Once deposited, a Conversion Notice may not be withdrawn
      without the written consent of the Issuer (with a copy of such consent together
      with the relevant Conversion Notice sent to the relevant Conversion Agent at
      the
      same time).

    
      
        
        

      

      
        6

        
          

        

      

       

    

     

    
      	
              6.2

            	
              Global
                Certificate

            

    

     

    Conversion
      Rights attaching to the Bonds represented by the Global Certificate shall be
      exercised in the manner set out herein and in the Conditions, provided
      that:

     

    
      	 	
              (a)

            	
              the
                Global Certificate need not be deposited with the Conversion Agent
                together with the relevant Conversion
                Notice;

            

    

     

    
      	 	
              (b)

            	
              the
                Conversion Notice for Bonds represented by the Global Certificate
                may be
                completed and deposited by or on behalf of an account holder of
                Clearstream or Euroclear or an Alternative Clearing System in which
                the
                Bond to be converted is held at such time, which has an interest
                in such
                Bonds;

            

    

     

    
      	 	
              (c)

            	
              Bonds
                which have been converted will be rendered void forthwith and the
                Global
                Certificate shall be annotated accordingly without cancellation of
                the
                Global Certificate; and

            

    

     

    
      	 	
              (d)

            	
              the
                holding of an interest in Bonds by an account holder of Clearstream
                or
                Euroclear or an Alternative Clearing System in which the Bonds are
                held at
                such time in respect of which the Conversion Rights are exercised
                will be
                confirmed by the relevant clearing system with the Conversion
                Agent.

            

    

     

    
      	
              6.3

            	
              Certificates
                held by Conversion Agents

            

    

     

    On
      deposit of a Certificate and a Conversion Notice (in duplicate) in accordance
      with Clause 6.1, the Certificate and the Conversion Notice so deposited shall
      be
      deemed to be held by the Conversion Agent as the agent of the Issuer. The
      Conversion Agent shall cancel forthwith upon the Conversion Date the
      Certificates representing the Bonds and (unless the Conversion Agent is also
      the
      Principal Agent) despatch such cancelled Certificates promptly to or to the
      order of the Principal Agent or its designated agent, together with a
      certificate stating the identifying numbers of the Bonds in respect of which
      the
      relevant Certificates have been delivered and the identifying numbers of the
      relevant Certificates.

     

    
      	
              6.4

            	
              Notification
                by Conversion Agents

            

    

     

    
      	 	
              (a)

            	
              Immediately
                following deposit of a Certificate (if applicable) and Conversion
                Notice
                in accordance with Clause 6.1 and payment of any required amount
                by
                Bondholders in accordance with Condition 6(B)(ii), the Conversion
                Agent
                with which they were deposited shall verify that the Conversion Right
                is
                exercisable and that the Conversion Notice (in duplicate) has been
                duly
                completed in relation to the Bonds, which are the subject of the
                purported
                conversion, in accordance with its terms and purports to have been
                signed
                by or on behalf of the Bondholder named therein and that the Conversion
                Notice is accompanied by all Certificates (if applicable) to which
                it
                relates. Following receipt of original Conversion Notices in accordance
                with this Clause 6.4, and notwithstanding the provisions of Clause
                6.4(c)(iii) below, the Principal Agent will send by post to the Issuer
                the
                original Conversion Notice (if applicable) as soon as reasonably
                practicable following any such request by the Issuer. For avoidance
                of
                doubt, the Conversion Agent should have no responsibility in respect
                to
                the Conversion Notice which is not duly completed and signed in accordance
                with Clause 6.1.

            

    

    
      
        
        

      

      
        7

        
          

        

      

       

    

     

    
      	 	
              (b)

            	
              As
                soon as reasonably practicable following receipt of the Conversion
                Notice
                by a Conversion Agent other than the Principal Agent and the fulfilment
                of
                the conditions in Clause 6.4(a), such Conversion Agent
                shall:

            

    

     

    
      	 	
              (i)

            	
              send
                by facsimile transmission a copy of such Conversion Notice to the
                Principal Agent and the Issuer;

            

    

     

    
      	 	
              (ii)

            	
              cancel
                forthwith upon the Conversion Date all Certificates delivered with
                such
                Conversion Notice and despatch such cancelled Certificates promptly
                (together with a certificate stating the certificate numbers of the
                Bonds
                so delivered), to or to the order of the Principal Agent or its designated
                agent, who shall destroy such cancelled Certificates;
                and

            

    

     

    
      	 	
              (iii)

            	
              despatch
                as soon as practicable and in any event within five (5) days after
                the
                Conversion Date by post, the original Conversion Notice (if applicable)
                to
                the Principal Agent.

            

    

     

    
      	 	
              (c)

            	
              Upon
                receipt of the Conversion Notice and in any event no later than five
                (5)
                Business Days following such receipt by the Principal Agent (either
                as a
                result of deposit of the original by a converting Bondholder with
                the
                Principal Agent in its capacity as Conversion Agent or as a result
                of
                receipt of the facsimile of such Conversion Notice pursuant to Clause
                6.4(b)(i) above) and fulfilment of the conditions in Clause 6.4(a),
                the
                Principal Agent in its capacity as Conversion Agent
                shall:

            

    

     

    
      	 	
              (i)

            	
              notify
                the Issuer in the manner specified in Exhibit B hereto (a “Conversion
                Agent Notification”)
                by facsimile transmission, of the following (together with a copy
                of the
                Conversion Notice(s)):

            

    

     

    
      	 	
              (A)

            	
              the
                total number, the aggregate principal amount of all Bonds deposited
                on the
                same occasion by the same Bondholder which are to be converted, the
                number
                of Shares issuable upon conversion and the name and address of such
                Bondholder;

            

    

     

    
      	 	
              (B)

            	
              the
                name and address of the person in whose name the Shares issuable
                upon
                conversion are to be registered;
                and

            

    

     

    
      	 	
              (C)

            	
              the
                Conversion Date and the Conversion Price in respect of such
                conversion;

            

    

     

    
      	 	
              (ii)

            	
              (where
                the Conversion Agent with which the Certificate is deposited is itself
                the
                Principal Agent) cancel forthwith upon the Conversion Date all
                Certificates delivered with such Conversion Notice and procure the
                destruction of such cancelled Certificates, unless notified otherwise
                by
                the Issuer at least five (5) Business Days prior to such Conversion
                Date;

            

    

     

    
      	 	
              (iii)

            	
              despatch
                as soon as practicable and in any event within five (5) days after
                the
                Conversion Date the original Conversion Notice (if applicable) to
                the
                Issuer; and

            

    

    
      
        
        

      

      
        8

        
          

        

      

       

    

     

    
      	 	
              (iv)

            	
              without
                any further notice or confirmation from the Issuer, and in any event
                no
                later than the Conversion Date, instruct the Registrar to remove
                the name
                of the relevant Bondholder from the Register or reduce the corresponding
                principal amount of Bonds registered as being represented by the
                Global
                Certificate, where appropriate.

            

    

     

    
      	 	
              (d)

            	
              Where
                a Conversion Notice is received which requires the Shares (or other
                securities, property or cash) issuable on conversion of the Bonds
                to which
                it relates to be dealt with in different ways for specified principal
                amounts (which must be US$1,000) of Bonds, the Principal Agent receiving
                the Conversion Notice may, and if requested by the Bondholder depositing
                the Conversion Notice, shall, treat each specified principal amount
                of
                Bonds as if it were subject to its own Conversion Notice and prepare
                and
                send the details referred to in Clause 6.4(c) separately for each
                such
                specified principal amount (and, for the avoidance of doubt so they
                are
                not aggregated for the purpose of calculating the number of Shares,
                or
                amount of other property, issuable on
                conversion).

            

    

     

    
      	
              6.5

            	
              Delivery
                by the Issuer 

            

    

     

    
      	 	
              (a)

            	
              Within
                ten (10) Business Days after the receipt of the relevant Conversion
                Agent
                Notification, the Issuer will forthwith send notification (in the
                manner
                specified in Exhibit C hereto) by facsimile to the Conversion Agent
                which
                has initially received the relevant Conversion Notice (and will send
                a
                copy to the Principal Agent (if it is not the Agent which received
                the
                relevant Conversion Notice) and the Registrar), in the case of a
                Bond in
                respect of which the Conversion Right has been exercised and in respect
                of
                which a Conversion Notice was deposited, confirming that delivery,
                despatch or payment in accordance with such Conversion Notice (or
                otherwise in accordance with the converting Bondholder’s instructions) of
                the certificate or certificates for the relevant Shares and/or securities,
                property or cash required to be delivered and/or paid upon conversion
                has
                been or will be made.

            

    

     

    
      	 	
              (b)

            	
              In
                addition, upon delivery and despatch of the certificate(s) for the
                relevant Shares issued on conversion or delivery of the relevant
                Shares to
                the converting Bondholder, the Issuer shall send confirmation by
                facsimile
                to the Conversion Agent which has sent the relevant Conversion Notice
                (and
                will send a copy to the Principal Agent and the Registrar) that the
                converting Bondholder or other person nominated in the Conversion
                Notice
                has been registered as the owner of the relevant Shares issued on
                conversion.

            

    

     

    
      	 	
              (c)

            	
              Promptly
                upon receipt of the confirmation referred to in Clause 6.5(b) of
                registration in the register of shareholders or notification that
                cash has
                been paid upon conversion (but not before), the Registrar shall remove
                the
                name of the relevant Bondholder from the Register, or reduce the
                number of
                Bonds of which it is registered as owner, as
                appropriate.

            

    

     

    
      	
              6.6

            	
              Issuer
                to provide Conversion Notice and Particulars of Adjustment to Conversion
                Price

            

    

     

    As
      soon
      as is practicable following a request from time to time, the Issuer will provide
      the Conversion Agents with copies of the form of Conversion Notice and shall,
      whenever the Conversion Price is adjusted pursuant to the Trust Deed and the
      Conditions, as soon as practicable, notify each of the Trustee and the
      Conversion Agents of particulars of the event giving rise to the adjustment,
      the
      Conversion Price after such adjustment, the date on which such adjustment takes
      effect and such other particulars and information as the Trustee may reasonably
      require. If required by any Bondholder, the Conversion Agents shall make
      Conversion Notices in the current form available to Bondholders. For the
      avoidance of doubt, no Agent has any duty to determine whether any event
      requiring any adjustment to the Conversion Price has occurred or is existing,
      or
      whether any such adjustment has been correctly made and no Agent has an
      obligation to calculate any Conversion Price or any adjustment to the Conversion
      Price.

