Document:

Option Deed

Exhibit
    10.2
    
      	 	
               

            
	 	
               

              Dated
                the 27th day of September 2005

               

              ADMIRE
                FAME INVESTS LIMITED

               

              GAIN
                HUGE INVESTMENTS LIMITED

               

              SPLENDID
                FORTUNE INVESTMENTS LIMITED

               

              AND
                

               

              GLOBAL
                INNOVATIVE SYSTEMS INC.

               

              AND

               

              KO
                YIN

               

            	 
	 	
              DEED

              FOR
                THE GRANT OF OPTIONS OVER THE SHARES OF
                HK$1 EACH IN

              BEIJING
                ILLUMINATION (HONG KONG) LIMITED

            	 
	 	
               

               

               

               

               

               

               

              

              Solicitors

            	 

    

     

    
      	
               

               

              35th
                Floor, Two International Finance Centre,

              8
                Finance Street,

              Central,
                Hong Kong

               

              Tel:
                (852) 2511 5100 Fax: (852) 2511 9515

              Website:
                www.prestongates.com

               

              Our
                ref:
                53520-00001/NKA/CWF

            

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    CONTENTS

    
      
        	
                Clause

              	
                Heading

              	
                Page

              
	 	 	 
	
                1.

              	
                INTERPRETATION

              	
                2

              
	
                2.

              	
                CALL
                  OPTION

              	
                2

              
	
                3.

              	
                EXERCISE
                  OF THE CALL OPTION

              	
                3

              
	
                4.

              	
                PUT
                  OPTION

              	
                3

              
	
                5.

              	
                EXERCISE
                  OF THE PUT OPTION

              	
                3

              
	
                6.

              	
                ADDITIONAL
                  OPTION

              	
                3

              
	
                7.

              	
                CONSIDERATION

              	
                4

              
	
                8.

              	
                COMPLETION

              	
                4

              
	
                9.

              	
                CONDUCT
                  OF BUSINESS PENDING COMPLETION

              	
                5

              
	
                10.

              	
                GRANTORS
                  WARRANTIES AND INDEMNITIES

              	
                6

              
	
                11.

              	
                GIS
                  WARRANTIES

              	
                8

              
	
                12.

              	
                POWER
                  OF ATTORNEY

              	
                9

              
	
                13.

              	
                FURTHER
                  ASSURANCE

              	
                9

              
	
                15.

              	
                CONFIDENTIALITY

              	
                9

              
	
                16.

              	
                TIME
                  AND WAIVER

              	
                10

              
	
                17.

              	
                PARTIAL
                  INVALIDITY

              	
                10

              
	
                18.

              	
                AMENDMENTS

              	
                10

              
	
                19.

              	
                NOTICES

              	
                10

              
	
                20.

              	
                COSTS
                  AND STAMP DUTY

              	
                11

              
	
                21.

              	
                ASSIGNMENT

              	
                11

              
	
                22.

              	
                ENTIRE
                  AGREEMENT

              	
                11

              
	
                23.

              	
                GOVERNING
                  LAW, JURISDICTION AND PROCESS AGENTS

              	
                11

              
	 	 	 
	
                SCHEDULE
                  1

              	
                DETAILS
                  OF THE GRANTORS’ HOLDINGS OF SHARES AND OPTION SHARES

              	
                13

              
	 	 	 
	
                SCHEDULE
                  2

              	
                GRANTORS
                  WARRANTIES

              	
                14

              
	 	 	 
	
                SCHEDULE
                  3

              	
                GIS
                  WARRANTIES

              	
                15

              
	 	 	 
	
                EXECUTION

              	 	
                16

              

      

    

     

     

    
      
        
          

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    THIS
      DEED is
      made
      on the 27th day of September 2005

    

    BETWEEN:

    

    
      	
              (1)

            	
              ADMIRE
                FAME INVESTS LIMITED,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at P.O. Box 957, Offshore Incorporations Centre,
                Road
                Town, Tortola, British Virgin Islands (“Admire
                Fame”);

            

    

    

    
      	
              (2)

            	
              GAIN
                HUGE INVESTMENTS LIMITED,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at P.O. Box 957, Offshore Incorporations Centre,
                Road
                Town, Tortola, British Virgin Islands (“Gain
                Huge”);

            

    

    

    
      	
              (3)

            	
              SPLENDID
                FORTUNE INVESTMENTS LIMITED,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at P.O. Box 957, Offshore Incorporations Centre,
                Road
                Town, Tortola, British Virgin Islands (“Splendid
                Fortune”,
                together with Admire Fame and Gain Huge are referred to as the
                “Grantors”);

            

    

    

    
      	
              (4)

            	
              GLOBAL
                INNOVATIVE SYSTEMS INC.,
                a
                company incorporated under the laws of the State of Nevada, the United
                States and having its correspondence office at 16/F., Hang Seng Mongkok
                Building, 677 Nathan Road, Mongkok, Kowloon, Hong Kong, the common
                shares
                of which are traded on OTCBB (“GIS”);
                and

            

    

    

    
      	
              (5)

            	
              KO
                YIN
                (holder of Hong Kong Permanent Identity Card No. P330688 (0)) and
                whose
                correspondence address is at House No. 5, Mantex Villa, Hang Lok
                Lane,
                Tung Lo Wan Hill, Tai Wai, New Territories, Hong Kong (the “Guarantor”).

            

    

    

    WHEREAS:

    

    
      	
              (A)

            	
              Beijing
                Illumination (Hong Kong) Limited (the “Company”)
                is a company incorporated in Hong Kong with limited liability and
                has an
                authorised share capital of HK$10,000 divided into 10,000 shares
                (the
                “Shares”)
                of HK$1.00 each, of which 1,250 Shares have been issued and allotted
                and
                are fully paid.

            

    

    

    
      	
              (B)

            	
              As
                at the date of this Deed, the Grantors are the legal and beneficial
                owners
                of the Option Shares (as defined
                herein).

            

    

    

    
      	
              (C)

            	
              By
                an agreement (the “Share
                Purchase Agreement”)
                dated 27
                September 2005 and made by Glory
                Goal Investment Limited,
                GIS and the Guarantor, GIS has agreed to acquire 325 Shares from
                Glory
                Goal Investment Limited,
                subject to the terms and conditions therein contained. Pursuant to
                Clause
                13.7 of the Share Purchase Agreement, the Guarantor has agreed to
                procure
                the Grantors, and GIS has agreed, to enter into a duly executed option
                deed in the form of this Deed.

            

    

    

    
      	
              (D)

            	
              Each
                of the Grantors has jointly and severally agreed to grant to GIS
                the Call
                Option (as defined herein) to acquire the Initial Option Shares subject
                to
                and upon the terms and conditions of this
                Deed.

            

    

    

    
      	
              (E)

            	
              GIS
                has agreed to grant to the Grantors the Put Option (as defined herein)
                to
                require GIS to acquire the Initial Option Shares subject to and upon
                the
                terms and conditions of this Deed.

            

    

    

    
      	
              (F)

            	
              Admire
                Fame and GIS
                have agreed that either of them shall have the Additional Right to
                require
                the other to sale or acquire the Additional Option Shares  subject
                to and upon the terms and conditions of this
                Deed.

            

    

    
      	
              (G)

            	
              In
                consideration of GIS agreeing to enter into this Deed, the Guarantor
                has
                agreed to guarantee, among other matters, the due and punctual performance
                by the Grantors of their obligations under this Deed subject to and
                upon
                the terms and conditions of this
                Deed.

