Document:

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                                                                   EXHIBIT 10.19

                              SHARE OPTION PLAN FOR

                    THE MIDDLE AND SENIOR LEVEL MANAGEMENT OF

               CHINA NETCOM GROUP CORPORATION (HONG KONG) LIMITED

With reference to international universal practices, and taking into account the
specific conditions of corporate development and compensation and performance
systems, this Plan is hereby compiled to establish and optimize internal
incentive and engagement mechanisms, to better motivate the middle and senior
level management, to attract and retain staffs with outstanding performance, and
to encourage and motivate the participants to increase values for the Company.

I.    DEFINITIONS

Unless otherwise stipulated by this Plan, the following terms shall have the
meanings set out below in this Plan:

"The Company": China Netcom Group Corporation (Hong Kong) Limited, a company
incorporated in Hong Kong, with its shares listed on the Hong Kong Stock
Exchange, and with its American Depositary Receipts listed on the New York Stock
Exchange;

"Option" or "Share Option": the rights authorized under the Share Option Plan to
subscribe shares at the stipulated price (i.e., exercise price) pursuant to the
Share Option Plan;

"Associate": as defined under the Hong Kong Listing Rules;

"The Board": the Board of Directors of the Company;

"Companies Ordinance": the Companies Ordinance (Chapter 32) of the Laws of Hong
Kong (amended from time to time);

"Provincial Companies": subsidiaries (branch companies) of the Company located
in provinces, autonomous regions, or municipalities of the People's Republic of
China;

"Regional and Municipal Branch Companies": various regional-level municipal
branch companies under the provincial company;

"International Company": the Company's International Telecommunications
Corporation Limited;

"Compensation Committee": a committee established by the Board, whose main
responsibilities include formulating compensation policy and with the authority
of the Board dealing with any issues related to this Plan. The committee members
are appointed by the Board. The term of each committee member is

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determined by the Board, and the Board can remove any of them at any time;

"Connected Person": as defined under the Hong Kong Listing Rules;

"The Plan": the Share Option Plan for the Middle and Senior Level Management of
China Netcom Group Corporation (Hong Kong) Limited.;

"The Effective Date of the Plan": the date on which the Share Option Plan is
approved by the shareholders of the Company;

"Validity Period": within ten years from the effective date of the Plan, unless
the Plan is terminated by the Board when exercising its rights under the Plan;

"Qualified Participants": according to the Share Option Plan, those Directors,
Executive Officers, Middle and Senior Managers or Professionals with special
skills of the Company or its subsidiary companies, who are considered by the
Board or the Compensation Committee as having made important contributions to
the Company;

"Middle and Senior Level Managers": management officers of the Company, and
various provincial, regional and municipal companies, whose ranks are higher
than the general manager level or the equivalent levels (inclusive);

"Professionals with special skills": expert-type employees and technical and
marketing staff, who hold key positions within the Company and its subsidiaries,
and exert a crucial influence on the business development of the Company. The
Compensation Committee has the authority to interpret the definition of the term
"Professionals with special skills", and to identify candidates among those
professionals with special skills.

"Option Granting Date": the date on which the Option is granted under the Plan,
that is, the date as specified in the Share Option Agreement;

"Option Effective Date": (i) the Option Granting Date, or (ii) the date on which
the Company is listed and trading of the Company's shares is commenced on the
Hong Kong Stock Exchange, whichever is later;

"Option Validity Period": the period from the Option Effective Date to the date
when the Option is lapsed pursuant to the Plan;

"Option Restrictive Period": the period between the Option Effective Date and
the Option Exercise Date, during which the Option shall not be exercised;

"Restrictive Schedule": the arrangement under which Options granted at one time
are exercised either at

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one time, or at several times in accordance with the predetermined schedule;

"Exercise Date": the calendar date on which shares can be subscribed upon
satisfaction of the Plan's stipulations and requirements. In the event that
shares cannot be traded on the Hong Kong Stock Exchange on such calendar date,
the Exercise Date shall be the next calendar date after shares are traded on the
Hong Kong Stock Exchange.

"Exercise Price": the price payable for each share when option holders exercise
their options to subscribe shares pursuant to the Share Option Plan. The initial
Exercise Price shall be the Initial Public Offering price. The Exercise Price
for the subsequent allotment shall be not less than the highest of the par value
of the share, the closing price on the Option Granting Day, and the average
closing price for the five business days prior to the Option Granting Day;

"Hong Kong Dollar": Hong Kong Dollar, the legal currency in Hong Kong;

"Hong Kong": Hong Kong Special Administrative Region of the People's Republic of
China;

"Hong Kong Stock Exchange": the Stock Exchange of Hong Kong Limited;

"Listing Rules": the Rules Governing the Listing of Securities on the Hong Kong
Stock Exchange;

"Subsidiaries": branch companies and subsidiaries, or joint ventures with
independent legal person status invested in and established by the Company. The
definition of "Subsidiaries" in the Companies Ordinance in respect of the
proportion of equity that is held by the Company in such companies and the
voting rights controlled by the Company in such companies shall be employed in
the context of this Plan;

"Non-Executive Director": a director without any administrative function in the
Company or its subsidiaries.

II.   PARTICIPANT QUALIFICATIONS

The scope of the participants to the Plan shall be the members of the Board of
the Company (including Executive Directors and Non-executive Directors); the
Middle and Senior level management personnel, Professionals with special skills
identified by the Compensation Committee.

III.  GRANTING QUANTITY

      (I)   Within the Validity Period of the Plan, the total number of options
            granted to all Qualified Participants shall not exceed 10% of the
            total shares after the Company's global offerings on the Plan's
            effective date. Upon the approval by the general meeting, the Board
            has the authority to set the limitation on the total number of
            options granted. But, the exercise of the

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            total number of options granted and issued according to the Option
            Plan and share options granted but not exercised, shall not exceed
            30% of the total shares issued at that time.

      (II)  Unless otherwise approved by the general meeting, the Share Option
            (whether the Share Option has been exercised or not) granted to the
            participants within any 12-month period shall not exceed 0.2% of
            total capital stocks of the Company on the Option Granting Date.