    
      
        
        

      

      
        9

        
          

        

      

       

    

     

    
      	
              6.7

            	
              Notification
                of Closure of Register of
                Shareholders

            

    

     

    The
      Issuer shall as soon as is practicable after becoming aware that the Issuer’s
      register of shareholders is to be closed, give notice to the Trustee and the
      Agents of any dates upon which such register of shareholders is to be closed.
      Such notice shall give particulars of the reason for such closure and the
      expected date when the register will be re-opened. 

     

    
      	
              6.8

            	
              Identification
                Codes

            

    

     

    Each
      Conversion Notice deposited with a Conversion Agent and each facsimile
      transmission sent and letter delivered in respect of a Conversion Notice
      pursuant to the foregoing provisions of this Clause by any Conversion Agent
      shall indicate the identification code designated below for that Conversion
      Agent, followed by the words “China
      Architectural Engineering, Inc. Variable Rate Convertible Bonds due 2012
      (US$)”,
      and
      shall bear the lowest number previously unused by that Conversion Agent in
      the
      sequence of whole numerals starting from one and continuing in uninterrupted
      sequence upwards, for identification. All confirmatory or subsequent
      communications (regardless of the identity of the sender or the recipient
      thereof) with regard to the conversion, receipt, delivery and/or payment of
      Shares and/or any other securities, property and cash relating to such
      Conversion Notice shall bear the same identifying number as well as the
      identification code of the relevant Conversion Agent.

     

    The
      identification codes of the Conversion Agent shall be as follows:

     

    BNYLDN1      

     

    Thus,
      by
      way of example, the reference to be used for the fifth Conversion Notice
      deposited with the Principal Agent and for each facsimile transmission and
      letter relating thereto would be “BNYLDN1/China Architectural Engineering, Inc.
      Variable Rate Convertible Bonds due 2012/0005”.

     

    
      	
              6.9

            	
              Fees
                and Expenses of Conversion

            

    

     

    The
      Issuer shall pay all stamp, issue, registration, excise, and similar taxes
      and
      duties and transfer costs (if any) payable with respect to the deposit of Bonds
      for conversion and the issue and delivery of Shares following such deposit
      (other than those taxes and duties payable by the converting Bondholder as
      expressly provided in Clause 6.1 or the Conditions), all expenses arising in
      the
      United States or England on the issue of Shares on conversion of Bonds and
      all
      charges of the Conversion Agents in connection thereon.

    
      
        
        

      

      
        10

        
          

        

      

       

    

     

    
      	
              6.10

            	
              Taxes
                and Duties

            

    

     

    Neither
      the Conversion Agent nor the Issuer is under any obligation to determine whether
      a Bondholder is liable to pay any taxes or duties, including stamp, issue,
      registration or similar taxes and duties upon exercise by such Bondholder of
      the
      Conversion Right. The Agents shall be entitled to rely without further enquiry
      and without liability on any information provided by such Bondholder in the
      Conversion Notice as to any such amounts payable and as to the details of the
      relevant tax authorities to which the Conversion Agent must pay monies received
      in settlement of the taxes and duties payable pursuant to Condition
      6(B)(ii).

     

    
      	
              7.

            	
              
                EARLY
                  REDEMPTION

              

            

    

     

    
      	
              7.1

            	
              Notice
                of Redemption

            

    

     

    If
      the
      Issuer intends to redeem all or any of the Bonds under Condition 9(B) or
      Condition 9(C) it shall, at least five (5) Business Days before the latest
      date
      for the publication of the notice of redemption required to be given to
      Bondholders in accordance with Condition 18, give prompt notice in writing
      of
      its intention to the Principal Agent and the Trustee stating the date on which
      such Bonds are to be redeemed and the Early Redemption Amount.

     

    
      	
              7.2

            	
              Redemption
                Notice

            

    

     

    On
      behalf
      of and at the request and expense of the Issuer, the Principal Agent shall
      publish the notice in accordance with Condition 18, in the form approved by
      the
      Issuer, required in connection with such redemption. Such notice shall specify
      the details in accordance with Condition 9(H). The Principal Agent shall
      forthwith notify the other Paying Agents of the contents of such
      notice.

     

    
      	
              7.3

            	
              Bondholders’
                Tax Option

            

    

     

    Each
      Paying Agent will keep a stock of notices (the “Bondholder’s
      Tax Election Notices”)
      each
      in a form similar to that set out in the Exhibit F and will make them available
      on demand to Bondholders. The Paying Agent with which a Bond is deposited
      pursuant to Condition 9(C) shall hold such Bond on behalf of the depositing
      Bondholder (but shall not, save as provided below, release it) until the
      proposed Tax Redemption Date of the Bonds pursuant to Condition 9(C)(i). On
      that
      date, subject as provided below, the relevant Paying Agent shall return such
      Bond to the depositing Bondholder and (in the case of the Global Certificate)
      endorse the relevant Schedule to such Certificate appropriately. If the
      deposited Bond (or Bonds) becomes (or become) immediately due and payable before
      that date, the Paying Agent concerned shall mail such Certificate by uninsured
      post to, and at the risk of, the relevant holder.

     

    
      	
              7.4

            	
              Redemption
                at the Option of the Bondholders and Redemption for Delisting or
                Change of
                Control

            

    

     

    Each
      Paying Agent will keep a stock of notices (“Bondholder
      Redemption Notices”)
      in a
      form similar to that set out in Exhibit E and will make them available on demand
      to Bondholders. The Paying Agent with which a Certificate is deposited pursuant
      to Condition 9(D) or Condition 9(E) shall hold such Certificate on behalf of
      the
      depositing Bondholder (but shall not, save as provided below, release it) until
      the due date for redemption of the Bonds in respect of which it is issued
      pursuant to Condition 9(D) or Condition 9(E), as the case may be. On that date,
      subject as provided below, the relevant Paying Agent shall surrender such
      Certificate to itself and treat it as if surrendered by the holder in accordance
      with the Conditions and (in the case of the Global Certificate) endorse the
      Schedule to such Certificate with the principal amount of Bonds to be redeemed
      and the principal amount of Bonds remaining after such redemption. If the Bond
      (or Bonds) represented by the deposited Certificate becomes (or become)
      immediately due and payable before that date, the Paying Agent concerned shall
      mail such Certificate by uninsured post to, and at the risk of, the relevant
      Bondholder at the address shown for the Bondholder on the register of
      Bondholders as supplied by the Registrar. At the end of the period for
      exercising the option in Condition 9(D) or Condition 9(E), as the case may
      be,
      each Paying Agent shall promptly notify the Principal Agent of the principal
      amount of Bonds in respect of which Bondholder Redemption Notices have been
      deposited with it and will forward such Bondholder Redemption Notices to the
      Principal Agent. The Principal Agent shall promptly notify such information
      and
      details of the principal amount of Bonds represented by the Global Certificate
      in respect of which the option in Condition 9(D) or Condition 9(E), as the
      case
      may be, has been exercised to the Issuer and the Trustee. A Bondholder
      Redemption Notice, once delivered, shall be irrevocable.

    
      
        
        

      

      
        11

        
          

        

      

       

    

     

    
      	
              7.5

            	
              Effect
                of Notice of Redemption

            

    

     

    Once
      a
      notice of redemption is provided in accordance with Condition 18 and/or a
      Bondholder Redemption Notice is duly completed, signed and deposited with any
      Paying Agents in accordance with Condition 9(D) or Condition 9(E), Bonds
      called/put for redemption become due and payable on the date fixed for
      redemption of the Bonds, the Relevant Event Redemption Date at the Early
      Redemption Amount or 126.51% of the principal amount of the Bonds, as the case
      may be, stated in the relevant notice. Upon surrender of any Certificate in
      respect of such Bond for redemption in accordance with said notice, such Bond
      shall be paid by the Issuer at the Early Redemption Amount or 126.51% of the
      principal amount of the Bonds, as the case may be, in accordance with the
      Conditions.

     

    
      	
              7.6

            	
              Deposit
                of Redemption Price

            

    

     

    For
      value
      on the Business Day prior to the relevant redemption date, the Issuer shall
      deposit with the Principal Agent money sufficient to pay the redemption price
      of
      all Bonds to be redeemed on that date other than any Bonds called for redemption
      on that date which have been converted prior to the date of such deposit. The
      Principal Agent shall as soon as practicable return to the Issuer upon its
      written request any money (without interest thereon) not required for that
      purpose because of conversion of any Bonds called for redemption.

     

    
      	
              8.

            	
              
                CANCELLATION
                  OF BONDS

              

            

    

     

    
      	
              8.1

            	
              Cancellation
                by Agents

            

    

     

    All
      Bonds
      which are redeemed, converted or purchased by the Issuer or any of its
      Subsidiaries shall be cancelled by the removal of the relevant Bondholder’s name
      from the Register by the Registrar and cancellation of the corresponding
      Certificates (or appropriate amendment of the Global Certificate if the Bonds
      are represented thereby) by the Agent to which they were surrendered or with
      which they were deposited. 

    
      
        
        

      

      
        12

        
          

        

      

       

    

     

    
      	
              8.2

            	
              Cancelled
                Certificates

            

    

     

    Each
      Agent shall (unless it is itself the Principal Agent) give all relevant details
      for the purposes of Clause 8.3 to, and shall forward Certificates cancelled
      by
      it promptly to, the Principal Agent or, as the case may be, its designated
      agent.

     

    
      	
              8.3

            	
              Certification
                of Payment Details

            

    

     

    Subject
      to receipt of the information described in Clause 8.2, the Principal Agent
      shall
      as soon as reasonably practicable, upon a request in writing from any of the
      Issuer, the Trustee and the Registrar, furnish the Issuer and the Trustee and
      the Registrar with a certificate signed by its duly authorised officer (whose
      name and specimen signature have previously been provided to the Issuer) stating
      (as applicable) (a) the aggregate amounts paid in respect of Bonds redeemed
      or
      paid and cancelled, (b) the aggregate principal amount of Bonds converted and
      cancelled and (c) the identifying numbers of such Bonds and (d) that such Bonds
      have been cancelled. Such certification may be accepted by the Trustee as
      conclusive evidence of repayment or discharge pro
      tanto of
      the
      Bonds, of payment of interest thereon (if any) or (as the case may be) of the
      issue of replacement Certificates.

