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Exhibit 4.42
 AMENDED AND RESTATED
 SHAREHOLDERS AGREEMENT
 by and among
 T2CN HOLDING LIMITED
 GIGAMEDIA CHINA LIMITED
 AND
 INVESTORS,
 THE SHAREHOLDERS LISTED ON
SCHEDULE 2 HERETO
 - and -
 Ant Bridge No. 2 Venture Capital Secondary Investment Limited Partnership
 dated as of
 November 25, 2006
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CONTENTS
 Table of Contents
 ARTICLE I. DEFINITIONS AND INTERPRETATION
    
    
    6SECTION 1.01 Definitions
    
    
    6SECTION 1.02 Interpretation
    
    
    13ARTICLE II. OBJECTIVES AND CERTAIN UNDERTAKINGS
    
    
    13SECTION 2.01 Objectives of the Company
    
    
    13SECTION 2.02 Principal Business
    
    
    13ARTICLE III. DIVIDEND RIGHTS
    
    
    14SECTION 3.01 Dividend Rights
    
    
    14ARTICLE IV. BOARD; SHAREHOLDERS MEETING
    
    
    14SECTION 4.01 Board of Directors
    
    
    14SECTION 4.02 Shareholders Meeting
    
    
    17ARTICLE V. PROTECTIVE PROVISIONS
    
    
    17SECTION 5.01 Protective Provisions for Preferred Shareholder
    
    
    17ARTICLE VI. CONVERSION RIGHTS
    
    
    18SECTION 6.01 Optional Conversion
    
    
    18SECTION 6.02 Automatic Conversion
    
    
    19SECTION 6.03 Preferred Share Conversion Price
    
    
    20SECTION 6.04 Fractional Shares
    
    
    23SECTION 6.05 Reservation of Shares Issuable Upon Conversion
    
    
    23SECTION 6.06 Notices
    
    
    24SECTION 6.07 Payment of Taxes
    
    
    24ARTICLE VII. LIQUIDATION RIGHTS
    
    
    24SECTION 7.01 Liquidation Preferences
    
    
    24SECTION 7.02 Liquidation on Sale or Merger
    
    
    25ARTICLE VIII. INFORMATION AND INSPECTION RIGHTS
    
    
    25SECTION 8.01 Delivery of Financial Statements to Preferred Shareholders
    
    
    25SECTION 8.02 Financial Statements
    
    
    26SECTION 8.03 Inspection
    
    
    26ARTICLE IX. RIGHTS OF FIRST REFUSAL; CO-SALE RIGHTS AND TRANSFER RESTRICTIONS
    
    
    26SECTION 9.01(a)
    
    
    26SECTION 9.02 Special Provisions in Relation to the Founders and Management
    
    
    31ARTICLE X. REGISTRATION RIGHTS
    
    
    31SECTION 10.01 Demand Registration
    
    
    31SECTION 10.02 Piggyback Registrations
    
    
    33
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SECTION 10.03 Procedures
    
    
    35SECTION 10.04 Indemnification under Registration Rights
    
    
    37SECTION 10.05 Additional Undertakings
    
    
    40ARTICLE XI. PRE-EMPTIVE RIGHT
    
    
    42SECTION 11.01 Pre-emptive Right
    
    
    42ARTICLE XII. REDEMPTION RIGHT
    
    
    44SECTION 12.01 Redemption Rights of Preferred Shareholders
    
    
    44ARTICLE XIII. AFFILIATED TRANSACTION
    
    
    44SECTION 13.01 Affiliated Transactions
    
    
    44ARTICLE XIV. PUT OPTION
    
    
    44ARTICLE XV. ISSUANCE OF ADDITIONAL PREFERRED SHARES
    
    
    47SECTION 15.01 Issuance of Additional Shares based on 2006 Accounts
    
    
    47SECTION 15.02 Issuance of Additional Shares based on 2007 Accounts
    
    
    48SECTION 15.03 Exercise of Options
    
    
    49SECTION 15.04 Net Operating Income
    
    
    49ARTICLE XVI. MISCELLANEOUS
    
    
    51SECTION 16.01 Insurance
    
    
    51SECTION 16.02 Successors and Assigns
    
    
    51SECTION 16.03 Cumulative Rights
    
    
    51SECTION 16.04 Entire Agreement; Amendments
    
    
    51SECTION 16.05 Further Assurance
    
    
    52SECTION 16.06 Severability
    
    
    52SECTION 16.07 Non-waiver
    
    
    52SECTION 16.08 Counterparts
    
    
    52SECTION 16.09 Dispute Resolution; Governing Law
    
    
    53SECTION 16.10 Effectiveness
    
    
    53
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THIS AMENDED AND RESTATED SHAREHOLDERS AGREEMENT ( Agreement)
 BY AND AMONG:
 1.
    
    T2CN HOLDING LTD., a limited liability company organized and existing under
the laws of the British Virgin Islands (the Company),2.
    
    The shareholders of the Company listed on Schedule 2. hereof (Key Shareholders);3.
    
    GIGAMEDIA CHINA LIMITED, a limited liability company organized and existing under the laws of
the British Virgin Islands (Gigamedia);4.
    
    MARVEL CITY INVESTMENTS LIMITED, a limited liability company organized and existing under
the laws of British Virgin Islands (MCI)];5.
    
    PATRIOT CAPITAL LIMITED;6.
    
