Document:

Sale and Purchase Agreement

    EXHIBIT
      10.1

    

    DATE:
      30 MARCH 2006

    

    

    WOO
      YUEN YU

    (as
      Vendor)

    

    AND
      

    

    TECH
      TEAM INVESTMENT LIMITED

    (as
      Purchaser)

    

    AND
      

    

    MICHELLE
      SIU KWAN LAM AND

    JOSEPH
      SUI KEI LAM

    (as
      Guarantors)

     

     

    
      
        

      

       

    

    SALE
      AND PURCHASE AGREEMENT 

    FOR
      

    6
      SHARES OF US$1 EACH IN

    LIGHTSCAPE
      HOLDING LTD.

     

      
        

      

       

       

       

       

       

       

        
          

        

      

       

      

    

     

    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: 53667-00002/NKA/CWF

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    I
      N D E X

    

      
        	
                Clause
                  No. 

              	
                Heading

              	
                Page
                  No.

              
	 	 	 
	
                1.
                  

              	
                INTERPRETATION

              	
                1

              
	
                2.
                  

              	
                SALE
                  AND PURCHASE OF THE SALE SHARES

              	
                4

              
	
                3.
                  

              	
                CONDITIONS

              	
                 4

              
	
                4.
                  

              	
                CONSIDERATION

              	
                5

              
	
                5.
                  

              	
                COMPLETION

              	
                5

              
	
                6.
                  

              	
                VENDOR
                  WARRANTIES AND INDEMNITIES

              	
                8

              
	
                7.
                  

              	
                PURCHASER
                  WARRANTIES AND OTHER UNDERTAKINGS

              	
                9

              
	
                8.
                  

              	
                PROFIT
                  GUARANTEE

              	
                10

              
	
                9.
                  

              	
                COMPLIANCE
                  WITH US SECURITIES LEGISLATION

              	
                11

              
	
                10.
                  

              	
                CONDUCT
                  OF BUSINESS PENDING COMPLETION

              	
                12

              
	
                12.
                  

              	
                ACCESS
                  TO INFORMATION

              	
                16

              
	
                13.
                  

              	
                FURTHER
                  ASSURANCE

              	
                16

              
	
                14.
                  

              	
                GUARANTEES

              	
                16

              
	
                15.
                  

              	
                CONFIDENTIALITY
                  AND ANNOUNCEMENTS

              	
                17

              
	
                16.
                  

              	
                TIME
                  AND WAIVER

              	
                17

              
	
                17.
                  

              	
                INVALIDITY

              	
                17

              
	
                18.
                  

              	
                AMENDMENTS

              	
                18

              
	
                19.
                  

              	
                NOTICES

              	
                18

              
	
                20.
                  

              	
                ASSIGNMENT

              	
                19

              
	
                21.
                  

              	
                ENTIRE
                  AGREEMENT

              	
                19

              
	
                22.
                  

              	
                COSTS

              	
                19

              
	
                23.
                  

              	
                COUNTERPART

              	
                19

              
	
                24.
                  

              	
                LEGAL
                  REPRESENTATION

              	
                19

              
	
                25.
                  

              	
                GOVERNING
                  LAW, JURISDICTION AND PROCESS AGENTS

              	
                19

              
	 	 	 
	
                Schedule

              	 	 
	 	 	 
	
                1
                  

              	
                DETAILS
                  OF THE COMPANY

              	
                20

              
	
                2
                  

              	
                DETAILS
                  OF THE SUBSIDIARY

              	
                21

              
	
                3
                  

              	
                VENDOR
                  WARRANTIES

              	
                22

              
	
                4
                  

              	
                TAX
                  INDEMNITY

              	
                33

              
	
                5
                  

              	
                NON-U.S.
                  SHAREHOLDER CERTIFICATE

              	
                34

              
	
                6
                  

              	
                EMPLOYMENT
                  AGREEMENTS

              	
                35

              
	 	 	
                 

              
	
                EXECUTION

              	
                36

              

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    THIS
      AGREEMENT is dated 30 March 2006

    

    BETWEEN:

    

    
      	(1)	
              WOO
                YUEN YU, holder
                of Hong Kong Identity Card No. B977792(5) and whose correspondence
                address
                is at Room 1112, 11/F., Cammer Commercial Building, 30 Cameron Road,
                Tsimshatsui, Kowloon, Hong Kong (the “Vendor”);

            

    

    

    
      	
              (2)

            	
              TECH
                TEAM INVESTMENT LIMITED,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at Sea Meadow House, Blackburne Highway, Road Town,
                Tortola, British Virgin Islands (the “Purchaser”);
                and

            

    

    

    
      	(3)	
              JOSEPH
                SUI KEI LAM,
                holder of Hong Kong Identity Card No. C486788(0) and whose
                correspondence address is at Level 25, Bank of China Tower, 1 Garden
                Road,
                Central, Hong Kong
                together with MICHELLE
                SIU KWAN LAM,
                holder of US Passport No. 701351369 and whose correspondence address
                is at
                Level 25, Bank of China Tower, 1 Garden Road, Central, Hong Kong
                (collectively the “Guarantors”).

            

    

    

    WHEREAS:

    

    
      	(A)	
              Lightscape
                Holding Ltd. (the “Company”)
                is a company incorporated in the British Virgin Islands with limited
                liability and has an authorised share capital of US$50,000 divided
                into
                50,000 shares (the “Shares”)
                of US$1.00 each, of which 10 Shares have been issued and allotted
                and are
                fully paid. The particulars of the Company and its subsidiary are
                set out
                in Schedule 1 and Schedule 2.

            

    

    

    
      	(B)	
              As
                at the date of this Agreement, the Vendor is the legal and beneficial
                owner of the Sale Shares, which shall be equivalent to 60% of the
                issued
                share capital of the Company upon
                Completion.

            

    

    

    
      	(C)	
              The
                Vendor has agreed to sell and the Purchaser has agreed to purchase
                the
                Sale Shares subject to and upon the terms and conditions of this
                Agreement.

            

    

    

    
      	
              (D)

            	
              The
                Purchaser requires the Guarantors, who are related to or associated
                with
                the Vendor and who have requested the Purchaser to enter into this
                Agreement, to give such covenants, undertakings and warranties together
                with the Vendor and to jointly and severally guarantee the performance
                by
                the Vendor of its obligation under this Agreement as are set out
                herein as
                a condition to the Purchaser’s entry into this
                Agreement.

            

    

    

    

    NOW
      IT IS HEREBY AGREED AS FOLLOWS:

    

    
      	
              1.

            	
              INTERPRETATION

            

    

    

    
      	1.1	
              In
                this Agreement (including the Recitals and Schedules), unless the
                context
                otherwise requires or permits, the following words and expressions
                shall
                have the meanings ascribed to each of them respectively
                below:

            

    

     

    
      	 	
              “Business
                Day”

            	
              a
                day (other than Saturday and days on which a tropical cyclone warning
                No.
                8 or above or a “black
                rainstorm warning signal”
                is hoisted in Hong Kong at any time between 9:00 a.m. and 5:00 p.m.)
                on
                which banks are open in Hong Kong and for general banking
                business;

            
	 	 	 
	 	
              “Completion”

            	
              completion
                of the sale and purchase of the Sale Shares in accordance with the
                terms
                and conditions of this Agreement;

            
	 	 	 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              “Completion
                Date”

            	
              any
                date falling within three Business Days after all the conditions
                specified
                in Clause 3.2 have been fulfilled (or waived) or such other date
                as the
                Vendor and the Purchaser may agree in writing prior to Completion
                and
                where the context otherwise requires, the date of which Completion
                takes
                place;

            
	 	 	 
	 	
              “Consideration
                Shares”

            	
              3,000,000
                new common shares of US$0.001 each in the share capital of GIS, to
                be
                issued and allotted to the Vendor for the settlement of the consideration
                of the sale of the Sale Shares pursuant to Clause 4.1;

            
	 	 	 
	 	
              “Employment Agreement”

            	
              the
                employment agreement between each of the Key Employees and Luminous
                LED
                Technologies Limited, in substantially the form as set out in Schedule
                6;

            
	 	 	 
	 	
              “Encumbrance”

            	
              any
                mortgage, charge, pledge, lien (otherwise than arising by statute
                or
                operation of law), hypothecation or other encumbrance, priority or
                security interest, deferred purchase, title retention, leasing,
                sale-and-repurchase or sale-and-leaseback arrangement whatsoever
                over or
                in any property, assets or rights of whatsoever nature and includes
                any
                agreement for any of the same and “Encumber”
                shall be construed accordingly;