     

    
      	
              8.4

            	
              Cancelled
                Certificates

            

    

     

    Unless
      otherwise instructed by the Issuer, the Principal Agent or its designated agent
      shall destroy the cancelled Certificates in its possession or held to its order
      and furnish to the Issuer and the Trustee upon request, a certificate of such
      destruction duly signed by its authorised officer.

     

    
      	
              8.5

            	
              Records

            

    

     

    Subject
      to receipt of the relevant information, the Principal Agent shall keep a full
      and complete record of all Bonds and of their redemption, conversion, payment,
      cancellation, despatch to the Issuer and replacement (as appropriate) and shall
      make such record available at all reasonable times during office hours to the
      Issuer, the Trustee and the other Agents. Notwithstanding the foregoing, the
      Principal Agent shall not be required to keep a record of the
      Register.

     

    
      	
              8.6

            	
              Identifying
                Numbers

            

    

     

    The
      Registrar shall notify the Principal Agent of the identifying numbers of the
      Bonds and the definitive Certificates which are issued and the same shall form
      the basis of the records to be kept by the Principal Agent.

     

    
      	
              9.

            	
              
                ISSUE
                  OF REPLACEMENT
                  CERTIFICATES

              

            

    

     

    
      	
              9.1

            	
              Stocks
                of Certificates

            

    

     

    From
      time
      to time after such time (if ever) as Bonds may be transferred into a name other
      than that of the holder of the Global Certificate, the Issuer will cause a
      sufficient quantity of additional blank Certificates (other than the Global
      Certificate) to be available, upon request, to the Registrar at its specified
      office for the purpose of delivering replacement Certificates as provided below.
      The Issuer will promptly notify the Trustee and the Registrar (and the Paying
      Agent, if applicable) if the authorised officer of the Issuer whose facsimile
      signature appears on such stocks of replacement Certificates ceases to be so
      authorised. In such circumstances the Issuer will promptly, properly and validly
      appoint a replacement authorised officer and upon the request of the Registrar
      or the Trustee promptly deliver to the Registrar such number of replacement
      Certificates as it may reasonably request, duly signed manually or in facsimile
      by such replacement authorised officer. Upon receipt of such replacement
      Certificates, the Registrar or its agent will be deemed to have been authorised
      by the Issuer to destroy any previous replacement Certificates and will notify
      the Issuer of such destruction.

    
      
        
        

      

      
        13

        
          

        

      

       

    

     

    
      	
              9.2

            	
              Replacement

            

    

     

    The
      Registrar will, subject to and in accordance with Condition 16 and the following
      provisions of this Clause, authenticate and deliver or cause to be authenticated
      and delivered (directly or, if applicable, through the relevant Agent) any
      replacement Certificates which the Issuer may determine to issue or deliver
      in
      place of Certificates which have been mutilated, defaced, lost, stolen or
      destroyed. The Registrar will inform the Issuer upon receiving any request
      from
      a Bondholder (directly or, if applicable, through the relevant Agent) for the
      issue of a replacement Certificate.

     

    
      	
              9.3

            	
              Conditions
                of Replacement

            

    

     

    The
      Registrar will verify with the relevant Agent, in the case of an allegedly
      lost,
      stolen or destroyed Certificate in respect of which the identifying number
      is
      known or believed to be known, that the Bond in respect of which such
      Certificate is issued has not been redeemed or converted or purchased by the
      Issuer and cancelled and the Registrar shall not deliver or cause to be
      delivered any replacement Certificate unless and until the applicant therefor
      shall have:

     

    
      	 	
              (a)

            	
              paid
                such costs, taxes and duties as may be incurred in connection
                therewith;

            

    

     

    
      	 	
              (b)

            	
              furnished
                the Registrar (directly or, if applicable, through the relevant Agent)
                with such evidence (including evidence as to the identifying number
                of the
                Certificate in question if known) and indemnity as the Issuer and
                the
                Registrar may reasonably require;
                and

            

    

     

    
      	 	
              (c)

            	
              surrendered
                to the Registrar (directly or, if applicable, through the relevant
                Agent)
                any mutilated or defaced Certificate to be
                replaced.

            

    

     

    
      	
              9.4

            	
              Cancellation
                of replaced Certificates

            

    

     

    The
      Registrar shall cancel or procure the cancellation of any mutilated or defaced
      Certificates surrendered to it for replacement. Unless otherwise instructed
      by
      the Issuer, the Registrar shall destroy or procure the destruction of such
      cancelled Certificates and upon request by the Issuer or the Trustee, furnish
      the Issuer, the Trustee and the Principal Agent with a certificate confirming
      such destruction and containing the information specified in Clause
      8.3.

     

    
      	
              9.5

            	
              Notification

            

    

     

    The
      Registrar shall, on delivering (either directly or, if applicable, through
      the
      relevant Agent) any replacement Certificate, forthwith inform the Issuer and
      each of the other Agents, of the identifying number of such replacement
      Certificate and (if known) of the identifying number of the definitive
      Certificate and the relevant Bonds in place of which such replacement
      Certificate has been delivered. 

    
      
        
        

      

      
        14

        
          

        

      

       

    

     

    
      	
              9.6

            	
              Records

            

    

     

    The
      Registrar shall keep a full and complete record of all replacement Certificates
      delivered (either directly or, if applicable, through the relevant Agent) and
      shall make such record available during office hours at all reasonable times
      to
      the Issuer, the Trustee and the Principal Agent.

     

    
      	
              9.7

            	
              Notice
                of presentation of replaced
                Certificates

            

    

     

    Whenever
      any Certificates alleged to have been lost, stolen or destroyed in replacement
      for which a new Certificate has been issued shall be surrendered or delivered
      to
      an Agent prior to payment or for conversion, the Agent shall immediately send
      notice thereof to the Issuer, the Registrar and the Principal
      Agent.

     

    
      	
              10.

            	
              
                DUTIES
                  OF THE TRANSFER AGENTS IN RESPECT OF
                  TRANSFERS

              

            

    

     

    If
      and to
      the extent specified by the Conditions and in accordance therewith and the
      terms
      of this Agreement or if otherwise requested by the Issuer, each Transfer Agent
      will:

     

    
      	 	
              (a)

            	
              receive
                requests for the transfer of Bonds, inform the Registrar, forward
                the
                deposited Certificate(s) to the Registrar and assist in the issue
                of a new
                Certificate in accordance with the Regulations referred to in Clause
                13
                and in particular forthwith notify the Registrar of (i) the name
                and
                address of the holder of the Bond, (ii) the identifying number of
                the
                relevant Certificate and the relevant Bonds, (iii) (where not all
                Bonds in
                respect of which a Certificate was issued are to be transferred)
                the
                number of Bonds transferred and their identifying numbers, and (iv)
                the
                name, address and account for payments (if any) of the transferee
                to be
                entered on the Register;

            

    

     

    
      	 	
              (b)

            	
              keep
                the Registrar informed of all transfers;
                and

            

    

     

    
      	 	
              (c)

            	
              carry
                out such other acts as may be necessary to give effect to the Conditions
                and the other provisions of this
                Agreement.

            

    

     

    
      	
              11.

            	
              
                DUTIES
                  OF THE REGISTRAR

              

            

    

     

    
      	
              11.1

            	
              The
                Register

            

    

     

    The
      Registrar shall maintain a register (the Register) outside the United Kingdom
      in
      accordance with the Conditions and the Regulations referred to in Clause 13.
      The
      Register shall: 

     

    
      	 	
              (a)

            	
              show
                the amount of Bonds and the date of issue and all subsequent transfers
                and
                changes of ownership in respect thereof and the names and addresses
                of the
                holders of Bonds; 

            

    

     

    
      	 	
              (b)

            	
              at
                all reasonable times during office hours be made available to the
                Issuer,
                the Trustee, the other Agents or any person authorised by any of
                them for
                inspection and for the taking of copies thereof or extracts therefrom
                and
                the Registrar shall deliver to such persons all such lists of holders
                of
                Bonds, their addresses, registered accounts, holdings and other details
                as
                they may request; and 

            

    

    
      
        
        

      

      
        15

        
          

        

      

       

    

     

    
      	 	
              (c)

            	
              include
                a record of the identifying number allocated to each Bond and the
                identifying number allocated to each definitive Certificate which
                is
                issued. Each Certificate will carry the identifying number of the
                Bond or
                Bonds in respect of which it is issued, as well as its own identifying
                number. 

            

    

     

    The
      Registrar will maintain proper records in relation to the title to any of the
      Bonds including all forms of transfer, probates, letters of administration
      and
      powers of attorney. The provisions set forth in Exhibit D hereto shall apply
      in
      relation to the maintenance of the Register and the transfer of Bonds. The
      Registrar will enter in the Register the details of all redemptions or
      conversions or purchases and cancellation of Bonds notified to it as aforesaid
      and the Registrar will comply with the proper and reasonable requests of the
      Issuer with respect to the maintenance of the Register and will provide to
      the
      Issuer, the Trustee and other Agents such information with respect thereto
      as
      may be requested by the Issuer or may be reasonably required by the Trustee
      or
      the other Agents for the proper performance of their respective
      duties.

     

    
      	
              11.2

            	
              Transfers

            

    

     

    The
      Registrar will receive requests for the transfer of Bonds and will also receive
      Certificates deposited with a Transfer Agent for transfer, effect the necessary
      entries, authenticate and issue new Certificates in accordance with the
      Regulations referred to in Clause 13 and deliver the new Certificate(s) to
      the
      relevant Agent.

     

    
      	
              11.3

            	
              Replacement

            

    

     

    The
      Registrar will also have certain duties in connection with the replacement
      of
      Certificates, which duties are set out in Clause 9.

     

    
      	
              12.

            	
              
                DOCUMENTS
                  AND CERTIFICATES FOR THE
                  REGISTRAR

              

            

    

     

    
      	
              12.1

            	
              Supply
                of Certificates

            

    

     

    From
      time
      to time after such time (if ever) as Bonds may be transferred to a name other
      than that of the holder of the Global Certificate, the Issuer will deliver
      to
      the Registrar and each Transfer Agent in reasonably sufficient time for the
      performance of its duties hereunder:

     

    
      	 	
              (a)

            	
              a
                supply of blank definitive Certificates sufficient to meet the Registrar
                and each Transfer Agent’s anticipated requirements as specified by the
                Registrar for Certificates upon effecting the transfers required
                by the
                holder of the Global Certificate;
                and

            

    

     

    
      	 	
              (b)

            	
              from
                time to time, so long as any Bond is outstanding, sufficient additional
                blank definitive Certificates as may be required by the Registrar
                for the
                performance of the Registrar’s and each Transfer Agent’s
                duties.

