THIS AGREEMENT is made on the 1st day of October 2001

BETWEEN:

(1)  HANG FUNG GOLD  TECHNOLOGY  LIMITED whose principal place of business is at
     Unit 25-32, 2nd Floor, Block B, Focal Industrial Centre, 21 Man Lok Street,
     Hunghom, Kowloon, Hong Kong (the "Company"); and

(2)  CHAN YAM FAI, JANE of Flat D, 10th Floor, Block B, Mountain Court, No. 5 Ho
     Man Tin Hill Road, Ho Man Tin, Kowloon, Hong Kong (the "Executive").

WHEREAS the Company has agreed to employ the Executive and the Executive has
agreed to serve the Company as an executive director on the following terms and
conditions.

WHEREBY IT IS AGREED AS FOLLOWS:-

1.   INTERPRETATION

(A) In this Agreement, unless the context otherwise requires:-

"Board" means the board of directors of the Company from time to time;

"Business" means all the business and affairs carried out by the Group from time
to time and with which the Executive  was  concerned  during the 12 month period
prior to the termination of the Employment;

"Companies Ordinance" means the Companies Ordinance (Cap. 32 of the Laws of Hong
Kong) from time to time amended or re-enacted;

"Group"  means  the  Company  and its  subsidiaries  from  time to time (and the
expression "member of the Group" shall be construed accordingly);

"Group  Employee"  means any person who was  employed  by the Group for at least
three months prior to and on the Termination Date, and

(i)  with whom the Executive has had personal  contact or dealings in performing
     her duties of employment; or

(ii) who has or has had  material  contact  with  customers  or suppliers of the
     Group in performing his or her duties of employment with the Group; or

(iii) who was a member of the management team of any company within the Group .

"Hong Kong" means the Hong Kong Special Administrative region of the PRC;

"HK$" means Hong Kong dollars;
<PAGE>

"Listing Rules" means the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited;

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

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

"subsidiary" means a company:

(a)  of which the Company controls the composition of the board of directors; or

(b)  of which the Company controls more than half of the voting power; or

(c)  of which the  company  holds  more than half of the  issued  share  capital
     (excluding  any part of it which carries no right to  participate  beyond a
     specified amount in a distribution of either profits or capital); or

(d)  which is a subsidiary  of any company which is a subsidiary of the Company;
     and

      "Termination Date" means the date when the Executive's employment with the
Company terminates.

(B)   References herein to Clauses and Schedules are references to the clauses
      and schedules of this Agreement which shall be deemed to form part of this
      Agreement. The heading in this Agreement are inserted for convenience of
      reference only and do not affect the interpretation hereof.

(C)   References herein to one gender include references to all other genders.
      References herein to persons include references to individuals, firms,
      companies, corporations and unincorporated bodies of persons and vice
      versa. References herein to the singular number include references to the
      plural and vice versa.

(D)   Terms defined in Section 2 of the Companies Ordinance shall in this
      Agreement have the meanings ascribed to them in that section.

2.    EMPLOYMENT

     Pursuant to a service agreement dated 27th February 1999 between the
      Company and the Executive (the "Service Agreement"), which expired on 30th
      September 2001, the Company agrees to continue to employ the Executive and
      the Executive agrees to serve the Company as an executive director, by
      extending the Service Agreement for a further term of three years to
      expire on 30th September 2004 subject to variation of the remuneration
      under the Service Agreement which variation takes effect from 1st October
      2001; and upon the terms and subject to the conditions hereinafter
      appearing.
<PAGE>

3.   DURATION

      The employment of the Executive by the Company shall commence from 1st
      October 2001 for a term of three years. Subject to Clause 10, either party
      may terminate this Agreement at any time by giving not less than three
      months' written notice or payment of salary in lieu thereof to the other
      party.