            
	 	 	 
	 	
              “GIS”

            	
              Global
                Innovative Systems Inc., a company incorporated under the laws of
                the
                State of Nevada, the United States and the common shares of which
                are
                quoted on OTCBB;

            
	 	 	 
	 	
              “Group”

            	
              the
                Company and its subsidiaries and “member
                of the Group”
                shall be construed accordingly;

            
	 	 	 
	 	
              “HK$”

            	
              Hong
                Kong dollars;

            
	 	 	 
	 	
              “Hong
                Kong”

            	
              the
                Hong Kong Special Administrative Region of the PRC;

            
	 	 	 
	 	
              “Independent
                Accountants”

            	
              an
                independent firm of accountants which is acceptable to the Purchaser,
                appointed by the Company for the purpose of Clause 8;

            
	 	 	 
	 	
              “Key
                Employees”

            	
              each
                of the Guarantors and Chan Albert Yee Tat;

            
	 	 	 
	 	
              “Management
                Accounts”

            	
              the
                unaudited pro forma combined balance sheet of the Group as at the
                Management Accounts Date and the unaudited pro forma combined profit
                and
                loss accounts of the Group for the period commenced from the date
                of the
                establishment of the Company and ended the Management Accounts Date
                including the directors’ report thereon (if any) and the notes thereto,
                copies of all of which are annexed hereto and initialed by the parties
                hereto for the purpose of identification;

            
	 	 	 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              “Management
                Accounts Date”

            	
              28
                February 2006;

            
	 	 	 
	 	
              “Non-U.S.
                Shareholder Certificate”

            	
              the
                certificate to be executed by the Vendor in substantially the form
                as set
                out in Schedule 5;

            
	 	 	 
	 	
              “OTCBB”

            	
              acronym
                for The OTC Bulletin Board, an electronic quotation system that displays
                real-time quotes, last-sale prices, and volume information
                over-the-counter securities that are not listed on The Nasdaq Stock
                Market
                or a national securities exchange in the US;

            
	 	 	 
	 	
              “PRC”

            	
              the
                People’s Republic of China;

            
	 	 	 
	 	
              “Purchaser
                Warranties”

            	
              representations,
                undertakings and warranties set out in Clause 7;

            
	 	 	 
	 	
              “Sale
                Shares”

            	
              six
                (6) Shares, which shall be equivalent to 60% of the issued share
                capital
                of the Company upon Completion, to be sold by the Vendor to the Purchaser
                pursuant to this Agreement;

            
	 	 	 
	 	
              “Tax
                Indemnity”

            	
              the
                deed of indemnity to be made between the Vendor, the Company and
                the
                Purchaser, in substantially the form as set out in Schedule
                4;

            
	 	 	 
	 	
              “Taxation”

            	
              all
                forms of taxation including overseas taxation and all forms of profits
                tax, interest tax, estate duty and stamp duty and all levies, imposts,
                duties, charges, fees, deductions and withholdings whatsoever charged
                or
                imposed by any statutory, governmental state, provincial, local government
                or municipal authority whatsoever and the expression “Tax”
                shall be construed accordingly;

            
	 	 	 
	 	
              “this
                Agreement”

            	
              this
                agreement for the sale and purchase of the Sale Shares, as amended
                from
                time to time;

            
	 	 	 
	 	
              “Vendor Warranties”

            	
              representations,
                undertakings and warranties set out in Clause 6 and Schedule
                3;

            
	 	 	 
	 	
              “US”

            	
              the
                United States of America; and

            
	 	 	 
	 	
              “US$”

            	
              United
                States of America dollars.

            

    

    

    
      	1.2	
              The
                headings of this Agreement are inserted for convenience only and
                shall be
                ignored in construing this Agreement. Unless the context otherwise
                requires, references in this Agreement to the singular shall be deemed
                to
                include references to the plural and vice versa; and references to
                one
                gender shall include all genders and references to any person shall
                include an individual, firm, body corporate or
                unincorporate.

            

    

    

    
      	1.3	
              References
                to any statute or statutory provision shall include any statute or
                statutory provision which amends or replaces or has amended or replaced
                it
                and shall include any subordinate legislation made under the relevant
                statute.

            

    

    

    
      	
              1.4

            	
              References
                in this Agreement to Clauses and Schedules are references to clauses
                of
                and schedules to this Agreement.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              1.5

            	
              The
                Schedules and Recitals shall form part of this
                Agreement.

            

    

    

    
      	1.6	
              Reference
                to
                a “subsidiary”
                shall be construed in accordance with section 2 of the Companies
                Ordinance
                (Chapter 32 of Laws of Hong Kong).

            

    

    

    
      	
              2.

            	
              SALE
                AND PURCHASE OF THE SALE
                SHARES

            

    

    

    
      	2.1	
              Subject
                to and upon the terms and conditions of this Agreement, the Vendor
                shall
                as legal and beneficial owner sell and the Purchaser shall purchase,
                the
                Sale Shares free from all Encumbrances together with all rights now
                and
                hereafter attaching thereto including but not limited to the right
                to all
                dividends and other distribution which may be paid, declared or made
                in
                respect thereof at any time on or after the date of this
                Agreement.

            

    

    

    
      	2.2	
              The
                Vendor represents and warrants that there are no pre-emption rights
                and
                any other restrictions on the transfer
                in
                relation to the Sale Shares, whether conferred by the memorandum
                and articles of association of the Company or
                otherwise.

            

    

    

    
      	2.3	
              The
                Purchaser shall not be obliged to (but may) complete the purchase
                of any
                of the Sale Shares unless the sale and purchase of all the Sale Shares
                is
                completed simultaneously in accordance with this
                Agreement.

            

    

    

    
      	
              3.

            	
              CONDITIONS

            

    

    

    
      	3.1	
              The
                Vendor shall give and shall procure that the Purchaser and/or any
                persons
                authorised by it in writing will be given such access to the premises
                and
                all books, documents, title deeds, records, returns, approvals,
                correspondence and accounts of the Group and all such information
                relating
                to the Group as may be reasonably requested by or on behalf of the
                Purchaser to undertake and conduct a full due diligence (including
                but
                without limitation, in all legal, financial and commercial aspects)
                against the Group and be permitted to take copies of any such books,
                documents, title deeds, records and accounts and that the directors
                and
                employees of the Group shall be instructed to give promptly all such
                information and explanations to any such persons as aforesaid as
                may be
                requested by it or them
                within fourteen (14) Business Days from the date of this
                Agreement.
                For the avoidance of doubt, such due diligence shall not limit or
                otherwise qualify in any way the Vendor Warranties.

            

    

    

    
      	3.2	
              Completion
                is conditional upon:

            

    

    

    
      	
            	(1)	
              the
                Purchaser being satisfied with the results of the due diligence review
                to
                be conducted under Clause 3.1;

            

    

    

    
      	
            	(2)	
              the
                Purchaser having received from firm(s) of lawyers qualified to practise
                laws in Hong Kong and/or the PRC acceptable to and as required by
                the
                Purchaser, legal opinion(s) confirming, inter alia, (i) relevant
                members
                of the Group in Hong Kong or the PRC are legally established and
                continued
                effectively; (ii) the Company’s title in the equity interest, direct or
                indirect, in such members of the Group is valid and legally enforceable;
                and (iii) members of the Group have obtained all necessary approvals
                and
                licenses for their then existing operation and
                businesses;

            

    

    

    
      	
            	(3)	
              GIS
                having received all of the regulatory, stockholder and other third
                party
                approvals and authorizations necessary to consummate the transactions
                contemplated hereunder;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	
              (4)

            	
              no
                event having occurred which suggests that there has been a breach
                of any
                of the Vendor Warranties that is material in the context of the sale
                and
                purchase of the Sale Shares; 

            

    

    

    
      	
            	(5)	
              the
                listing of the issued shares of GIS on OTCBB not being revoked or
                withdrawn, or, if applicable, suspended for more than ten (10) consecutive
                Business Days (excluding any suspension pending the clearance or
                issue of
                the announcement or circular of GIS in relation to the transactions
                contemplated under this Agreement);
                and

            

    

    

    
      	
            	(6)	
              all
                necessary approvals, consents, authorisations and licences in relation
                to
                the transactions contemplated under this Agreement having been
                obtained.