IV.   GRANTING AND ACCEPTING THE OPTION

      (I)   Within the Validity Period of the Plan, the Share Options may be
            granted once each year, the Board has the authority to grant options
            in the appropriate manner at the stipulated exercise price to its
            selected Qualified Participants. The Board or the Compensation
            Committee shall decide the timing and the amount to be granted, as
            well as the Exercise Price.

      (II)  The Board grants Share Options to the Qualified Participants in the
            form of an Option Agreement. Option holders do not have to make any
            payment, but shall confirm acceptance of the Option granted within
            28 days after the date on which the Option is granted. Acceptance
            made after such 28 days shall not be considered. Option holders are
            allowed to accept part of the Options the Board grants to them, but
            the accepted amount shall be the complete trading unit amount or its
            integral multiples.

      (III) Participants may be granted Options once each year. The Board has
            the authority to choose new Qualified Participants and grant Options
            to them.

      (IV)  Options shall not be granted within the following periods:

            1.    In the event of any incident or issue that is significant
                  enough to affect the share price, and until such information
                  affecting the share price has been published in the press.

            2.    One month prior to the following dates (whichever is earlier),
                  until the publication of the Annual or Interim Report:

                  (1)   the date of the Board meeting for the approval of the
                        Annual or Interim Report;

                  (2)   the deadline for release of the Company's Annual or
                        Interim Report.

      (V)   Share Options granted to the Company's Directors, President,
            substantial shareholders or Qualified Participants of their
            respective associates under the Share Option Plan shall have
            received the approval from the Independent Non-executive Directors
            (excluding directors to be granted such Option) of the Company. The
            granting of Options to such persons shall be in accordance with the
            relevant provisions of the Listing Rules of the Hong Kong Stock
            Exchange.

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      V.    EXERCISE AND YIELD OF OPTIONS

            1.    The initial granted exercise price of the Options shall be at
                  the IPO price, and subsequent exercise price for allotment
                  shall be at a price no lower than the highest of the par value
                  of the share, the closing share price on the Option Granting
                  Day, and the average closing share price for five business
                  days prior to the Option Granting Day.

            2.    During each share option period, the Option Validity Period
                  shall be six years, that is, six years after Option Effective
                  Date, the outstanding option rights shall be automatically
                  lapsed. The initial Share Option's Vesting Period shall be 1.5
                  years, and it shall proceed in installments according to the
                  vesting schedule. The maximum exercise amount in one
                  installment shall not exceed the percentages listed below:

                  40% (4/10) of the total Options granted can be exercised
                  eighteen months after the Option Effective Date;

                  Another 30% (3/10) of the total Options granted can be
                  exercised thirty months after the Option Effective Date;

                  The remaining 30% (3/10) of the total Options granted can be
                  exercised forty-two months after the Option Effective Date;

            3.    Unless the option holder dies and this right therefore is
                  transferred to the legal representative of his/her estate, the
                  Option holder may not transfer, dispose or otherwise sell such
                  option or other related rights to third parties. Should an
                  option holder transfer, dispose or otherwise sell such option
                  or other related rights to third parties, the Company shall
                  have the rights to cancel any options granted to such option
                  holder.

            4.    In the event of a capitalization issue, share offering, share
                  splitting or combination, or reduction of the stock capital,
                  the Board has the authority to adjust the share quantity and
                  exercise price of the Plan's share options (those yet to be
                  exercised), provided that the ratio between the total number
                  of ordinary shares involved in the Option Plan and total
                  shares outstanding remains unchanged. Such adjustment shall
                  ensure that the Option Plan's participants have the same
                  exercisable option percentage before and after the adjustment
                  and such adjustment may not result in the issued share price
                  below par value.

            5.    The exercise yield at the time of the exercise by the option
                  holder is calculated as the product of the difference between
                  the exercise price and the market price of the Company's
                  shares multiplied by the number of exercised options, less
                  related tax charges. The yield after the option is exercised
                  belongs to the person who exercises the option. The exercise

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                  yield shall be zero should he/she does not exercise his/her
                  option during the exercise period.

            6.    Before partially or wholly exercising the Option by the option
                  holder, he/she shall inform the Company in writing of his/her
                  intention to exercise and the share quantity and the exercise
                  price, etc. The option holder shall not be required to reach
                  any performance target before exercising his/her option,
                  unless the Board has otherwise stipulated and has indicated
                  this in the Share Option Agreement.

      VI.   RIGHTS AFTER THE TERMINATION OF EMPLOYMENT

                  (1)   If an option holder's employment is terminated due to
                        his/her misconduct or conviction of criminal offence,
                        he/she would no longer be qualified as a Qualified
                        Participant under the Plan and all the unexercised
                        options shall be lapsed upon the date of the termination
                        of such employment and under no circumstances such
                        Option may be exercised.

                  (2)   If the option holder resigns on his/her own initiative,
                        all the unexercised options shall be lapsed upon the
                        date on which his/her employment terminates.

                  (3)   Apart from reasons of death, incapacitation or the
                        provisions in Article VI. (I) or Article VI. (II)
                        resulting in the termination of employment, if an option
                        holder is no longer a Qualified Plan Participant due to
                        the termination of his/her employment, he/she can still
                        exercise those unexercised options granted to him/her
                        within twelve months after date on which his/her
                        employment is terminated. The unexercised options shall
                        automatically be lapsed after this period.

      VII.  RIGHTS AFTER DEATH

      If the option holder dies and no events take place in connection with any
      reasons of the termination of employment specified in Article VI. (I), the
      legal representative can exercise any granted but unexercised effective
      Options from the date of the death of the option holder until the
      expiration date of such options. The unexercised options shall be
      automatically lapsed after the above period.

      VIII. RIGHTS AFTER INCAPACITATION

      The option holder can at any time exercise the granted but unexercised
      effective Options from the date of his/her incapacitation until the
      expiration date of such Options. The unexercised Options shall be
      automatically lapsed after the above period.