            

    

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    NOW
      IT IS HEREBY AGREED AS
      FOLLOWS:

    

    
      	
              1.

            	
              INTERPRETATION

            

    

    

    
      	
              1.1

            	
              Unless
                otherwise expressed or required by the context herein, capitalised
                terms and
                expressions used herein shall have the same meanings as those used
                or
                defined in the Share Purchase
                Agreement.

            

    

    

    
      	
              1.2

            	
              In
                this Deed (including
                the Recitals), the following expressions shall have the following
                meanings
                except where the context otherwise requires and
                in
                addition to the definitions in the Share Purchase Agreement:

            

    

     

    
      
        	 	
                “Additional
                  Option Shares”

              	
                72
                  Shares which shall be sold by Admire Fame and equivalent to 5.76%
                  of the
                  issued share capital of the Company upon Completion;

              
	 	 	 	 
	 	
                “Additional
                  Right”

              	
                the
                  right to require the sale or acquisition of the Additional Option
                  Shares
                  by either GIS or Admire Fame pursuant to Clause 6;

              
	 	 	 	 
	 	
                “Call
                  Option”

              	
                the
                  option to require the sale by the Grantors of the Initial Option
                  Shares to
                  GIS subject to and upon the terms and conditions of this
                  Deed;

              
	 	 	 	 
	 	
                “Completion”

              	
                completion
                  of the sale and purchase of the Option Shares in accordance with
                  the terms
                  and conditions of this Deed;

              
	 	 	 	 
	 	
                “Initial Option
                  Shares”

              	
                313
                  Shares, which shall be (i) as between the Grantors, in the proportion
                  of
                  the number of Option Shares set against their respective name in
                  Schedule
                  1 and (ii) in aggregate equivalent to 25.04% of the issued share
                  capital
                  of the Company upon Completion;

              
	 	 	 	 
	 	
                “Option
                  Period”

              	
                a
                  period of nine (9) months commencing from the expiry of the sixth
                  month of
                  the Completion Date (within the meaning assigned thereto in the
                  Share
                  Purchase Agreement);

              
	 	 	 	 
	 	
                “Option
                  Shares”

              	
                the
                  Additional Option Shares and the Initial Option Shares;

              
	 	 	 	 
	 	
                “Put
                  Option”

              	
                the
                  option to require the purchase by GIS of the Initial Option Shares
                  from
                  the Grantors subject to and upon the terms and conditions of this
                  Deed;
                  and

              
	 	 	 	 
	 	
                “this
                  Deed”

              	
                this
                  deed for the grant of the Call Option and the Put Option, as amended
                  from
                  time to time.

              

      

    

    

    
      	
              1.2

            	
              References
                herein to Clauses are, unless the context otherwise requires, to
                clauses
                in this Deed

            

    

    

    
      	
              1.3

            	
              The
                headings are inserted for convenience only and shall not affect the
                construction of this Deed.

            

    

    

    
      	
              2.

            	
              CALL
                OPTION

            

    

    

    
      	
              2.1

            	
              The
                Grantors hereby irrevocably and unconditionally grants to GIS the
                Call
                Option to purchase the Initial Option Shares from the Grantors subject
                to
                and upon the terms and conditions of this
                Deed.

            

    

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              2.2

            	
              The
                Call Option can only be exercised in respect of all the Initial Option
                Shares and can be exercised once
                only.

            

    

    

    
      	
              2.3

            	
              Upon
                exercise of the Call Option, the Grantors shall as beneficial owners
                sell
                and GIS shall purchase all, but not any portion thereof, of the Initial
                Option Shares free from all Encumbrances and together with all rights
                attaching thereto as at the date of exercise of the Call
                Option.

            

    

    

    
      	
              3.

            	
              EXERCISE
                OF THE CALL OPTION

            

    

    

    
      	
              3.1

            	
              The
                Call Option may be exercised by GIS at its sole discretion at any
                time
                within the Option Period.

            

    

    

    
      	
              3.2

            	
              GIS
                may exercise the Call Option to require the Grantors to sell all,
                but not
                any portion thereof, of the Options Shares to GIS. The Call Option
                may be
                exercised by GIS pursuant to the terms of this Deed by serving a
                Call
                Option notice on each of the Grantors and the date of exercise of
                the Call
                Option shall be the date on which the Call Option notice is received
                by
                each of the Grantors.

            

    

    

    
      	
              4.

            	
              PUT
                OPTION

            

    

    

    
      	
              4.1

            	
              GIS
                hereby irrevocably and unconditionally grants to the Grantors the
                Put
                Option to require GIS to purchase the Initial Option Shares subject
                to and
                upon the Terms and conditions of this
                Deed.

            

    

    

    
      	
              4.2

            	
              The
                Put Option can only be exercised in respect of all the Initial Option
                Shares and can be exercised once
                only.

            

    

    

    
      	
              4.3

            	
              Upon
                exercise of the Put Option, the Grantors shall on as beneficial owners
                sell and GIS shall purchase all, but not any portion thereof, of
                the
                Initial Option Shares free from all Encumbrances and together with
                all
                rights attaching thereto as at the date of exercise of the Put Option.
                GIS
                shall not be obliged to (but may) any Initial Option Shares unless
                all the
                Grantors complete their sale of the Initial Option Shares in accordance
                with this Deed.

            

    

    

    
      	
              5.

            	
              EXERCISE
                OF THE PUT OPTION

            

    

    

    
      	
              5.1

            	
              The
                Put Option may be exercised by the Grantors at any time within the
                Option
                Period, PROVIDED THAT in each of any two months during the Option
                Period,
                the profit before taxation and extraordinary items of the Group as
                shown
                in the unaudited combined balance sheet of the Group as at the last
                calendar date of each such month and the unaudited combined profit
                and
                loss accounts of the Group ending such date as reviewed by the Independent
                Accountants or the auditors of the Group for the time being in accordance
                with the generally accepted accounting practice, standards and principles
                of Hong Kong shall not be less than HK$3,000,000 and FURTHER THAT
                the Call
                Option has not been exercised by
                GIS.

            

    

    

    
      	
              5.2

            	
              The
                Grantors may exercise the Put Option to require GIS to purchase from
                the
                Grantors all, but not any portion thereof, of the Initial Option
                Shares by
                serving a Put Option notice on GIS and the date of exercise of the
                Put
                Option shall be the date on which the Put Option notice is received
                by
                GIS.

            

    

    

    
      	
              6.

            	
              ADDITIONAL
                OPTION

            

    

    

    
      	 	
              GIS
                and Admire Fame further agree that upon the exercise of the Call
                Option or
                the Put Option (whichever occurs first), either GIS (in the event
                that the
                Call Option has been exercised by GIS pursuant to Clause 3) or Admire
                Fame
                (in the event that the Put Option has been exercised by the Grantors
                pursuant to Clause 5) shall have the Additional Right to require
                the other
                to sell (in the event that the Call Option has been exercised by
                GIS
                pursuant to Clause 3) or acquire (in the event that the Put Option
                has
                been exercised by the Grantors pursuant to Clause 5) the Additional
                Option
                Shares. The following provisions shall apply in respect of the Additional
                Right:

            

    

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	 	
              (a)

            	
              the
                Additional Right shall be exercisable by either GIS (in the event
                that the
                Call Option has been exercised by GIS pursuant to Clause 3) and Admire
                Fame (in the event that the Put Option has been exercised by the
                Grantors
                pursuant to Clause 5), in its absolute discretion, simultaneous upon
                the
                exercise of the Call Option or the Put Option and, subject thereto,
                can
                only be exercised in respect of all the Additional Option Shares
                and can
                be exercised once only; and

            

    

    

    
      	 	
              (b)

            	
              the
                exercise of the Additional Right shall be made by giving written
                notice
                from either GIS or Admire Fame to the other (which notice, once given,
                shall be irrevocable) simultaneous with the giving of notice of the
                Call
                Option or the Put Option (as the case may
                be).