            

    

    

    
      	3.3	
              The
                Vendor shall use her best endeavours to assist the Purchaser in connection
                with the due diligence review to be conducted under Clause 3.1 and
                procure
                the fulfillment of the conditions set out in Clauses 3.2(1) and (2)
                and,
                in particular, shall procure that all information and documents required
                by the Purchaser (or GIS) pursuant to all applicable rules, codes
                and
                regulations whether in connection with the preparation of all
                announcement, circulars, reports, independent advice or otherwise
                are duly
                given to the Purchaser (or GIS), the Securities and Exchange Commission
                of
                the US and other relevant regulatory authorities. The Purchaser shall
                use
                its reasonable endeavours to procure the fulfillment of the conditions
                set
                out in Clauses 3.2(3), (5) and (6).

            

    

    

    
      	
              3.4

            	
              The
                Purchaser may at any time waive in writing any of the conditions
                set out
                in Clauses 3.2(1), (2), (4) and (6) on such terms as it may in its
                absolute discretion consider appropriate. If any of the conditions
                set out
                in Clause 3.2 has not been fulfilled (or, as the case may be, waived
                by
                the Purchaser) on or before 12:00 noon on 30 April 2006 or such other
                date
                as the Purchaser may agree, this Agreement shall lapse and determine
                (other than Clauses 15, 19, 22, 24 and 25 which shall continue to
                have
                full force and effect) and neither party hereto shall have any obligations
                and liabilities hereunder save for any antecedent breaches of the
                terms
                hereof.

            

    

    

    
      	3.5	
              The
                Vendor shall, forthwith upon the fulfillment of the conditions set
                out in
                Clauses 3.2(1) and (2), inform the Purchaser of that fact and provide
                such
                documents as the Purchaser may require evidencing the fulfillment
                of such
                conditions.

            

    

    

    
      	3.6	
              Subject
                to the receipt of the notification from the Vendor in accordance
                with
                Clause 3.5, the Purchaser shall confirm in writing to the Vendor
                that all
                the conditions set out in Clause 3.2 have either been fulfilled to
                the
                satisfaction of the Purchaser or waived by the Purchaser, as the
                case may
                be.

            

    

    

    
      	
              4.

            	
              CONSIDERATION

            

    

    

    
      	4.1	
              The
                consideration for the sale and purchase of the Sale Shares shall
                be an
                aggregate amount of US$3,750,000, which shall be satisfied by the
                allotment and issue of the Consideration Shares by GIS to the Vendor,
                valued at US$1.25 per each Consideration
                Share.

            

    

    

    
      	4.2	
              The
                Consideration Shares to be issued and allotted to the Vendor as
                consideration for the Sale Shares pursuant to Clause 4.1 shall rank
                pari
                passu among themselves and with all other common shares of GIS then
                in
                issue.

            

    

    

    
      	
              5.

            	
              COMPLETION

            

    

    

    
      	5.1	
              Upon
                compliance with or fulfillment of all the conditions set out in Clause
                3.2, Completion shall take place at the offices of the Purchaser
                or such
                other place as the parties shall determine at 4:00 p.m. on the Completion
                Date when all the acts and requirements set out in this Clause 5
                shall be
                complied with (except that any of such acts and requirements may
                be waived
                by the party not in default of its obligations hereunder, PROVIDED
                THAT
                such waiver shall not prejudice any of the rights which it or any
                other
                party may have under this
                Agreement).

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              5.2

            	
              At
                Completion, the Vendor shall deliver or procure the delivery to the
                Purchaser of all the following:

            

    

    

    
      	
            	(1)	
              copy,
                certified by a director of the Company as true and complete and that
                the
                resolutions therein are subsisting and have not been amended or revoked
                as
                at the Completion Date, of the resolutions in such form to the
                satisfaction of the Purchaser passed by the directors of the Company
                and
                its subsidiaries (as appropriate) approving the following
                matters:

            

    

    

    
      	
            	(i)	
              transfer
                of the Sale Shares to the Purchaser (or its nominee(s)) and the
                registration of such transfer subject to the relevant instrument
                of
                transfer being duly presented for
                registration;

            

    

    

    
      	
            	(ii)	
              the
                appointments of up to three (3) nominees of the Purchaser as directors
                of
                the Company with effect from the Completion
                Date;

            

    

    

    
      	
            	(iii)	
              the
                appointment of up to one (1) nominee of the Purchaser as director
                of each
                subsidiary of the Company with effect from the Completion
                Date;

            

    

    

    
      	
            	(iv)	
              if
                so required by the Purchaser, accepting the resignation of the company
                secretary of the Company and the appointment of such person to the
                company
                secretary as the Purchaser may nominate by not less than three Business
                Days’ notice before Completion;

            

    

    

    
      	
            	(v)	
              the
                revocation of all existing bank mandates of the Company and its
                subsidiaries and the appointment of such persons as the Purchaser
                may
                nominate for the operation of the Company’s and the subsidiaries’ bank
                accounts; and

            

    

    

    
      	
            	(vi)	
              the
                entering into by the Company of and authorizing any one director
                thereof
                to execute the same on its behalf the Tax
                Indemnity;

            

    

    

    
      	
            	(2)	
              valid
                share certificate(s) in respect of the Sale
                Shares;

            

    

    

    
      	
            	(3)	
              duly
                executed instrument(s) of transfer of the Sale Shares in favour of
                the
                Purchaser (or its nominee(s));

            

    

    

    
      	
            	(4)	
              an
                application, in such form as the Purchaser may reasonably prescribe,
                for
                the number of the Consideration Shares to be issued and allotted
                to the
                Vendor (or her nominee(s));

            

    

    

    
      	
            	(5)	
              such
                other documents as may be required to give to the Purchaser good
                title to
                the Sale Shares and to enable the Purchaser (or its nominee(s)) to
                become
                the registered owner thereof; 

            

    

    

    
      	
            	(6)	
              a
                certificate issued by each of the Vendor and the Guarantors confirming
                that she/he is not aware of any event which is in breach or inconsistent
                with any of the Vendor Warranties;

            

    

    

    
      	
            	(7)	
              the
                Tax Indemnity duly executed by the Vendor, the Guarantors and the
                Company;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	(8)	
              the
                Employment Agreements duly executed by the Key Employees and the
                Company;

            

    

    

    
      	
            	(9)	
              the
                Non-U.S. Shareholder Certificate duly executed by the Vendor (or
                her
                nominee(s));

            

    

    

    
      
        
          	
                	(10)       
                   (i)	
                  copies,
                    certified by a director of the Company as true and complete,
                    of all
                    statutory records and minute books (which shall be duly written
                    up to date
                    as at Completion) including an original copy of the memorandum
                    and
                    articles of association or other equivalent constitutional documents,
                    certificate of incorporation and business registration certificates,
                    business licence, governmental approval letters and certificates
                    (if any)
                    and other statutory records of each Group
                    Company;

                

        

      

    

    

    
      	
            	(ii)	
              copies,
                certified by a director of the Company as true and complete, of all
                tax
                returns and assessments each Group Company, if any, (receipted where
                the
                due dates for payment fell on or before the Completion Date);
                

            

    

    

    
      	
            	(iii)	
              copies
                of all correspondence, if any, with its lawyers, accountants, tax
                or
                revenue departments, all other documents and correspondence, if any,
                relating to the business affairs of each Group Company; and all title
                deeds, evidence of ownership and documents relating to assets owned
                by
                each Group Company,

            

    

     

    or
      written authorities in favour of the Purchaser for the collection of such
      documents.

    

    
      	5.3	
              Against
                compliance and fulfillment of all acts and the requirements set out
                in
                Clause 5.2, the Purchaser shall deliver to the
                Vendor:

            

    

    

    
      	
            	(1)	
              duly
                executed instrument(s) of transfer in respect of the Sale
                Shares;

            

    

    

    
      	
            	(2)	
              copy,
                certified by a director of the Purchaser as true and complete, of
                the
                resolutions in such form to the satisfaction of the Vendor passed
                by the
                directors of the Purchaser or GIS (where applicable) approving this
                Agreement and other documents necessary for the purpose of effecting
                this
                transaction and authorising a person or persons to execute the same
                (with
                seal, where appropriate) for and on its behalf, the issue and allotment
                of
                the Consideration Shares in accordance with the provisions of Clause
                4 and
                enter the name of the Vendor (or its nominee(s)) as holders thereof
                on its
                register of members;

            

    

    

    
      	
            	(3)	
              deliver
                to the Vendor duly issued definitive certificate in board lots (as
                far as
                is practicable) for quotation on OTCBB for the Consideration Shares
                issued
                and allotted to the Vendor under Clause
                4.1;

            

    

    

    
      	
            	(4)	
              a
                certificate issued by the Purchaser confirming that it is not aware
                of any
                event which is in breach or inconsistent with any of the Purchaser
                Warranties; and

            

    

    

    
      	
            	(5)	
              the
                Tax Indemnity duly executed by the Purchaser;
                and

            

    

    

    
      	5.4	
              In
                the event that the Vendor shall fail to do anything required to be
                done by
                her under Clause 5.2, without prejudice to any other right or remedy
                available to the Purchaser, the Purchaser
                may:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (1)

            	
              defer
                Completion to a day not more than twenty-one (21) Business Days after
                the
                Completion Date (and so that provisions of this Clause 5.4(1) shall
                apply
                to Completion as so deferred); or

            

    

    

    
      	 	
              (2)

            	
              proceed
                to Completion so far as practicable but without prejudice to the
                Purchaser’s right to the extent that the Vendor shall not have complied
                with its obligations hereunder; or

            

    

    

    
      	 	
              (3)

            	
              rescind
                this Agreement (other than Clauses 15, 19, 22, 24 and 25 which shall
                continue to have full force and effect) in which case none of the
                parties
                hereto shall have any claim of any nature whatsoever against any
                of the
                other parties under this Agreement (save for any rights and liabilities
                of
                the parties which have accrued prior to
                rescission).