    TAE LLC;(the persons named in 4 to 6, each an Investor and collectively the Investors), and7.
    
    Ant Bridge No. 2 Venture Capital Secondary Investment Limited Partnership, a limited
partnership formed and existing under the laws of Japan (Antfactory).
 Party Parties
 WHEREAS
 (A)
    
    The Company is a company incorporated in the British Virgin Islands and the details of the
Company as at the date of this Agreement are set out in Schedule 1hereof; and
 (B)
    
    The Company, Gigamedia and the Key Shareholders are parties to a share purchase agreement
dated April 27th, 2006 (the First Series A Share Purchase Agreement), under
which the Company has issued 7,500,000 Series A Preferred Shares to Gigamedia.
 (C)
    
    The Company, the Investors and the Key Shareholders are parties to a share purchase agreement
dated June 21, 2006 (the  Second Series A Share Purchase Agreement), under which the Company
has issued 3,000,000
Series A Preferred Shares to the Investors.
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(D)
    
    Chengwei (China) Investment Company (Chengwei) and Antfactory are parties to a share
transfer agreement dated October 23, 2006 (the Chengwei SPA), under which Chengwei has
transferred to Antfactory a total of 2,700,000 Ordinary Shares.
  IT IS AGREED
 ARTICLE I. DEFINITIONS AND INTERPRETATION
 Definitions
 Additional Shares
    
    as used in Section 6.03(e) hereof, means any
Equity Securities to be issued by the Company
in subsequent funding transactions, subject
to restrictions as provided in Section
6.03(e);Additional Transfer Notice
    
    has the meaning set forth in Sub-Section
9.01(a)(iii);Applicable Securities Law
    
    means (i) with respect to any offering of
securities in the United States of America,
or any other act or omission within that
jurisdiction, the securities law of the
United States, as amended from time to time,
including the Exchange Act and the Securities
Act, and any applicable law of any state of
the United States of America, and (ii) with
respect to any offering of securities in any
jurisdiction other than the United States of
America, or any related act or omission in
that jurisdiction, the applicable laws of
that jurisdiction;Affiliate
    
    with regard to a given Person, means a Person
that controls, is controlled by or is under
common control with the given Person. For
purposes of this Agreement, except as
otherwise expressly provided, when used with
respect to any Person, control means the
power to direct the management and policies
of such Person, directly or indirectly, whether
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through the ownership of voting securities, by
contract or otherwise, and the terms affiliated,
controllingand controlled have meanings
correlative to the foregoing;
 Big-Four Accounting Firm
    
    means KPMG, PWC, Deloitte&Touche and
Ernst&Young LLPBoard of Directors
    
    means the board of directors of the Company;Business
    
    has the meaning set forth in Section 2.01;Business Day
    
    means a day (other than a Saturday or Sunday or
national holiday) on which licensed banks are
generally open in the PRC for general banking
business;Closing
    
    means the Closing as defined under the First Series A Share
Purchase Agreement, being May 8, 2006;Commission
    
    means (i) with respect to any offering of
securities in the United States of America,
the Securities and Exchange Commission of the
United States of America or any other federal
agency at the time administering the
Securities Act, and (ii) with respect to any
offering of securities in a jurisdiction
other than the United States of America, the
regulatory body of the jurisdiction with
authority to supervise and regulate the sale
of securities in that jurisdiction;Company
    
    means T2CN Holding Limited, a company
incorporated in British Virgin Islands, with
its registered address at Trinity
Chambers, P.O. Box 4301, Road Town, Tortola,
BVI;Conversion Price
    
    has the meaning set forth in Section 6.03;Domestic Company
    
    means each of Shanghai T2 Entertainment Co.,
Ltd. and Shanghai T2 Advertisement Co., Ltd.,
each a limited liability company incorporated
under the laws of the PRC in Shanghai, PRC;Effective Conversion Price
    
    means, with respect to any Ordinary Share
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Equivalent at a given time, an amount equal
to the quotient of (i) the sum of any
consideration, if any, received by the
Company with respect to the issuance of such
Ordinary Share Equivalent and the
consideration receivable by the Company, if
any, upon the exercise, exchange or
conversion of the Ordinary Share Equivalent
over (ii) the number of Ordinary Shares
issuable upon the exercise, conversion or
exchange of the Ordinary Share Equivalent;Equity Securities
    
    means any Ordinary Shares and/or Ordinary
Share Equivalents;First Series A Share Purchase
Agreement
    
    has the meaning set forth in Recital
(B) of this Agreement;Form F-3
    
    means such form under the Securities Act as
in effect on the date hereof or any
registration form under the Securities Act
subsequently adopted by the Commission that
permits inclusion or incorporation of
substantial information by reference to other
documents filed by the Company with the
Commission. Form F-3, as applied in this
Agreement, could be either Form F-3, if the
Company is deemed a foreign private issuer
under the Securities Exchange Act of 1934, as
amended, or Form S-3, if the Company is
deemed a domestic issuer under such Act;Founder
    
    means such Key Shareholders as listed on
Schedule 2-1 hereof;GAAP
    
    means generally accepted accounting
principles in the United States of America;Group
    
    means the Company and its Subsidiaries and
Affiliate(s);Happy Digital
    
    means a company established in Chengdu City with the Chinese name
of (CHINESE CHARACTERS)Happy Digital Transaction
    
    means the purchase by the Company of the equity interest in Happy
Digital owned by the shareholders of Happy Digital.
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HKIAC
    
