AGREEMENT FOR THE SALE AND PURCHASE OF SHARES IN SUNDAY COMMUNICATIONS LIMITED

Execution Version

AGREEMENT FOR THE
SALE AND PURCHASE OF SHARES
IN SUNDAY COMMUNICATIONS LIMITED

1.1    In this Agreement where the context so admits, the following words and expressions shall have the following meanings:

Subject to the terms and conditions of this Agreement, the Vendor shall sell, as legal and beneficial owner, and the Purchaser shall purchase, or procure the purchase by one of its wholly-owned subsidiaries of, the Sale Shares, free from all liens, charges and encumbrances and together with all rights now or hereafter attaching to them, including all rights to any dividends or other distributions declared, made or paid after the date of this Agreement.

3.1   The total consideration payable for the Sale Shares (the "Consideration") shall be the sum of HK$266,587,100 (two hundred and sixty six million, five hundred and eighty seven thousand, one hundred Hong Kong dollars), being a price per Sale Share of HK$0.65.

3.4   The transfer of the Sale Shares shall be effected on the Company's principal register of members in the Cayman Islands, subject (if necessary) to the consent of the board of directors of the Company to the removal of the Sale Shares to that register and the Sale Shares shall remain on that register until title has been transferred to the Purchaser or one of its subsidiaries designated by the Purchaser.

4.1.1         there being no breach of the representations and warranties set out in Schedule 1 to this Agreement;

4.1.2         the consent of the boards of directors of each of the Vendor and the Vendor Guarantor to the sale of the Sale Shares on the terms of this Agreement being obtained.

4.2   If the Conditions are not satisfied (or waived by relevant party), all rights, obligations and liabilities of the Parties hereunder shall cease and terminate and none of the Parties shall have any claim against any other in respect of this Agreement save for claims (if any) in respect of any antecedent breaches of this Agreement.

5.2.1         duly executed transfer form(s) in respect of all of the Sale Shares in favour of the Purchaser or its wholly owned subsidiary referred to in Clause 2 designated by the Purchaser or the nominee(s) of either of them together with (in respect 

of the relevant physical Sale Shares) the relative share certificate(s) and/or (in respect of the relevant Sale Shares held in CCASS) the relevant instructions to the relevant CCASS participant(s) to effect the transfer(s) of the relevant Sale Shares through CCASS to the Purchaser or its wholly owned subsidiary referred to in Clause 2 designated by the Purchaser or such person(s) having an account(s) with CCASS as may be notified in writing by the Purchaser to the Vendor at least 2 Business Days prior to the Completion Date;

5.2.2         certified copies of the minutes of the meetings of directors, or the written approvals of the directors (as the case may be), of each of the Vendor and the Vendor Guarantor required to authorise the execution and completion of this Agreement by the Vendor and the Vendor Guarantor, and the performance by the Vendor and the Vendor Guarantor of their respective obligations hereunder;

5.2.3         legal opinions from legal counsel for the Vendor and the Vendor Guarantor in their respective jurisdictions of incorporation, confirming that the Vendor and the Vendor Guarantor are each validly incorporated and have the capacity to enter into this Agreement and that this Agreement constitutes the legal, valid and enforceable obligations of each of them; and

5.2.4         if Hong Kong stamp duty is payable on the transfer of the Sale Shares, a cheque drawn in favour of "The Government of the Hong Kong Special Administrative Region" in the amount of the Vendor's 50% share of the estimated stamp duty payable in respect of the sale and purchase of the Sale Shares.

5.3   At Completion:

5.3.1         the Vendor and the Vendor Guarantor shall deliver to the Company (with certified copies to the Purchaser) letters of resignation by all the Resigning Directors, expressed to be subject to the Offer proceeding, with effect from the later of (1) the first closing date of the Offer and (2) the date on which the Offer becomes or is declared unconditional (or such earlier date as the Executive under the Takeovers Code may permit) but otherwise unconditional and irrevocable, as directors of the Company and of each subsidiary of the Company of which they are respectively directors, confirming, in each case, that they have no claims against the Company or the relevant subsidiary (as the case may be), whether by way of compensation for loss of office or otherwise howsoever; and

5.3.2         the Vendor shall use all reasonable endeavours to procure that a board meeting of the Company is held at which resolutions shall be passed approving:-

5.3.2.1      the resignations of the Resigning Directors, as directors of the Company referred to in Clause 5.3.1; and