            

    

    

    
      	5.5	
              In
                the event that the Purchaser shall fail to do anything required to
                be done
                by it under Clause 5.3, without prejudice to any other right or remedy
                available to the Vendor, the Vendor
                may:

            

    

    

    
      	 	
              (1)

            	
              defer
                Completion to a day not more than twenty-one (21) Business Days after
                the
                Completion Date (and so that provisions of this Clause 5.5(1) shall
                apply
                to Completion as so deferred); or

            

    

    

    
      	 	
              (2)

            	
              proceed
                to Completion so far as practicable but without prejudice to the
                Vendor’s
                right to the extent that the Purchaser shall not have complied with
                its
                obligations hereunder; or

            

    

    

    
      	 	
              (3)

            	
              rescind
                this Agreement (other than Clauses 15, 19, 22, 24 and 25 which shall
                continue to have full force and effect) in which case none of the
                parties
                hereto shall have any claim of any nature whatsoever against any
                of the
                other parties under this Agreement (save for any rights and liabilities
                of
                the parties which have accrued prior to
                rescission).

            

    

    

    
      	
              6.

            	
              VENDOR
                WARRANTIES AND
                INDEMNITIES

            

    

    

    
      	6.1	
              Each
                of the Vendor and the Guarantors hereby represents, warrants and
                undertakes to the Purchaser and its successors and assigns that the
                Vendor
                Warranties are true, correct and accurate in all material respects
                on the
                date of this Agreement and will continue to be so up to and including
                the
                Completion Date with reference to the facts and circumstances from
                time to
                time applying.

            

    

    

    
      	6.2	
              Each
                of the Vendor Warranties is without prejudice to any other Vendor
                Warranty
                and, except where expressly or otherwise stated, no provision in
                any
                Vendor Warranty shall govern or limit the extent or application of
                any
                other provision in any Vendor Warranty. Each of the Vendor and the
                Guarantors hereby agrees that the Purchaser shall treat each of the
                Vendor
                Warranties as a condition of this
                Agreement.

            

    

    

    
      	6.3	
              Each
                of the Vendor and the Guarantors hereby agrees to fully indemnify
                and
                keeps the Purchaser and its successors and assigns fully indemnified
                on
                demand from and against any depletion of assets, all losses, costs
                and
                expenses (including legal expenses) which the Purchaser and its successors
                and assigns may incur or sustain from or in consequence of any of
                the
                Vendor Warranties not being correct or fully complied with. This
                indemnity
                shall be without prejudice to any of the rights and remedies of the
                Purchaser and its successors and assigns in relation to any such
                breach of
                Vendor Warranties and all such rights and remedies are hereby expressly
                reserved.

            

    

    

    
      	6.4	
              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 and:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	
              (1)

            	
              the
                effect thereof is that the value of some assets of the Group including,
                without limitation, the value of any asset stated in the Management
                Accounts being less than its value would have been had there been
                no such
                breach or the matter warranted were as warranted;
                or

            

    

    

    
      	
            	(2)	
              the
                Group has incurred or is under any liability or contingent liability
                which
                would not have been incurred if such matter were as represented or
                warranted or the relevant undertaking were performed;
                or

            

    

    

    
      	
            	(3)	
              the
                effect thereof is that the amount of a liability of the Group is
                higher
                than its amount would have been had there been no such breach or
                the
                matter warranted were as warranted,

            

    

    

    then,
      without prejudice to any other provisions of this Agreement, each of the Vendor
      and the Guarantors shall indemnify the Purchaser 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 the Purchaser may sustain, suffer,
      or incur as a result of any of the foregoing and each of the Vendor and the
      Guarantors shall pay to the Purchaser on demand the full amount of any such
      loss
      as aforesaid in immediately available funds.

    

      
        	
                6.5

              	
                The
                  Vendor Warranties shall survive Completion and the rights and remedies
                  of
                  the Purchaser in respect of any breach of the Vendor Warranties
                  shall not
                  be affected by Completion or by the Purchaser rescinding, or failing
                  to
                  rescind this Agreement, or 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.

              

      

      

      
        	
                6.6

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

              

      

    

    

    
      	
              6.7

            	
              The
                aggregate amount of the liability of the Vendor and the Guarantors
                in
                respect of any claim for breach of any of the Vendor Warranties or
                to
                indemnify as aforesaid or shall not exceed the aggregate amount of
                the
                consideration payable pursuant to Clause 4 (or the equivalent
                thereof).

            

    

    

    
      	
              6.8

            	
              The
                Purchaser shall reimburse to the Vendor and the Guarantors an amount
                equal
                to any sum paid by the Vendor or any one of the Guarantors in respect
                of a
                claim under the Vendor Warranties or to be indemnified as aforesaid
                which
                is subsequently recovered or paid to the Purchaser or the Company
                by a
                third party.

            

    

    

    
      	
              7.

            	
              PURCHASER
                WARRANTIES AND OTHER
                UNDERTAKINGS

            

    

    

    
      	
              7.1

            	
              The
                Purchaser hereby represents, warrants and undertakes to the Vendor
                and her
                successors and assigns as follows:

            

    

    

    
      	 	
              (1)

            	
              it
                is a wholly owned subsidiary of
                GIS;

            

    

    

    
      	 	
              (2)

            	
              it
                has been duly incorporated and is validly existing under the laws
                of the
                British Virgin Islands and has full power, authority and legal right
                to
                own its assets and carry on its
                business;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (3)

            	
              the
                Consideration Shares represent approximately 9.8% of the common shares
                of
                GIS in issue on the date of this Agreement, and approximately 8.9%
                of the
                common shares of GIS in issue on Completion as enlarged by the issue
                of
                the Consideration Shares; and

            

    

    

    
      	 	
              (4)

            	
              the
                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.

            

    

    

    
      	
              7.2

            	
              The
                Purchaser agrees that the Vendor may treat each of the Purchaser
                Warranties as a condition of this
                Agreement.

            

    

    

    
      	
              7.3

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

            

    

    

    
      	
              7.4

            	
              The
                Purchaser shall be under no liability in respect of a breach of any
                of the
                Purchaser Warranties or to indemnify pursuant to this Agreement unless
                the
                Purchaser shall have received written notice from the Vendor prior
                to the
                date falling on the first anniversary of the Completion Date in respect
                of
                the Purchaser 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 first anniversary of the
                Completion Date unless proceedings in respect thereof shall then
                have been
                commenced against the Purchaser.

            

    

    

    
      	
              7.5

            	
              The
                indemnity provided for under Clause 7.4 is without prejudice to any
                other
                rights and remedies of the Vendor in relation to any breach of any
                of the
                Purchaser Warranties and all other rights and remedies are expressly
                reserved to the Vendor.

            

    

    

    
      	
              7.6

            	
              Each
                of the Purchaser Warranties is without prejudice to any other Purchaser
                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 Agreement or other agreements or indemnities
                shall govern or limit the extent or application of any other provision
                of
                this Agreement or such other
                agreements.

            

    

    

    
      	
              7.7

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

            

    

    

    
      	
              7.8

            	
              The
                Purchaser undertakes to allocate all business in relation to lighting
                technology and lighting consultancy, other than those handled by
                Beijing
                Illumination (Hong Kong) Limited and its group companies, to the
                Company
                or its subsidiary provided that all supply of light sourcing equipment
                products and ancillary products required for the business of the
                Group
                must first be sourced from Beijing Illumination (Hong Kong) Limited
                and
                its group companies.