    means Hong Kong International Arbitration Center;Holderor Holders
    
    means any Person or Persons owning or have the right
to acquire Registrable Securities including but not
limited to the Founders and the Key Shareholders.Initiating Holder
    
    means, with respect to a request duly made under
Section 10.01 or Section 10.02 to register any
Registrable Securities, the Holder owning at least
twenty five percent (25%) of the Registrable
Securities including any Preferred Shareholder
holding more than fifty percent (50%) of the
Preferred Shares on an as-converted basis initiating
such request;Issuance Notice
    
    has the meaning set forth in Section 11.01(b);Key Shareholder
    
    means a Person listed in Schedule 2, including the
Founders, the Management and other shareholders
listed on Schedule 2 hereof;Listing
    
    means the admission or quotation of the Shares
(including the Shares into which any Securities may
convert) to the list of a quotation system of a
stock exchange;Management
    
    means such management staff of the Company as listed on Schedule 2-2
hereof;New Securities
    
    means any Equity Securities of the Company issued after the closing of the
transactions contemplated by the Second Series A Share Purchase Agreement; provided the term
New Securities does not include (i) securities issued upon conversion of the Preferred
Shares; (ii) securities issued under the Stock Option Pool; (iii) securities issued in a
Qualified Public Offering; (iv) securities issued pursuant to the acquisition of another
corporation by the Company by merger or by purchase,(v) securities issued pursuant to the
conversion, exercise or exchange of Ordinary Share Equivalents provided that the initial
issuance of such Ordinary Share Equivalents
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shall
have complied with the procedures set out in Section
11.01 or been exempted from such procedures pursuant
to the terms set out in Section 11.01, or (vi)
securities issued in connection with any stock split,
stock dividend or re-capitalization of the Company;Offered Shares
    
    has the meaning set forth in Section 9.01(a);Ordinary Shareholder
    
    means any Person registered in the Companys register of members as the holder of
Ordinary Shares (including but not limited to the Key Shareholders), and the permitted
transferees and assigns of such Person;Ordinary Shares
    
    means the ordinary shares of the Companywith par value of US$0.01 per share as at the date
hereof;Ordinary Share Equivalents
    
    means warrants, options and rights
exercisable into Ordinary Shares and
instruments, preferred shares and other
securities ultimately convertible or
exercisable into or exchangeable for Ordinary
Shares;Original Issue Price
    
    means, as to any Preferred Shares issued or
to be issued, whether pursuant to Section
15.01 or 15.02 or otherwise, US$2.00 each;Person
    
    means any individual, person corporate,
corporation, partnership, limited
partnership, proprietorship, association,
limited liability company, firm, trust,
estate or enterprise or entity;PRC
    
    means the Peoples Republic of China, for the
purpose of this Agreement, excluding the Hong
Kong Special Administrative Region, the Macau
Special Administrative Region and Taiwan;Preferred Shares
    
    means the Companys Series A Preferred Shares
with par value of US$0.01 each as at the date
hereof with the rights and privileges
as set forth in the Restated Memorandum and Articles;
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Preferred Shareholder
    
    means any Person registered in the Companys
register of members as the holder of
Preferred Shares, and the permitted
transferees and assigns of any Preferred
Shareholder;Qualified Public Offering
    
    means a firm commitment public offering of
Ordinary Shares that has been registered
under the relevant securities act and
jurisdiction with gross proceeds to the
Company of at least US$40,000,000, and in
which situation the price of each Share shall
be at least 2.4 times the Original Issue
Price;Registrable Securities
    
    means (i) the Preferred Shares, (ii) the
Ordinary Shares issuable or issued upon
conversion of the Preferred Shares and (iii)
any other Ordinary Shares now or later held
by any holder of Ordinary Shares including
the Key Shareholders;Registration
    
    means a registration effected by preparing
and filing a Registration Statement and the
declaration or ordering of the effectiveness
of that Registration Statement; and the terms
Register and Registered have meanings
concomitant with the foregoing;Registration Statement
    
    means a registration statement prepared on
Form F-1, F-2 or F-3 under the Securities
Act, or on any comparable form in connection
with registration in a jurisdiction other
than the United States;Remaining Shares
    
    has the meaning set forth in Section
9.01(a)(iii);Restated Memorandum and
Articles
    
    means the Restated Memorandum and Articles of Association of the
Company, the form of which is attached as Exhibit 1hereto;Second Series A Share Purchase
Agreement
    
    has the meaning set forth in Recital
(C) of this Agreement;Securities
    
    means shares, equity interests, debentures, stocks, bonds, notes, units, warrants,
options,
derivative instruments or any other instrument
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of
whatsoever nature which may be converted into and/or
give rise to any rights in respect of or relating to
shares or any equity interest or any other interests
or securities, in or of the Company (or, where
applicable, the holding company of the Company);Securities Act
    
    means the United States Securities Act of 1933, as amended;Selling Expenses
    
    means all underwriting discounts and selling commissions applicable to the sale of Registrable
Securities pursuant to this Agreement;Share
    
    means a share in the issued share capital of the Company (of whatever class) and includes,
without limitation, the Ordinary Shares and the Preferred Shares;Shareholder
    
    means a holder of Share(s) from time to time;Stock Option Pool
    
    means up to 5,500,000 Ordinary Shares that the Company shall reserve for the issuance of stock
option to certain directors, officers, employees, consultants and/or advisors of the Company as
the Board of Directors of the Company may approve from time to time;Subsidiaries
    
    means the subsidiaries of the Company from time to time (and each a Subsidiary);Transfer
    
    has the meaning set forth in Section 9.01(a);Transfer Notice
    
    has the meaning set forth in Section 9.01(a);Transferor
    
    has the meaning set forth in Section 9.01(a);US and United States
    
    means the United States of America;United States Dollars and US$
    
    means the lawful currency of the US;Violation
    
    has the meaning set forth in Section 10.04(a)(i);
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35% J-Town Stock
    