5.3.2.2      the appointment with effect from the date of posting of the Offer Document (or such earlier date specified by the Purchaser which the Executive has consented to), but otherwise on an unconditional and

irrevocable basis, of such persons as the Purchaser shall nominate as directors of the Company; and the Vendor shall deliver to the Purchaser certified copies of the minutes of the board meeting containing those resolutions; and

5.3.3        the Vendor shall use all reasonable endeavours to procure that a board meeting of each key subsidiary of the Company nominated by the Purchaser is held at which resolutions shall be passed approving:

5.3.3.1      the resignations of the Resigning Directors, as directors of such key subsidiary; and

5.3.3.2      the appointment with effect from the date of the posting of the Offer Document (or such earlier date specified by the Purchaser which the Executive has consented to), but otherwise on an unconditional and irrevocable basis, of such persons as the Purchaser shall nominate as directors of such key subsidiary.

and the Vendor shall deliver to the Purchaser certified copies of the minutes of the board meetings of each such key subsidiary containing those resolutions.

5.4    At Completion and subject to compliance by the Vendor and the Vendor Guarantor with their respective obligations under Clauses 5.2 and 5.3, the Purchaser shall:

5.5   If any of the Vendor, the Vendor Guarantor or the Purchaser shall be unable to comply with any of their respective obligations under Clauses 5.2, 5.3 or 5.4 (as the case may be) on or before the date fixed for Completion, the Party not in default may:-

5.5.1         defer Completion to a date not more than 28 days after the said date (and so that the provisions of this Clause 5.5 shall apply to Completion as so deferred); or

5.5.2         proceed to Completion so far as practicable but without prejudice to that Party's rights (whether under this Agreement generally or under this Clause) to the extent that the other Party shall not have complied with its obligations hereunder; or

5.5.3         terminate this Agreement, without prejudice to any other rights or remedies of the terminating Party arising under this Agreement or otherwise.

5.6   The Vendor and the Vendor Guarantor shall use their respective reasonable endeavours to procure that the board meetings referred to in Clause 5.3.2.2 and Clause 5.3.3.2 shall be convened and the requisite resolutions proposed to appoint persons nominated by the Purchaser as directors and shall further procure that the Resigning Directors and any other person designated by the Vendor or the Vendor Guarantor as a director of the relevant company shall vote in favour of the relevant resolutions and the Vendor and the Vendor Guarantor shall use all reasonable endeavours to ensure that the persons nominated as directors by the Purchaser are duly appointed. Provided that the Vendor and the Vendor Guarantor have complied with their foregoing obligations under this Clause 5.6, if the persons designated for appointment as directors by the Purchaser are not appointed and the Purchaser elects to proceed to Completion under Clause 5.5.2. or to terminate this Agreement under Clause 5.5.3, the Purchaser will not have a claim for damages or other remedy against the Vendor or the Vendor Guarantor as a result solely of the failure of the persons nominated for appointment as directors of the Company and the key subsidiaries by the Purchaser not having been so appointed, but without prejudice to any and all other claims, rights and remedies of the Purchaser under this Agreement or otherwise.

6.1   Upon an obligation arising on me Purchaser (or the wholly owned subsidiary of the Purchaser designated by it to purchase the Sale Shares) to make a mandatory general offer pursuant to Rule 26 of the Takeovers Code for the Offer Shares as a result of Completion of this Agreement and/or the performance of the Purchaser's obligations hereunder, the Purchaser or the wholly owned subsidiary of the Purchaser designated by it to purchase the Sale Shares (as the case may be) shall announce as soon as is reasonably practicable as required pursuant to the Takeovers Code the making of the Offer.

6.2   The Purchaser undertakes to the Vendor and the Vendor Guarantor to fulfil its obligations, and to procure that any wholly owned subsidiary designated by it to purchase the Sale Shares will fulfil its obligations, under Rule 26 of the Takeovers Code.

6.3   The Parties undertake that they will comply with the Takeovers Code in relation to the Offer and they will each use all reasonable endeavours (and the Vendor and the Vendor Guarantor will through the Resigning Directors, use all reasonable endeavours) to procure that the Company shall supply such information as may be reasonably necessary to be included in the documents to be despatched or the announcements to be issued pursuant to the Takeovers Code in connection with the Offer, take respective responsibility for such information and authorise the publication, despatch and/or release of such documents and announcements.

6.4   The Vendor and the Vendor Guarantor shall use all reasonable endeavours, but without prejudice to the fiduciary duties of the relevant directors, to procure that the board of directors of the Company shall recommend acceptance of the Offer by the shareholders of the Company.