            

    

    

    
      	
              7.

            	
              CONSIDERATION

            

    

    

    
      	
              7.1

            	
              The
                consideration for the sale and purchase of the Initial Option Shares
                shall
                be an aggregate amount of HK$70,200,000 (equivalent to US$9,000,000)
                which
                shall be satisfied by GIS on Completion by the issue and allotment
                of an
                aggregate 7,200,000 common shares (each an “Option
                Consideration Share”
                and collectively the “Option
                Consideration Shares”)
                of US$0.0001 each in the share capital of GIS to each of the Grantors
                (in
                proportion to the number of the Initial Option Shares
                set out against their respective names in Schedule 1 as
                nearly as practicable),
                credited as fully paid at the agreed valuation of US$1.25 per Option
                Consideration Share.

            

    

     

    
      	7.2	
            	
              The
                consideration for the sale and purchase of the Additional Option
                Shares
                subject to the Additional Right shall be an aggregate amount of
                HK$16,148,242.50 (equivalent to US$2,070,287.50) which shall be satisfied
                by GIS on Completion by the issue and allotment of an aggregate 1,656,230
                Option Consideration Shares to Admire Fame, credited as fully paid
                at the
                agreed valuation of US$1.25 per Option Consideration
                Share.

            

    

    

    
      	
              7.3

            	
              The
                Option Consideration Shares to be issued and allotted to the Grantors
                as
                consideration for the Option Shares pursuant to Clauses 7.1 and 7.2
                shall
                rank pari passu among themselves and with all other common shares
                of GIS
                then in issue.

            

    

    

    
      	
              8.

            	
              COMPLETION

            

    

    

    
      	
              8.1

            	
              Each
                of the Grantors and GIS shall be bound to complete the sale and purchase
                of the Initial Option Shares within seven (7) Business Days after
                the date
                of exercise of the Call Option or the Put Option (as the case may
                be) and
                in the event that the Additional Right has been exercised, each of
                Admire
                Fame and GIS shall be bound to complete the sale and purchase of
                the
                Additional Option Shares simultaneous with the sale and purchase
                of the
                Initial Option Shares.

            

    

    

    
      	
              8.2

            	
              Completion
                shall take place at the offices of Preston Gates & Ellis, legal
                advisers to the Grantors and the Guarantor at 35th Floor, Two
                International Finance Centre, 8 Finance Street, Central, Hong Kong
                at or
                before 5:00 p.m. on the date of completion of the Call Option or
                the Put
                Option (as the case may be) and the Additional
                Right.

            

    

    

    
      	
              8.3

            	
              At
                Completion, each of the Grantors shall deliver or cause to be delivered
                to
                GIS:

            

    

    

    
      	 	
              (1)

            	
              instrument(s)
                of transfer in respect of the transfer of the Initial Option Shares
                and/or
                the Additional Option Shares duly executed by the relevant Grantor
                in
                favour of GIS or its nominee(s);

            

    

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
      	 	
              (2)

            	
              share
                certificate(s) in respect of the Initial Option Shares and/or the
                Additional Option Shares;

            

    

    

    
      	 	
              (3)

            	
              copy,
                certified as true and complete by a director of the relevant Grantor,
                of
                resolutions of the board of directors of the relevant Grantor approving
                this Deed and authorising the execution of the same;
                and

            

    

    

    
      	 	
              (4)

            	
              copy,
                certified by a director of the Company as true and complete, of the
                resolutions in such form to the satisfaction of GIS passed by the
                directors of the Company approving the transfer of the Initial Option
                Shares and/or the Additional Option Shares to GIS and the registration
                of
                such transfer subject to the relevant instrument of transfer being
                duly
                presented for registration.

            

    

    

    
      	
              8.4

            	
              At
                Completion, GIS shall:

            

    

    

    
      	 	
              (1)

            	
              deliver
                to the Grantors duly issued definitive certificate in board lots
                (as far
                as is practicable) for trading on OTCBB for the Option Consideration
                Shares issued and allotted to the Grantors under Clauses 7.1 and
                7.2 for
                the Option Shares in favour of the Grantors (or as it may direct);
                and

            

    

    

    
      	 	
              (2)

            	
              produce
                to the Grantors duly executed instrument(s) of transfer in respect
                of the
                Option Shares duly executed by GIS.

            

    

    

    
      	
              9.

            	
              CONDUCT
                OF BUSINESS PENDING
                COMPLETION

            

    

    

    
      	 	
              Each
                of the Grantors hereby undertakes jointly and severally with GIS
                that it
                shall until Completion take all steps necessary to ensure that except
                with
                the consent of GIS, no resolution of the board of directors of the
                Company
                or of the Company in general meeting shall be passed and the Company
                shall
                not carry out any actions, which shall include, but not limited to,
                the
                following:

            

    

    

    
      	 	
              (1)

            	
              the
                creation or issue of any shares in any member of the Group or the
                grant of
                any options over any shares or the uncalled capital of any member
                of the
                Group or the issue of any warrant, debentures, securities or other
                obligations convertible into shares in any member of the Group or
                enter
                into any agreement to do any of the same;

            

    

    

    
      	 	
              (2)

            	
              the
                capitalisation, repayment or other from of distribution of any amount
                standing to the credit of any reserve of any member of the Group
                on the
                redemption or purchase of any shares in any member of the Group or
                any
                other reorganisation of share
                capital;

            

    

    

    
      	 	
              (3)

            	
              the
                winding-up or liquidation of any member of the Group;
                

            

    

    

    
      	 	
              (4)

            	
              the
                alteration of the rights attaching to any of the Sale Shares or the
                shares
                or registered capital in any member of the Group;
                

            

    

    

    
      	 	
              (5)

            	
              the
                acquisition or disposal of any lease or any other interests in real
                property owned or occupied by each member of the Group or the creation
                of
                any Encumbrance over such property;

            

    

    

    
      	 	
              (6)

            	
              the
                acquisition or disposal of any property or other asset by each member
                of
                the Group if the aggregate sum involved exceeds (or, in the case
                of a
                disposal, if the book value exceeds)
                HK$2,000,000;

            

    

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    
      	 	
              (7)

            	
              the
                acquisition or formation by any member of the Group of any subsidiary
                or
                the acquisition of any share in any other company or the participation
                by
                any member of the Group in any partnership or joint
                venture;

            

    

    

    
      	 	
              (8)

            	
              the
                sale or disposal of the whole or a substantial part of the undertaking
                or
                the assets of any member of the
                Group;

            

    

    

    
      	 	
              (9)

            	
              the
                entering into of any material contract by any member of the Group
                other
                than in its usual and ordinary course of
                business;

            

    

    

    
      	 	
              (10)

            	
              except
                in the usual and ordinary course of business of the relevant member
                of the
                Group, the lending of any moneys (otherwise than by way of deposit
                with a
                bank or other institution the normal business of which includes the
                acceptance of deposit), the granting of any credit or the giving
                of any
                guarantee or indemnity;

            

    

    

    
      	 	
              (11)

            	
              the
                amalgamation or merger of any member of the Group with any other
                company
                or concern;

            

    

    

    
      	 	
              (12)

            	
              the
                alteration of the composition of any board of directors of any member
                of
                the Group; 

            

    

    

    
      	 	
              (13)

            	
              the
                making of any capital commitment by any member of the
                Group;

            

    

    

    
      	
            	(14)	
              the
                borrowing of any moneys or acceptance of credit facilities by any
                member
                of the Group from banks, financial institutions and any other third
                parties other than in its usual and ordinary course of business;
                or

            

    

    

    
      	 	
              (15)

            	
              the
                making, declaration or payment of any dividend or
                distribution.