    J-Town Information Technolgoy Co., Ltd. is a joint venture
established by the Company and JC Entertainment Corporation. (JCE) with the registered
captial of USD 1.5 million, in which the Company and JCE hold 65% and 35% of equity interests
respectively. The Company intends to purchase from JCE the 35% equity interests of J-Town.
 Interpretation
 (i)
    
    the terms defined in this Section 1 shall have the meanings assigned to them in
this Section 1 and include the plural as well as the singular;(ii)
    
    references to a Shareholder shall include references to his successors or
permitted assignees;(iii)
    
    all accounting terms not otherwise defined herein have the meanings assigned
under US GAAP;(iv)
    
    all references in this Agreement to designated Sections and other
subdivisions are to the designated Sections and other subdivisions of the body of this
Agreement;(v)
    
    pronouns of either gender or neuter shall include, as appropriate, the other
pronoun forms;(vi)
    
    the words herein, hereof and hereunder and other words of similar import
refer to this Agreement as a whole and not to any particular Section or other
subdivision; and(vii)
    
    all references in this Agreement to designated Schedules, Exhibits and Annexes
are to the Schedules, Exhibits and Annexes attached to this Agreement unless explicitly
stated otherwise.
 ARTICLE II. OBJECTIVES AND CERTAIN UNDERTAKINGS
 Objectives of the Company Business
 Principal Business
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ARTICLE III. DIVIDEND RIGHTS
 Dividend Rights
 ARTICLE IV. BOARD; SHAREHOLDERS MEETING
 Board of Directors
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Shareholders Meeting
  mutatis mutandis
 ARTICLE V. PROTECTIVE PROVISIONS
 Protective Provisions for Preferred Shareholder
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ARTICLE VI. CONVERSION RIGHTS
  Optional Conversion
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Automatic Conversion
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Preferred Share Conversion Price Conversion Price
 Adjustment for Share Splits and Combinations
 Adjustment for Ordinary Share Dividends and Distributions
 Adjustments for Other Dividends
 Reorganizations, Mergers, Consolidations, Reclassifications,
Exchanges, Substitutions
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Sale of Shares Below the Conversion Price
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(i)
    
    In the event of any increase in the number of
Ordinary Shares deliverable or any reduction in consideration payable
upon exercise, conversion or exchange of any Ordinary Share Equivalents
where the resulting Effective Conversion Price is less than the
Conversion Price at such date, including, but not limited to, a change
resulting from the anti-dilution provisions thereof, the Conversion
Price, shall be re-computed to reflect such change as if, at the time of
issue for such Ordinary Share Equivalents, such Effective Conversion
Price applied.(ii)
    
    If any right to exercise, convert or exchange any
Ordinary Share Equivalents shall expire without having been fully
exercised, the Conversion Price as adjusted upon the issuance of such
Ordinary Share Equivalents shall be readjusted to the Conversion Price
which would have been in effect had such adjustment been made on the
basis that (A) the only Additional Shares deemed issued or such Ordinary
Share Equivalents were such Additional Shares, if any, as were actually
issued upon the exercise, conversion or exchange of any part of such
Ordinary Share Equivalents prior to the expiration thereof and (B) such
Additional Shares, if any, were deemed issued for (x) the consideration
actually received by the Company upon such exercise, conversion or
exchange, plus (y) where the Ordinary Share Equivalents consist of
options, warrants or rights to purchase Ordinary Shares, the
consideration, if any, actually received by the Company for the grant of
such Ordinary Share Equivalents as were actually exercised, plus (z)
where the Ordinary Share Equivalents consist of shares or securities
convertible or exchangeable for Additional Shares, the consideration
received for the issue or sale of Ordinary Share Equivalents actually
converted.(iii)
    
    For any Ordinary Share Equivalent with respect to
which the Conversion Price has been adjusted under this Sub-Section (c),
no further adjustment of the Conversion Price shall be
made solely as a result of the actual issuance of Ordinary Shares upon
the actual exercise or conversion of such Ordinary Share Equivalent.
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Certificate of Adjustment
 Notice of Record Date
 Fractional Shares
 Reservation of Shares Issuable Upon Conversion
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Notices
 Payment of Taxes
 ARTICLE VII. LIQUIDATION RIGHTS
 Liquidation Preferences
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Liquidation on Sale or Merger
 (1)
    
    any consolidation or merger of the Company with or into any other corporation
or other entity or person, or any other corporate reorganization, in which the
shareholders of the Company immediately prior to such consolidation, merger or
reorganization, own less than 50% of the Companys voting power immediately after such
consolidation, merger or reorganization, or any transaction or series of related
transactions to which the Company is a party in which in excess of 50% of the Companys
voting power is transferred, excluding any consolidation or merger effected exclusively
to change the domicile of the Company; or(2)
    
    a sale, lease or other disposition of all or substantially all of the assets of
the Company;
 and upon any such event, any proceeds resulting to the Shareholders of the Company therefrom
shall be distributed in accordance with the terms of Section 7.01.
 ARTICLE VIII. INFORMATION AND INSPECTION RIGHTS
 Delivery of Financial Statements to Preferred Shareholders
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Financial Statements
 Inspection
 ARTICLE IX. RIGHTS OF FIRST REFUSAL; CO-SALE RIGHTS AND TRANSFER RESTRICTIONS
 (a) Right of First Refusal for Preferred Shareholders Transferor Transfer Transfer Notice Offered Shares
 (ii)
    