6.5    At all times after the date hereof and until the Offer shall become or be declared unconditional in all respects, each of the Vendor and the Vendor Guarantor shall refrain from deliberately taking any action or making any statement which is or may be prejudicial to the success of the Offer. Without prejudice to the generality of the foregoing, each of the Vendor and the Vendor Guarantor:

6.5.4         shall not make any offer to acquire the whole or any part of the issued share capital of the Company or permit any company in which the Vendor or the Vendor Guarantor (as the case may be), directly or indirectly, has control to make such an offer or solicit or encourage any other person to make such an offer;

6.5.5         shall not acquire any interest in any other shares in, or other securities of, the Company; and

6.5.6         shall not enter into any agreement or arrangement with any person, whether conditionally or otherwise, to do any of the acts referred to in this Clause 6.5.

6.6   Each of the Parties undertakes to the others that it shall execute and do and procure that there shall be executed and done all other documents and things as may be necessary or desirable to implement or give legal effect to the provisions of this Agreement.

6.7   At all times after the date hereof until the later of (1) the first closing date of the Offer and (2) the date on which the Offer shall become or be declared unconditional in ail respects, each of the Vendor and the Vendor Guarantor shall use its respective reasonable endeavours to ensure that the business of the Group will be operated in the ordinary course and in particular (but without limiting the generality of the foregoing) that the Company and each of its subsidiaries shall not:

6.7.1        dispose of any material assets used or required for the operation of its business;

6.7.7         borrow any sum in excess of amounts borrowed in the ordinary course of business and available to it at the date of this Agreement;

6.8   The Purchaser expressly acknowledges that of the ten directors of the Company, only two (namely ▇▇▇▇▇▇ ▇▇▇ Sun ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ) ("Relevant Directors") are directors of, or interested in, the Vendor and the Vendor Guarantor. Accordingly, provided that the Vendor and the Vendor Guarantor have otherwise complied with their obligations to use their respective reasonable endeavours and have not taken any action which might or might be expected to prevent the matters referred to in Clauses 6.3, 6.4 and 6.7 from taking place, the obligations of the Vendor and Vendor Guarantor under Clauses 6.3, 6.4 and 6.7 (but not under any other provision of this Clause 6 or any other provision of this Agreement) shall be qualified (if necessary) to the extent that the Vendor and the Vendor Guarantor shall not be in breach of their obligations thereunder if the Vendor and the Vendor Guarantor are unable to procure performance of the obligations referred to therein as a result of the actions of other directors of the Company and its subsidiaries and/or the Relevant Directors not comprising a majority of the board.

6.9   The Vendor Guarantor hereby irrevocably undertakes to the Purchaser that on or before Completion the Vendor Guarantor will not offer, sell, transfer, pledge, charge, create any right in respect of or grant any option over or otherwise dispose of any of its shares in the Vendor or any interest therein and will procure that the Vendor will not create, allot or issue any new shares or class of shares or securities.

6.10  If requested by the Purchaser within 12 months after Completion, the Vendor shall procure that the entire legal and beneficial interest in all deferred shares in Mandarin Communications Limited held by the Vendor, the Vendor Guarantor or any of then-respective subsidiaries will be transferred to a Group Company free from all liens, charges and encumbrances and together with all rights now or hereafter attaching to them, and will use its reasonable endeavours to procure that the remaining deferred shares of Mandarin Communications Limited which are not owned by a Group Company will be transferred to a Group Company on the same basis.

8.1   Each of the Vendor and the Vendor Guarantor covenants with the Purchaser that it will not, during the period from the date of this Agreement until the date which is two years after Completion (either alone or jointly with, through or as manager, adviser, consultant or agent for or shareholder or investor in any person or holder of any other security in any person) directly or indirectly;

8.1.1         be engaged, concerned or interested in or otherwise directly or indirectly exert any management control over, any company carrying on a mobile communications business in Hong Kong as a carrier licensee (as defined in the Telecommunications Ordinance) ("Competitor");

8.1.2         (other than as a result of general advertisement without direct solicitation or contact) solicit or contact (with a view to the engagement or employment by any person) any senior employee or any person who has been a senior employee, officer (other than the Resigning Directors) or manager of any Group Company;

8 1.3         do or say anything which is harmful to the reputation of any Group Company which may lead any person to cease to do business with any Group Company on substantially equivalent terms to those previously offered to any Group Company prior to Completion or not to engage in business with any Group Company,

with the intent that each of the foregoing shall constitute an entirely separate and independent restriction on each of the Vendor and the Vendor Guarantor.