            

    

     

    
      	
              12.2

            	
              Safekeeping
                of Certificates

            

    

     

    Each
      Transfer Agent and the Registrar shall maintain in safekeeping all Certificates
      and blank Certificates delivered to and held by it and shall ensure that
      Certificates are issued only in accordance with the Conditions (including the
      provisions of the Global Certificate) and the provisions of this
      Agreement.

    
      
        
        

      

      
        16

        
          

        

      

       

    

     

    
      	
              12.3

            	
              Information

            

    

     

    Within
      seven (7) days of any request therefor by the Issuer or any Agent, so long
      as
      any of the Bonds are outstanding, each Transfer Agent and the Registrar shall
      certify to the Issuer and the relevant Agent the number of blank Certificates
      held by it hereunder.

     

    
      	
              13.

            	
              
                INFORMATION
                  AND REGULATIONS CONCERNING THE
                  BONDS

              

            

    

     

    
      	
              13.1

            	
              Provision
                of information

            

    

     

    Each
      Agent will give to the other Agents such further information with regard to
      their activities hereunder as may reasonably be required by them for the proper
      carrying out of their respective duties.

     

    
      	
              13.2

            	
              Regulations

            

    

     

    The
      Issuer may, subject to the Conditions, from time to time with the approval
      of
      the Registrar and the Trustee promulgate regulations (the “Regulations”)
      concerning the carrying out of transfers of Bonds and the forms and evidence
      to
      be provided. All such transfers will be made subject to the Regulations. The
      initial Regulations are set out in Exhibit D. The Registrar shall, at the
      expense of the Issuer, provide copies of the current Regulations to Bondholders
      (free of charge) upon request in accordance with Condition 4(F).

     

    
      	
              14.

            	
              
                REMUNERATION

              

            

    

     

    
      	
              14.1

            	
              Fees

            

    

     

    The
      Issuer will, in respect of the services to be performed by the Principal Agent
      and the Registrar and the other Agents under this Agreement, the Conditions
      and
      the Trust Deed, pay to the Principal Agent the commissions, fees and expenses
      as
      separately agreed in writing with the Principal Agent. The Principal Agent’s
      receipt of such money shall be a complete discharge of the Issuer’s obligation
      to pay the same and the Issuer need not concern itself with the apportionment
      of
      such moneys as between the Principal Agent, the Registrar and the other
      Agents.

     

    
      	
              14.2

            	
              Costs

            

    

     

    The
      Issuer will pay to the Principal Agent all out-of-pocket expenses (including,
      without limitation, advertising and insurance expenses and the fees and expenses
      of legal advisers) properly incurred by any Agent and the Registrar in
      connection with its services performed under this Agreement, the Conditions
      and
      the Trust Deed promptly upon receipt from the Principal Agent of notification
      of
      the amount of such expenses together with the relevant invoices and/or
      receipts.

     

    
      	
              14.3

            	
              Distribution
                to Agents

            

    

     

    The
      Principal Agent will be responsible for distributing the remuneration of the
      Agents and the Registrar and their relevant costs and expenses promptly upon
      receipt of the moneys therefor from the Issuer. The Issuer need not be concerned
      with the appointment of such moneys as between the Agents.

    
      
        
        

      

      
        17

        
          

        

      

       

    

     

    
      	
              14.4

            	
              Stamp
                duties

            

    

     

    The
      Issuer will pay or reimburse all stamp, registration and other similar taxes,
      fees or duties, if any, to which this Agreement may be subject on execution,
      issue, payment or enforcement.

     

    
      	
              14.5

            	
              Obligations
                to survive

            

    

     

    Any
      outstanding obligations of the Issuer to the Agents and the Registrar under
      this
      Clause 14 shall survive the termination of this Agreement, the Conditions and
      the Trust Deed and the resignation or removal of any of the Agents or the
      Registrar.

     

    
      	
              15.

            	
              
                FUNDS
                  HELD BY PRINCIPAL
                  AGENT

              

            

    

     

    
      	
              15.1

            	
              Repayment

            

    

     

    Any
      sums
      paid by, or by arrangement with, the Issuer to the Principal Agent pursuant
      to
      the terms of this Agreement shall not be required to be repaid to the Issuer
      unless and until the Bonds in respect of which such sums were paid shall have
      been converted or redeemed or purchased and cancelled or claims in respect
      of
      such sums shall have become prescribed under Condition 13, but in any of these
      events the Principal Agent shall (provided that all other amounts due under
      this
      Agreement shall have been duly paid), save as mentioned below, forthwith repay
      to the Issuer upon its written request sums (without interest) equivalent to
      the
      amounts which would otherwise have been payable on the relevant Bonds together
      with any fees previously paid (except for any commissions, fees and expenses
      paid by the Issuer pursuant to Clause 14) to the Principal Agent in respect
      of
      such Bonds.

     

    
      	
              15.2

            	
              Use
                of moneys

            

    

     

    The
      Principal Agent shall be entitled to deal with moneys paid to it by the Issuer
      for the purposes of this Agreement in the same manner as other moneys paid
      to a
      banker by its customers and shall not be liable to account to the Issuer for
      any
      interest thereon, save as otherwise agreed between the Issuer and the Principal
      Agent. No Agent shall exercise any right of set-off or lien or similar claim
      over moneys paid to it or by it under this Agreement. Unless required by law,
      moneys held by the Principal Agent need not be segregated.

     

    
      	
              16.

            	
              
                MISCELLANEOUS

              

            

    

     

    
      	
              16.1

            	
              Publication
                of notices

            

    

     

    On
      behalf
      and at the written request and expense of the Issuer, the Principal Agent will
      as soon as practicable cause to be published any notices required to be given
      by
      the Issuer or the Trustee in accordance with the Trust Deed or any of the
      Conditions, save as set out herein. The Issuer shall provide the Principal
      Agent
      with signed copies of any notices to be published at least five (5) Business
      Days prior to the date of publication save and except any announcements, notices
      or circulars to be published pursuant to the requirements of the Securities
      and
      Exchange Commission, AMEX or an Alternative Stock Exchange whereupon such
      announcements, notices or circulars shall be given by the Issuer to the
      Principal Agent as soon as reasonably practicable after its
      publication.

    
      
        
        

      

      
        18

        
          

        

      

       

    

     

    
      	
              16.2

            	
              Notices
                to the Trustee

            

    

     

    Upon
      each
      occasion that the Issuer gives to the Trustee any notice in connection with
      the
      Bonds, the Issuer shall at the same time give a similar notice to the Principal
      Agent.

     

    
      	
              16.3

            	
              Voting

            

    

     

    Each
      of
      the Agents shall perform the functions described as being performed by it in
      Schedule 3 to the Trust Deed and shall keep a full and complete record of forms
      of proxy issued by it.

     

    
      	
              16.4

            	
              No
                implicit duties

            

    

     

    The
      Agents shall be obliged to perform such duties, and only such duties, as are
      herein and in the Conditions specifically set forth, and no implied duties
      or
      obligations shall be read into this Agreement or the Conditions against any
      of
      them.

     

    
      	
              16.5

            	
              No
                agency or trust

            

    

     

    In
      acting
      hereunder and in connection with the Bonds, the Agents shall act solely as
      agents of the Issuer (or, where a notice given by the Trustee pursuant to Clause
      5.6 shall not have been withdrawn, the Trustee) and will not thereby assume
      any
      obligations towards, or relationship of agency or trust for, any of the
      Bondholders.

     

    
      	
              16.6

            	
              Taking
                of advice

            

    

     

    Any
      of
      the Agents may consult with legal or other professional advisers satisfactory
      to
      it, and the opinion of such advisers shall be full and complete protection
      in
      respect of any action taken, omitted or suffered hereunder in good faith and
      in
      accordance with the opinion of such advisers.

     

    
      	
              16.7

            	
              Liability

            

    

     

    Save
      for
      any action taken, suffered or omitted as a result of the Agents’ wilful default,
      gross negligence or fraud, the Agents shall be protected and shall incur no
      liability for or in respect of any action taken, omitted or suffered in reliance
      upon any instruction, request or order from the Issuer or the Trustee, or any
      Bond, Certificate, form of transfer, Conversion Notice, resolution, direction,
      consent, certificate, affidavit, statement, facsimile transmission, electronic
      message or other paper or document reasonably believed by it to be genuine
      and
      to have been delivered, signed or sent by the proper party or parties. The
      Agents shall be under no duty to inquire into or investigate the validity,
      accuracy or content of any document. The Agents shall not be under any
      obligation to take any action hereunder which may involve it in any expense
      or
      liability, the payment of which within a reasonable time is not, in its opinion,
      assured to it, or would be contrary to applicable law or
      regulation.

     

    
      	
              16.8

            	
              Indemnity
                by the Issuer 

            

    

     

    The
      Issuer will indemnify each of the Agents against any losses, liabilities, costs,
      claims, actions, demands, damages or expenses which it may incur or which may
      be
      made against it as a result of or in connection with its appointment or the
      exercise or non-exercise by it of its powers, discretions and duties, except
      those may result from its own fraud, wilful misconduct or gross negligence
      or
      that of its directors, officers, employees or agents. Each Agent shall, to
      the
      extent permitted by laws, notify the Issuer promptly of any third party claim
      for which it may seek an indemnity from the Issuer and such Agent shall use
      its
      reasonable endeavours to co-operate with the Issuer in its defence of such
      claim. The relevant Agent will use its reasonable endeavours to consult with
      the
      Issuer and with respect to any settlement offer. The consultation period will
      expire on the thirtieth day after the notice of such settlement offer is given
      by the relevant Agent to the Issuer. Except in the case of fraud, wilful
      misconduct or gross negligence on its part, no Agent shall be liable either
      for
      any act or omission under this Agreement, or if any Bond, Certificate, form
      of
      transfer or Conversion Notice shall be lost, stolen, destroyed or damaged.
      Notwithstanding the foregoing, under no circumstances will the Agents be liable
      to the Issuer or any other party to this Agreement for any consequential loss
      (being loss of business, goodwill, opportunity or profit) or any special or
      punitive damages of any kind whatsoever; in each case however caused or arising
      and whether or not foreseeable, even if advised of the possibility of such
      loss
      or damage. The provisions of this Clause 16.8 shall survive the resignation
      or
      removal of any Agent or the Registrar and the termination of this Agreement.
      