            

    

    

    
      	
              10.

            	
              GRANTORS
                WARRANTIES AND
                INDEMNITIES

            

    

    

    
      	10.1	 	
              Each
                of the Grantors and the Guarantor hereby represents, warrants and
                undertakes to GIS and its successors and assigns that the warranties
                (the
                “Grantors
                Warranties”)
                set out in Schedule 2 are true and accurate in all material respects
                on
                the date of this Deed and will continue to be so up to and including
                the
                date of Completion with reference to the facts and circumstances
                from time
                to time applying.

            

    

    

    
      	10.2	 	
              Each
                of the Grantors Warranties is without prejudice to any other Grantors
                Warranty and, except where expressly or otherwise stated, no provision
                in
                any Grantors Warranty shall govern or limit the extent or application
                of
                any other provision in any Grantors Warranty. Each of the Grantors
                and the
                Guarantor hereby agrees that GIS shall treat each of the Grantors
                Warranties as a condition of this
                Deed.

            

    

    

    
      	10.3	 	
              Each
                of the Grantors and the Guarantor hereby agrees to fully indemnify
                and
                keeps GIS and its assigns fully indemnified on demand from and against
                any
                depletion of assets, all losses, costs and expenses (including legal
                expenses) which GIS and its assigns may incur or sustain from or
                in
                consequence of any of the Grantors Warranties not being correct or
                fully
                complied with. This indemnity shall be without prejudice to any of
                the
                rights and remedies of GIS and its assigns in relation to any such
                breach
                of Grantors Warranties and all such rights and remedies are hereby
                expressly reserved.

            

    

    

    
      	10.4	 	
              If
                it shall be found at any time after Completion that any of the Vendor
                Warranties is not true, correct and accurate or is not as represented,
                warranted or undertaken, without prejudice to any other provisions
                of this
                Deed, each of the Grantors and the Guarantor shall indemnify GIS
                on demand
                on a full indemnity basis, and holds it harmless from and against
                all
                liabilities, damages, costs, claims, reduction in net consolidated
                assets
                or increase in net consolidated liabilities and all reasonable expenses
                which GIS may sustain, suffer, or incur as a result of any of the
                foregoing and each of the Grantors and the Guarantor shall pay to
                GIS on
                demand the full amount of any such loss as aforesaid in immediately
                available funds.

            

    

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    
      	10.5	 	
              The
                Grantors Warranties shall survive Completion and the rights and remedies
                of GIS in respect of any breach of the Grantors Warranties shall
                not be
                affected by Completion, or GIS failing to exercise or delaying the
                exercise of any right or remedy, or by any other event or matter
                whatsoever, except a specific and duly authorised written waiver
                or
                release and no single or partial exercise of any right or remedy
                shall
                preclude any further or other
                exercise.

            

    

    

    
      	10.6	 	
              Each
                of the Grantors and the Guarantor undertakes in relation to any Grantors
                Warranty which refers to the knowledge, awareness, information or
                belief
                of each of the Grantors and the Guarantor that it/he has made due
                and
                careful enquiry into the subject matter of that Grantors Warranty
                and that
                it/he does not have the knowledge, awareness, information or belief
                that
                the subject matter of that Grantors Warranty may not be correct,
                complete
                or accurate.

            

    

    

    
      	
              10.7

            	
              The
                liability of each of the Grantors and the Guarantor in respect of
                any
                breach of the Grantors Warranties shall be limited as provided in
                this
                Clause 10.7:

            

    

    

    
      	 	
              (1)

            	
              the
                Grantors and the Guarantor shall be under no liability in respect
                of a
                breach of any of the Grantors Warranties or to indemnify pursuant
                to this
                Deed unless the Grantors and the Guarantor shall have received written
                notice from GIS prior to the date falling on the sixth anniversary
                of the
                date of Completion in respect of the Grantors Warranties or the indemnity
                as aforesaid giving full details of the relevant claim and any such
                claim
                shall (if not previously satisfied, settled or withdrawn) be deemed
                to
                have been waived at the expiration of three (3) months after the
                sixth
                anniversary of the date of Completion unless proceedings in respect
                thereof shall then have been commenced against the Grantors and the
                Guarantor;

            

    

    

    
      	 	
              (2)

            	
              the
                Grantors and the Guarantor shall be under no liability in respect
                of any
                breach of the Vendor Warranties or to indemnify as
                aforesaid:

            

    

    

    
      	 	
              (i)

            	
              if
                such liability would not have arisen but for something voluntarily
                done or
                omitted to be done (other than pursuant to a legally binding commitment
                created on or before Completion) by GIS or the Company or any member
                of
                the Group after Completion and otherwise than in the usual and ordinary
                course of business;

            

    

    

    
      	 	
              (ii)

            	
              to
                the extent that such liability arises or is increased as a result
                only of
                an increase in rates of taxation made after Completion with retrospective
                effect; or

            

    

    

    
      	 	
              (iii)

            	
              to
                the extent that in accordance with applicable law (whether of Hong
                Kong,
                the PRC or elsewhere) a note, provision, allowance or reserve in
                respect
                thereof was made in the management accounts of the Company provided
                that,
                for the avoidance of doubt, to the extent any such note, provision,
                allowance or reserve is not in accordance with applicable law, the
                liability of the Grantors and/or the Guarantor in respect thereof
                shall
                not be limited or excluded by this sub-Clause
                (iii).

            

    

    

    
      	
              10.8

            	
              The
                aggregate amount of the liability of the Grantors and the Guarantor
                in
                respect of any claim for breach of any of the Grantors Warranties
                or to
                indemnify as aforesaid shall not exceed the aggregate amount of the
                consideration payable pursuant to Clause 7 (or the equivalent
                thereof).

            

    

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    
      	
              11.

            	
              GIS
                WARRANTIES

            

    

    

    
      	
              11.1

            	
              Subject
                to Clause 11.7, GIS represents, warrants and undertakes to the Grantors
                and the Guarantor and their respective successors and assigns that
                the
                warranties (the “GIS
                Warranties”)
                set out in Schedule 3 set out in are true and accurate in all material
                aspects on the date of this Deed and will continue to be so on up
                to and
                including the date of Completion with reference to the facts and
                circumstances from time to time applying.

            

    

    

    
      	
              11.2

            	
              GIS
                agrees that the Grantors and the Guarantor may treat each of the
                GIS
                Warranties as a condition of this
                Deed.