      IX.   THE CHANGE OF CONTROLLING INTERESTS

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      "The Change of Controlling Interests", under the Plan, refers to any one
      of the situations arising after the Company's shares are listed on and
      have commenced to be traded on the Hong Kong Stock Exchange:

            (I)   Any person, entity or organization has acquired or hold the
                  issued ordinary shares of the Company; or more than 30% of the
                  voting rights attached to the stocks issued by the Company,
                  (or reaching the percentage which according to the Codes on
                  Takeovers and Mergers and Share Repurchases triggers a
                  mandatory general offer)

            However, in respect to this clause the following situations shall
            not be construed as "the Change of Controlling Interests":

                  -     according to the Companies Ordinance, the person, entity
                        or organization purchasing the shares is related to the
                        Company;

                  -     purchased by the Company;

                  -     purchased by the employee incentive plan (or related
                        trust funds) which is either established or supervised
                        by the Company;

            (II)  the Company, as one party, enters into any reorganization,
                  merger or acquisition approved by all the Company's
                  shareholders;

            (III) the liquidation or reorganization of the Company.

            If there is any change of the Controlling Interests, any unexercised
            options held by the option holder for more than six months shall
            immediately become effective and exercisable. The exercisable period
            shall be within the twelve months from the date of the change of
            Controlling Interests. Any outstanding Option shall be lapsed from
            the date of such change of Controlling Interests.

      X.    AMENDMENT AND TERMINATION OF THE PLAN

            (I)   The Board may at any time amend any article of the Share
                  Option Plan and any clause of the Option (including making
                  such amendments in compliance with laws or regulations), on
                  the principle that such amendments shall not damage the rights
                  of any option holder.

            (II)  Any amendment that is to the advantage of current or future
                  option holders, or any amendment that is related to the
                  revision of the Listing Rules shall obtain prior approval from
                  the shareholders at the general meeting.

            (III) Any substantive and significant amendments to the terms or
                  conditions of the Option Plan shall obtain approval from the
                  general meeting, unless such amendments are automatically

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                  effective in accordance with the current clauses of the Option
                  Plan.

                  Any alteration in limiting the authority of the Board to amend
                  the Option Plan shall be approved in the Company's general
                  meeting.

                  The amended Plan or clauses shall still be in accordance with
                  the related regulations of the Rules Governing the Listing on
                  the Hong Kong Stock Exchange.

            (IV)  During the Validity Period of the Plan, the Board may at any
                  time terminate the Share Option Plan or stop granting Options
                  according to the Option Plan. Those options already granted
                  according to the Plan but are yet to be exercised may continue
                  to be exercised according to the Plan, or be cancelled by the
                  Board according to Article XI of the Plan.

                  The Plan shall be lapsed automatically upon the expiry of the
                  Validity Period. If the Board decides to adopt a new share
                  option plan, it shall be approved at the Company's general
                  meeting.

      XI.   CANCELLATION OF THE OPTIONS

      Any granted but outstanding options may be cancelled by the Board with the
      consent of option holders, provided that (I) the Board shall pay the
      option holders an amount equal to the fair market value of the options on
      the cancellation date; (II) the Board shall offer to give the option
      holder an equivalent amount in an alternative share option Plan (or share
      options under any other Plan); (III) the Board should make other
      arrangements as agreed with the option holder to compensate the loss of
      the option rights.

      XII.  STATUS OF THE SHARES

            (I)   Shares under the Option Plan are ordinary shares that may be
                  traded on stock exchanges and the issuance of which has been
                  approved by the Company. Their listing shall be approved by
                  the Hong Kong Stock Exchange. Such shares may be the
                  designated but unissued shares, reserved shares or those
                  repurchased shares approved by the Board, on the condition
                  that such shares shall not violate laws or the rules and
                  regulations of the relevant Stock Exchange.

            (II)  Any outstanding shares shall not be entitled to any dividend
                  distribution nor any attached voting right. Those shares
                  issued from exercised options shall enjoy in every respect the
                  same status as those issued ordinary shares, except for the
                  share right before the date of the exercise of Option..

      XIII. THE LONGEST VALIDITY PERIOD OF THE PLAN

      Unless otherwise terminated by the Board according to the Plan, the
      Validity Period of the Option Plan

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      shall be ten years from its effective date. There shall be no further
      options granted after expiration.

      XIV.  MISCELLANEOUS

            (I)   Unless otherwise provided, decisions made by the Board of the
                  Company concerning the related Share Option shall be final and
                  binding on all participating parties.

            (II)  The Compensation Committee under the Board shall, under the
                  regulation of the Listing Rules, be responsible for the
                  management and the interpretation of the Option Plan. The
                  Company's Human Resources Department shall be responsible for
                  of the implementation of the Plan and the compilation of the
                  detailed implementation regulations for each grant, which
                  shall be presented to the Board for approval.

            (III) The Plan shall be officially in effect upon the approval by
                  the shareholders at the Company's general meeting.

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                                                                   EXHIBIT 10.20

                                                                  EXECUTION COPY

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                            SHARE PURCHASE AGREEMENT

                                       FOR

                             CERTAIN ORDINARY SHARES

                 OF CHINA NETCOM CORPORATION (HONG KONG) LIMITED

                                 BY AND BETWEEN

                                 CNC FUND, L.P.

                                       AND

                             CNET FOUNDATION LIMITED

================================================================================

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                                                                  EXECUTION COPY

                            SHARE PURCHASE AGREEMENT

      This Share Purchase Agreement (this "Agreement") is made by and between
CNET Foundation Limited ("CNET"), a company organized under the laws of the
British Virgin Islands ("BVI"), and CNC Fund, L.P. (the "Fund"), a partnership
organized under the laws of the Cayman Islands with the intention that it is to
take effect from June 28, 2004 ("Effective Date").

