Document:

[COMPANY LOGO GOES HERE]

Nortel Networks
Service Provider & Carrier
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6
(905) 863-3107 (esn 333) Main
(905) 824-9310 (esn 335-1280) Home Office
(905) 863-5751 (esn 333) FAX

www.nortelnetworks.com

lugal@nortelnetworks.com

      Richard Dugal
 Regional Vice President
merging Service Providers
         Canada

NORTEL NETWORKS CONFIDENTIAL SPECIAL HANDLING

January 19, 2001

Mr. Matt Hcysel
Chairman & CEO
China Broadband Corp.
2080, 440 - 2 Avenue SE
Calgary, Alberta
T2P 5E9

Dear Matt:

Attached is a new Supplement No. 1 to the Purchase and License Agreement
("PLA") between Nortel Networks Limited ("Nortel Networks") and China Broadband
Corporation ("CBC") dated September 28, 2000.  The parties wish to replace the
existing "PLA Supplement", which was attached to the PLA at the time of
execution of the PLA, with the attached Supplement No. 1.

If you agree with the following, please arrange for execution by China
Broadband Corporation in the space indicated below to indicate acceptance of the
amendment of the PLA.

<PAGE>

Nortel Networks United and China Broadband Corporation hereby agree to amend the
Purchase and License Agreement ("PLA") between them dated September 28, 2000 by
deleting the "PLA Supplement" which was attached to the PLA at the time of
execution of the PLA with the "Supplement No. 1" a copy of which is attached to
this letter, such amendment to have retroactive effect from September 28, 2000.

Agreed:

NORTEL NETWORKS LIMITED                         CHINA BROADBAND CORPORATION

By:/s/RICHARD DUGAL                             By:/s/MATT HEYSEL
   -------------------                             -------------------
Name: Richard Dugal                             Name: Matt Heysel
     -----------------                               -----------------
Title: Region Director                          Title: Chairman & CEO
      ----------------                                ----------------
Date: Jan. 24, 2001                             Date: Jan. 23, 2001
      ----------------                                ----------------

Yours very truly,

/s/RICHARD DUGAL

<PAGE>

China Broadband Corporation                                     NORTEL
                                                                  NETWORKS
PLA Supplement Number 1
--------------------------------------------------------------------------------

The terms and conditions provided to this Supplement ("Supplement Number 1")
are in addition to those contained in the Purchase and License Agreement ("PLA")
dated September 28, 2000 between China Broadband Corporation ("Customer") and
Nortel Networks Limited ("Nortel Networks"). Capitalized terms used in this
Supplement and not otherwise defined herein have the meanings ascribed thereto
in the PLA.

1. REPLACEMENT OF EXISTING SUPPLEMENT

The PLA Supplement attached to the PLA as of the daft of execution of the PLA is
hereby deleted in its entirety and replaced with this Supplement Number 1.

2. TERM

This Supplement Number 1 is effective from September 28, 2000 and will continue
in effect for a period of five years thereafter ("Term").

3. SHIPMENT AND DELIVERY

Nortel Networks will ship the equipment listed in Exhibit "A", and all other
Products to be shipped under this agreement, FOB Nortel Networks' factory.

Customer is responsible for shipping the goods into the People's Republic of
China ("PRC") to the installation site(s). Customer shall comply fully with all
relevant laws, rules and regulations in respect of the importation of the goods
into the PRC.

Customer is responsible for payment of all shipping costs, customs duties and
related amounts including all taxes other than taxes calculated on the net
income of Nortel Networks.

4. ESTIMATED VOLUME

Customer agrees that during the Term it shall purchase from Nortel Networks and
make full payment for Products and Services having an aggregate price of up to
US$250,000,000.00 (Two Hundred and Fifty Million United States Dollars).

5. PRICING ANTI PAYMENT

The prices for the quantities of Products set forth in Exhibit "A" shall be as
set forth in such Exhibit. Nortel Networks agrees that during the Term, the
price applicable to the Products listed in Exhibit "B" shall be calculated in
accordance with Exhibit "B". Nortel Networks shall be entitled to invoice 100%
of the price for any Products upon shipment of such Products.

6. PURCHASE ORDER: AND LETTER OF CREDIT

Customer shall issue one purchase order in respect of each calendar quarter for
all products required to be shipped in such quarter. Such purchase order shall
be issued no more than quarterly, but may be issued semiannually or annually at
Customer's discretion. Each such purchase order (i) shall be paid in full prior
to any shipment being made for product ordered therein, or (ii) shall be
accompanied by an irrevocable standby letter of credit in the form attached
hereto as Exhibit "C", or such other form as is agreed by the parties in
writing, issued by a Canadian Bank. Customer agrees that Nortel Networks may
make a demand under such letter of credit in respect of any payment not made
within 30 days of invoice at any time from and after such 30 days during the
term of such letter of credit.