8.4    Nothing in Clause 8.1 shall apply in relation to the holding of shares or other securities by the Vendor or the Vendor Guarantor in a Competitor, provided that:

9.1   The Vendor Guarantor hereby irrevocably and unconditionally guarantees to the Purchaser the due and punctual performance of each obligation of the Vendor contained in this Agreement. The Vendor Guarantor shall pay to the Purchaser from time to time on demand a sum of money which the Vendor is at any time liable to pay to the Purchaser under or pursuant to this Agreement and which has not been paid at

the time the demand is made. The obligations of the Vendor Guarantor under this Clause 9.1 are primary obligations and not those of a mere surety. If an obligation of the Vendor is void, voidable or unenforceable for any reason, the obligations of the Vendor Guarantor under this Clause 9.1 are unaffected and the Vendor Guarantor shall perform the Vendor's obligations as if it were primarily liable for the performance.

9.2   The obligations of the Vendor Guarantor under Clause 9.1 are continuing and are not satisfied, discharged or affected by an intermediate payment or settlement of account by or a change in the constitution or control of, or the insolvency of, or bankruptcy, winding up or analogous proceedings relating to the Vendor.

9.3   The liability of the Vendor Guarantor under Clause 9.1 is not affected by an arrangement which the Purchaser may make with the Vendor or with another person which (but for this Clause 9.3) might operate to diminish or discharge the liability of or otherwise provide a defence to a surety.

9.4    Without affecting the generality of Clause 9.3, the Purchaser may at any time as it thinks fit and without reference to the Vendor Guarantor:

9.4.3         discharge a party to other securities or guarantees held by the Purchaser and release all or any of those securities or guarantees; and

9.4.4         compound with, accept compositions from and make other arrangements with the Vendor or a person or persons liable on other securities or guarantees held or to be held by the Purchaser.

9.5   So long as the Vendor is under an actual or contingent obligation under this Agreement, the Vendor Guarantor shall not exercise a right which it may at any time have by reason of the performance of its obligations under Clause 9.1 to be indemnified by the Vendor, to claim a contribution from another surety of the Vendor's obligations or to take the benefit (wholly or partly and by way of subrogation or otherwise) of any of the Vendor's rights under this Agreement or of any other security taken by the Purchaser in connection with this Agreement.

9.6   The liability of the Vendor Guarantor under Clause 9.1 is not affected by the avoidance of an assurance, security or payment or a release, settlement or discharge which is given or made on the faith of an assurance, security or payment, in either case, under an enactment relating to bankruptcy or insolvency.

10.1 Save as required by law or the Stock Exchange, the SFC, the Takeovers Code or any applicable regulations of any regulatory authority, each of the Vendor and the Vendor Guarantor shall keep secret the possibility, terms and condition of the Offer until the relevant announcement regarding the same has been published by the Purchaser.

10.2 Each of the Vendor and the Vendor Guarantor understands and agrees that, in accordance with the Takeovers Code, particulars of this Agreement and the dealings of the Vendor and the Vendor Guarantor, persons acting in concert with them for the purposes of the Takeovers Code and each of their respective Associates (as defined in the Takeovers Code) in any shares in the capital of the Company (including subscription rights and derivatives) in the past six months will be contained in the Offer Document and that this Agreement will be available for inspection during the offer period (as defined in the Takeovers Code) and each of the Vendor and the Vendor Guarantor undertakes to make available to the Purchaser promptly upon request a written memorandum identifying all such dealings.

10.3 Each of the Vendor and the Vendor Guarantor undertakes to use its reasonable endeavours to ensure that the Company shall provide drafts of any and all announcements and other documents proposed to be made, released or despatched by or on behalf of the Company or the Vendor and/or the Vendor Guarantor in connection with the Offer and to incorporate the reasonable comments of the Purchaser in those announcements and other documents, but without prejudice to the obligations of the Company or the Vendor and/or the Vendor Guarantor (as the case may be) under any law, the Listing Rules or the Takeovers Code.

The Parties acknowledge and agree that each Party shall bear its own legal costs incurred in connection with the preparation and negotiation of this Agreement and matters incidental thereto.