                                 R E C I T A L S

      WHEREAS, pursuant to Subscription Agreement dated as of September 29,
2000, among China Netcom Holdings (BVI) Limited ("CNC(BVI)"), a company
organized under the laws of the British Virgin Islands, China Netcom Corporation
(Hong Kong) Limited ("CNC (HK)"), a company incorporated in the Hong Kong
Special Administrative Region ("Hong Kong") of the People's Republic of China
("PRC"), China Netcom Corporation Limited (the "OpCo") an enterprise organized
under the laws of the PRC and the Fund, CNC (HK) issued to the Fund 30,967,127
Series A Preferred Shares, par value US$0.01 per share, of CNC (HK) (the
"Preferred Shares");

      WHEREAS, CNET has agreed to sell to the Fund 6,400,000 ordinary shares of
CNC (HK) (the "Common Shares") upon the terms set out as follows;

      WHEREAS, as at the Effective Date, CNC Holdings owns 100% of CNC (BVI),
which, together with the Fund and CNET, owns 100% of the CNC (HK), which in turn
owns 100% of the OpCo;

      WHEREAS, a subsidiary of CNC (BVI) in Hong Kong is expected to conduct an
initial public offering in 2004;

      WHEREAS, the Fund has entered into a share purchase and exchange agreement
(as such agreement may be amended from time to time, the "Share Purchase and
Exchange Agreement") with CNC (HK) and CNC (BVI); and

      WHEREAS, pursuant to the Share Purchase and Exchange Agreement, the Fund
contemplates entering into transactions whereby the Preferred Shares and the
Common Shares are exchanged for an interest in Listco.

      NOW, THEREFORE, in consideration of the above premises and the agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1. DEFINITIONS.

      1.1. Capitalized terms not defined herein have the meanings ascribed to
them in the Share Purchase and Exchange Agreement.

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      1.2. The following terms shall have the following meanings:

      "Exchange Period" means the period commencing on the first Trading Day
      following the end of the Lock-up Period and ending on the Maturity Date.

      "Exchange Share Proceeds" means the net proceeds received by the Fund from
      a sale of the Exchange Shares on the SEHK on, or within three Trading Days
      after, delivery to the Fund of a Notice of Exchange (in the case of a
      payment by the Fund pursuant to Section 3.2 hereof) or within three
      Trading Days after the Maturity Date (in the case of a payment by the Fund
      pursuant to Section 3.3 hereof), after deduction of all expenses of such
      sale (including without limitation brokerage commissions, stamp duty,
      legal fees and disbursements (if any) and applicable transactional
      levies).

      "Exchange Shares" means such number of Listco Shares to be held by the
      Fund for the benefit of CNET pursuant to the terms of this Agreement equal
      to 0.49% of the total number of Listco Shares in issue immediately prior
      to completion of the Listco IPO, subject to dilution only from (A) shares
      to be issued in the IPO, (B) shares issuable under Listco's employee stock
      option plan and (C) shares issued in exchange for any material additional
      assets that CNC(BVI) acquires from any entity outside of mainland China
      that is not an affiliate of CNC(BVI) and contributes to Listco between the
      Effective Date and the date of completion of the Listco IPO.

      "Face Amount" means US$26,400,000.

      "HK$" means Hong Kong dollars, the lawful currency of Hong Kong.

      "HK$ Equivalent" of any amount denominated in US$ means the HK$ equivalent
      of such amount at the US$/HK$ Exchange Rate on the Listing Date.

      "Hong Kong" means the Hong Kong Special Administrative Region of the PRC.

      "Instrument" has the meaning set forth in Section 2.2.

      "IPO Price" means the price, in HK$, at which Listco Shares are issued and
      sold to the public in the Listco IPO.

      "Listco Shares" means the ordinary shares of Listco.

      "Listing Date" means the day on which the Listco Shares commence trading
      on the SEHK.

      "Limit Order Exchange" means an exchange of the Instrument pursuant to
      Section 3.1, in connection with which CNET in the relevant Notice of
      Exchange has specified a Limit Order Price.

      "Limit Order Price" means a minimum price specified in a Notice of
      Exchange.

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      "Limit Order Expiration Date" means, in connection with a Limit Order
      Exchange, the date (if any) specified as the Limit Order Expiration Date
      in the relevant Notice of Exchange.

      "Lock-up Period" means the period commencing on the Listing Date and
      ending on the last day on which sales by the Fund of Listco Shares are
      subject to any restriction pursuant to the Share Exchange Agreement and/or
      any other agreement entered into between or among the Fund, Listco and/or
      the underwriters of the Listco IPO.

      "Maturity Date" means the day that is one year after the expiration of the
      Lock-up Period; provided that if such day is not a Trading Day, the
      Maturity Date shall be the next following Trading Day.

      "Notice of Exchange" has the meaning set forth in Section 3.1.

      "PRC" means the People's Republic of China.

      "SEHK" means The Stock Exchange of Hong Kong Limited.

      "Trading Day" means a day on which the SEHK is open for trading and is not
      closed for any reason prior to its normal closing time.

      "US$" means United States dollars, the lawful currency of the United
      States of America.

2. SHARE PURCHASE AND INSTRUMENT ISSUANCE.

      2.1. Purchase of Common Shares. The Fund hereby agrees to purchase from
CNET, and CNET hereby agrees to sell to the Fund, all the Common Shares. The
consideration for the purchase and sale of the Common Shares shall be the
payment by the Fund to CNET of an amount equivalent to the Face Amount as is
evidenced by the issuance and delivery to CNET of the Instrument and upon the
terms as set out in this Agreement.

      2.2. Issuance of Instrument. Upon execution of this Agreement, the Fund
shall, as soon as practicable and within five days from satisfaction of the
conditions to the Fund's obligations set out in Section 6.1, issue to CNET an
exchangeable Instrument (the "Instrument"), with a face value equal to the Face
Amount, substantially in the form of Exhibit 1 attached hereto, in exchange for
the transfer of the Common Shares to the Fund.