            

    

    

    
      	
              11.3

            	
              GIS
                shall indemnify and keep fully and effectively indemnified the Grantors
                and the Guarantor on demand from and against all losses, costs and
                expenses which may be incurred by them or any of them in connection
                with
                any breach of any of GIS Warranties or their successfully enforcing
                any
                claim for any such breach.

            

    

    

    
      	
              11.4

            	
              GIS
                shall be under no liability in respect of a breach of any of the
                GIS
                Warranties or to indemnify pursuant to this Deed unless GIS shall
                have
                received written notice from the Grantors and the Guarantor prior
                to the
                date falling on the sixth anniversary of the date of Completion in
                respect
                of the GIS Warranties or the indemnity as aforesaid giving full details
                of
                the relevant claim and any such claim shall (if not previously satisfied,
                settled or withdrawn) be deemed to have been waived at the expiration
                of
                three (3) months after the sixth anniversary of the date of Completion
                unless proceedings in respect thereof shall then have been commenced
                against GIS.

            

    

    

    
      	
              11.5

            	
              The
                indemnity provided for under Clause 11.4 is without prejudice to
                any other
                rights and remedies of the Grantors and the Guarantor in relation
                to any
                breach of any of the GIS Warranties and all other rights and remedies
                are
                expressly reserved to the Grantors and the
                Guarantor.

            

    

    

    
      	
              11.6

            	
              Each
                of the GIS Warranties is without prejudice to any other GIS Warranty
                or
                other agreements or indemnities entered into between the parties
                or any of
                them and, except where expressly stated otherwise, no provision contained
                in this Deed or other agreements or indemnities shall govern or limit
                the
                extent or application of any other provision of this Deed or such
                other
                agreements.

            

    

    

    
      	
              11.7

            	
              All
                of the GIS Warranties are deemed to be qualified by GIS’s filings with the
                Securities and Exchange Commission of the US published up to the
                date of
                this Deed.

            

    

    

    
      	
              11.8

            	
              No
                claim by the Grantors or the Guarantor shall be prejudiced, nor shall
                the
                amount of any claim by them be reduced, in consequence of any information
                relating to GIS or its affairs which may at any time have come to
                the
                knowledge of any of the Grantors or the Guarantor, and it shall not
                be a
                defence to any claim against GIS that any of the Grantors or the
                Guarantor
                knew or ought to have known or had constructive knowledge or any
                information relating to the circumstance giving rise to such claim,
                subject, in each case, to Clause
                11.7.

            

    

    

    
      	
              11.9

            	
              The
                rights and remedies of the Grantors and the Guarantor in respect
                of any
                breach of the GIS Warranties shall not be affected by investigations
                made
                by or on behalf of them into the affairs of
                GIS.

            

    

    

    
      	
              11.10

            	
              The
                GIS Warranties shall survive Completion insofar as the same are not
                fully
                performed on Completion.

            

    

    

    
      	
              11.11

            	
              The
                aggregate amount of the liability of GIS in respect of any claim
                for
                breach of any of the GIS Warranties or to indemnify as aforesaid
                shall not
                exceed the aggregate amount of the agreed valuation of the Consideration
                Shares pursuant to Clause 7 (or the equivalent
                thereof)

            

    

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      	
              12.

            	
              POWER
                OF ATTORNEY

            

    

    

    
      	
              12.1

            	
              As
                continuing security for the due performance of the Grantors’ obligations
                in this Deed, each of the Grantors hereby irrevocably and by way
                of
                security appoints GIS (the “Grantor’s
                Attorney”)
                with full power of substitution and with full power to act alone
                to be the
                lawful attorney of each of the Grantors and on its behalf to execute
                and
                do any such instrument, act or thing which in the opinion of such
                Grantor’s Attorney, the Grantors ought to do under the covenants and
                provisions contained in this Deed. Each of the Grantors agrees to
                ratify
                and confirm and covenant to ratify and confirm whatever such Grantor’s
                attorneys shall lawfully do by virtue of this Clause
                12.1.

            

    

    

    
      	
              12.2

            	
              As
                continuing security for the due performance of GIS’s obligations in this
                Deed, GIS hereby irrevocably and by way of security appoints the
                Guarantor
                (the “GIS’s
                Attorney”)
                with full power of substitution and each with full power to act alone
                to
                be the attorney of GIS and on its behalf to execute and do any such
                instrument, act or thing which in the opinion of such GIS’s Attorney, GIS
                ought to do under the covenants and provisions contained in this
                Deed. GIS
                agrees to ratify and confirm and covenant to ratify and confirm whatever
                such GIS’s attorney shall lawfully do by virtue of this Clause
                12.2.

            

    

    

    
      	
              13.

            	
              FURTHER
                ASSURANCE

            

    

    

    
      	 	
              Each
                party hereto shall, at the costs and expenses of the other party
                hereto
                execute, do and perform or procure to be executed, done and performed
                by
                other necessary parties all such further acts, agreements, assignments,
                assurances, deeds and documents as the other party may require effectively
                to vest the full benefit of this
                Deed.

            

    

    

    
      	
              14.

            	
              GUARANTEE

            

    

    

    In
      consideration of GIS agreeing to purchase the Option Shares, the Guarantor
      hereby unconditionally and irrevocably guarantees the due and punctual
      performance and observance by the Grantors of all their obligations and, if
      and
      wherever any of the Grantors defaults for any reason whatsoever in the
      performance of any such obligations, the Guarantor shall forthwith upon demand
      perform (or procure the performance of) and satisfy (or procure the satisfaction
      of) such obligations with regard to which such default has been made. As a
      separate and independent stipulation, the Guarantor hereby covenants and agrees
      that, subject as is stated herein, any obligation expressed to be undertaken
      by
      each of the Grantors which may not be enforceable against it by reason of any
      legal limitation, disability or incapacity on or of the Grantors or any other
      fact or circumstance shall nevertheless be enforceable against and recoverable
      from the Guarantor as though the same had been incurred by him, and the
      Guarantor was the sole or principal obligor in respect thereof and shall be
      performed or paid by the Guarantor on demand.

    

    
      	
              15.

            	
              CONFIDENTIALITY

            

    

    

    Except
      in
      compliance with an order or requirement of a competent court or authority,
      no
      general public disclosure regarding this Deed or the terms hereof shall be
      made
      by any of the Grantors and GIS without the prior written consent of the other.
      Each of the Grantors and GIS further agree that they will not, and will procure
      that their respective directors, officers, employees, representatives and agents
      not to, disclose to any person who is not a direct participant in discussions
      concerning the grant of the Call Option and the Put Option, the status of the
      discussions or negotiations taking place or any of the terms, conditions or
      other facts with respect to the grant of the Call Option and Put
      Option.

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    
      	
              16.

            	
              TIME
                AND WAIVER

            

    

    

    Time
      shall in every respect be of the essence of this Deed but no failure on the
      part
      of any party hereto to exercise, and no delay on its part in exercising any
      right hereunder shall operate as a waiver thereof, nor will any single or
      partial exercise of any right under this Deed preclude any other or further
      exercise of it or the exercise of any other right or prejudice or affect any
      right against any other parties hereto under the same liability, whether joint,
      several or otherwise. The rights and remedies provided in this Deed are
      cumulative and not exclusive of any rights or remedies provided by
      law.

    

    
      	
              17.