4.   EXECUTIVE'S DUTIES

      The Executive shall, during the continuance of her employment hereunder:

(a)   serve the Company as an executive director and, in such capacity, perform
      such duties and exercise the powers from time to time assigned to or
      vested in her by the Board;

(b)   comply with and conform to any lawful instructions or directions from time
      to time given or made by the Board, or with the authority of the Board,
      and shall comply with the Company's rules, regulations, policies and
      procedures from time to time in force;

(c)   faithfully and diligently serve the Group and use her best endeavours to
      promote the business and interests thereof;

(d)   devote herself exclusively and diligently to the business and interests of
      the Group and personally attend thereto at all times during usual business
      hours and during such other times as the Company may reasonably require
      except in case of incapacity through illness or accident in which case she
      shall forthwith notify the Secretary of the Company of such incapacity and
      shall furnish to the Board such evidence thereof as it may require;

(e)   keep the Board promptly and fully informed (in writing if so requested) of
      her conduct of the business or affairs of the Group and provide such
      explanations as the Board may require in connection therewith;

(f)   comply to the best of her ability with the Listing Rules from time to time
      in force for so long as the Company is listed on the Stock Exchange; and

(g)   not demand or accept or permit any member of her family to demand or
      accept from third parties any gifts, benefits or advantages offered or
      given to the Executive or a member of her family by reason of her
      employment with the Company.
<PAGE>

5.    REMUNERATION


5.1.  With effect from 1st October, 2001, the remuneration of the Executive
      shall be revised as follows:

(a)  an annual salary of HK$1,300,000  payable in twelve installments or in such
     manner as may be agreed  between the Company and the Executive from time to
     time no later  than the  first  day of each  calendar  month to which  such
     salary  relates,  such salary to include any sum  receivable  as director's
     fees or other  remuneration from any other member of the Group. This salary
     will be reviewed by the Board on or around 1 April each year; and

(b)  a discretionary bonus of such amounts (if any) at such times and subject to
     such conditions as the Board may in its absolute  discretion  decide.  Such
     bonus, if payable,  shall be calculated as a percentage of the consolidated
     net profit  after  taxation  and  extraordinary  items of the Group of each
     financial  year (as disclosed by the audited  consolidated  accounts of the
     Group) (the  "Consolidated  Profit")  provided that the aggregate amount of
     bonus payable to all the executive directors shall not exceed five per cent
     (5%) of the  Consolidated  Profit for the relevant  year during the term of
     this  Agreement.  The Executive  will not be eligible to be considered  for
     such a bonus if she has left the  employment  of the  Company or is serving
     out any notice given to her by the Company to terminate  her  employment at
     the date when the Company's annual bonuses are declared.

5.2.  The discretionary bonus referred to in Clause 5.1(c) shall be payable in
      respect of each financial year within thirty (30) days after the issue of
      the audited consolidated accounts of the Group for such financial year.

5.3.  The Executive shall not vote or be counted in the quorum in respect of any
      resolution regarding the amount of monthly salary, guaranteed double pay
      or discretionary bonus payable to her.

5.4.  The Company may arrange for the whole or any part of the Executive
      remuneration payable hereunder to be paid by one or more members of the
      Group to which the Executive has provided or may provide services pursuant
      to this Agreement.

6.    OTHER BENEFITS

      In addition to the foregoing remuneration and benefits, the Executive
      shall also be entitled to the following, subject to determination by the
      Board as to the appropriate level of cost of each item:

(a)  the provision of medical, dental and optical insurance under such insurance
     scheme as the  Board may  decide  from time to time at the  expense  of the
     Company for the benefit of the Executive, her spouse and dependant children
     under the age of 18;
<PAGE>

(b)  membership  of  the  Group's  provident  fund  subject  to  the  terms  and
     conditions of such scheme from time to time in force;

(c)  the shared use of a Company owned car,  together  with the other  executive
     directors  of the  Company,  in respect of which the Company  shall pay all
     maintenance, petrol, and parking costs; and

(d)  the Company  shall pay for the  maintenance,  petrol and  parking  costs in
     respect of one car owned by the Executive.