Propietary and Confidential Information                                        1

<PAGE>

China Broadband Corporation                                     NORTEL
                                                                  NETWORKS
PLA Supplement Number 1
--------------------------------------------------------------------------------

7. ACCOUNT TEAM

Nortel Networks will assign as account team in both North America and China to
work closely with Customer to implement the business plan, assist Customer with
marketing programs, introductions and participation in mutually agreed to trade
shows, special events such as the Lighting Ceremonies etc.

8. AUTHORITY

China Broadband Corporation warrants that it has the authority to bind big Sky
and SHBS and guarantees the performance by Big Sky and SHBS of all of their
obligations specified in the PLA and this Supplement Number 1.

CHINA BROADBAND CORPORATION

By:/s/MATT HEYSEL
   -------------------
Name: Matt Heysel
     -----------------
Title: Chairman & CEO
      ----------------
Date: Jan. 23, 2001
      ----------------

NORTEL NETWORKS LIMITED

By:/s/RICHARD DUGAL
   -------------------
Name: Richard Dugal
     -----------------
Title: Region Director
      ----------------
Date: Jan. 24, 2001
      ----------------

Propietary and Confidential Information                                        2

<PAGE>

<TABLE>
<CAPTION>

China Broadband Corporation                                     NORTEL
                                                                  NETWORKS
PLA Supplement Number 1
--------------------------------------------------------------------------------

                                  EXHIBIT "A"

MODEL                   DESCRIPTION                                       QTY           LIST US$        EXT
-------------           ----------------------------------------------  -------         --------      -------
<S>                     <C>                                             <C>             <C>           <C>
DE3801E02               CMTS-1000                                       *               *             *
DE3804031               Receiver Card                                   *               *             *
ARSVS01031              CPS-2000 V1.1                                   *               *             *
ARSVS01020              CPS-2000 Software Kit V1.1                      *               *             *
ARSVS01016              CPS-2000 Documentation                          *               *             *
DE3810001               SNMPC 4.2 Software                              *               *             *
DE3810004               On Net Server Software Arris                    *               *             *
DE3313001               LCn Software Arris                              *               *             *
ARCD21522               Cable Modem, Ethernet (Revised 9-14)            *               *             *
AL2012F14               BayStack 450-24T Switch                         *               *             *
DS1410005-1.0           Optivity Campus NMS 702 Network Management      *               *             *
NTJT55AH                Australia Power Cord                            *               *             *
NTJT02FA                BSN-5000 System - 10G                           *               *             *
NTJT16AA                Slot Cover                                      *               *             *
NTJT29CA                Sub Svc Card + 4xSub Svc Module no encryption   *               *             *
NTJT36CA                8xFE(UTPS)                                      *               *             *
NTJT60BA                SW - ISOS Software Release 2.0                  *               *             *
NTJT63AA                SW - ISOS - Aggregation - 1000 users            *               *             *
NTJT64AA                SW - ISOS - Residential Firewalls - 1000 users  *               *             *
NTJT68AA                SW - ISOS - Interdomain Routing (BG P-4)        *               *             *
NTJTB0BA                SW - SC5- Entry - 2000 subscribers              *               *             *
NTJT878A                SW - SC5 Server for ISOS 2.0 - Domain Tier      *               *             *
NTJT50AA                AC Power Shelf                                  *               *             *
NTJT51AA                AC Power Module                                 *               *             *
NTJT52AA                Status Cable                                    *               *             *
NTJT90BA                Perf Pak                                        *               *             *
                                                                        TOTAL                         *

<FN>
* - Information has been omitted and has been filed separately with the United
    States Securities and Exchange Commission pursuant to an application for
    confidential treatment under Rule 406 of the Securities Exchange Act of
    1933, as amended.
</FN>

</TABLE>

PROPRIETARY AND CONFIDENTIAL INFORMATION                                       3

<PAGE>

China Broadband Corporation                                     NORTEL
                                                                  NETWORKS
PLA Supplement Number 1
--------------------------------------------------------------------------------

                                  EXHIBIT "B"

For the Term Nortel Networks agrees that the following discounts shall apply to
purchases of the listed Products by Customer:

        o *********
        o *********
        o *********
        o *********
        o *********
        o *********
        o *********

********* - Information has been omitted and has been filed separately with the
            United States Securities and Exchange Commission pursuant to an
            application for confidential treatment under Rule 406 of the
            Securities Exchange Act of 1933, as amended.

PROPRIETARY AND CONFIDENTAL INFORMATION                                        4NOTE CANCELLATION AGREEMENT

         This Note Cancellation Agreement ("AGREEMENT") is entered into as of
July 20, 2001, between Canaccord International Ltd. (the "RELEASOR") and China
Broadband Corp., a Nevada corporation ("RELEASEE").