3. EXCHANGE AND CANCELLATION OF INSTRUMENT.

      3.1. Exchange. If CNET delivers to the Fund during the Exchange Period a
notice of exchange in the form attached as Exhibit 2 hereto, duly executed by an
authorized signatory of CNET and attaching the original Instrument (a "Notice of
Exchange"), then:

            (a) in the case of a Limit Order Exchange, the Fund shall, as soon
      as practicable after receipt of such Notice of Exchange, sell the Exchange

<PAGE>

      Shares on the SEHK and, within three Trading Days after such sale, pay the
      Exchange Share Proceeds to CNET; provided that if the Notice of Exchange
      specifies a Limit Order Expiration Date and the Fund is unable to sell the
      Exchange Shares on the SEHK at a price greater than or equal to the Limit
      Order Price on or before the Limit Order Expiration Date, the Notice of
      Exchange shall be deemed to be withdrawn as of the close of business on
      the Limit Order Expiration Date and shall have no further effect
      thereafter;

            (b) in any other case, sell the Exchange Shares on the SEHK within
      two Trading Days after receipt of such Notice of Exchange and, within
      three Trading Days after such sale, pay the Exchange Share Proceeds to
      CNET.

      CNET shall inform the Fund in writing of the names of all persons from
time to time authorized to execute a Notice of Exchange on behalf of CNET and
shall provide a specimen signature of each such person.

      3.2. Maturity. If no Notice of Exchange is delivered by CNET prior to the
Maturity Date, or if a Notice of Exchange in respect of a Limit Order Exchange
has been delivered by CNET prior to the Maturity Date but the Fund has been
unable on or prior to the Maturity Date to sell the Exchange Shares on the SEHK
at a price greater than or equal to the Limit Order Price, then the Fund shall,
within five Trading Days after the Maturity Date, pay to CNET the Exchange Share
Proceeds based on the market price obtained by the Fund on a sale of the
Exchange Shares on the SEHK; provided that the Fund shall not be required to pay
such amount unless and until CNET has delivered the Instrument to the Fund for
cancellation.

      3.3. Payments. All payments due from the Fund to CNET shall be made by
wire transfer to the following bank account:

      The Hongkong and Shanghai Banking Corporation Limited

      A/C no: 004-502-406119-001

The Fund shall be entitled to deduct from and set off against any such payment
any amounts due and payable to the Fund by CNET, for which the Fund has issued a
written demand to CNET which the Fund has certified to be reasonable, but which
amounts have not yet been paid.

      3.4. Cancellation of the Instrument. Upon the payment by the Fund of the
amount required to be paid pursuant to Section 3.1 or 3.2, the Fund shall be
discharged from any liability under the Instrument and the Instrument shall be
cancelled.

4. REPRESENTATIONS AND WARRANTIES OF THE FUND.

      The Fund hereby represents and warrants to CNET that the statements in the
following paragraphs of this Section 4 are all true and correct:

      4.1. Organization, Good Standing and Qualification. The Fund is a
partnership duly incorporated and organized, validly existing, and in good
standing under the laws of the Cayman Islands, and has the requisite corporate
power and

<PAGE>

corporate authority to own, lease, and operate their assets, properties and
business, and to carry on its business as it is now being conducted. Subject to
receipt of the limited partner consents referred to in Section 6.1, the Fund
has the corporate power and authority to enter into and perform this Agreement.

      4.2. Valid Issuance of the Instrument. The Instrument, when issued as
provided in this Agreement, will be duly authorized, validly issued and CNET
will obtain full right, title and interest to the same.

      4.3. Governmental Consents. No consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with any
court, governmental agency, regulatory authority or political subdivision
thereof, or any other entity, other than the consents and approvals referred to
in Section 6.1 is required for the execution, delivery and performance by the
Fund of this Agreement in order to consummate the transactions contemplated in
this Agreement. None of such filings and qualifications are the subject of any
pending or, to the best knowledge of the Fund, threatened attack by appeal or
direct proceeding or otherwise.

      The Fund hereby undertakes to CNET on the terms as set forth in the
following statements:

      4.4. Status of Obligations. The obligations of the Fund to pay to CNET the
Face Amount and the amounts due upon exchange of the Instrument shall at all
times constitute unsubordinated obligations of the Fund, ranking pari passu with
all other general obligations of the Fund.

      4.5. Exchange Shares. The Fund shall at all times set aside the Exchange
Shares to meet its obligations to CNET, which Exchange Shares shall at all times
be unencumbered and shall not in any way directly or indirectly be disposed of
or made available to any other person.

      4.6. Approvals. The Fund undertakes to use its reasonable best endeavors
to obtain all the approvals and consents necessary or desirable by it as
referred to in Section 6.1.

      4.7. Indemnification. The Fund shall indemnify CNET and hold CNET harmless
from and against any loss, liability, cost or damage, including attorneys fees
and other charges, arising from any breach by the Fund of any of the
representations, warranties or undertakings set forth in this Section 4.

5. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS OF CNET.

      CNET hereby represents, warrants and undertakes to the Fund that as
follows:

      5.1. Authorization and Validity. CNET is a company duly organized, validly
existing, and in good standing under the laws of the BVI, and has the requisite
power and authority to own and operate its assets and business, and to carry on
its business as it is now being conducted. CNET has the requisite power and
authority to enter into and perform this Agreement. All action of CNET necessary
for the authorization, execution, delivery of, and the performance of all
obligations of CNET

<PAGE>

under this Agreement, has been taken or will be taken prior to execution of this
Agreement, and this Agreement constitutes valid and legally binding obligations
of CNET.

      5.2. Governmental and Third Party Consents and Approvals. No consent,
approval, order or authorization of, or registration, qualification,
designation, declaration or filing with any court, governmental agency,
regulatory authority or political subdivision thereof, or any other entity, is
required for the execution, delivery and performance by CNET of this Agreement
in order to consummate the transactions contemplated in this Agreement. None of
such filings and qualifications are the subject of any pending or, to the
knowledge of CNET, threatened attack by appeal or direct proceeding or
otherwise.