            	
              PARTIAL
                INVALIDITY

            

    

    

    If
      at any
      time one or more provisions of this Deed is or becomes invalid, illegal,
      unenforceable or incapable of performance in any respect under the laws of
      any
      relevant jurisdiction, the validity, legality, enforceability or performance
      of
      the remaining provisions hereof in that jurisdiction or the validity, legality,
      enforceability or performance under the laws of any other relevant jurisdiction
      of any provisions of this Deed shall not in any way be effected or impaired
      thereby.

    

    
      	
              18.

            	
              AMENDMENTS

            

    

    

    This
      Deed
      shall not be amended, supplemented or modified except by instruments in writing
      signed by all parties hereto.

    

    
      	
              19.

            	
              NOTICES

            

    

    

    
      	
              19.1

            	
              Any
                notice claim, demand, court process, document or other communication
                to be
                given under this Deed (collectively “communication”
                in this Clause 19) shall be in writing in the English language and
                may be
                served or given personally or sent to the telex or facsimile numbers
                (if
                any) of the relevant party and marked for the attention and/or copied
                to
                such other person as specified in Clause
                19.5.

            

    

    

    
      	
              19.2

            	
              A
                change of address or telex or facsimile number of the person to whom
                a
                communication is to be addressed or copied pursuant to this Deed
                shall not
                be effective until five (5) days after a written notice of change
                has been
                served in accordance with the provisions of this Clause 19 on all
                other
                parties to this Deed with specific reference in such notice that
                such
                change is for the purposes of this
                Deed.

            

    

    

    
      	
              19.3

            	
              A
                party may not designate a non Hong Kong address for the service of
                communications to it.

            

    

    

    
      	
              19.4

            	
              All
                communications shall be served by the following means and the addressee
                of
                a communication shall be deemed to have received the same within
                the time
                stated adjacent to the relevant means of
                despatch:

            

    

     

    
      
        	 	
                Means
                  of despatch

              	 	
                Time
                  of deemed receipt

              	 
	 	 	 	 	 
	 	
                Local
                  mail or courier

              	 	
                24
                  hours

              	 
	 	
                Telex

              	 	
                on
                  despatch

              	 
	 	
                Facsimile
                  

              	 	
                on
                  despatch

              	 
	 	
                Air
                  courier/speedpost

              	 	
                3
                  days

              	 
	 	
                Airmail

              	 	
                5
                  days

              	 

      

    

    

    
      	
              19.5
                

            	
              The
                initial addresses and facsimile numbers of the parties for the service
                of
                communications, the person for whose attention such communications
                are to
                be marked and the person to whom a communication is to be copied
                are as
                follows:

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    

      
        	 	
                To
                  the Grantors:

              	 	 
	 	 	
                Address:
                  

              	
                c/o
                  House No. 5, Mantex Villa, Hang Lok Lane, Tung Lo Wan Hill, Tai
                  Wai,
                  New.Territories, Hong Kong

              
	 	 	
                Facsimile:

              	
                (852)
                  2759 8811

              
	 	 	
                Attention:

              	
                Mr.
                  Ko Yin

              
	 	 	 	 
	 	
                To
                  GIS:

              	
                Name:

              	
                Global
                  Innovative Systems Inc.

              
	 	 	
                Address:
                  

              	
                16/F.,
                  Hang Seng Mongkok Building, 677 Nathan Road, Mongkok, Kowloon,
                  Hong
                  Kong

              
	 	 	
                Facsimile:
                  

              	
                (852)
                  2546 6878

              
	 	 	
                Attention:

              	
                Board
                  of Directors

              
	 	 	 	 
	 	
                To
                  the Guarantor:

              	
                Address:
                  

              	
                House
                  No. 5, Mantex Villa, Hang Lok Lane,
                  

              
	 	 	 	
                Tung
                  Lo Wan Hill, Tai Wai,

              
	 	 	 	
                New.Territories,
                  Hong Kong

              
	 	 	
                Facsimile:
                  

              	
                (852)
                  2759 0282

              

      

    

     

    
      	
              19.6

            	
              A
                communication served in accordance with this Clause 19 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 or that the envelope containing such
                communication was properly addressed and posted or despatched to
                the
                addressee’s address or that the communication was properly transmitted by
                telex, facsimile or cable to the addressee. In the case of communication
                by telex, such communication shall be deemed properly transmitted
                upon the
                receipt by the machine sending the telex the telex answerback of
                the
                addressee; in the case of facsimile transmission, such transmission
                shall
                be deemed properly transmitted on receipt of a report of satisfactory
                transmission printed out by the sending
                machine.

            

    

    

    
      	
              19.7

            	
              Nothing
                in this Clause 19 shall preclude the service of communication or
                the proof
                of such service by any mode permitted by
                law.

            

    

    

    
      	
              20.

            	
              COSTS
                AND STAMP DUTY

            

    

    

    
      	
              20.1

            	
              Each
                party shall bear its own costs and expenses (including legal fees)
                incurred in connection with the preparation, negotiation, execution
                and
                performance of this Deed.

            

    

    

    
      	
              20.2

            	
              All
                stamp duty (if any) payable in connection with the sale and purchase
                of
                the Option Shares shall be borne equally by the Grantors (as between
                them,
                in
                proportion to the number of the Option Shares
                sold by each of them as
                nearly as practicable)
                and GIS.

            

    

    

    
      	
              21.

            	
              ASSIGNMENT

            

    

    

    This
      Deed
      shall be binding upon each party’s successors and assigns and personal
      representatives and none of the parties hereto may assign or transfer any of
      its
      rights and obligations under this Deed.

    

    
      	
              22.

            	
              ENTIRE
                AGREEMENT

            

    

    

    This
      Deed
      constitutes the entire agreement between the parties hereto with respect to
      the
      matters dealt with herein and supersedes all previous agreements, arrangements,
      statements, understandings or transactions between the parties hereto in
      relation to the matters hereof.

      

    
      	
              23.

            	
              GOVERNING
                LAW, JURISDICTION AND PROCESS
                AGENTS

            

    

    

    
      	
              23.1

            	
              This
                Deed shall be governed by and construed in accordance with the laws
                of
                Hong Kong.

            

    

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    
      	
              23.2

            	
              The
                parties hereto hereby irrevocably submit to the non-exclusive jurisdiction
                of the courts of Hong Kong.

            

    

    

    
      	
              23.3

            	
              Each
                of the Grantors hereby irrevocably appoints the Guarantor whose
                correspondence address is at House No. 5, Mantex Villa, Hang Lok
                Lane,
                Tung Lo Wan Hill, Tai Wai, New.Territories, Hong Kong as its service
                agent
                to accept service or process out of the courts of the Hong Kong in
                connection with this Deed. Such appointment cannot be revoked and
                each of
                the Grantors hereby confirms that any process, writ of action or
                summonses
                out of the courts of Hong Kong served either personally on or sent
                by post
                (postal prepaid) to the service agent referred to in this Clause
                23.3 at
                the then current address of such service agent shall be and shall
                be
                deemed to be served on each of the Grantors and that the failure
                of the
                service agent to give any notice of such service of process to each
                of the
                Grantors shall not impair or affect the validity of such service
                or of any
                judgment based thereon.