12.    GENERAL

13.    NOTICES

13.4 The initial addresses and facsimile numbers of the Parties for the service of communications and the persons for whose attention such communications are to be marked are as follows:-

To the Vendor:-

Address:                 25th Floor, Unimix Industrial Centre, ▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
Facsimile no.:         (▇▇▇)▇▇▇▇ ▇▇▇▇
Attention:               Company Secretary

To the Vendor Guarantor:-

Address:                 25th Floor, Unimix Industrial Centre, ▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
Facsimile no.:         (▇▇▇) ▇▇▇▇ ▇▇▇▇
Attention:               Company Secretary

To the Purchaser:-

Address:                 ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇'▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇
Facsimile no.:         (▇▇▇) ▇▇▇▇ ▇▇▇▇
Attention:               Company Secretary

13.5 A communication served in accordance with this Clause shall be deemed sufficiently served and in proving service and/or receipt of a communication it shall be sufficient to prove that such communication was left at the addressee's address (in the case of personal delivery) or that the communication was properly transmitted by facsimile to the addressee. In the case of communication by facsimile transmission, such transmission shall be deemed properly transmitted on receipt of a report of satisfactory transmission printed out by the sending machine.

14.    GOVERNING LAW AND SUBMISSION TO JURISDICTION

This Agreement shall be governed by and construed in accordance with the laws of Hong Kong and the Parties hereto irrevocably submit to the non-exclusive jurisdiction of the Hong Kong courts for the purpose of enforcing any claim arising hereunder.

SCHEDULE 1

REPRESENTATIONS AND WARRANTIES

(a)   any provision of the memorandum or articles of association or equivalent constitutional documents of the Vendor or the Vendor Guarantor; or

(b)   any agreement or instrument to which the Vendor or the Vendor Guarantor is a party or by which it is bound; or

(c)   any order, judgment, decree or other restriction applicable to the Vendor or the Vendor Guarantor.

(a)   result in any Group Company losing the benefit of a permit, asset, lease, tenancy, licence, grant, subsidy, right or privilege which it enjoys at the date of this Agreement in any jurisdiction; or

(b)  conflict with, or result in a breach of, or constitute a default or give rise to an event of default under, or require the consent of a person under, or enable a person to terminate, or relieve a person from an obligation under:

4.1   Except for two dormant joint ventures, no Group Company is or has agreed to become a member of any partnership, joint venture, consortium or other unincorporated association. In relation to the two joint ventures, both of them are dormant, the joint venture agreements have been terminated and no Group Company has any material liability or obligation arising out of or in connection with either of them.

5.1    Since the Balance Sheet Date:

The insurance policies maintained by or on behalf of the Group provide for indemnity cover against all losses and liabilities that are normally insured against by a person carrying on the same type of business as the Group. So far as the Vendor is aware, there are no material outstanding claims under, or in respect of the validity of, any of those policies and, so far as the Vendor is aware, there are no circumstances likely to give rise to any claim under those policies.

7.     CONTRACTS AND COMMITMENTS

7.1   Except for the Huawei Agreements, no Group Company is a party to or subject to any agreement or arrangement with a value exceeding US$10 million:

8.      LICENCES

8.1    Each Group Company has all necessary licences, consents, permits and authorities necessary to carry on its business in the places and in the manner in which its business is now carried on, all of which are valid and subsisting. Subject to the powers of the Telecommunications Authority under the Telecommunications Ordinance, there is no reason why any of those licences, consents, permits and authorities should be suspended, cancelled, revoked or not renewed on the same terms.

8.2    No material queries have been received from, or investigations or enquiries undertaken, by the Office of the Telecommunications Authority in Hong Kong, other than as a result of the performance of this Agreement by the parties.

9.      LITIGATION AND INVESTIGATION

9.1   No Group Company is engaged in any material litigation, administrative, mediation or arbitration proceedings or other proceedings or hearings before any statutory or governmental body, department, or other agency (except for debt collection in the normal course of business) or is the subject of any investigation, enquiry or enforcement proceedings by any such body, department or other agency and, so far as the Vendor is aware, no such proceedings, investigation or enquiry have been threatened or are pending and there are no circumstances likely to give rise to any such proceedings.

9.2    No Group Company is affected by any materia! existing or pending judgements or rulings and no Group Company has given any undertaking arising from legal proceedings to a court, governmental agency, regulatory body or third party.

9.3     No Group Company is party to any material outstanding investigation or dispute with the Inland Revenue Department.

10.    INTELLECTUAL PROPERTY

10.1  The intellectual property used in connection with the conduct of the business of each Group Company (whether or not registered):

11.   OTHERS

The copies of the Huawei Agreements provided to the Purchaser for review are the current versions and up to date, including all material amendments.

RESIGNING DIRECTORS

▇▇▇▇▇▇ ▇▇▇ Sun ▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇

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