      5.3. Interests of Governmental Officials, Directors and Officers. No
present or former governmental official of the PRC, Hong Kong or any other
country, region or territory or any political subdivision thereof that has or
has had, in the last two years, or is in any way associated with any
governmental agency or instrumentality that has or has had, in the last two
years, any involvement in

            (a) the approval of the Listco IPO, the transactions contemplated by
      this Agreement or the Share Purchase and Exchange Agreement, or any matter
      related thereto or

            (b) the regulation of CNC(HK) or any of its parent or subsidiary
      companies or any of their respective businesses,

and no director or officer of CNC (HK), CNC (BVI) or China Network Communication
Group Corp., has any direct or indirect legal or beneficial interest in CNET or
any of its assets, and there is no intention on the part of CNET or any of its
officers or directors or, to the knowledge of CNET, any other person to grant or
transfer any such interest to any such person. To the knowledge of CNET, no such
person has received or will receive any improper benefit in connection with the
Listco IPO the transactions contemplated by this Agreement or the Share Purchase
and Exchange Agreement. CNET shall promptly inform the Fund in writing in any of
the foregoing information in this Section 5.3 ceases to be true and correct.

      5.4. Legality. Neither the execution nor the performance of this Agreement
will violate any law of the PRC, Hong Kong or any other country, region or
territory.

      5.5. Valid Issuance of the Common Shares. The Common Shares are duly
authorized, validly issued, owned by CNET free of any encumbrance, and the Fund
will obtain full right, title and interest to the same.

      5.6. Indemnification. CNET shall indemnify the Fund and hold the Fund
harmless from and against any loss, liability, cost or damage, including
attorneys fees and other charges, arising from any breach by CNET of any of the
representations, warranties or undertakings set forth in this Section 5.

<PAGE>

6. CONDITIONS TO OBLIGATIONS.

      6.1. Approvals. Consummation of the transactions contemplated in Sections
2 and 3 above will be subject to receipt of all necessary consents and
approvals, including without limitation any consent of the limited partners and
lead investors of the Fund necessary or advisable under the limited partnership
agreement of the Fund. The transactions contemplated in Sections 2 and 3 above
have been or will be approved by the board of directors and shareholders of CNC
(HK) and have been or will be acknowledged by China Netcom Communication Group
Corporation, in each case with full disclosure of any interests or prospective
interests of employees, officers and/or directors of CNC(HK) in CNET, and will
be disclosed in Listco's IPO prospectus, as appropriate. CNET will provide
evidence as reasonably requested by the Fund of such approvals and
acknowledgments.

      6.2. Representations and Warranties. The obligation of the Fund to
consummate the transactions contemplated in Sections 2 and 3 above is subject to
the representations and warranties of CNET set forth in Section 5 above being
true and correct in all material respects. The obligation of CNET to consummate
the transactions contemplated in Sections 2 and 3 above is subject to the
representations and warranties of the Fund set forth in Section 4 above being
true and correct in all material respects.

      6.3. Legal Opinions. The obligation of the Fund to consummate the
transactions contemplated in Sections 2 and 3 above is subject to receipt by the
Fund of (i) a legal opinion of Freshfields Bruckhaus Deringer addressed to the
Fund in the form attached as Exhibit 3 and (ii) a legal opinion of [PRC legal
counsel acceptable to the Fund] addressed to the Fund in the form attached as
Exhibit 4.

      6.4. Relationship to Share Purchase and Exchange Agreement. The
obligations of the Fund under this Agreement and the Instrument are subject to
the performance in full by CNC (BVI) and CNC (HK) of their obligations under the
Share Purchase and Exchange Agreement. If CNC (BVI) or CNC (HK) fails to perform
any of its obligations under the Share Purchase and Exchange Agreement, CNET and
the Fund shall consult and agree in good faith on appropriate modifications to
this Agreement and the Instrument.

7. FEES AND EXPENSES.

      CNET will bear (i) all reasonable fees and expenses in connection with the
transaction described herein, (ii) the Fund's legal expenses reasonably incurred
in connection with the transaction described herein, subject to CNET's review,
and (iii) all expenses and Hong Kong stamp duty of the Fund reasonably incurred
in connection with the implementation of such transactions, including without
limitation all expenses relating to the acquisition, and disposition and
(subject as provided below in this Section 7) holding of the Exchange Shares. In
addition, CNET will bear all general operational expenses of the Fund incurred
after the disposition or distribution by the Fund of all of its Listco Shares
other than the Exchange Shares to the partners of the Fund, provided, however,
that until the Fund has disposed or distributed all of such Listco Shares, the
Fund shall bear all general operational expenses.

<PAGE>

8. TERMINATION.

      After execution of this Agreement, if the Option Exercise as set forth in
Section 1.2 of the Share Purchase and Exchange Agreement is not completed by
December 31, 2004, the Common Shares will, at the election of either party, be
returned to CNET in exchange for cancellation of the Instrument. If the Option
Exercise is completed but the Effective Date (as defined in the Share Purchase
and Exchange Agreement) does not occur by December 31, 2004, at the election of
the Fund at any time thereafter the Fund will have the right to return the CNET
Shares to CNC (BVI) in exchange for the Common Shares and to return the Common
Shares to CNET. In such event, the Fund shall have no further liability under
the Instrument, and CNET shall return the Instrument to the Fund for
cancellation.

9. NOTICES.

      9.1. Notice Addresses and Method of Delivery. All notices, requests,
demands, consents and other communications ("Notices") required to be given by
any Party to any other Party shall be in writing and delivered by

            (a) hand delivery or courier;

            (b) prepaid registered letter sent by first class mail (airmail if
            to an address in a country other than the country in which the
            sender is situated), return receipt request; or

            (c) facsimile

            to the applicable Party at the address or facsimile number stated
            below:

                  (i) If to the Fund: CNC Fund, L.P.
                                      c/o Bank of Bermuda (Cayman) Limited
                                      36C Bermuda House - 3rd Floor
                                      P.O. Box 513 GT
                                      Dr. Roy's Drive
                                      George Town, Grand Cayman
                                      Cayman Islands
                                      Attention:   General Manager,
                                                   Global Fund Services
                                      Facsimile:   (1-345) 949-7959

                                      with copies to:

                                      Bermuda Trust (Far East) Limited
                                      39th Floor, Edinburgh Tower
                                      The Landmark
                                      15 Queen's Road Central
                                      Hong Kong
                                      Attention:   Director, Institutional Trust
                                      Telex:       86017 BETRY HX
                                      Facsimile:   (852) 2537-1253

<PAGE>

                                      and

                                      Paul, Weiss, Rifkind, Wharton & Garrison
                                      12th Floor, Hong Kong Club Building
                                      3A Chater Road
                                      Central, Hong Kong
                                      Attention:   John E. Lange
                                      Facsimile:   (852) 2536-9622

                  (ii) If to CNET:     CNET Foundation Limited
                                       59th Floor, Bank of China Tower
                                       1 Garden Road
                                       Hong Kong
                                       Attention:  Wenlong Sun
                                       Facsimile:  (852) 2121-2819

            or, as to each Party, at such other address or number as shall be
            designated by such Party in a notice to the other Parties containing
            the new information in the same format as the information set out
            above and complying as to delivery with the terms of this Section.