                                    RECITALS

         WHEREAS, Releasor has been engaged by the Releasee as a financial
advisor;

         WHEREAS, Releasor has negotiated with SoftNet Systems, Inc. to acquire
a Promissory Note dated September 29, 2000, in the principal amount of
US$1,700,000, due September 30, 2001, with interest payable at maturity at the
rate of 8% per annum ("Note");

         WHEREAS, Releasee is "Maker" and Releasor is anticipated to be the
"Holder" of the Note on or about July 20, 2001; and

         B.       WHEREAS, Releasor and Releasee each desire to cancel the Note
upon the terms and conditions described herein.

                                    AGREEMENT

         NOW, THEREFORE, the parties agree as follows:

1.       CANCELLATION OF NOTE AND RELEASE. Subject to the terms and conditions
set forth herein, Releasor agrees to deliver to Releasee at Closing (defined
below) the Note marked across its face "CANCELLED" and upon such delivery
thereby shall forever release and discharge Releasee of any and all of its
obligations under the Note, including any obligation to pay principal and
interest.

2.       PAYMENT IN FULL SATISFACTION AND DISCHARGE OF NOTE.  Upon closing
(defined below) Releasee agrees to pay Releasor the following consideration
("CANCELLATION PAYMENT"):

         (a) in cash, official bank check or wire transfer an amount equal to
the accrued interest under the Note at the date of Closing ("CANCELLATION
PAYMENT"); and

         (b) a Warrant, in substantially the form attached hereto as Exhibit A
("WARRANT"), exercisable to acquire 500,000 shares of the Releasee's common
stock at a price per share equal to the average of the closing ask and bid
prices for the Corporation's common stock for the five days preceding the
Closing Date, commencing on the Closing Date and ending at 5:00 p.m., New York
Time, on the second anniversary of the Closing Date.

         THE WARRANT, AND ALL SHARES OF CAPITAL STOCK ISSUABLE THEREUNDER, HAVE
         NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
         AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND MAY
         NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE
         DISTRIBUTED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION

<PAGE>

         STATEMENT FILED UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE
         SECURITIES LAWS OR EXEMPTIONS THEREFROM, SUCH EXEMPTIONS, AT THE OPTION
         OF THE COMPANY, TO BE EVIDENCED BY AN OPINION OF COUNSEL SATISFACTORY
         TO THE COMPANY.

3.       CLOSING.

         3.1 CLOSING; CLOSING DATE. The closing of the transactions contemplated
hereby shall be effective as of the delivery of he closing deliveries described
below ("CLOSING") at the offices of Koffman Kaleff, Vancouver BC. at 11:00 a.m.
on July 20, 2001, or at such time and place as the parties mutually agree
("CLOSING DATE").

         3.2      CLOSING DELIVERIES.  At Closing:

                  (a) Releasor shall deliver to Releasee the Note marked across
                      its face "CANCELLED"; and
                  (b) Releasee shall deliver to Releasor the Cancellation
                      Payment and the Warrant.

4.       WAIVERS. No action taken pursuant to this Agreement, including any
investigation by or on behalf of any party, will be deemed to constitute a
waiver by the party taking such action, or compliance with any representation,
warranty, covenant or agreement contained herein. The waiver by any party hereto
of a breach of any provision of this Agreement shall not operate or be construed
as a waiver of any subsequent breach. The waiver by any party hereto at or
before the Closing Date of any condition to its obligations hereunder which is
not fulfilled shall preclude such party from seeking redress from the other
party hereto for breach of any representations, warranty, covenant or agreement
contained in this Agreement.

5.       BINDING EFFECT: BENEFITS. This Agreement shall inure to the benefit of
the parties hereto and shall be binding upon the parties hereto and their
respective successors and assigns, heirs and legal representatives. Except as
otherwise set forth herein, nothing in this Agreement, express or implied, is
intended to confer on any person other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under of by reason of this Agreement.

6.       GOVERNING LAW; JURISDICTION; VENUE; REMEDIES;INDEPENDENT LEGAL COUNSEL.
This Agreement shall be interpreted and construed as to both validity and
performance and enforced in accordance with and governed by the laws of the
Province of Alberta, without giving effect to the choice of law principles
thereof. The parties agree that any action hereunder will be held exclusively in
the courts in the Province of Alberta. The parties acknowledge that remedies at
law, including monetary damages, may be inadequate to remedy a breach of certain
material terms herein, including Releasor's delivery of the Note, and the
parties agree that equitable remedies may be necessary to enforce such terms and
covenants, including specific performance. Releasor and Releasee acknowledge
that the terms of this Agreement have been negotiated by

<PAGE>

the parties hereto and each of them has had a full opportunity to receive
independent business, tax and legal counsel with respect to this Agreement and
the transactions contemplated herein.

7.       COUNTERPARTS.  This Agreement may be executed in counterpart originals,
each of which shall constitute an executed original and together shall
constitute a fully-executed document.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first written above.

RELEASOR:                                    RELEASEE:

Canaccord International Ltd.                 China Broadband Corp.

By:  _________________________               By:  /s/MATTHEW HEYSEL
Its: _________________________               Its: Chairman and Chief Executive
                                                  Officer

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