    Preferred Shareholders Option:
 (1)
    
    Each Preferred Shareholder shall have an option for a
period of thirty (30) days from the receipt of the Transfer Notice to elect
to purchase its respective pro rata share (including any re-allocation
contemplated below) of the Offered Shares at the same price and subject to
the same material terms and conditions as described in the Transfer Notice,
subject to Section 9.01(a)(v).(2)
    
    A Preferred Shareholder (an Exercising Shareholder) may
exercise such purchase option and, thereby, purchase all or a
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part of its
respective pro rata share (including any re-allocatiion as provided below) of
the Offered Shares, by notifying Transferor and the Company in writing,
before expiration of the thirty (30) day period as to the number of such shares which it will purchase (including any re-allocation) (the Exercise
Amount).
 (3)
    
    The Offered Shares shall first be allocated among each Exercising
Shareholder (with rounding to avoid fractional shares) in proportion to its
respective pro rata share provided that in no event shall an amount greater
than such Exercising Shareholders Exercise Amount be allocated to such
Exercising Shareholder.(4)
    
    Any Offered Shares not yet purchased by any Exercising
Shareholder in accordance with sub-paragraph (3) above or any Affiliate of
such Exercising Shareholder in accordance with sub-paragraph (7) below
(Excess Shares) shall be re-allocated among all the other Exercising
Shareholders in proportion to each such Exercising Shareholders respective
pro rata share (with rounding to avoid fractional shares), and such procedure
shall be employed until the Exercise Amounts of all Exercising Shareholders
shall have been satisfied.(5)
    
    In the context contemplated under sub-paragraph (3) above,
an Exercising Shareholders pro rata share is equal to the product of (x)
the total number of Offered Shares, and (y) a fraction, the numerator of
which shall be the aggregate number of all Preferred Shares owned by such
Exercising Shareholder on the date of the Transfer Notice and the denominator
of which shall be the aggregate number of all Preferred Shares owned by all
the Exercising Shareholders on the date of the Transfer Notice.(6)
    
    In the context of a re-allocation of the Excess Shares
referred to in sub-paragraph (4) above, an Exercising Shareholders pro rata
share is equal to the product of (x) the total number of Excess Shares, and
(y) a fraction, the numerator of which shall be the number of all Preferred
Shares owned by such Exercising Shareholder on the date of the Transfer
Notice and the denominator of which shall be the aggregate number of all
Preferred Shares owned by all the Exercising Shareholders (except for the
Preferred Shareholder whose shares are subject to such re-allocation) on the
date of the Transfer Notice.
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(7)
    
    A Preferred Shareholder shall be entitled to apportion the
Offered Shares to be purchased among its Affiliates, provided that such
Preferred Shareholder notifies the Transferor of such allocation and upon
receipt of written consent of the Transferor.(8)
    
    Payment for the Offered Shares which have been allocated to
any Exercising Shareholder as provided above shall be by check or wire
transfer, against delivery of such Offered Shares to such Exercising
Shareholder at a place agreed by the relevant Parties and at the time of the
scheduled closing therefor, which shall be no later than forty-five (45) days
after the Preferred Shareholders receipt of the Transfer Notice, unless the
Transfer Notice contemplated a later closing with the prospective third party
transferee(s) or unless the value of the purchase price has not yet been
established pursuant to Section 9.01(a)(v).
 Additional Transfer Notice Remaining Shares
   (1)
    
    Should the purchase price specified in the Transfer
Notice or Additional Transfer Notice be payable in property other than
cash or evidences of indebtedness, the Preferred Shareholders (or the
Company) shall have the right, upon receipt of the Transferors written
consent, to pay the
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purchase price in the form of cash equal in amount to
the value of such property.
 (2)
    
    Subject to the paragraph above, if the Transferor
and any Preferred Shareholder (or the Company) cannot agree on such cash
value within ten days after the Preferred Shareholders receipt of the
Transfer Notice (or the Companys receipt of the Additional Transfer
Notice), the valuation shall be made by an appraiser of recognized
standing (acting as expert and not as an arbitrator) selected by the
Transferor and such Preferred Shareholders (or the Company) or, if they
cannot agree on an appraiser within twenty (20) days after the Preferred
Shareholders receipt of the Transfer Notice (or the Companys receipt of
the Additional Transfer Notice), each shall select an appraiser of
recognized standing and the two appraisers shall designate a third
appraiser of recognized standing, who shall act as expert and not as an
arbitrator and whose appraisal shall be determinative of such value.(3)
    
    The cost of such appraisal shall be borne by such
Preferred Shareholders and/or the Company (if applicable) and shall be
shared pro rata by them based on the number of Offered Shares each such
Preferred Shareholder and/or the Company (if applicable) is to purchase.(4)
    