    
      
        
        

      

      
        19

        
          

        

      

       

    

     

    
      	
              16.9

            	
              Entitlement
                to treat holder as owner

            

    

     

    Except
      as
      ordered by a court of competent jurisdiction or may be required by law, each
      of
      the Agents shall (whether or not the relevant Bond is overdue and regardless
      of
      any notice of ownership, trust or any interest, or writing on, or the loss
      or
      theft of, the Certificate issued in respect of it) be entitled to treat the
      registered holder of any Bond as the absolute owner for all
      purposes.

     

    
      	
              16.10

            	
              Copies
                of documents

            

    

     

    So
      long
      as any of the Bonds remains outstanding, the Issuer shall provide the Agents
      with a sufficient number of copies of the Trust Deed and of each of the
      documents which are sent to the Trustee or which are required to be made
      available by stock exchange regulations relating to the Bonds, to be available
      and, subject to being provided with such copies, each of the Agents will procure
      that such copies shall be available at its specified office during normal office
      hours for examination by Bondholders and that copies thereof will be furnished
      to Bondholders upon request at their own expenses.

     

    
      	
              16.11

            	
              Acquisition
                of Bonds

            

    

     

    Any
      Agent, their affiliates and each of their respective officers, directors and
      employees, may become the owner of, or acquire any interest in, any Bonds or
      Shares with the same rights that it or they would have if it were not appointed
      hereunder, and may engage or be interested in any financial or other transaction
      with the Issuer and may act on, or as depositary, trustee or agent for, any
      committee or body of holders of Bonds or other obligations of the Issuer as
      freely as if it were not appointed hereunder.

     

    
      	
              16.12

            	
              Merger

            

    

     

    Any
      corporation into which any Agent may be merged or converted or any corporation
      with which any Agent may be consolidated or any corporation resulting from
      any
      merger, conversion or consolidation to which any Agent shall be a party or
      any
      corporation succeeding to all or substantially all of the corporate trust
      business of any Agent shall, to the extent permitted by applicable law, be
      the
      successor Agent under this Agreement without the execution or filing of any
      paper or any further act on the part of any of the parties hereto. Notice of
      any
      such merger, conversion or consolidation shall forthwith be given to the Issuer,
      the Trustee and the Bondholders.

    
      
        
        

      

      
        20

        
          

        

      

       

    

     

    
      	
              16.13

            	
              Illegality

            

    

     

    In
      the
      event that the Agents shall be uncertain as to its duties or rights hereunder
      or
      shall receive instructions, claims or demands from the Issuer, in its opinion,
      conflict with any of the provisions of this Agreement, it shall be entitled
      to
      refrain from taking any action until it is directed in writing by a final order
      or judgment of a court of competent jurisdictions. 

     

    
      	
              16.14

            	
              Instruction
                in writing

            

    

     

    Notwithstanding
      anything to the contrary contained in this Agreement, none of the Agents shall
      be obliged to act or omit to act in accordance with any instruction, direction
      or request delivered to them by the Issuer unless such instruction, direction
      or
      request is delivered to such Agents in writing.

     

    
      	
              16.15

            	
              No
                Liability for interest

            

    

     

    The
      Agent
      shall not be under any liability for interest on any moneys at any time received
      by it pursuant to any of the provisions of this Agreement or of the Bonds and
      applied by it in accordance with the provisions hereof, except as otherwise
      provided hereunder or agreed in writing.

     

    
      	
              16.16

            	
              Delegations

            

    

     

    The
      Agents may execute any of its powers and perform any of its duties hereunder
      directly or through delegates or attorneys and may consult with counsel,
      accountants and other skilled persons to be selected and retained by it. The
      Agents shall not be liable for the acts of such delegates or attorneys, or
      for
      anything done, suffered or omitted by it in accordance with the advice or
      opinion of any such counsel, accountants or other skilled persons.

     

    
      	
              16.17

            	
              Expert
                advice 

            

    

     

    The
      Agent
      shall engage and consult, at the expense of the Issuer with any legal adviser
      and professional adviser selected by it and rely upon any advice so obtained
      and
      each of the Agents and each of their respective directors, officers, employees
      and duly appointed agents shall be protected and shall not be liable in respect
      of any action taken, or omitted to be done or suffered to be taken, in
      accordance with such advice.

     

    
      	
              16.18

            	
              Force
                Majeure

            

    

     

    Notwithstanding
      anything to the contrary in this Agreement, no Agent shall in any event be
      liable for any failure or delay in the performance of its obligations hereunder
      if it is prevented from so performing its obligations by any circumstances
      beyond the control of such Agent, including without limitation, existing or
      future law or regulation, any existing or future act of governmental authority,
      Act of God, flood, war whether declared or undeclared, terrorism, riot,
      rebellion, civil commotion, strike, lockout, other industrial action, general
      failure of electricity or other supply, aircraft collision, technical failure,
      accidental or mechanical or electrical breakdown, computer failure or failure
      of
      any money transmission system.

    
      
        
        

      

      
        21

        
          

        

      

       

    

     

    
      	
              16.19

            	
              Amendments
                and/or Modifications

            

    

     

    This
      Agreement may be amended by all of the parties, without the consent of any
      Bondholder, either (a) for the purpose of curing any ambiguity or of curing,
      correcting or supplementing any defective provision contained in this Agreement
      or (b) in any manner which the parties may mutually deem necessary or desirable
      and which shall not be inconsistent with the Conditions and shall not be
      materially prejudicial to the interests of the Bondholders.

     

    
      	
              16.20

            	
              Anti-Money
                Laundering and Terrorism

            

    

     

    The
      Agent
      may take and instruct any delegate to take any action which is in its sole
      discretion considers appropriate so as to comply with any applicable law,
      regulation, request of a public or regulatory authority or any Group policy
      which relates to the prevention of fraud, money laundering, terrorism or other
      criminal activities or the provision of financial and other services to
      sanctioned persons or entities. Such action may include but is not limited
      to
      the interception and investigation of transactions on the Issuer’s accounts
      (particularly those involving the international transfer of funds) including
      the
      source of the intended recipient of fund paid into or out of the Issuer’s
      accounts. In certain circumstances, such action may delay or prevent the
      processing of the Issuer’s instructions, the settlement of transactions over the
      Issuer’s accounts or the Agent’s performance of its obligations under this
      Agreement. Where possible, the Agent will endeavour to notify the Issuer of
      the
      existence of such circumstances. Neither the Agent nor any delegate will be
      liable for any loss (whether direct or consequential and including, without
      limitation, loss of profit or interest) caused in whole or in part by any
      actions which are taken by the Agent or any delegate pursuant to this Clause
      16.
      For the purposes of this Clause 16.20, the Group means the Issuer, its
      Subsidiaries and associated companies.

     

    
      	
              17.

            	
              
                CHANGES
                  IN AGENTS

              

            

    

     

    
      	
              17.1

            	
              Appointment
                and termination of
                appointment

            

    

     

    The
      Issuer may appoint further or other Agents. The Issuer may also terminate the
      appointment of any Agent at any time subject to the prior written approval
      of
      the Trustee (which approval shall not be unreasonably withheld or delayed).
      Such
      termination shall be effective by giving:

     

    
      	 	
              (a)

            	
              to
                the Trustee;

            

    

     

    
      	 	
              (b)

            	
              in
                the case of any Agent other than the Principal Agent, to the Principal
                Agent; and

            

    

     

    
      	 	
              (c)

            	
              to
                the Agent whose appointment is to be
                terminated,

            

    

     

    at
      least
      thirty (30) days’ written notice to that effect. However, no such notice
      relating to the termination of the appointment of the Principal Agent or the
      Registrar shall take effect until a new Principal Agent or, as the case may
      be,
      Registrar approved in writing by the Trustee has been appointed on terms
      approved (such approval shall not be unreasonably withheld or delayed) in
      writing by the Trustee. The Issuer shall procure that there are at all times
      (a)
      a Principal Agent, (b) (if requested by the Trustee) a Paying Agent with a
      specified office in an European Union member state that will not be obliged
      to
      withhold or deduct tax pursuant to European Council Directive 2003/48/EC or
      any
      law implementing or complying with, or introduced in order to conform to, such
      Directive and (c) a Registrar which will maintain a register of Bondholders
      outside the United Kingdom. The termination of the appointment of any Agent
      shall not take effect (i) until notice thereof shall have been given to the
      Bondholders in accordance with Condition 18 and (ii) within the period
      commencing forty-five (45) days immediately preceding any due date for a payment
      in respect of the Bonds and ending fifteen (15) days after such
      date.

    
      
        
        

      

      
        22

        
          

        

      

       

    

     

    
      	
              17.2

            	
              Resignation

            

    

     

    Any
      Agent
      may resign its appointment hereunder at any time by giving to the person(s)
      referred to in Clauses 17.1(a) and 17.1(b) and the Issuer at least thirty (30)
      days’ written notice to that effect, provided that (a) in the case of the
      resignation of the Principal Agent or the Registrar, no such resignation shall
      take effect until a new Principal Agent or, as the case may be, Registrar
      approved (such approval shall not be unreasonably withheld or delayed) in
      writing by the Trustee has been appointed by the Issuer on terms approved (such
      approval shall not be unreasonably withheld or delayed) in writing by the
      Trustee, (b) no such resignation shall take effect unless upon the expiry of
      the
      notice period there are Agents as required by Clause 17.1 and the Conditions,
      (c) no such resignation shall take effect until notice thereof shall have been
      given to the Bondholders in accordance with Condition 18 and (d) no such notice
      shall be given so as to expire within a period commencing thirty (30) days
      immediately preceding any due date for a payment in respect of the Bonds and
      ending fifteen (15) days after such date. Notwithstanding the foregoing, the
      Issuer agrees with each Agent that if, by the day falling seven (7) Business
      Days before the expiry of any notice referred to above, the Issuer has not
      appointed a replacement Agent, then the relevant Agent shall be entitled, on
      behalf and at the expense of the Issuer, to appoint in its place any reputable
      financial institution of good standing on terms approved by the Trustee (such
      approval shall not be unreasonably withheld or delayed). 

     

    Notwithstanding
      any other provision of this Clause 17, the appointment of any Agent shall
      forthwith terminate if such Agent becomes incapable of acting, is adjudged
      bankrupt or insolvent, files a voluntary petition in bankruptcy, makes an
      assignment for the benefit of its creditors, consents to the appointment of
      a
      receiver, administrator or other similar official of all or a substantial part
      of its property or assets or admits in writing its inability to pay or meet
      its
      debts as they mature or suspends payment thereof, or if a resolution is passed
      or an order made for the winding up or dissolution of such Agent or any
      analogous event occurs under any applicable law.

