Authority of theBoard of Directors The Board of Directors shall be highest body of authority of the Company and shall decide all major issues of the Company. The powers and functions of the Boardshall be to examine, discuss and approve or disapprove the following: A. The amendment of these Articles of Association of the Company; B. The termination or dissolution of the Company; C. The increase or assignment of the registered capital of the Company; D. The merger of the Company with another economic organization; E. The annual business plan and financial policies of the Company, including, but notlimited to, all matters relating to the investment of funds, substantialpurchases of good and services, foreign exchange balancing and developmentprograms; F. The Company’s annual financial budget and final annual accounts and accountingstatements; G. Production programs of the Company; H. Changes in the scale or scope of the Company’s operations or in its development plans; I. Borrowings,guarantees and/or other financing arrangements of the Company; J. The acquisition by the Company of other enterprises, or the purchase, sale, lease,mortgage or disposition of any real property or any fixed asset of the Company; K. The appointment and dismissal of senior offers such as the General Manger and otherofficers and employees of the Company; L. The establishment of the Company’s management structure and wage plan; M. The formulation of important Company rules and regulations; N. Reinvestment of the Company’s after tax profits as additional registered capital; O. Extension of the Term of the Company; P. Establishment or closing down of offices, facilities, branches or other establishments of the Company; Q. Initiation,defense or termination of judicial or arbitration proceedings in which the Company is a party inside or outside the PRC; R. Theappointment of auditors S. Plansfor contributions to and the utilization of the reserve, bonus and welfare andenterprise expansion funds; and T. Other important matters which concern the rights and interests of the Company, asdetermined by the Board.