7.   EXPENSES

The  Company  shall  reimburse  the  Executive  (against  receipts or such other
reasonable  evidence of expenditure as the Board may require) for all reasonable
expenses  properly  incurred  in the course of her  employment  hereunder  or in
promoting or otherwise in connection with the business of the Group.

8.   DEDUCTIONS

The Company shall to the extent permitted by s.32 of the Employment Ordinance of
the Laws of Hong Kong, be entitled to deduct from the  Executive's  remuneration
hereunder  any  monies due from her to the  Company  or any of its  subsidiaries
including,  but not limited to, any  outstanding  loans,  advances,  the cost of
repairing  any damage to or loss of the Group's  property  caused by her (and of
recovering  the same) and any other  monies owed by her to the Company or any of
its subsidiaries.

9.   LEAVE

9.1  The Executive  shall be entitled  after  completion of each year of service
     with the Company to  twenty-one  working days' annual leave (in addition to
     public  holidays) with full pay, which leave shall be taken at such time or
     time as may be approved by the Board.

9.2  Unused annual leave may be carried forward from time to time.

10.  TERMINATION

10.1 If at any time during the term of her  employment  hereunder  the Executive
     shall:

(a)         be guilty of or commit any serious misconduct which in the absolute
            opinion of the Board is in any way detrimental to the interests of
            any member of the Group;

(b)         be in breach of any material term of this Agreement;
<PAGE>

(c)         commit any act of bankruptcy or become insolvent or make any
            arrangements or composition with her creditors generally;

(d)         fail to pay her personal debts;

(e)         be convicted of any criminal offence involving her integrity or
            honesty; or

(f)         refuse to carry out any reasonable lawful order given to her by the
            Board in the course of her employment or fail diligently to attend
            to her duties hereunder;

        the Company may terminate the Executive's employment hereunder forthwith
        without any notice or payment in lieu of notice and upon such
        termination the Executive shall not be entitled to any payment or other
        benefits whatsoever (other than in respect of unpaid salary and unused
        annual leave actually accrued) for or in respect of the then current
        year of service or to claim any compensation or damages for or in
        respect of or by reason of such termination.

10.2    In the event of termination of the Executive's employment for whatever
        reason, the Executive shall (if not already vacated from such office(s))
        forthwith resign as a director of the Company and from all offices held
        by her in any member of the Group.

10.3    Any delay of forbearance by the Company in exercising any right to
        terminate this Agreement shall not constitute a waiver of such right.

11.  NO RIGHT TO WORK

      The Company shall be under no obligation to provide any work for the
      Executive during any period of notice either given by the Company or the
      Executive to terminate the Executive's employment under this Agreement.
      The Company may at any time during the said period suspend the Executive
      from her employment or exclude her from any premises of the Company.
      Provided that during such period the Executive shall continue to receive
      salary and all other contractual benefits provided by this Agreement.

12.  EXECUTIVE'S UNDERTAKINGS

12.1 The Executive  shall not either during the  continuance  of her  employment
     hereunder or at any time thereafter:

(a)  divulge to any person  whomsoever or to any body corporate or unincorporate
     (except to those  officers  of the Group  whose  province it is to know the
     same); or

(b)  use for her own purposes or for any purposes  other than those of the Group
     and shall use her best endeavors to prevent the unauthorized publication or
     disclosure of any trade secret or any confidential  information  concerning
     the business or finances of any member of the Group or any of its dealings,
     transactions  or affairs or those of its customers,  suppliers,  management
     and shareholders which may come to her knowledge during or in the course of
     her employment  including but not limited to any such information  relating
     to  customers,  customer  lists or  requirements  or ways of  dealing  with
     customers,  pricing structures,  marketing and sales information,  business
     plans or dealings, employees or officers,  financial information,  accounts
     and plans, designs, formulae, product lines, prototypes, services, research
     activities,   source  codes  and  computer  systems,  software,   technical
     information,   any  document  marked  "Confidential"  (or  with  a  similar
     expression),  or any information which she has been told is confidential or
     which she might  reasonably  expect the Group would regard as confidential,
     or any  information  which  has been  given to the Group in  confidence  by
     customers and other persons.
<PAGE>