    If the time for the closing of the Preferred
Shareholders purchase or the Companys purchase has expired but for the
determination of the value of the purchase price offered by the
prospective transferee, such closing shall be held on or prior to the
fifth business day after such valuation shall have been made pursuant to
this sub-Section.
 Preferred Shareholders Right of Co-Sale
  28




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Selling Preferred Shareholde Selling Preferred
Shareholders
     Limitations to Rights of First Refusal and Co-Sale
 Accession of Subsequent Shareholders
 29




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Special Provisions in Relation to the Founders and Management
   Right of First Refusal for Key Shareholders
 ARTICLE X. REGISTRATION RIGHTS
 Demand Registration Registration Other Than on Form F-3
 30




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Registration on Form F-3
 Right of Deferral
 (1)
    
    in any jurisdiction in which the Company would be
required to execute a general consent to service of process in effecting
such Registration or qualification, unless the Company is already subject
to service of process in such jurisdiction;(2)
    
    if, within ten (10) days of the receipt of any request
of the Initiating Holder to Register any Registrable Securities under
Section 10.01(a) or Section 10.01(b), the Company gives notice to the
Initiating Holder of its bona fide intention to effect the filing for its
own account of a Registration Statement with the Commission within sixty
(60) days of receipt of that request (other than a registration of
securities in a transaction under Rule 145 of the Securities Act or an
offering solely to employees), provided that the Company is
actively employing
in good faith all reasonable efforts to cause that Registration Statement
to become effective; or(3)
    
    within six (6) months immediately following the
effective date of any Registration Statement pertaining to the securities
of the Company (other than a registration of securities in a transaction
under Rule 145 of the Securities Act or with respect to an employee benefit
plan).
  31




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provided
 Underwritten Offerings provided
 Piggyback Registrations Registration of the Companys
Securities
 32




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Right to Terminate Registration
 Underwriting Requirements provided
   Exempt Transactions
 33




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Procedures Registration Procedures and Obligations
 (i)
    
    Prepare and file with the Commission a Registration
Statement with respect to those Registrable Securities and use its reasonable
best efforts to cause that Registration Statement to become effective, and,
upon the request of the Holders holding a majority of the Registrable
Securities Registered thereunder, keep the Registration Statement effective
for up to 120 days;(ii)
    
    Prepare and file with the Commission amendments and
supplements to that Registration Statement and the prospectus used in
connection with the Registration Statement as may be necessary to comply with
the provisions of Applicable Securities Law with respect to the disposition
of all securities covered by the Registration Statement;(iii)
    
    Furnish to the Holders the number of copies of a
prospectus, including a preliminary prospectus, required by Applicable
Securities Law, and any other documents as they may reasonably request in
order to facilitate the disposition of Registrable Securities owned by them;(iv)
    
    Use its reasonable best efforts to Register and qualify the
securities covered by the Registration Statement under the securities laws of
any jurisdiction, as reasonably requested by the
Holders, provided that the Company shall not be required to qualify
to do business or file a general consent to service of process in any such
jurisdictions, and provided further that in the event any
jurisdiction in which the securities shall be qualified imposes a
non-waivable requirement that expenses incurred in connection with the
qualification of the securities be borne by selling shareholders, those
expenses shall be payable pro rata by selling shareholders;(v)
    
    In the event of any underwritten public offering, entering
into and performing its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of the offering. Each
shareholder participating in the underwriting shall also enter into and
perform its obligations under such an agreement;
 34




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(vi)
    
    Notify the Holders of Registrable Securities covered by the
Registration Statement at any time when a prospectus relating thereto is
required to be delivered under Applicable Securities Law or of the happening
of any event as a result of which any prospectus included in the Registration
Statement, as then in effect, includes an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing;(vii)
    
    Provide a transfer agent and registrar for all Registrable
Securities Registered pursuant to the Registration Statement and, where
applicable, a CUSIP number for all those Registrable Securities, in each case
not later than the effective date of the Registration;(viii)
    
    Furnish, at the request of any Initiating Holder requesting Registration of
Registrable Securities pursuant to this Agreement, on the date that such
Registrable Securities are delivered for sale in connection with a
Registration pursuant to this Agreement, (i) an opinion, dated the date of
the sale, of the counsel representing the Company for the purposes of the
Registration, in form and substance as is customarily given to underwriters
in an underwritten public offering; and (ii) a comfort letter dated the date
of the sale, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public
offering, addressed to the underwriters; and(ix)
    
    Take all reasonable action necessary to list the
Registrable Securities on the primary exchange upon which the Companys
securities are then traded.
 Information From Holders
 Expenses of Registration
 35




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Indemnification under Registration Rights
 (a)
    
    Company Indemnity.(i)
    
    To the extent permitted by law, the Company will indemnify
and hold harmless the Holder, its officers, directors, shareholders, legal
counsel and accountants, any underwriter (as defined in the Securities Act)
for such Holder and each Person, if any, who controls (as defined in the
Securities Act) the Holder or underwriter against any losses, claims, damages
or liabilities (joint or several) to which they may become subject under laws
which are applicable to the Company and relate to action or inaction required
of the Company in connection with any Registration, qualification, or
compliance, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (each a Violation): (i) any
untrue statement or alleged untrue statement of a material fact contained in
such Registration Statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii)
the omission or alleged omission to state in the Registration Statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, a material fact required to be stated
therein or necessary to make the statements therein not misleading, or (iii)
any violation or alleged violation by the Company of Applicable Securities
Laws, or any rule or regulation promulgated under Applicable Securities Laws.
The Company will reimburse the Holders, underwriter or controlling person for
any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such
loss, claim, damage, liability or action.(ii)
    