     

    
      	
              17.3

            	
              Delivery
                of Records by Principal Agent on
                Termination

            

    

     

    If
      the
      appointment of the Principal Agent hereunder is terminated or the Principal
      Agent resigns its appointment hereunder, the Principal Agent shall subject
      to
      payment of all outstanding fees and expenses, on the date on which such
      termination or resignation takes effect, pay to the successor Principal Agent
      the amounts held by it in respect of Bonds, the Certificates relating thereto
      which have not been presented for payment and any other amounts held by it
      in
      respect of the Bonds and shall deliver to the successor Principal Agent Bonds
      surrendered to it but not yet destroyed, Conversion Notices held by it, all
      records concerning Bonds and the Certificates maintained by the Principal Agent
      pursuant to this Agreement, but shall have no other duties or responsibilities
      to provide services as Principal Agent hereunder. The Principal Agent shall
      be
      entitled to the payment by the Issuer of its remuneration for the services
      previously tendered hereunder in accordance with the terms of Clause 14 and
      to
      the reimbursement of all reasonable expenses (including legal fees) incurred
      in
      connection therewith.

    
      
        
        

      

      
        23

        
          

        

      

       

    

     

    
      	
              17.4

            	
              Delivery
                of Records by Registrar on
                Termination

            

    

     

    If
      the
      appointment of the Registrar is terminated or the Registrar resigns its
      appointment hereunder, the Registrar shall subject to payment of all outstanding
      fees and expenses, on the date on which such termination or resignation takes
      effect, deliver to the successor Registrar, the Register, all Certificates
      and
      blank Certificates held by it and all other records concerning the Bonds
      maintained by it pursuant to this Agreement, but shall have no other duties
      or
      responsibilities to provide services as Registrar hereunder.

     

    
      	
              17.5

            	
              Delivery
                of Records by Agents on
                Termination

            

    

     

    If
      the
      appointment of any Agent is terminated or any Agent or the Registrar resigns
      its
      appointment hereunder, such Agent or the Registrar shall subject to payment
      of
      all outstanding fees and expenses, on the date on which such termination or
      resignation takes effect, deliver to any successor Agent or the Registrar or,
      if
      none, the Principal Agent any records or other documents concerning the Bonds
      maintained by it pursuant to this Agreement, but shall have no other duties
      or
      responsibilities hereunder.

     

    
      	
              17.6

            	
              Change
                of Office

            

    

     

    If
      any
      Agent shall change its specified office, it shall give to the Issuer, the
      Principal Agent and the Trustee not less than thirty (30) days’ prior written
      notice to that effect giving the address of the new specified office. As soon
      as
      practicable thereafter, the Principal Agent shall give to the Bondholders,
      on
      behalf of and at the expense of the Issuer, notice of such change and the
      address of the new specified office in accordance with Condition
      18.

     

    
      	
              18.

            	
              
                NOTICES

              

            

    

     

    Any
      communication shall be by letter sent by pre-paid registered post or courier
      or
      facsimile transmission:

     

    
      	 	
              to
                the Issuer:

            	 	
              China
                Architectural Engineering, Inc.

              105
                Baishi Rd., Jiuzhou West Avenue

              Zhuhai,
                519070

              China

               

              Telephone
                no. : +86-756-853-8908

              Fax
                no. : +86-756-853-8922

              Attention : Luo
                Ken Yi

            

    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	 	
              to
                the Trustee:

            	 	
              The
                Bank of New York, London Branch

              40th
                Floor, One Canada Square

              London,
                E14 5AL, United Kingdom

               

              Fax
                no.: +44 20 7964 6369

              Attention:
                Global Corporate Trust

               

              With
                a copy to:

               

              The
                Bank of New York

              Level
                12, 3 Pacific Place

              1
                Queen’s Road East

              Hong
                Kong

               

              Fax
                no.: 852 2295 3283

              Attention:
                Corporate Trust

            
	 	 	 	 
	 	
              to
                the Registrar:

            	 	
              The
                Bank of New York

              101
                Barclay Street, 21st Floor, New York

              NY
                10286, United States of America

               

              Fax
                no.: +1 212 815 5802/5803

              Attention:
                Global Corporate Trust

               

              With
                a copy to:

               

              The
                Bank of New York

              Level
                12, 3 Pacific Place

              1
                Queen’s Road East

              Hong
                Kong

               

              Fax
                no.: 852 2295 3283

              Attention:
                Corporate Trust

            
	 	 	 	 
	 	
              and,
                in the case of any of the Paying Agents, to the Principal Paying
                Agent
                care of:

            	 	
              The
                Bank of New York, London Branch

              40th
                Floor, One Canada Square

              London,
                E14 5AL, United Kingdom

               

              Fax
                no.: +44 20 7964 6369

              Attention:
                Global Corporate Trust

               

              With
                a copy to:

               

              The
                Bank of New York

              Level
                12, 3 Pacific Place

              1
                Queen’s Road East

              Hong
                Kong

               

              Fax
                no.: 852 2295 3283

              Attention:
                Corporate Trust

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

       

    

     

    Any
      notice or demand sent by post as provided in this Clause shall be deemed (unless
      any relevant part of the postal service is affected by industrial action) to
      have been given, made or served three (3) days (in the case of inland post)
      or
      seven (7) days (in the case of overseas post) after despatch and any notice
      sent
      by fax as provided in this Clause shall be deemed to have been given, made
      or
      served twenty-four (24) hours after despatch and receipt of confirmation of
      error-free transmission (if received during business hours and, if not, on
      the
      next Business Day in the place of receipt). Subject thereto, neither the
      non-receipt of, nor the time of receiving, any such confirmation of a notice
      given by fax as is referred to above shall invalidate or affect such notice
      or
      the time at which it is deemed as provided above to have been
      given.

     

    Any
      of
      the parties named above may change its address for the purpose of this Clause
      by
      giving notice of such change to the other parties to this
      Agreement.

     

    
      	
              19.

            	
              
                GOVERNING
                  LAW AND JURISDICTION

              

            

    

     

    
      	
              19.1

            	
              The
                provisions of this Agreement are governed by, and shall be construed
                in
                accordance with, English law.

            

    

     

    
      	
              19.2

            	
              Subject
                to sub-clause 19.4 below, the Issuer irrevocably agrees for the benefit
                of
                the Agents and the Trustee that the courts of England are to have
                exclusive jurisdiction to settle any dispute which may arise out
                of or in
                connection with this Agreement and accordingly submit to the exclusive
                jurisdiction of the English courts.

            

    

     

    
      	
              19.3

            	
              The
                Issuer waives any objection to the courts of England on the grounds
                that
                they are an inconvenient or inappropriate
                forum.

            

    

     

    
      	
              19.4

            	
              The
                Agents may take any suit, action or proceeding arising out of or
                in
                connection with this Agreement (together referred to as “Proceedings”)
                against the Issuer in any other court of competent jurisdiction and
                concurrent Proceedings in any number of
                jurisdictions.

            

    

     

    
      	
              19.5

            	
              The
                Issuer irrevocably and unconditionally appoints The
                London Law Agency
                at
                its registered office for the time being as its agent for service
                of
                process in England in respect of any Proceedings and undertakes that
                in
                the event of it ceasing so to act it will appoint such other person
                as the
                Trustee may approve as its agent for that
                purpose.

            

    

     

    
      	
              19.6

            	
              The
                Issuer:

            

    

     

    
      	 	
              (a)

            	
              agrees
                to procure that, so long as any of the Bonds remain liable to
                prescription, there shall be in force an appointment of such a person
                approved by the Trustee with an office in London with authority to
                accept
                service as aforesaid;

            

    

     

    
      	 	
              (b)

            	
              agrees
                that failure by any such person to give notice of such service of
                process
                to the Issuer shall not impair the validity of such service or of
                any
                judgement based thereon; and

            

    

    
      
        
        

      

      
        26

        
          

        

      

       

    

     

    
      	 	
              (c)

            	
              agrees
                that nothing in this Agreement shall affect the right to serve process
                in
                any other manner permitted by law.

            

    

     

    
      	
              20.

            	
              
                COUNTERPARTS

              

            

    

     

    This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one (1)
      instrument.

     

    
      	
              21.

            	
              Termination
                of this Agreement

            

    

     

    This
      Agreement shall terminate forthwith when none of the Bonds remain
      outstanding.

     

    
      	
              22.

            	
              
                TERMINATION
                  OF THIS AGREEMENT

              

            

    

     

    A
      person
      who is not a party to this Agreement has no rights under the Contracts (Rights
      of Third Parties) Act 1999 to enforce any term of these presents, but this
      does
      not affect any right or remedy of a third party which exists or is available
      apart from that Act.

     

    
      	
              23.

            	
              
                INVALIDITY

              

            

    

     

    If
      any
      provision in this Agreement shall be held to be illegal, invalid or
      unenforceable, in whole or in part, under any enactment or rule of law, such
      provision or part shall to that extent be deemed not to form part of this
      Agreement but the legality, validity and enforceability of the remainder of
      this
      Agreement shall not be affected.

     

    [Remainder
      of the page intentionally left blank]

    
      
        
        

      

      
        27

        
          

        

      

       

    

     

    IN
      WITNESS WHEREOF
      the
      parties hereto have executed this Paying and Conversion Agency Agreement on
      the
      date first above written.

     

    The
      Issuer

     

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

     

    

    By:
      /s/
      Luo
      Ken Yi

    
      

    

    Name:
      Luo
      Ken
      Yi

    Title:
      Chief
      Executive Officer, Chief Operating Officer and Chairman of the Board_

    

     

    The
      Principal Agent, the Conversion Agent and the Transfer
      Agent

     

    THE
      BANK OF NEW YORK, LONDON BRANCH

     

    

    By: 
      [SIGNATURE OF AUTHORIZED PERSON] 

    
      

    

    Name:
      

    
      

    

    Title:
      

    
      

    

    

     

    The
      Registrar

     

    THE
      BANK OF NEW YORK

    

     

    By: 
      [SIGNATURE OF AUTHORIZED PERSON]

    
      

    

    Name:
      

    
      

    

    Title:
      

    
      

    

    

     

    The
      Trustee

     

    THE
      BANK OF NEW YORK, LONDON BRANCH

     

    
       

      By: 
        [SIGNATURE OF AUTHORIZED PERSON]

      
        

      

      Name:
        

      
        

      

      Title:
        

      
        

      

      

        
          
            
            

          

          
            28

            
              

            

          

           

        

      

    

     

    EXHIBIT
      A

     

    CONVERSION
      NOTICE

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    (Please
      read the notes overleaf before completing this Notice.)