            

    

    

    
      	
              7.9

            	
              The
                Purchaser undertakes to use its best endeavours to obtain and maintain
                a
                listing for all the Shares issued any stock exchange or securities
                market
                on which the securities are listed or quoted or dealt in within 18
                months
                following Completion. 

            

    

    

    
      	
              8.

            	
              PROFIT
                GUARANTEE

            

    

    

    
      	
              8.1

            	
              In
                consideration of the Purchaser’s agreement to enter into this Agreement,
                each of the Vendor and the Guarantors hereby irrevocably and
                unconditionally guarantees to the Purchaser that the aggregate net
                profit
                after taxation but before extraordinary items of the Group (the
                “Net
                Profit”)
                for the twelve months ending 31 March 2007 as shown in the audited
                consolidated financial statements of the Group ending such date shall
                not
                be less than HK$20,000,000 (the “Guaranteed
                Net Profit”).
                If the Net Profit is less than the Guaranteed Net Profit, then the
                Vendor
                and the Guarantors shall pay to the Purchaser in cash within fourteen
                (14)
                calendar days after the delivery of the audited consolidated financial
                statements of the Group aforesaid an amount calculated as
                follows:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Amount
      payable to the Purchaser = (Guaranteed Net Profit - Net Profit) x
      60%

    

    PROVIDED
      THAT the aforesaid amount shall be rounded up to the nearest whole
      dollar.

    

    
      	
              8.2

            	
              The
                Vendor undertakes to procure that the audited consolidated financial
                statements of the Group shall be prepared by the Company and audited
                by
                the Independent Accountants in accordance with the generally acceptable
                accounting practice, standards and principles of Hong Kong in respect
                of
                the twelve months referred to in Clause 8.1, together with any notes,
                reports or statements included therein or annexed thereto, a copy
                of which
                shall be delivered to the Purchaser for review by not later than
                two (2)
                months following the balance sheet date of the relevant
                period.

            

    

    

    
      	
              9.

            	
              COMPLIANCE
                WITH US SECURITIES
                LEGISLATION

            

    

    

    
      	
              9.1

            	
              The
                Vendor acknowledges and agrees that the Consideration Shares to be
                issued
                and allotted by GIS have not been registered under the United States
                Securities Act of 1933 (as amended) (the “Securities
                Act”)
                or any other applicable securities laws and that such securities
                will be
                issued and allotted pursuant to safe harbour provisions relating
                to the
                prospectus and registration requirements set forth in Regulation
                S of the
                Securities Act the availability of which is predicated in part on
                the
                Vendor’s representations as contained herein and in the Non-U.S.
                Shareholder Certificate. The Vendor agrees to abide by all applicable
                resale restrictions and hold periods imposed by all applicable securities
                legislation. The share certificate(s) 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 such safe harbor provisions relating to the prospectus
                and registration requirements of the Securities
                Act:

            

    

    

    “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 CONFIRMED BY AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER AND 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.”

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              9.2

            	
              The
                Vendor agrees that she may exchange the certificate(s) representing
                the
                Consideration Shares by delivering such certificate(s) to GIS 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.

            

    

    

    
      	
              9.3

            	
              The
                Vendor further acknowledges that the Consideration Shares issued
                pursuant
                to the terms and conditions set forth in the Agreement will be issued
                as
                “restricted securities” as defined by Rule 144 promulgated pursuant to the
                Securities Act and will have such hold periods as are required under
                applicable securities laws of the US and as a result may not be sold,
                transferred or otherwise disposed, except pursuant to an effective
                registration statement under the Securities Act, or unless, in the
                opinion
                of the GIS’s counsel, such transfer or other disposition is made 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.

            

    

    

    
      	
              9.4

            	
              The
                Vendor represents that the Vendor is acquiring the Consideration
                Shares
                for the Vendor’s own account, for investment purposes only and not with a
                view to, or for sale in connection with, a distribution, as that
                term is
                used in Section 2(11) of the Securities Act, in a manner which would
                require registration under the Securities Act or any state securities
                laws.

            

    

    

    
      	
              9.5

            	
              The
                Vendor acknowledges that it is able to protect its interests in connection
                with the acquisition of the
                Consideration Shares and can bear the economic risk of investment
                in such
                securities without producing
                a material adverse change in Vendor’s financial condition. The Vendor
                otherwise has such knowledge and experience in financial or business
                matters that the Vendor is capable of evaluating the merits and risks
                of
                the investment in the Consideration Shares.

            

    

    

    
      	
              9.6

            	
              The
                Vendor represents, warrants and covenants that it is not acquiring
                the
                Consideration Shares as part of a group within the meaning of
                Section 13(d)(3) of the Exchange Act and the Vendor has not agreed to
                act with any other person for the purpose of acquiring, holding,
                voting or
                disposing of the Consideration Shares purchased hereunder for purposes
                of
                Section 13(d) under the Exchange Act, and the Vendor is acting
                independently with respect to its investment in the Consideration
                Shares. 

            

    

    

    
      	
              10.

            	
              CONDUCT
                OF BUSINESS PENDING
                COMPLETION

            

    

    

    
      	10.1	
              The
                Vendor hereby undertakes with the Purchaser to procure that, except
                as
                required by this Agreement, no resolution of the directors or shareholders
                of any member of the Group shall be passed prior to Completion without
                the
                prior written consent of the
                Purchaser.

            

    

    

    
      	10.2	
              The
                Vendor hereby undertakes with the Purchaser that until Completion
                the
                Group shall carry on its business in a manner consistent with past
                practice and shall:

            

    

    

    
      	
            	(1)	
              procure
                that the Group shall not without first obtaining the prior written
                consent
                of the Purchaser enter into any contract or commitment of an unusual
                or
                onerous nature or other than in the normal and ordinary course of
                business; and

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	(2)	
              keep
                the Purchaser informed of all matters relating to the Group and its
                business, assets and prospects.

            

    

    

    
      	10.3	
              Without
                prejudice and notwithstanding Clause 10.2, the Vendor undertakes
                that it
                shall pending Completion take all steps necessary to ensure that
                the Group
                shall not carry out any of the following actions and no resolution
                of the
                board of directors of any member of the Group or of its general meeting
                shall be passed to carry out the same unless the written consent
                of the
                Purchaser is obtained:

            

    

    

    
      	 	
              (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 form 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
                alteration of the memorandum and articles of association of any member
                of
                the Group and the passing of any resolutions inconsistent with the
                provision of this Agreement;

            

    

    

    
      	 	
              (6)

            	
              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;

            

    

    

    
      	 	
              (7)

            	
              the
                acquisition of 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$100,000;

            

    

    

    
      	 	
              (8)

            	
              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;

            

    

    

    
      	 	
              (9)

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

            

    

    

    
      	 	
              (10)

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

            

    

    

    
      	 	
              (11)

            	
              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;

            

    

    

    
      	 	
              (12)

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

            

    

    

    
      	 	
              (13)

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

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (14)

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

            

    

    

    
      	
            	(15)	
              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

            

    

    

    
      	 	
              (16)

            	
              the
                making, declaration or payment of any dividend or distribution except
                the
                payment of HK$2,000,000 as bonus to Mr. Albert Yee Tat CHAN out of
                the
                profits of the Company legally available for such payment calculated
                up to
                28 February 2006.

            

    

    

    
      	10.4	
              If
                at any time before Completion the Vendor or any of the Guarantors
                comes to
                know of any fact or event which:

            

    

    

    
      	 	
              (1)

            	
              is
                in any way inconsistent with any of the undertakings or agreements
                of the
                Vendor or any of the Guarantors,
                and/or

            

    

    

    
      	 	
              (2)

            	
              suggests
                that any of the Vendor Warranties may not be correct or incapable
                of being
                carried out, and/or

            

    

    

    
      	 	
              (3)

            	
              might
                affect the willingness of a prudent purchaser for value of the Sale
                Shares
                to complete its purchase or the amount of the consideration which
                such
                purchaser would be prepared to pay for the Sale
                Shares,

            

    

    

    the
      Vendor and the Guarantors shall give immediate written notice thereof to the
      Purchaser in which event the Purchaser may within seven (7) Business Days of
      receiving such notice rescind this Agreement by written notice to the Vendor
      and
      the Guarantors.