    The indemnity agreement contained in this Section 10.04(a)
shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably withheld),
nor shall the Company be liable in any such case for any such loss, claim,
damage, liability or action to the extent that it arises out of or is based
upon a Violation that occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such Registration
by any such Holder, underwriter or controlling person of the Company.(iii)
    
    With respect to any preliminary prospectus, the foregoing
indemnity shall not inure to the benefit of the Holders or
 36




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underwriter, or
any Person controlling (within the meaning of the Securities Act) the Holders
or underwriter, from whom the Person asserting any such losses, claims,
damages or liabilities purchased shares in the offering, if a copy of the
prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by or
on behalf of the Holders or underwriter to such Person, if required by law so
to have been delivered, at or prior to the written confirmation of the sale
of the shares to such Person, and if the prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability.
 (b)
    
    Holders Indemnity.(i)
    
    To the extent permitted by law, the selling Holder will
indemnify and hold harmless the Company, its directors, officers, legal
counsel and accountants, any underwriter, and each Person, if any, who
controls (within the meaning of the Securities Act) the Company or such
underwriter, against any losses, claims, damages or liabilities (joint or
several) to which any of the foregoing persons may become subject, under
Applicable Securities Laws, or any rule or regulation promulgated under
Applicable Securities Laws, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon
any Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by the Holders expressly for use in connection with such
Registration; and the Holders will reimburse any person intended to be
indemnified pursuant to this Section 10.04(b), for any legal or other
expenses reasonably incurred by such person in connection with
investigating or defending any such loss, claim, damage, liability or
action.(ii)
    
    The indemnity contained in this Section 10.04(b) shall not
apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Holders (which consent shall not be unreasonably withheld), and in no event
shall any indemnity under this Section 10.04(b) exceed the gross proceeds
from the offering received by such Holders.
 Notice of Indemnification Claim
 37




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Contribution
 Underwriting Agreement
 Survival
 38




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##### 



Additional Undertakings
 (i)
    
    make and keep public information available, as those terms
are understood and defined in Commission Rule 144 (or comparable provision
under Applicable Securities Laws in any jurisdiction where the Companys
securities are listed), at all times following ninety (90) days after the
effective date of a Qualified Public Offering;(ii)
    
    file with the Commission in a timely manner all reports and
other documents required of the Company under all Applicable Securities Laws;
and(iii)
    
    at any time following 90 days after the effective date of
the Qualified Public Offering, promptly furnish to the Holders, upon request
(i) a written statement by the Company that it has complied with the
reporting requirements of all Applicable Securities Laws at any time after it
has become subject to such reporting requirements or, at any time after so
qualified, that it qualifies as a registrant whose securities may be resold
pursuant to Form F-3 (or any form comparable thereto under Applicable
Securities Laws of any jurisdiction where the Companys securities are
listed), (ii) a copy of the most recent annual or quarterly report of the
Company and such other reports and documents as may be filed by the Company
with the Commission, and (iii) such other information as may be reasonably
requested in availing any Holder of any rule or regulation of the Commission,
that permits the selling of any such securities without Registration or
pursuant to such form.
 Limitations on Subsequent Registration Rights
 39




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##### 



Market Stand-Off Agreement
 Termination of Registration Rights
 Assignment of Registration Rights Shares
 40




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##### 



Exercise of Preferred Shares
 ARTICLE XI. PRE-EMPTIVE RIGHT
 Pre-emptive Right General
 Issuance Notice Issuance Notice Pre-emptive
Shareholder Pre-emptive Amount
 Allocation of New Securities
 Allocation of Excess New Securities Excess New Securities
 41




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##### 



Pro rata share of New Securities pro rata share
 Pro rata share of Excess New Securities pro rata share
 Sales by the Company
 Assignments and Transfers; No Third Party Beneficiaries
 Legend
  42




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##### 



Termination
 ARTICLE XII. REDEMPTION RIGHT
 Redemption Rights of Preferred Shareholders
 ARTICLE XIII. AFFILIATED TRANSACTION
 Affiliated Transactions
 ARTICLE XIV. PUT OPTION
 Put Right Put Option
 43




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##### 



Put Option Notice
 Consideration
Shares
  44




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##### 



Net Operating Income
 45




---



##### 



ARTICLE XV. ISSUANCE OF ADDITIONAL PREFERRED SHARES
 Issuance of Additional Shares based on 2006 Accounts
 2006N
 46




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##### 



If 2006N is less than USD 5 million, each Preferred Shareholder has the option to
further buy its respective pro rata additional Preferred Shares of the total additional
6 million Preferred Shares at the price of higher of 8.65 times of the Net Operating
Income per Share or $1 per share.Notwithstanding anything to the contrary in this Section 15.01, in no event should ANP
exceed the total number of preferred shares outstanding prior to the issue of new
preferred shares under this provision.
 Issuance of Additional Shares based on 2007 Accounts 2007 Accounts
 If the Net Operating Income reflected in the 2007 accounts (2007N) is less than
US$17,000,000, each Preferred Shareholder shall be entitled to
purchase its respective pro rata additional Preferred Shares from the Company at a
consideration equal to their par value. The number of such additional Preferred Shares
as entitled to be purchased by the Preferred Shares shall be calculated as follows:ANP = NP X (17,000,000/2007N*ISR2007  1)For the purpose of this Section 15.02:NP = the number of Preferred Shares issued on ClosingANP = Additional number of Preferred Shares to be issuedISR 2007 = (Number of issued Shares and warrants as of March 31, 2007  Ordinary Shares
issued under the Stock Option Pool  Shares and warrants
 47