12.2    Forthwith upon the termination of the employment of the Executive
        hereunder, and/or at any other time if the Company shall so request, the
        Executive shall deliver to the Company all documents (including
        correspondence, lists of customers, notes, memoranda, plans, drawings
        and other documents of whatsoever nature), models or samples made or
        compiled by or delivered to the Executive during her employment
        hereunder and concerning the business, finances or affairs of any member
        of the Group. For the avoidance of doubt it is hereby declared that the
        property in all such documents as aforesaid shall at all times be vested
        in the relevant member of the Group.

12.3    The Executive shall not at any time during the continuance of her
        employment hereunder or for a period of twelve months immediately
        following the Termination Date whether on her own behalf of any other
        person or body corporate or unincorporate directly or indirectly:

(a)  at any place within Hong Kong carry on or be  concerned  as a  shareholder,
     director, employee, partner, manager,  consultant,  adviser or otherwise to
     or in any person,  firm or company  engaged in any business in  competition
     with the  business(es) of the Company in the faithful  performance of which
     it could be reasonably  anticipated  that the  Executive  would or would be
     required or expected to use or disclose  any  confidential  information  or
     trade  secrets of the Company or any member of the Group  provided that the
     provisions  of this  clause  shall only apply in  respect  of  products  or
     services with which the Executive was personally concerned or for which the
     Executive was responsible during the Executive's employment hereunder;

(b)  solicit or entice away from any member of the Group or deal with any person
     or body corporate or  unincorporate  who now is or at the Termination  Date
     may have  become a customer or supplier of any member of the Group and with
     whom the  Executive  had  personal  contact or  dealings  during the twelve
     months immediately preceding the Termination Date;


(c)  encourage or procure any person who is a Group  Employee or director of any
     member of the Group to leave the Group's employment, where that person is a
     Group  Employee or  director of any member of the Group on the  Termination
     Date; or
<PAGE>

(d)  accept  into  employment  or  otherwise  engage or use the  services of any
     person who is a Group  Employee or director or  consultant to any member of
     the Group on the  Termination  Date, and who by reason thereof is or may be
     likely to be in possession of any confidential  information relating to the
     Group's business or otherwise.

12.4 Each  of the  above  restrictions  constitutes  an  entirely  separate  and
     independent restriction on the Executive.

12.5 While at the date of this Agreement the duration, extent and application of
     each of the above  restrictions  are  considered  by the parties no greater
     than is necessary for the protection of the interest of the Company and any
     member of the Group and reasonable in all the circumstances,  if unforeseen
     charges occur or court  judgements are delivered  which would render any of
     the  provisions  invalid  or void,  the  parties  declare  that each of the
     restrictions  or any parts thereof being separate and severable shall where
     appropriate  be deleted or  amended  to the extent  necessary  to make such
     restrictions effective and enforceable.

12.6 The Executive shall comply,  where relevant,  with every rule of law, every
     rule and  regulation of the Stock  Exchange or any other stock  exchange on
     which she deals and every regulation,  code of practice and the bye-laws of
     the Company in force in relation to dealings in shares, debentures or other
     securities  of the  companies  in the Group and in relation to  unpublished
     price-sensitive  information  affecting  the  shares,  debentures  or other
     securities of any company in the Group,  including (without limitation) the
     Model Code for Securities Transactions by Directors of Listed Companies set
     out  in  Appendix  10 to  the  Listing  Rules  and  the  provisions  of the
     Securities (Insider Dealing) Ordinance, Provided always that in relation to
     overseas  dealings  the  Executive  shall also  comply with all laws of the
     state and all  rules  and  regulations  of the  stock  exchange,  market or
     dealing system in which such dealings take place.