    

    
      	
              10.5

            	
              If
                at any time before Completion the Purchaser comes to know of any
                fact or
                event which:

            

    

    

    
      	 	
              (1)

            	
              is
                in any way inconsistent with any of the undertakings or agreements
                of the
                Purchaser, and/or

            

    

    

    
      	 	
              (2)

            	
              suggests
                that any of the Purchaser Warranties may not be correct or incapable
                of
                being carried out, and/or

            

    

    

    
      	 	
              (3)

            	
              might
                affect the willingness of a prudent investor for value for the
                subscription of the Consideration Shares to subscribe for the
                Consideration Shares or the amount of the subscription price which
                such
                investor would be prepared to subscribe for the Consideration
                Shares,

            

    

    

    the
      Purchaser shall give immediate written notice thereof to the Vendor in which
      event the Vendor may within ten (10) Business Days of receiving such notice
      rescind this Agreement by giving to the Purchaser a notice in writing signed
      by
      them jointly (but not otherwise).

    

    
      	10.6	
              If
                at any time before Completion the Vendor or any of the Guarantors
                fails to
                comply with any of his/her obligations under this Clause 10 or any
                other
                provisions of this Agreement or the Purchaser determines (acting
                reasonably) that any of the Vendor Warranties might have been incorrect
                or
                is or may be incapable of performance, the Purchaser may rescind
                this
                Agreement by written notice to the Vendor and the
                Guarantors.

            

    

    

    
      	
              11.

            	
              RESTRICTIONS
                ON VENDOR AND
                GUARANTORS

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              11.1

            	
              Each
                of the Vendor and the Guarantors undertakes to the Purchaser that
                he/she
                shall not without the prior written consent of the Purchaser for
                a period
                of three (3) years after Completion either solely or jointly with
                or on
                behalf of any other person, firm, company, trust or otherwise whether
                as
                director, shareholder, employee, partner, agent or
                otherwise:

            

    

    

    
      	 	
              (a)

            	
              carry
                on or be engaged or interested directly or indirectly in any capacity
                (except as the owner of shares or securities listed or quoted or
                dealt in
                on any stock exchange or securities market held by way of investment
                only)
                in any business which shall be in competition within Hong Kong and
                the PRC
                with the Company or any of its subsidiaries in the carrying on the
                business of lighting technology and lighting
                consultancy;

            

    

    

    
      	 	
              (b)

            	
              solicit
                or entice or endeavour to solicit or entice away from the Company
                or any
                of its subsidiaries any employee, officer, manager, consultant (including
                employees who are directors) of the Company or any of its subsidiaries
                or
                any persons whose services are otherwise made available to the Company
                or
                any of its subsidiaries on a full-time or substantially full-time
                basis;

            

    

    

    
      	 	
              (c)

            	
              deal
                with, canvass, solicit or approach or cause to be dealt with, canvassed
                or
                solicited or approached for business in respect of any trade or business
                carried on or service provided by the Company or any of its subsidiaries
                any person, firm or company who at Completion or within two years
                prior to
                Completion was a customer, supplier, client, representative, agent
                of or
                in the habit of dealing under contract with the Company or any of
                its
                subsidiaries;

            

    

    

    
      	
              11.2

            	
              Each
                of the Vendor and the Guarantors further undertakes to the Purchasers
                that:

            

    

    

    
      	 	
              (a)

            	
              he/she
                will not at any time hereafter make use of or disclose or divulge
                to any
                person other than to officers or employees of the Company whose province
                it is to know the same any information relating to the Company or
                any of
                its subsidiaries other than any information properly available to
                the
                public or disclosed or divulged pursuant to an order of a court of
                competent jurisdiction;

            

    

    

    
      	 	
              (b)

            	
              he/she
                will not at any time hereafter in relation to any trade, business
                or
                company use a name including the word or symbol “Lightscape” or its
                Chinese equivalent or any similar word or symbol in such a way as
                to be
                capable of or likely to be confused with the name of the Company
                or any
                subsidiary and shall use all reasonable endeavours to procure that
                no such
                name shall be used by any person, firm or company with which it is/they
                are connected; and 

            

    

    

    
      	 	
              (c)

            	
              he/she
                shall not do anything which might prejudice the goodwill of the Company
                or
                any of its subsidiaries.

            

    

    

    
      	
              11.3

            	
              Each
                and every obligation under this Clause 11 shall be treated as a separate
                obligation and shall be severally enforceable as such and in the
                event of
                any obligation or obligations being or becoming unenforceable in
                whole or
                in part such part or parts as are unenforceable shall be deleted
                from this
                Clause 11 and any such deletion shall not affect the enforceability
                of all
                such parts of this Clause 11 as remain not so
                deleted.

            

    

    

    
      	
              11.4

            	
              The
                restrictions contained in this Clause 11 are considered reasonable
                by the
                parties hereto but in the event that any such restriction shall be
                found
                to be void but would be valid if some part thereof were deleted or
                the
                area of operation or the period of application reduced such restriction
                shall apply with such modification as may be necessary to make it
                valid
                and effective.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              12.

            	
              ACCESS
                TO INFORMATION

            

    

    

    The
      Vendor shall procure that, pending Completion, the Purchaser, its agents,
      representatives and professional advisers are given promptly on request full
      access to all such facilities and information regarding the business, assets,
      liabilities, contracts and affairs of the Group and other evidence of ownership
      of the assets owned by the Group as the Purchaser may require.

    

    
      	13.	
              FURTHER
                ASSURANCE

            

    

    

    Each
      party shall 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 within its powers to give effect
      to
      this Agreement and all transactions contemplated hereunder. 

    

    
      	14.	
              GUARANTEES

            

    

     

    
      	
              14.1

            	
              Each
                of the Guarantors hereby irrevocably and unconditionally guarantees
                to the
                Purchaser the due and punctual performance of the Vendor of her
                obligations under this Agreement and undertakes to indemnify and
                keep
                effectively indemnified the Purchaser (if necessary by payment of
                cash on
                first demand) against all liabilities, losses, damages, costs and
                expenses
                stipulated under this Agreement or otherwise which the Purchaser
                may
                suffer or incur in connection with any default or delay on the part
                of the
                Vendor in the performance or any such
                obligations.

            

    

    

    
      	
              14.2

            	
              The
                obligations and liabilities of the Guarantors shall be continuing
                obligations and shall not be satisfied, discharged or affected by
                an
                intermediate payment or any change in the constitution or control
                of, or
                the insolvency of or any bankruptcy, winding up or analogous proceedings
                relating to any of the parties to this
                Agreement.

            

    

    

    
      	
              14.3

            	
              The
                liability of each of the Guarantors hereunder shall be unaffected
                by any
                arrangement which the Purchaser may make with the Vendor or with
                any other
                person which (but for this provision) might operate to diminish or
                discharge the liability of or otherwise provide a defence to a surety.
                Without prejudice to the generality of the foregoing, the Purchaser
                is to
                be at liberty at any time and without reference to the Guarantors
                to give
                time for payment or grant any other indulgence and to give up, deal
                with,
                vary, exchange or abstain from perfecting or enforcing any other
                securities or guarantees held by the Guarantors at any time and to
                discharge any party thereto and to realise such securities or guarantees,
                as the Purchaser thinks fit and to compound with, accept compositions
                from
                and make any other arrangements with the Vendor without affecting
                the
                liability of the Guarantors
                hereunder.

            

    

    

    
      	
              14.4

            	
              As
                a separate and independent stipulation, it is hereby agreed by each
                of the
                Guarantors that any obligation and undertaking by each of the Guarantors
                under this Clause 14 which may not be enforceable against the Guarantors
                on the footing of a guarantee, whether by reason of any legal limitation
                (other than any limitation imposed by this Agreement), disability
                or
                incapacity on or of the Vendor or any other fact or circumstance
                whether
                or not known to the Purchaser shall nevertheless be enforceable against
                any of the Guarantors as the sole and principal obligor in respect
                thereof.

            

    

    

    
      	
              14.5

            	
              Without
                prejudice to the other provisions of this Agreement, the obligations
                and
                undertakings expressed to be assumed by or imposed on the Guarantors
                under
                this Agreement shall remain in force so long as the Vendor shall
                have any
                liability or obligation to the Purchaser under this Agreement and
                until
                all such liabilities and obligations have been discharged in
                full.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              14.6

            	
              Each
                of the Guarantors hereby waives any right to require a proceeding
                first
                against the Vendor or any other
                person.

            

    

    

    
      	
              14.7

            	
              Each
                of every obligation, covenant, representation, warranty and undertaking
                of
                the Guarantors provided herein shall be the joint and several obligations,
                covenants, representations, warranties and undertakings of each of
                the
                Guarantors and the Purchaser shall be at liberty to release, compound
                with
                or otherwise vary or agree to vary the liability of, or to grant
                time or
                other indulgence, or make other arrangements with any one of the
                Guarantors without the consent of or notice to the others and without
                prejudicing, affecting the right, remedy and power of the Purchaser,
                against the others.