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##### 



issued for the acquisition of
the 35% J-Town Stock) / (number of issued Shares and warrants as of the Closing +
Ordinary Shares actually issued for Happy Digital).
 In case additional Preferred Shares have been already issued to the Preferred
Shareholders according to Section 15.01, then the additional Preferred Shares issued
under this Section 15.02 shall be calculated as follows:
 ANP = NP X(17,000,000/2007N*ISR2007 1) ANP1ANP1 = The number of additional Preferred Shares already issued according to Section
15.01
 Notwithstanding anything to the contrary in this Section 15.02, in no event should ANP
plus ANP1 exceed the total number of preferred shares outstanding prior to the issue of
new preferred shares under this provision.
 Exercise of Options
 Net Operating Income
    48




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##### 



r
   pro rata additional
Preferred Shares
 49




---



##### 



pro
rata share
 ARTICLE XVI. MISCELLANEOUS
 Insurance
 Successors and Assigns
  Cumulative Rights
 Entire Agreement; Amendments
 50




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##### 



Further Assurance
 Severability
 Non-waiver
 Counterparts
 51




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##### 



Dispute Resolution; Governing Law
       Effectiveness
 52




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##### 



Discrepancy.
 [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
 53




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T2CN HOLDINGS LIMITEDBy:
    
    /s/ Greg YeName:
    
    Greg YeTitle:
    
    Chief Financial OfficerGIGAMEDIA CHINA LIMITEDBy:
    
    /s/ Hsiang-Jen ChiangName:
    
    Hsiang-Jen ChiangTitle:
    
    Managing DirectorMARVEL CITY INVESTMENTS LIMITEDBy:
    
    /s/ Yip Chi ChiuName:
    
    Yip Chi ChiuTitle:
    
    DirectorTAE LLCBy:
    
    /s/ Vincent XieName:
    
    Vincent XieTitle:
    
    PartnerPATRIOT CAPITAL LIMITEDBy:
    
    /s/ Mang-Yin MaName:
    
    Mang-Yin MaTitle:
    
    DirectorCHENGWEI (CHINA) INVESTMENT COMPANYBy:
    
    /s/ Feng BoName:
    
    Feng BoTitle:
 54




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##### 



Ji WANG(CHINESE CHARACTERS)Signed:
    
    /s/ Ji WangYanqing LI(CHINESE CHARACTERS)Signed:
    
    /s/ Yanqing LiJun-Tse TENG(CHINESE CHARACTERS)Signed:
    
    /s/ Jun-Tse TengWilliam ZHUSigned:
    
    /s/ William ZhuYu-Chia LEESigned:
    
    /s/ Yu-Chia LeeWeigang YESigned:
    
    /s/ Weigang YeNEWMARGIN T2CN INVESTMENT LTDBy:
    
    /s/ Feng TaoName:
    
    Feng TaoTitle:
 55




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KINGLAND OVERSEAS DEVELOPMENT INCBy:
    
    /s/ Jun Tse TengName:Title:OTHER ORDINARY SHAREHOLDERSCALNEVA FINANCIAL GROUPBy:
    
    /s/ Bryan M. DearName:
    
    Bryan M. DearTitle:BRYAN M. DEARSigned:
    
    /s/ Bryan M. DearD. BRUCE HORTONSigned:
    
    /s/ D. Bruce HortonBRADLEY N. SCHARFESigned:
    
    /s/ Bradley N. ScharfeGUY PECKHAMSigned:
    
    /s/ Guy PeckhamMICHELLE COTE-DEARSigned:
    
    /s/ Michelle Cote-Dear
 56




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##### 



T. ROBERT HORTONSigned:
    
    /s/ T. Robert HortonNEWMARGIN HAPPYDIGITAL INVESTMENT PARTNERS INC.By:
    
    /s/ Jun Tse TengName:Title:ANT BRIDGE NO. 2 VENTURE CAPITAL SECONDARY INVESTMENT LIMITED PARTERSHIPBy:
    
    /s/ Kasunori OsakiName:
    
    Kasunori OsakiTitle:
    
    President and CEO
 57




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SCHEDULE 1
 Particulars of the Company
as of the date of this Agreement
 1. Name:
    
    T2CN Holding LTD.2. Date of Incorporation:
    
    May 7, 20043. Country of incorporation
and status of company:
    
    British Virgin Islands,
International Business Company4. Registered number:
    
    Business Company No. 10296685. Registered office:
    
    offices of Trinity Chambers P.O. Box 4301, Road Tow, Tortola, British
Virgin Islands6. Total Issued and outstanding shares:
    52,103,0017. Directors:
    
    TAO FENG, BO FENG, JI WANG, JUN-TSE TENG,
HSIANG-JEN CHIANG and YIP CHI CHIU8. Secretary:
    
    N/A9. Financial year end:
    
    December 31
 58




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SCHEDULE 2
 List of Key Shareholders
 List of Founders
 
 List of Management
 William Zhu  Yu-Chia Lee  Weigang YE
 2-3 List of Other Key Shareholders
 
 59