      9.2. Time of Delivery. Any Notice delivered:

            (a) by hand delivery or courier shall be deemed to have been
      delivered on the date of actual delivery;

            (b) by prepaid registered letter shall be deemed to have been
      delivered seven days after the date of posting; and

            (c) by facsimile shall be deemed to have been delivered on the day
      the transmission is sent (as long as the sender has a confirmation report
      specifying a facsimile, a facsimile number of the recipient, the number of
      pages sent and the date of the transmission).

      9.3. Proof of Delivery. In proving delivery of any Notice it shall be
sufficient:

            (a) in the case of delivery by hand delivery or courier, to prove
      that the Notice was properly addressed and delivered;

            (b) in the case of delivery by prepaid registered letter, to prove
      that the Notice was properly addressed and posted; and

            (c) in the case of delivery by facsimile transmission, to prove that
      the transmission was confirmed as sent by the originating machine to the
      facsimile number of the recipient, on the date specified.

<PAGE>

10. GENERAL PROVISIONS.

      10.1. Governing Law; Arbitration.

            (a) This Agreement shall be governed, interpreted and enforced in
      accordance with the laws of the State of New York, U.S.A.

            (b) In the event any dispute arises between the parties, which
      cannot amicably be resolved, such dispute shall be submitted to the Hong
      Kong International Arbitration Centre ("HKIAC") for arbitration in
      accordance with the UNCITRAL Arbitration Rules as at present in force and
      as amended as follows: (i) the appointing authority shall be HKIAC; (ii)
      the place of arbitration shall be in Hong Kong, (iii) there shall be three
      arbitrators (one to be appointed by CNET, a second to be appointed by the
      Fund, and the third to be appointed jointly by these two arbitrators),
      (iv) such arbitration shall be administered in accordance with the HKIAC
      Procedures for Arbitration in force as of the date hereof, and (v) the
      language to be used in arbitration proceedings shall be English.

      10.2. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.

      10.3. Headings. The headings and captions used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement.

      10.4. Amendments and Waivers. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of both parties to this Agreement.

      10.5. Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision(s) shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision(s) were so excluded and shall be enforceable in accordance with
its terms.

      10.6. Entire Agreement. This Agreement, together with all exhibits and
schedules hereto, constitutes the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersedes any and all
prior negotiations, correspondence, agreements, understandings duties or
obligations between the parties with respect to the subject matter hereof.

      10.7. Further Assurances. From and after the Effective Date, upon the
request of either party, each party shall execute and deliver such instruments,
documents or other writings as may be reasonably necessary to confirm and carry
out and to effectuate fully the intent and purposes of this Agreement.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

                                            CNET FOUNDATION LIMITED

                                            By: ________________________________
                                                Name:
                                                Title:

                                            CNC FUND, L.P.

                                            By: CNC CAYMAN LIMITED,
                                                as a General Partner

                                                By: ____________________________
                                                    Name:
                                                    Title:

                                            By: BEST BLUECHIP INVESTMENTS
                                                LIMITED
                                                as a General Partner

                                                By: ____________________________
                                                    Name:
                                                    Title:

                                            By: GS CHINA BROADNET GP, L.L.C.
                                                as a General Partner

                                                By: ____________________________
                                                    Name:
                                                    Title:

<PAGE>

                                                                       EXHIBIT 1

                            [FORM OF THE INSTRUMENT]

                        Unsecured Instrument Due [   ]

      CNC Fund, L.P., a partnership duly organized and existing under the laws
of the Cayman Islands (the "Issuer"), for value received, hereby promises to pay
to CNET Foundation Limited (the "Holder") the sum specified in the Agreement, in
accordance with the terms of the Agreement. The Face Amount of this Instrument
is US$26,400,000.

      The Issuer issued this Instrument under a share purchase agreement
effective as of June 28, 2004 between the Issuer and the Holder (the
"Agreement"). Terms defined in the Agreement and not defined herein have the
meanings ascribed thereto in the Agreement. This Instrument is subject to all of
the terms and conditions set forth in the Agreement.

THIS INSTRUMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF HONG KONG BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF
LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD
BE REQUIRED THEREBY.

<PAGE>

                                                                       EXHIBIT 2

                            [FORM OF EXCHANGE NOTICE]

                                 Exchange Notice

To:   CNC Fund, L.P.
      c/o Bank of Bermuda (Cayman) Limited
      36C Bermuda House - 3rd Floor
      P.O. Box 513 GT
      Dr. Roy's Drive
      George Town, Grand Cayman
      Cayman Islands

      We refer to the Share Purchase Agreement effective as of June 28, 2004
between CNC Fund L.P. and CNET Foundation Limited (the "Agreement") and to the
Instrument attached hereto (the "Instrument").

      We hereby give notice of exchange of the Instrument pursuant to Section
3.1 of the Agreement.

      [This is a Limit Order Exchange. The Limit Order Price is HK$______. [The
Limit Order Expiration Date is _____.]](1)

                                            CNET FOUNDATION LIMITED

                                            By: ________________________________
                                                Name:
                                                As authorized signatory
                                                designated pursuant to Section
                                                3.2 of the Agreement

Dated:________________________

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

(1) Include if applicable.