            

    

    

    
      	
              23.4

            	
              GIS
                hereby irrevocably appoints Mr. Bondy Tan, holder of Hong Kong Permanent
                Identity Card No. D 500769 (1)) and whose correspondence address
                is at
                16/F., Hang Seng Mongkok Building, 677 Nathan Road, Mongkok, Kowloon,
                Hong
                Kong as its service agent to accept service or process out of the
                courts
                of the Hong Kong in connection with this Deed. Such appointment cannot
                be
                revoked and GIS hereby confirms that any process, writ of action
                or
                summonses out of the courts of Hong Kong served either personally
                on or
                sent by post (postal prepaid) to the service agent referred to in
                this
                Clause 23.4 at the then current address of such service agent shall
                be and
                shall be deemed to be served on GIS and that the failure of the service
                agent to give any notice of such service of process to GIS shall
                not
                impair or affect the validity of such service or of any judgment
                based
                thereon.

            

    

    
      
        
           

        

        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    SCHEDULE
      1

    

    DETAILS
      OF THE GRANTORS’ HOLDINGS OF SHARES AND OPTION SHARES

    

    
      	
              Name
                of Grantors

            	
              Number
                of Shares held

            	
              Number
                of Initial Option Shares

            	
              Number
                of Additional Option Shares

            
	
              Admire
                Fame

            	
              215

            	
              143

            	
              72

            
	
              Gain
                Huge

            	
              125

            	
              125

            	
              -

            
	
              Splendid
                Fortune

            	
              45

            	
              45

            	
              -

            

    

    

    
      
        
           

        

        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    SCHEDULE
      2

    

    GRANTORS
      WARRANTIES

    

    
      	
              1.

            	
              Recitals

            

    

    

    The
      matters stated in the Recitals to this Deed (save for Recital (E)) are true
      and
      correct in all material respects.

    

    
      	
              2.

            	
              The
                Grantors, the Guarantor and the
                Company

            

    

    

    
      	
              2.1

            	
              Each
                of the Grantors and the Guarantor has the full power to enter into
                and
                perform this Deed and this Deed will, when executed, constitute binding
                obligations on each of them in accordance with its
                terms.

            

    

    

    
      	
              2.2

            	
              Save
                as disclosed to GIS, there is no outstanding indebtedness or other
                liability (actual or contingent) owing by any member of the Group
                to the
                Grantors or the Guarantor, any director of a member of the Group
                or any
                person connected with the Grantors or the Guarantor nor is there
                any
                indebtedness owing to a member of the Group by any such
                person.

            

    

    

    
      	
              2.3

            	
              The
                Option Shares are issued fully paid and are beneficially owned by
                the
                Grantors free from all Encumbrances and the same are freely transferable
                by the Grantors without the consent, approval, permission, licence
                or
                concurrence of any third party.

            

    

    
      
        
           

        

        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    SCHEDULE
      3

    

    GIS
      WARRANTIES

    

    
      	
              1.

            	
              The
                audited condensed consolidated financial statements of GIS and its
                subsidiaries for the year ended 31 March 2005 have been prepared
                in
                accordance with generally accepted accounting principles and practice
                consistently applied and give a true and fair view of the results
                of
                operations and assets and liabilities of GIS and its subsidiaries
                for the
                year ended and as at the date to which such financial statements
                have been
                made up.

            

    

    

    
      	
              2.

            	
              GIS
                has been duly incorporated and is validly existing under the laws
                of its
                place of incorporation (namely, the State of Nevada, the US) and
                has full
                power, authority and legal right to own its assets and carry on its
                business.

            

    

    

    
      	
              3.

            	
              The
                Option Consideration Shares represent about 44.44% of the common
                shares of
                GIS in issue on the date of this Deed, and about 29% of the common
                shares
                of GIS in issue on Completion as enlarged by the issue of the
                Consideration Shares and the Option Consideration
                Shares.

            

    

    

    
      	
              4.

            	
              The
                Option Consideration Shares shall, upon issue, rank pari passu among
                themselves and with all other common shares of GIS then in issue
                and are
                free from all Encumbrances.

            

    

    

    
      	
              5.

            	
              Since
                30 June 2005, there has been no material adverse change to the financial
                position of GIS and its subsidiaries (taken as a
                whole).

            

    

    

    
      	
              6.

            	
              All
                information contained in this Deed or in the documents referred to
                herein
                and therein and all other information concerning GIS and/or any part
                or
                parts of its business operations assets and liabilities (actual or
                contingent) supplied in the course of the negotiations leading to
                this
                Deed to each of the Grantors or its agents was when given true, complete
                and accurate in all material respects and there is no fact or matter
                which
                has not been disclosed which renders any such information or documents
                untrue, inaccurate or misleading in any material respect at the date
                of
                this Deed or which if disclosed might reasonable be expected to influence
                adversely any of the Grantor’s decision to accept the Option Consideration
                Shares on the terms of this
                Deed.

            

    

    
      
        
           

        

        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF
      this
      Deed has been executed on the day and year first above written.

    

    
      
        	
                SEALED
                  with the COMMON
                  SEAL of

              	
                )

              
	 	
                )

              
	
                and
                  SIGNED
                  by
                  

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                ADMIRE
                  FAME INVESTS LIMITED

              	
                )

              
	
                in
                  the presence of:

              	
                )

              
	 	 
	 	 
	 	 
	
                SEALED
                  with the COMMON
                  SEAL of

              	
                )

              
	 	
                )

              
	
                and
                  SIGNED
                  by
                  

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                GAIN
                  HUGE INVESTMENTS 

              	
                )

              
	
                LIMITED

              	
                )

              
	
                in
                  the presence of:

              	
                )

              
	 	 
	 	 
	 	 
	
                SEALED
                  with the COMMON
                  SEAL of

              	
                )

              
	 	
                )

              
	
                and
                  SIGNED
                  by
                  

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                SPLENDID
                  FORTUNE

              	
                )

              
	
                INVESTMENTS
                  LIMITED

              	
                )

              
	
                in
                  the presence of:

              	
                )

              
	 	 
	 	 
	 	 
	
                GIS

              	 
	 	 
	
                SIGNED
                  by
                  

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                GLOBAL
                  INNOVATIVE 

              	
                )

              
	
                SYSTEMS
                  INC. 

              	
                )

              
	
                in
                  the presence of:

              	
                )

              
	 	 
	 	 
	 	 
	
                THE
                  GUARANTOR

              	 
	 	 
	
                SIGNED,
                  SEALED and
                  DELIVERED by

              	
                )

              
	
                KO
                  YIN

              	
                )

              
	
                in
                  the presence of:

              	
                )

              

      

    

     

    16Letter Agreement

    Exhibit
      10.3

     

    

    

    Date: 
3
      October 2005

    

    GLORY
      GOAL INVESTMENTS LIMITED,

    ADMIRE
      FAME INVESTMENTS LIMITED,

    GAIN
      HUGE INVESTMENTS LIMITED,

    SPLENDID
      FORTUNE INVESTMENTS LIMITED

    AND

    KO
      YIN

    

    PRESENT

    

    Dear
      Sir

    

    Sale
      and Purchase of

    325
      Shares in Beijing Illumination (Hong Kong) Limited

    AND

    Deed
      for the Grant of Options over 

    385
      Shares in Beijing Illumination (Hong Kong) Limited

    

    We
      refer to the sale and purchase agreement (the “Agreement”)
      dated 27 September 2005 entered into by Global Innovative Systems Inc.
      (“GIS”),
      Glory Goal Investments Limited and Ko Yin for the sale and purchase of 325
      shares in Beijing Illumination (Hong Kong) Limited and the deed (the
“Option
      Deed”)
      dated 27 September 2005 executed by GIS, Admire Fame Investments Limited, Gain
      Huge Investments Limited, Splendid Fortune Investments Limited and Ko Yin for
      the grant of options over up to 385 shares in Beijing Illumination (Hong Kong)
      Limited. 