13.  PLACE OF WORK / SECONDMENT

13.1 The Executive's  normal place of work shall be Unit 25-32, 2nd Floor, Block
     B, Focal Industrial Centre, 21 Man Lok Street, Hunghom,  Kowloon, Hong Kong
     but the Company  reserves  the right to change this to any place  within or
     outside Hong Kong.  The Executive will be given at least one month's notice
     of any such change.  The Executive  will be provided with such financial or
     other  relocation  assistance as may be payable  under any relevant  policy
     which the Group may operate at the relevant time.

13.2 The  Executive  acknowledges  and agree the  Company  may from time to time
     transfer or second her services to any other member of the Group as part of
     any reorganization or otherwise and either permanently or temporarily.
<PAGE>

14.      MISCELLANEOUS

14.1    This Agreement shall be in substitution for any subsisting agreement or
        arrangement (oral or otherwise) made between the Company and the
        Executive which shall be deemed to have been terminated by mutual
        consent as from the date on which the Executive's employment under this
        Agreement commences.

14.2    The expiration or termination of this Agreement howsoever arising shall
        not operate to affect such of the provisions hereof as in accordance
        with their terms are expressed to operate or have effect thereafter.

14.3    In the event of any variation of the remuneration payable to the
        Executive hereunder being made by consent of the parties hereto such
        variation shall not constitute a new agreement but (subject to any
        express agreement to the contrary) the employment of the Executive
        hereunder shall continue subject in all respects to the terms and
        conditions of this Agreement with such variation as aforesaid.

14.4    Each notice, demand or other communication given or made under this
        Agreement shall be in writing and delivered or sent to the relevant
        party at its address or fax number set out below (or such other address
        of fax number as the addressee has by five day's prior written notice
        specified to the other party):

        To the Company:        Hang Fung Gold Technology Limited
                               Unit 25-32, 2nd Floor
                               Block B, Focal Industrial Centre
                               21 Man Lok Street
                               Hunghom, Kowloon
                               Hong Kong

                               Fax Number:                2362 3034
                               Attention: Board of Directors
<PAGE>

      To the Executive:        Chan Yam Fai, Jane
                               Flat D, 10th Floor, Block B
                               Mountain Court
                               No. 5 Ho Man Tin Hill Road
                               Ho Man Tin
                               Kowloon
                               Hong Kong

                               Fax Number:      2362 3034


        Any notice, demand or other communication so addressed to the relevant
        party shall be deemed to have been delivered (a) if given or made by
        letter, when actually delivered to the relevant address; and (b) if
        given or made by fax, when dispatched subject to receipt of
        machine-printed confirmation of error-free dispatch.

14.5    If at any time any provision of this Agreement is or becomes illegal,
        invalid or unenforceable in any respect, the legality, validity and
        enforceability of the remaining provisions of this Agreement shall not
        be affected or impaired thereby.

14.6    No failure or delay by the Company in exercising any right, power or
        remedy under this Agreement shall operate as a waiver thereof, nor shall
        any single or partial exercise of the same preclude any further exercise
        thereof or the exercise of any other right, power or remedy. Without
        limiting the foregoing, no waiver by the Company of any breach by the
        Executive of any provision in this Agreement shall be deemed to be a
        waiver of any subsequent breach of that or any other provision in this
        Agreement.

14.7    This Agreement shall be governed by and construed in accordance with the
        laws of Hong Kong and the parties hereto hereby irrevocably submit to
        the non-exclusive jurisdiction of the Hong Kong courts.

<PAGE>

IN WITNESS WHEREOF the parties hereto have signed this document on the date
appearing at the head hereof.


SIGNED by Lam Sai Wing              )
for and on behalf of                )
HANG FUNG GOLD                      )
TECHNOLOGY LIMITED                  )
in the presence of:                 )




SIGNED by                           )
CHAN YAM FAI, JANE                  )
in the presence of:                 )
<PAGE>