<PAGE>

                                                                       EXHIBIT 3

                          [FORM OF FRESHFIELDS OPINION]

<PAGE>

                                                                       EXHIBIT 4

                          [FORM OF PRC COUNSEL OPINION]
<PAGE>

                                                                  EXECUTION COPY

                             AMENDMENT NO. 1 TO THE
                      SHARE PURCHASE AND EXCHANGE AGREEMENT

            THIS AMENDMENT NO. 1 (this "Amendment") to the SHARE PURCHASE AND
EXCHANGE AGREEMENT (the "Agreement"), dated June 11, 2004 is made as of July 20,
2004, by and among China Netcom Holdings (BVI) Limited, China Netcom Corporation
(Hong Kong) Limited and CNC Fund, L.P. (together, the "Parties"). All
capitalized terms used but not defined herein shall have the meanings ascribed
to such terms in the Agreement.

                                R E C I T A L S:

            Pursuant to Section 13.5 of the Agreement, the Parties hereby wish
to amend the Agreement.

            NOW, THEREFORE, the Agreement is hereby amended as follows:

            1. Purchase of the CNC (HK) Interest. Section 1.1(b)(ii) is hereby
amended by deleting the words "$325 million" and replacing them with the words
"$30,967,127".

            2. Lock-up Period. Section 6 of the Agreement is hereby amended by
deleting the words "after the first trading day of the IPO of Listco ("Effective
Date")" and replacing them with the words "after the date of Listco's prospectus
(the "Effective Date")."

            3. Term. Section 8.1 of the Agreement is hereby deleted and amended
in its entirety to read as follows:

            "Drop Dead" Date. In the event that (x) the Listco IPO is not
completed by December 31, 2004, or (y) any entity in the China Netcom Group
(including China Network Communications Group Corporation and its subsidiaries)
other than a subsidiary of CNC (BVI) (such entity, an "Other IPO Subsidiary")
conducts an initial public offering prior to completion of the Listco IPO, the
Fund will have the right, exercisable by written notice to CNC (BVI) and CNC
(HK), to require CNC (BVI) to return or re-issue the 30,967,127 Preferred Shares
and 6,400,000 Common Shares constituting the CNC (HK) Interest to the Fund in
exchange for the Pre-IPO Listco Shares then held by the Fund, and CNC (HK) shall
take all steps necessary to effect the return of the CNC (HK) Interest in the
manner described in this Section 8.1; provided that the number of Common Shares
into which the Preferred Shares will be convertible at the time of any such
return or re-issuance (i) shall be (A) adjusted in accordance with the terms of
the Preferred Shares, as if the Preferred Shares had been continuously
outstanding at all times from the date of this Agreement until the date of such
return or re-issuance and (B) adjusted appropriately to take into account any
conversion of the Preferred Shares prior to any such re-issuance, and (ii) shall
in any event represent not less than the percentage of pre-IPO Listco Shares
determined in accordance with Section 1.1(b)(i). Immediately upon delivery of
such notice, (i) all of the Fund's rights under the Investor Rights Agreement,
the Registration Rights Agreement, the Memorandum and Articles of Association of

<PAGE>

CNC (HK) as in effect on the date hereof, the Ancillary Agreements and all other
agreements and corporate documents under which the Fund had any rights
immediately prior to the date hereof shall be restored in full, (ii) if any or
all of the Preferred Shares have been cancelled, converted or modified in any
way, they shall be re-authorized, reissued and otherwise reinstated such that
they are identical in all respects to the Series A Preferred Shares existing
immediately prior to the execution of this Agreement, (iii) CNC (BVI) shall
return to the Fund, and CNC (HK) shall procure the return to the Fund of, the
certificates representing the Preferred Shares and the Common Shares, and (iv)
CNC (BVI) and CNC (HK) shall take all further actions reasonably requested by
the Fund in order to ensure that the Fund and CNET will have substantially the
same rights and interests in respect of CNC (HK) as they had immediately prior
to the execution of this Agreement.

            4. Effective Date. This Amendment shall be effective immediately
upon signing by all the Parties.

            5. Ratification of the Agreement. Except as otherwise expressly
provided herein, all of the terms and conditions of the Agreement are ratified
and shall remain unchanged and continue in full force and effect.

            6. Governing Law; Arbitration.

            (a) This Agreement shall be governed, interpreted and enforced in
accordance with the laws of the State of New York, U.S.A.

            (b) In the event any dispute arises among the Parties, or any of
them which cannot amicably be resolved, such dispute shall be submitted to the
Hong Kong International Arbitration Centre ("HKIAC") for arbitration in
accordance with the UNCITRAL Arbitration Rules as at present in force and as
amended as follows: (i) the appointing authority shall be HKIAC; (ii) the place
of arbitration shall be in Hong Kong, (iii) there shall be three arbitrators
(one to be appointed by CNC (BVI) and/or CNC (HK), a second to be appointed by
the Fund, and the third to be appointed by these two arbitrators), (iv) such
arbitration shall be administered in accordance with the HKIAC Procedures for
Arbitration in force as of the date hereof, and (v) the language to be used in
arbitration proceedings shall be English.

                  [remainder of page left intentionally blank]

<PAGE>

            IN WITNESS WHEREOF, the Parties hereto have executed this Agreement
as of the date first written above.

                                          CHINA NETCOM HOLDINGS (BVI)
                                          LIMITED

                                          By: _________________________________
                                              Name:
                                              Title:

                                          CHINA NETCOM CORPORATION
                                          (HONG KONG) LIMITED

                                          By: _________________________________
                                              Name:
                                              Title:

<PAGE>

                                          CNC FUND, L.P.

                                          By: CNC CAYMAN LIMITED,
                                              as a General Partner

                                              By: _____________________________
                                                  Name:
                                                  Title:

                                          By: BEST BLUECHIP INVESTMENTS LIMITED
                                              as a General Partner

                                              By: _____________________________
                                                  Name:
                                                  Title:

                                          By: GS CHINA BROADNET GP,
                                              L.L.C. as a General Partner

                                              By: _____________________________
                                                  Name:
                                                  Title:

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