            

    

    

    
      	15.	
              CONFIDENTIALITY
                AND ANNOUNCEMENTS

            

    

    

    
      	15.1	
              Each
                of the parties hereto undertakes to the others that he/she/it will
                not, at
                any time after the date of this Agreement, divulge or communicate
                to any
                person other than to his/her/its professional advisers, or when required
                by law, or to his/her/its respective officers or employees whose
                province
                it is to know the same any confidential information concerning the
                business, accounts, finance or contractual arrangements or other
                dealings,
                transactions or affairs of any of the others which may be within
                or may
                come to its knowledge and it shall use its best endeavours to prevent
                the
                publication or disclosure of any such confidential information concerning
                such matters.

            

    

    

    
      	15.2	
              No
                public announcement or communication of any kind shall be made in
                respect
                of the subject matter of this Agreement unless specifically agreed
                between
                the parties hereto or unless an announcement is required pursuant
                to the
                applicable law and the regulations or the requirements of the Securities
                and Exchange Commission of the US or any other regulatory body or
                authority. Any announcement by any party hereto required to be made
                pursuant to any relevant law or regulation or the requirements of
                the
                Securities and Exchange Commission of the US or any other regulatory
                body
                or authority shall be issued only after such prior consultation with
                the
                other party as is reasonably practicable in the
                circumstances.

            

    

    

    
      	16.	
              TIME
                AND WAIVER

            

    

    

    Time
      shall in every respect be of the essence of this Agreement 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 Agreement 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 Agreement are
      cumulative and not exclusive of any rights or remedies provided by law. The
      parties shall then use all reasonable endeavors to replace the invalid or
      unenforceable provisions by a valid and enforceable substitute provision the
      effect of which is as close as possible to the intended effect of the invalid
      and unenforceable provision.

    

    
      	17.	
              INVALIDITY

            

    

    

    If
      at any
      time any one or more of the provisions of this Agreement is or becomes illegal,
      invalid or unenforceable in any respect under the laws of any relevant
      jurisdiction, neither the legality, validity or enforceability of the remaining
      provisions of this Agreement in that jurisdiction nor the legality, validity
      or
      enforceability of such provision under the laws of any other jurisdictions
      shall
      in any way be affected or impaired thereby.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	18.	
              AMENDMENTS

            

    

    

    This
      Agreement 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 Agreement (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 Agreement
                  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 Agreement with specific reference
                  in such
                  notice that such change is for the purposes of this
                  Agreement.

              

      

    

    

    
      	
              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:

            

    

    

    To
      the
      Vendor and the Guarantors: 

    

      
        	
                Address:

              	
                Level
                  25, Bank of China Tower, 1 Garden Road, Central, Hong
                  Kong

              
	
                Facsimile:

              	
                (852)
                  2251 8552

              

      

    

    

    To
      the
      Purchaser:

    

      
        	
                Address:

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

              
	
                Facsimile:
                  

              	
                (852)
                  2546 6878

              
	
                Attention:

              	
                Mr.
                  Bondy Tan

              

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      
        	
                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.

              	
                ASSIGNMENT

              

      

      

      This
        Agreement shall be binding upon and enure for the benefit of each party’s
        successors or assigns and, none of the rights of the parties under this
        Agreement may be assigned or transferred.

      

      
        	
                21.

              	
                ENTIRE
                  AGREEMENT

              

      

      

      This
        Agreement (together with any documents referred to herein) constitutes the
        entire agreement between the parties hereto with respect to the matters dealt
        with herein and supersedes any previous agreements, arrangements, statements,
        understandings or transactions between the parties hereto in relation to
        the
        matters hereof.

      

      
        	
                22.

              	
                COSTS

              

      

      

      Each
        of
        the Vendor, Guarantors and the Purchaser shall bear his/her/its own costs
        and
        expenses (including legal fees) incurred in connection with the preparation,
        negotiation, execution and performance of this Agreement and all documents
        incidental or relating to Completion. 

      

      
        	
                23.

              	
                COUNTERPART

              

      

      

      This
        Agreement may be executed in any number of counterparts, all of which taken
        together shall constitute one and the same instrument and any of parties
        hereto
        may execute this Agreement by signing any such counterparts.

      

      
        	
                24.

              	
                LEGAL
                  REPRESENTATION

              

      

      

      The
        parties hereby acknowledge that Preston Gates & Ellis only act for the
        Purchaser in connection with this Agreement and each of the Vendor and the
        Guarantors has been duly advised to seek independent legal advice and to
        obtain
        separate legal representation.

      

      
        	
                25.

              	
                GOVERNING
                  LAW, JURISDICTION AND PROCESS
                  AGENTS

              

      

      

      
        	
                25.1

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

              

      

      

      
        	
                25.2

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

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    SCHEDULE
      1

    

    DETAILS
      OF THE COMPANY

    

      
        	
                Name
                  of Company 

              	
                :

              	
                LIGHTSCAPE
                  HOLDING LTD.

              
	
                 

              	 	 
	
                Date
                  of Incorporation 

              	
                :

              	
                23
                  March 2004

              
	
                 

              	 	 
	
                Place
                  of Incorporation 

              	
                :

              	
                British
                  Virgin Islands

              
	
                 

              	 	 
	
                Company
                  Number 

              	
                :

              	
                587649

              
	
                 

              	 	 
	
                Registered
                  Office 

              	
                :

              	
                Overseas
                  Management Company Trust (B.V.I.) Ltd. 

                OMC
                  Chambers, P.O. Box 3152, Road Town, Tortola, British Virgin
                  Islands

              
	 	 	 
	
                Existing
                  company secretary 

              	
                :

              	
                Not
                  yet appointed

              
	 	 	 
	
                Authorised
                  share capital 

              	
                :

              	
                US$50,000
                  divided into 50,000 Shares

              
	
                 

              	 	 
	
                Issued
                  share capital 

              	
                :

              	
                US$10
                  (comprising of 10 Shares)

              
	
                 

              	 	 
	
                Existing
                  shareholder: 

              	 	 
	
                 

              	 	 
	
                Name
                  of shareholder 

              	
                 

              	
                    No.
                  of
                  shares        Percentage

              
	
                 

              	 	 
	
                WOO
                  Yuen Yu 

              	
                 

              	
                        10            100%

              
	
                Directors:
                  

              	
                :

              	
                WOO
                  Yuen Yu

              
	
                Auditors
                  

              	
                :

              	
                Not
                  yet appointed

              
	
                 

              	 	 
	
                Financial
                  year end 

              	
                :

              	
                Not
                  yet determined

              
	
                 

              	 	 
	
                Principal
                  activities 

              	
                :

              	
                Investment
                  holding

              

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      2

    

    DETAILS
      OF THE SUBSIDIARY

    

      
        	
                Name
                  of Company 

              	
                :
                  

              	
                Luminous
                  LED Technologies Limited

              
	
                 

              	 	 
	
                Date
                  of Incorporation 

              	
                :
                  

              	
                19
                  March 2005

              
	
                 

              	 	 
	
                Place
                  of Incorporation 

              	
                :
                  

              	
                Hong
                  Kong

              
	
                 

              	 	 
	
                Company
                  Number 

              	
                :
                  

              	
                957093

              
	
                 

              	 	 
	
                Registered
                  Office 

              	
                :
                  

              	
                Level
                  25, Bank of China Tower, 1 Garden Road, Central, Hong Kong

              
	
                 

              	 	 
	
                Existing
                  company secretary 

              	
                :
                  

              	
                ACORE
                  LIMITED

              
	
                 

              	 	 
	
                Authorised
                  share capital 

              	
                :
                  

              	
                HK$10,000.00
                  divided into 10,000 shares of HK$1.00 each

              
	
                 

              	 	 
	
                Issued
                  share capital 

              	
                :
                  

              	
                HK$1,000.00
                  (comprising of 1,000 shares of HK$1.00 each)

              
	
                 

              	 	 
	
                Existing
                  shareholders: 

              	 	 
	
                 

              	 	 
	
                Name
                  of shareholders 

              	
                 

              	
                    No.
                  of
                  shares        Percentage

              
	
                 

              	 	 
	
                LIGHTSCAPE
                  HOLDING LTD. 