    

    Unless
      otherwise requires, capitalised terms and expressions defined or to which a
      meaning is assigned in the Agreement and the Option Deed (as the case may be)
      shall have the same meanings when used herein.

    

    For
      value
      received, we hereby agree to amend and supplement the Agreement and the Option
      Deed by the inclusion of the following provisions into the Agreement and the
      Option Deed (to the extent as applicable):

    

    
      	
              1.

            	
              Amendments
                to the Agreement

            

    

    

    
      	
              1.1

            	
              The
                Vendor acknowledges and agrees that the Consideration Shares will
                be
                issued and allotted pursuant to a safe harbour from the prospectus
                and
                registration requirements of the United States Securities Act of
                1933 (as
                amended) (the “Securities
                Act”).
                The Vendor agrees to abide by all applicable resale restrictions
                and hold
                periods imposed by all applicable securities legislation. The share
                certificate representing the Consideration Shares issued and allotted
                on
                Completion will be endorsed with the following legend pursuant to
                the
                Securities Act in order to reflect the fact that the Consideration
                Shares
                will be issued and allotted to the Vendor pursuant to a safe harbor
                from
                the prospectus and registration requirements of the Securities
                Act:

            

    

    
       

      Global
        Innovative Systems Inc.

       

      16/F. |
        Hang
        Seng Mongkok Building
        | 677
        Nathan Road |
        Mongkok |
        Kowloon |
        Hong
        Kong

      3873
        Airport Way |
        PO
        Box 9754
        | Bellingham |
        Washington
        | 98227-9754
        USA

      t:
        888.852.8838  
        f:
        360.671.0896  
        e:
        info@gistt.com  
        w:
        www.gistt.com

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    “THE
      SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
      TO A
      PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION
      S
      UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”).

    

    NONE
      OF
      THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE SECURITIES
      ACT,
      OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED
      OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR
      TO
      U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER
      THE
      SECURITIES ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
      SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
      NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
      EACH
      CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
      HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
      COMPLIANCE WITH THE SECURITIES ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS
      DEFINED BY REGULATION S UNDER THE SECURITIES ACT.”

    

    
      	
              1.2

            	
              The
                Vendor may exchange its certificate representing the Consideration
                Shares
                by delivering such certificate to the Purchaser duly executed and
                endorsed
                in blank (or accompanied by duly executed stock powers duly endorsed
                in
                blank), in each case in proper form for transfer, with signatures
                guaranteed, and, if applicable, with all stock transfer and any other
                required documentary stamps affixed thereto and with appropriate
                instructions to allow the transfer agent to issue a certificate for
                the
                Consideration Shares to the holder thereof together with a Regulation
                S
                Investment Letter, a copy of which is attached to this
                letter.

            

    

    

    
      	
              1.3

            	
              The
                Vendor further acknowledges that the Consideration Shares issued
                pursuant
                to the terms and conditions set forth in the Agreement will have
                such hold
                periods as are required under applicable securities laws and as a
                result
                may not be sold, transferred or otherwise disposed, except pursuant
                to an
                effective registration statement under the Securities Act, or pursuant
                to
                an exemption from, or in a transaction not subject to, the registration
                requirements of the Securities Act and in each case only in accordance
                with all applicable securities
                laws.

            

    

    

    
      	
              2.

            	
              Amendments
                to the Option Deed

            

    

    

    
      	
              2.1

            	
              Each
                of the
                Grantors acknowledges and agrees that the Option Consideration Shares
                will
                be issued and allotted pursuant to a safe harbour from the prospectus
                and
                registration requirements of the Securities Act. Each
                of the
                Grantors agrees to abide by all applicable resale restrictions and
                hold
                periods imposed by all applicable securities legislation. The share
                certificate representing the Option Consideration Shares issued and
                allotted on Completion (as defined in the Option Deed) will be endorsed
                with the legend set forth in paragraph 1.1 of this
                letter.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              2.2

            	
               

            	
              Each
                of the Grantors may
                exchange its certificate representing the Option Consideration Shares
                by
                delivering such certificate to the Purchaser duly executed and endorsed
                in
                blank (or accompanied by duly executed stock powers duly endorsed
                in
                blank), in each case in proper form for transfer, with signatures
                guaranteed, and, if applicable, with all stock transfer and any other
                required documentary stamps affixed thereto and with appropriate
                instructions to allow the transfer agent to issue a certificate for
                the
                Option Consideration Shares to the holder thereof together with a
                Regulation S Investment Letter, a copy of which is attached to this
                letter.

            

    

    

    
      	
              2.3

            	
              Each
                of the Grantors
                further acknowledges that the Option Consideration Shares issued
                pursuant
                to the terms and conditions set forth in the Option Deed will have
                such
                hold periods as are required under applicable securities laws and
                as a
                result may not be sold, transferred or otherwise disposed, except
                pursuant
                to an effective registration statement under the Securities Act,
                or
                pursuant to an exemption from, or in a transaction not subject to,
                the
                registration requirements of the Securities Act and in each case
                only in
                accordance with all applicable securities
                laws.

            

    

    

    
      	
              2.4

            	
              Admire
                Fame hereby confirms, acknowledges and ratifies that references to
                its
                name in the Option Deed should read Admire Fame Investments
                Limited.

            

    

    

    
      	
              3.

            	
              Savings

            

    

    

    Save
      to the extent amended by this letter, all other provisions of the Agreement
      and
      the Option Deed shall remain in full force and effect.

    

    
      	
              4.

            	
              Governing
                Law

            

    

    

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

            

    

    

    Please
      signify your consent for such amendments and supplements by signing, dating
      and
      returning the attached copy of this letter to us by hand. This letter, and
      any
      number of counterparts so signed, dated and returned, shall constitute one
      and
      the same instrument and is a supplemental agreement to the Agreement and a
      supplemental deed to the Option Deed and is binding on all parties.

    

    Yours
      faithfully

    For
      and on behalf of      

    Global
      Innovative Systems Inc. 

    

    

    /s/
      Bondy Tan            

    Name: Bondy
      Tan

    Title: President
      and Chief Executive Officer

     

    *
      * * * *
      * * * * * * * * * * * * * * * * * * * * * * * * *

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                Agreed
                  to the above:

              	 
	 	 
	
                Signed,
                  sealed and delivered

              	
                )

              
	
                by
                  Ko
                  Yin

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	
                Signed
                  by
                  Ko
                  Yin

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                Glory
                  Goal Investments Limited

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	
                Sealed
                  with
                  the common seal of

              	
                )

              
	
                and
                  Signed
                  by
                  Ko
                  Yin

              	
                )

              
	
                for
                  and on behalf of

              	
                ) 

              
	
                Admire
                  Fame Investments Limited

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	
                Sealed
                  with
                  the common seal of

              	
                )

              
	
                and
                  Signed
                  by
                  Ko
                  Yin

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                Gain
                  Huge Investments Limited

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	
                Sealed
                  with
                  the common seal of

              	
                )

              
	
                and
                  Signed
                  by
                  Ko
                  Yin

              	
                )

              
	
                for
                  and on behalf of

              	
                )

              
	
                Splendid
                  Fortune Investments Limited

              	
                )

              

      

    

     

    in
      the
      presence of:

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