     

    
      	
              Name:
                

              
                

              

            	
              Date:
                

              
                

              

            
	
              Address:
                

              
                

              

            	
              Tel
                No:

              
                

              

            
	
              *Euroclear/Clearstream
                Account No.:

              
                

              

            	
              Fax
                No:

              
                

              

            

    

     

    (*delete
      as appropriate)

     

    Signature1 
      :

     

     

    
      

    

     

    
      	
              To:
                

            	
              The
                Bank of New York, London Branch as Principal
                Agent

            

    

     

    
      	
              Cc:
                

            	
              China
                Architectural Engineering, Inc. (the “Issuer”)

            

    

     

    I/We,
      being the holders of the Bonds specified below, hereby irrevocably elect to
      convert such Bonds into fully-paid shares of common stock (the “Shares”)
      with a
      par value of US$0.001 each of the Issuer in accordance with the terms and
      conditions of the Bonds.

     

    
      	1	
              Total
                principal amount, number and identifying numbers of Bonds to be
                converted:

            

    

     

    Total
      principal amount: 

    
      

    

     

    Total
      number of Bonds:

    
      

    

     

    Identifying
      numbers of Bonds (if relevant)*: 

    
      

    

     

    Identifying
      numbers of Certificates deposited in respect of Bonds to be converted (if
      relevant)*: .

     

    
      
 

    N.B.
      If
      necessary, the identifying numbers of Bonds and Certificates can be attached
      separately.

     

    *
      Not
      required for Bonds represented by a Global Certificate

     

      
        

      

    

    
      	1	
              Where
                the Bonds to be converted are evidenced by the Global Certificate,
                the
                Conversion Notice need not be signed. In such a case, delivery of
                the
                Conversion Notice will constitute confirmation by the beneficial
                owner of
                the Bonds to be converted that the information in the Conversion
                Notice is
                true and accurate on delivery. If applicable, a corporation should
                sign
                under hand by an authorised official who must state his/her capacity
                and
                print the name of the relevant
                corporation.

            

    

    
      
        
        

      

      
        29

        
          

        

      

       

    

     

    
      	
              2

            	
              Name(s)
                and address(es) of person(s) in whose name(s) the Shares required
                to be
                delivered on conversion are to be
                registered:

            

    

     

    Name:

    
      

    

     

    Address:

    
      

    

     

    
      
 

    Telephone
      Number:

    
      

    

     

    Fax
      Number:

    
      

    

     

    
      	
              3

            	
              I/We
                hereby request that the certificates for the Shares together with
                any
                other securities, property or cash, including any United States dollar
                cheque in respect of payment of an Equivalent Amount pursuant to
                Condition
                6(B)(iii) required to be delivered upon conversion, be despatched
                (at
                my/our risk and expense) to the person whose name, contact person,
                telephone numbers, fax number and address is given below and in the
                manner
                specified below:

            

    

    
    

     

    
      	
              Name:

            	
              

                

              

            
	
              Contact
                Person:

            	
              

                

              

            
	
              Address:

            	
              

                

              

            
	 	
              

                

              

            
	 	
              

                

              

            
	
              Account
                No.: 

            	
              

                

              

            
	
              Account
                Name:

            	
              

                

              

            
	
              Telephone
                Number/Fax Number: 

            	

              

            
	
              Manner
                of despatch:

            	
              

                

              

            

    

     

    The
      Certificate in respect of the Bonds converted hereby accompanies this Conversion
      Notice.*

     

    
      	
              Name:

            	
               

              
                

              

            
	
              Address:

            	
               

              
                

              

            
	 	
               

              
                

              

            
	 	
               

              
                

              

            

    

     

    *
      Not
      required for Bonds represented by the Global Certificate.

    
      
        
        

      

      
        30

        
          

        

      

       

    

     

    
      	
              4

            	
              The
                Issuer has notified the Conversion Agents that the Issuer’s register of
                shareholders will be closed on the following
                dates:

            

    

     

    
      

    

     

    
      

    

     

    N.B.

     

    
      	
              (i)

            	
              This
                Conversion Notice will be void unless the introductory details and
                Sections 1 to 4 are completed.

            

    

     

    
      	
              (ii)

            	
              Your
                attention is drawn to Condition 6(B)(ii) of the Bonds with respect
                to the
                conditions precedent which must be fulfilled before the Bonds specified
                above will be treated as effectively eligible for
                conversion.

            

    

     

    
      	
              (iii)

            	
              Despatch
                of share certificates or other securities or property will be made
                at the
                risk and expense of the converting Bondholder and the converting
                Bondholder will be required to submit any necessary documents required
                in
                order to effect despatch in the manner
                specified.

            

    

     

    
      	
              (iv)

            	
              If
                a retroactive adjustment contemplated by the terms and conditions
                of the
                Bonds is required in respect of a conversion of Bonds, certificates
                for
                the additional Shares deliverable pursuant to such retroactive adjustment
                (together with any other securities, property or cash) will be delivered
                or despatched in the same manner as the Shares, other securities,
                property
                and cash or, as the case may be, Equivalent Amount previously issued
                pursuant to the relevant Conversion
                Notice.

            

    

     

    For
      Agent’s use only:

     

    1 (A) Bond
      conversion identification reference: 

     

    (B) Deposit
      Date: ________________

     

    (C) Conversion
      Date: ______________

     

    
      	
              2

            	
              (A)

            	
              Aggregate
                principal amount of Bonds in respect of which Certificates have been
                deposited for conversion:

            

    

     

    (B) Conversion
      Price on Conversion Date: 

     

    (C) Number
      of
      Shares issuable: 

     

    
      	
              3

            	
              (if
                applicable) amount of cash payment due to converting Bondholder under
                Condition 6(A)(ii) in respect of fractions of Shares:
                _______________

            

    

     

    
      
        

      

    

    The
      Conversion Agent must complete items 1, 2 and (if applicable)
      3.

    
      
        
        

      

      
        31

        
          

        

      

       

    

     

    EXHIBIT
      B

    CONVERSION
      AGENT NOTIFICATION

     

    Form
      of
      notification to be sent by facsimile transmission by an Agent to the Issuer,
      and, if different, the Principal Agent - see Clause 6.4(c)(i).

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    
      	
              To:

            	
              China
                Architectural Engineering, Inc. (the “Issuer”)
                (Attention: Luo
                Ken Yi)
                

            

    

     

    
      	
              To:
                

            	
              Principal
                Agent (Attention: Global Corporate
                Trust)

            

    

     

    Bonds
      conversion identification reference: _______/ China Architectural Engineering,
      Inc. Variable Rate Convertible Bonds due 2012 (US$)/_________

     

    (A)

     

    (B)

     

    (C)

     

    (D)

     

    (E)

     

    (F)

     

    (G)

     

    (H)

     

    Regards

     

    [name
      of agent]

     

    [Identifying
      symbol and number]

     

    Explanation

     

    Against
      the letters (A) to (H) inclusive will be inserted the following information
      with
      respect to the relevant Conversion Notice:

     

    
      	(A)	=	
              name
                and address of converting holder of the Bonds or accountholder of
                Euroclear or Clearstream or other clearing system in which the Bond
                is
                held at such time; 

            

    

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    
       

      
        	(B)	=	
                
                  total
                    number of Bonds in respect of which a Certificate has been deposited
                    by
                    the same holder of the Bonds;

                

              

      

      
        
           

          
            	(C)	=	
                    identifying
                      numbers of the Bonds; 

                  

          

          
            
               

              
                	(D)	=	
                        number
                          of Shares (excluding fractions) issuable to such holder
                          of the
                          Bonds;

                      

              

              
                
                   

                  
                    	(E)	=	
                            name(s)
                              and address(es) of person(s) in whose name(s) the Shares
                              issuable upon
                              conversion are to be
                              registered;

                          

                  

                  
                    
                       

                      
                        	(F)	=	
                                (if
                                  applicable) amount of cash payment due to converting
                                  holder of the Bonds
                                  in respect of fractions of Shares;

                              

                      

                      
                        
                           

                          
                            	(G)	=	
                                    the
                                      Deposit Date, the Conversion Date and the Conversion
                                      Price in respect of
                                      the conversion; and 

                                  

                          

                          
                            
                               

                              
                                	(H)	=	
                                        name
                                          and address of person to whom, and the
                                          manner in which, share
                                          certificates, in which case a duly completed
                                          Delivery Instruction is
                                          attached hereto), etc. and, if applicable,
                                          a cheque in respect of an
                                          Equivalent Amount pursuant to Condition
                                          6(B)(iii) are to be
                                          despatched.

                                      

                              

                               

                              
                                
                                  
                                  

                                

                                
                                  33

                                  
                                    

                                  

                                

                                
                                  
                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    EXHIBIT
      C

    NOTIFICATION
      FROM ISSUER

     

    Form
      of
      notification to be sent by facsimile transmission by the Issuer to the Agent
      which has sent the relevant Conversion Notice - see Clause 6.5.

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    
      	To:	
              The
                Bank of New York, London Branch 
as
                Agent

            

    

     

    
      	Cc:	
              [                                           
                ]

            

    

    Fax:
      [                                   
      ]

     

    
      	To:	
              [                                           
                ]
                (attention: [                       
                ])

            

    

    
       

      
        	
              	
                [                                           
                  ]
                  (attention: [                       
                  ])

              

      

       

    

    Bond
      conversion identification reference

     

    (A)

     

    
      	(B)	
              (i)

            

    

     

    (ii)

     

    (iii)

     

    (C)

     

    (D)

     

    Regards

     

    China
      Architectural Engineering, Inc.

     

    Explanation

     

    Against
      the letters (A) to (D) inclusive will be inserted the following information
      with
      respect to the delivery of Shares upon conversion:

     

    
      	(A)	=	
              the
                identification code and number of the Agent who forwarded the copy
                of the
                Conversion Notice in respect of the Bonds that have been
                converted;

            

    

     

    
      	
              (B)

            	
              =

            	
              (i)

            	
              the
                number of Shares delivered upon
                conversion;

            

    

     

    
      	
            	(ii)	
              the
                amount of cash paid under Condition 6(A)(ii) in respect of fractions
                of
                Shares; and;

            

    

     

    
      	
            	(iii)	
              the
                amount of any other cash (including any Equivalent Amount) received
                upon
                conversion.

            

    

    
       

      
        	(C)	=	
                the
                  date on which the certificate or certificates for Shares and any
                  securities, property or cash were made available for
                  collection;

              

      

      
        
           

          
            	(D)	=	
                    if
                      applicable, the name and address of the person to whom or to
                      whose order
                      the certificate or certificates for Shares and/or cash. if
                      any, were
                      despatched and the address to which and the manner in which
                      they were
                      despatched.

                  

          

           

          
            
              
              

            

            
              34

              
                

              

            

            
              
              

            

          

           

        

      

    

    EXHIBIT
      D

    REGULATIONS
      CONCERNING THE TRANSFER AND REGISTRATION OF BONDS

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    
      	
              1.

            	
              Each
                Bond shall be in the denomination of US$1,000. Certificates, each
                evidencing entitlement to one (1) or more Bonds, shall be issued
                in
                accordance with the Conditions.

            

    

     

    
      	
              2.

            	
              The
                Bonds are transferable by execution of the form of transfer on each
                Certificate endorsed under the hand of the transferor or, where the
                transferor is a corporation, under its common seal or under the hand
                of
                two (2) of its officers duly authorised in writing. In this Exhibit,
                transferor
                shall, where the context permits or requires, include joint transferors
                and be construed accordingly.

            

    

     

    
      	
              3.

            	
              The
                Certificate issued in respect of the Bond to be transferred must
                be
                delivered for registration to the office of a Transfer Agent or the
                Registrar accompanied by such other evidence (including certificates
                and/or legal opinions) as the Transfer Agent or the Registrar may
                reasonably require to prove the title of the transferor or his right
                to
                transfer the Bond and his identity and, if the form of transfer is
                executed by some other person on his behalf or in the case of the
                execution of a form of transfer on behalf of a corporation by its
                officers, the authority of that person or those persons to do so.
                The
                signature of the person effecting a transfer of a Bond shall conform
                to
                any list of duly authorised specimen signatures supplied by the registered
                holder or be certified by a recognised bank, notary public or in
                such
                other manner as the Agent or Registrar may
                require.

            

    

     

    
      	
              4.

            	
              The
                executors or administrators of a deceased holder of Bonds (not being
                one
                (1) of several joint holders) and, in the case of the death of one
                (1) or
                more of joint holders, the survivor or survivors of such joint holders,
                shall be the only persons recognised by the Issuer as having any
                title to
                such Bonds.

            

    

     

    
      	
              5.

            	
              Any
                person becoming entitled to Bonds in consequence of the death or
                bankruptcy of the holder of such Bonds may, upon producing such evidence
                that he holds the position in respect of which he proposes to act
                under
                this paragraph or of his title as the Transfer Agent or the Registrar
                shall require (including certificates and/or legal opinions), be
                registered himself as the holder of such Bonds or, subject to the
                preceding paragraphs as to transfer, may transfer such Bonds. The
                Issuer
                and the Agents or Registrar may retain any amount payable upon the
                Bonds
                to which any person is so entitled until such person shall be so
                registered or shall duly transfer the
                Bonds.

            

    

     

    
      	
              6.

            	
              Unless
                otherwise requested by him and agreed by the Issuer, a holder of
                Bonds
                shall be entitled to receive only one (1) Certificate in respect
                of his
                holding.

            

    

     

    
      	
              7.

            	
              The
                joint holders of a Bond shall be entitled to one (1) Certificate
                only in
                respect of their joint holding which shall, except where they otherwise
                direct, be delivered to the joint holder whose name appears first
                in the
                Register in respect of the joint
                holding.

            

    

     

    
      	
              8.

            	
              The
                Issuer, the Registrar and the Transfer Agents shall make no charge
                to the
                holders for the registration of any holding of Bonds or any transfer
                of
                Bonds or for the issue of any Certificates or for the delivery of
                Certificates at the specified office of the Agent to whom the request
                for
                registration, transfer or delivery was delivered or by uninsured
                post to
                the address specified by the holder. If any holder entitled to receive
                a
                Certificate wishes to have it delivered to him otherwise than at
                the
                specified office of such Agent or the Registrar, such delivery shall
                be
                made upon his written request to such Agent or the Registrar, at
                his risk
                and (except where sent by uninsured post to the address specified
                by the
                holder) at his expense.

            

    

    
      
        
        

      

      
        35

        
          

        

      

       

    

     

    
      	
              9.

            	
              Each
                Transfer Agent will within five (5) Business Days of a request to
                effect a
                transfer of a Bond (or within twenty-one (21) days if the transfer
                is of a
                Bond represented by the Global Certificate) deliver at its specified
                office to the transferee or despatch by mail (at the risk of the
                transferee) to such address as the transferee may request, a new
                Certificate in respect of the Bond or Bonds transferred. In the case
                of a
                transfer, conversion or redemption of fewer than all the Bonds in
                respect
                of which a Certificate is issued, a new Certificate in respect of
                the
                Bonds not transferred, converted or redeemed will be so delivered
                to the
                holder to its address appearing on the register of holders of
                Bonds.

            

    

     

    
      	
              10.

            	
              Notwithstanding
                any other provisions of this Agreement, the Registrar shall register
                the
                transfer of any Bond only upon presentation of an executed and duly
                completed form of transfer substantially in the form set forth in
                the Form
                of Certificate for Definitive Bonds in Schedule 1 or the Form of
                Global
                Certificate in Schedule 2 to the Trust Deed together with any other
                documents thereby required.

            

    

     

    
      	
              11.

            	
              The
                Registrar and Transfer Agents may promulgate any other regulations
                that
                they may deem necessary for the registration and transfer of the
                Bonds.

            

    

    
      
        
        

      

      
        36

        
          

        

      

       

    

     

    EXHIBIT
      E

    FORM
      OF BONDHOLDER REDEMPTION NOTICE

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012

     

    [In
      the
      case of facsimile transmission

     

    To:
       [l]

     

    
      	Cc:	
              [                                                   
                ]

            

    

    Fax:
      [                                           
      ] 

     

    By
      depositing this duly completed Bondholder Redemption Notice with a Paying Agent
      for the Bonds the undersigned holder of such of the Bonds as are represented
      by
      the Certificate surrendered with this Bondholder Redemption Notice and referred
      to below irrevocably exercises its option to have such Bonds redeemed on
      [  ]
      under
      Condition [9(D) / 9(E)] * 
      of the
      Bonds.

     

    This
      Bondholder Redemption Notice relates to Certificates representing Bonds in
      the
      aggregate principal amount of US$_________________. The identifying numbers
      of
      such Certificates are as follows:

     

    
      

    

     

    
      
 

      

    

     

    
      
 

    
      
 

    
      

    

     

    If
      any
      Certificate issued in respect of the Bonds referred to above is to be returned
      (Note 1) to the undersigned under Clause 7.4 of the Paying and Conversion Agency
      Agreement entered into by the Issuer in respect of the Bonds, it will be
      returned by post to the address of the Bondholder appearing on the register
      of
      Bondholders.

     

    Payment
      in respect of the above-mentioned Bonds will be made in accordance with the
      Conditions of the Bonds.

     

    Dated:   

     

    Signature:

     

    Name:

     

      
        

      

    

    * Delete
      as
      applicable.

    
      
        
        

      

      
        37

        
          

        

      

       

    

     

    [To
      be completed by recipient Agent]

     

    Received
      by: 

    
      

    

     

    [Signature
      and stamp of Agent]

     

    At
      its
      office at:

    
      

    

     

    On:

    
      

    

     

    Notes:

     

    
      	
              (1)
                

            	
              Certificates
                so returned will be sent by post, uninsured and at the risk of the
                Bondholder.

            

    

     

    
      	
              (2)
                

            	
              This
                Bondholder Redemption Notice is not valid unless all of the paragraphs
                requiring completion are duly
                completed.

            

    

     

    
      	
              (3)
                

            	
              The
                Agent with whom Certificates are deposited will not in any circumstances
                be liable to the depositing Bondholder or any other person for any
                loss or
                damage arising from any act, default or omission of such Agent in
                relation
                to such Certificates or any of them unless the loss or damage was
                caused
                by the fraud or gross negligence of such Agent or its directors,
                officers
                or employees or agents.

            

    

    
      
        
        

      

      
        38

        
          

        

      

       

    

     

    EXHIBIT
      F

    FORM
      OF BONDHOLDER’S TAX ELECTION NOTICE

    

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

    US$10,000,000
      VARIABLE RATE CONVERTIBLE BONDS DUE 2012 (THE BONDS)

     

    By
      depositing this duly completed Bondholder’s Tax Election Notice with a Paying
      Agent for the Bonds the undersigned holder of such of the Bonds as are
      surrendered with this Notice and referred to below irrevocably exercises its
      option under Condition 9(C) of the Bonds not to have such Bonds redeemed on
      the
      Tax Redemption Date under Condition 9(C)(i) of the Bonds.

     

    This
      Notice relates to Bonds in the aggregate principal amount of US$__________.
      The
      identifying numbers of such Certificates are as follows:

     

    
      

    

     

    
      
 

    
      
 

    
      
 

    
      
 

    
      

    If
      any
      Certificate issued in respect of the Bonds
      referred to above is to be returned(1)
      to the
      undersigned under Clause 7.3 in Exhibit F of the Paying and Conversion Agency
      Agreement entered into by the Issuer in respect of the Bonds, it will be
      returned by post to the address of the Bondholder appearing on the register
      of
      Bondholders.

     

    Payment
      in respect of the above-mentioned Bonds will be made in accordance with the
      Conditions of the Bonds.

     

    
      	
              Dated:

            	
              Signature:

            

    

     

    Name:

     

    [To
      be
      completed by recipient Agent]

     

    Received
      by: 

    
      

    

     

    [Signature
      and stamp of Agent]

     

    At
      its
      office at: 

    
      

    

     

    On:
      

    
      
 

    Notes:

     

    
      	
              (1)
                

            	
              Certificates
                so returned will be sent by post, uninsured and at the risk of the
                Bondholder.

            

    

     

    
      	
              (2)
                

            	
              This
                Bondholder’s Tax Election Notice is not valid unless all of the paragraphs
                requiring completion are duly
                completed.

            

    

     

    
      	(3)	
              The
                Agent with whom Certificates are deposited will not in any circumstances
                be liable to the depositing Bondholder or any other person for any
                loss or
                damage arising from any act, default or omission of such Agent in
                relation
                to such Certificates or any of them unless the loss or damage was
                caused
                by the fraud or negligence of such Agent or its directors, officers
                or
                employees or agents.

            

    

    
      
        
        

      

      
        39

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