              	
                 

              	
                      1,000             
                  100%

              
	
                Directors:
                  

              	
                :
                  

              	
                WOO
                  Yuen Yu

              
	
                Auditors
                  

              	
                :
                  

              	
                Not
                  yet appointed

              
	
                 

              	 	 
	
                Financial
                  year end 

              	
                :
                  

              	
                Not
                  yet determined

              
	
                 

              	 	 
	
                Principal
                  activities 

              	
                :
                  

              	
                Investment
                  holding

              

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      3

    

    VENDOR
      WARRANTIES

    

    
      	l.	
              Recitals

            

    

    

    The
      matters stated in the Recitals to this Agreement are true and correct in all
      material respects.

    

    
      	2.	
              The
                Vendor, the Guarantors and the
                Company

            

    

    

    
      	2.1	
              Each
                of the Vendor and the Guarantors has the full power to enter into
                and
                perform this Agreement and this Agreement will, when executed, constitute
                binding obligations on each of them in accordance with its
                terms.

            

    

    

    
      	2.2	
              There
                is no outstanding indebtedness or other liability (actual or contingent)
                owing by any member of the Group to the Vendor or the Guarantors,
                any
                director of a member of the Group or any person connected with the
                Vendor
                or the Guarantors nor is there any indebtedness owing to a member
                of the
                Group by any such person.

            

    

    

    
      	2.3	
              The
                entire issued share capital of the Company is as set out in Recital
                (A)
                and the Sale Shares are issued fully paid and are beneficially owned
                by
                the Vendor free from all Encumbrances and the same are freely transferable
                by the Vendor without the consent, approval, permission, licence
                or
                concurrence of any third party.

            

    

    

    
      	2.4	
              True
                copies or certified true copies of the memorandum and articles of
                association or constitutional documents of the Company and its
                subsidiaries and have been provided to the Purchaser. The copies
                of the
                memorandum and articles of association or constitutional documents
                of the
                Company and its subsidiaries so provided to the Purchaser are true
                and
                complete and have embodied in them or annexed to them a copy of every
                such
                resolution as is required by applicable laws of the place of the
                incorporation or other relevant
                legislation.

            

    

    

    
      	2.5	
              None
                of the members of the Group has granted any right to call for the
                issue of
                or agreed to issue at any time after Completion any share or loan
                capital.

            

    

    

    
      	2.6	
              None
                of the members of the Group is under any contract, options, warrants
                or
                any other obligations regarding any part of its capital, issued or
                unissued, or for the issue of any shares, debentures, warrants, options,
                or other similar securities.

            

    

    

    
      	2.7	
              None
                of the members of the Group has any other subsidiary and does not
                have any
                investment in any other company, other than Lightscape Technologies
                Ltd.
                (which the Group has an equity interest of 50% of its issued share
                capital), Luminous Technologies Ltd. (which the Group has an equity
                interest of 30% of its issued share capital) and Lightscape Technology
                (Macau) Ltd. (which the Group has an equity interest of 49.6% of
                its
                issued share capital).

            

    

    

    
      	3.	
              Financial
                and taxation

            

    

    

    
      	3.1	
              The
                Management Accounts were prepared in accordance with the generally
                accepted accounting practice, standards and principles of Hong Kong,
                substantially the same accounting practice, standards and principles
                as
                those adopted and consistently applied by the
                Group.

            

    

     

    
      	3.2	
              Each
                member of the Group has duly complied and will until Completion continue
                duly to comply with its obligations to account to the relevant tax
                authorities for all amounts for which it is or may become accountable
                in
                respect of Taxation.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	3.3	
              All
                returns in connection with Taxation that should have been made by
                a member
                of the Group have been made currently and on a proper basis and will
                until
                Completion continue to be so made.

            

    

    

    
      	3.4	
              Each
                member of the Group has duly and punctually paid all Taxation which
                it has
                become liable to pay and is under no liability to pay any penalty
                or
                interest in connection with any claim for
                Taxation.

            

    

    

    
      	3.5	
              The
                Group has sufficient working capital to carry on its businesses in
                their
                present form and at present levels of turnover for the foreseeable
                future
                and for the purposes of carrying out and fulfilling in accordance
                with
                their terms all orders, projects and other contractual obligations
                which
                have been placed with or undertaken by the
                Group.

            

    

    

    
      	3.6	
              Save
                as disclosed in the Management Accounts, the Company and other members
                of
                the Group has no outstanding debts, liabilities and indebtedness,
                whether
                actual, contingent or deferred, due or payable or incurred in the
                ordinary
                and usual course of business, since the Management Accounts
                Date.

            

    

     

    
      	3.7	
              Each
                member of the Group has exercised its reasonable endeavours to preserve
                and secure all tax benefits and
                refunds.

            

    

    

    
      	3.8	
              All
                assets of the Group of a wasting or depreciable nature are stated
                in the
                Management Accounts after deduction of depreciation, and such depreciation
                being in amounts sufficient to write down such assets over their
                respective expected useful economic lives, and unless stated to the
                contrary in the Management Accounts, depreciation is calculated on
                a
                straight line basis and a consistent depreciation policy has been
                adopted
                over all assets and there has been no change in the basis or policy
                of
                depreciation.

            

    

    

    
      	3.9	
              All
                accounting records, vouchers, invoices, ledgers, contracts and memoranda
                and all other accounting documents of the Group and records of all
                transactions thereof are in the possession of the relevant member
                of the
                Group and have been properly written up, kept and maintained in accordance
                with generally accepted accounting practice and together shows a
                true and
                fair view of the affairs and financial position of the
                Group.

            

    

    

    
      	3.10	
              A
                consistent accounting policy has been adopted by each of the members
                of
                the Group over the past three years immediately preceding the Management
                Accounts Date (or, from the date of incorporation when this is a
                shorter
                period) and there has been no material change
                thereof.

            

    

    

    
      	3.11	
              None
                of the members of the Group holds any security (including any guarantee
                or
                indemnity) which is not valid and enforceable against the grantor
                thereof
                in accordance with its terms.

            

    

    

    
      	3.12	
              In
                relation to all financing arrangements to which any of the members
                of the
                Group is a party:

            

    

    

    
      	
            	(a)	
              there
                has been no contravention of or non compliance with any provision
                of any
                such document which is material and adverse in the context of the
                Group;

            

    

    

    
      	
            	(b)	
              no
                steps for the enforcement of any Encumbrances have been taken or
                threatened;

            

    

    

    
      	
            	(c)	
              there
                has not been any material alteration in the terms and conditions
                of any of
                the said arrangements or facilities all of which are in full force
                and
                effect;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	(d)	
              nothing
                has been done or omitted to be done whereby the continuance of the
                said
                arrangements and facilities in full force and effect might be adversely
                affected or prejudiced; and

            

    

    

    
      	
            	(e)	
              none
                of the arrangements is dependent on the guarantee of or on any security
                provided by a third party.

            

    

    

    
      	3.13	
              The
                total amount borrowed by each of the members of the
                Group:

            

    

    

    
      	
            	(a)	
              from
                its bankers does not exceed its overdraft facilities;
                and

            

    

    

    
      	
            	(b)	
              from
                whatsoever source does not exceed any limitation on borrowing contained
                in
                its constitutive documents or any other deed or document binding
                on
                it.

            

    

    

    
      	3.14	
              There
                were no material commitments on capital account outstanding as at
                the
                Management Accounts Date and, since the Management Accounts Date,
                the
                members of the Group have not made, or agreed to make, any material
                capital expenditure, or incurred or agreed to incur any material
                capital
                commitments nor has any of them disposed of, or realised, any capital
                assets material to its usual and ordinary course of business or any
                interest therein.

            

    

    

    
      	3.15	
              The
                net tangible asset value of the Group as at the date of this Agreement
                calculated in accordance with the generally accepted accounting principles
                of Hong Kong is not less than the amount shown in the Management
                Accounts
                and the Vendor and the Guarantors consider that the accounting basis
                and
                policies adopted for such calculations are fair, reasonable and
                appropriate to reflect the net tangible assets of the Group as at
                such
                date.

            

    

    

    
      	4.	
              Assets

            

    

    

    
      	4.1	
              The
                assets of the Group included in the Management Accounts are solely
                the
                property of the Group and are not subject to any Encumbrance or any
                agreement to give or create any Encumbrance including any bill of
                sale,
                hire or hire purchase agreement, conditional sale, credit sale or
                similar
                agreement except for (i) any hire purchase agreement in the usual
                and
                ordinary course of business involving expenditure of less than
                HK$1,000,000 per annum; (ii) title retention provisions in respect
                of
                goods and materials supplied to the Group in the usual and ordinary
                course
                of business; or (iii) liens arising in the ordinary course of business
                by
                operation of law.

            

    

    

    
      	4.2	
              Since
                the Management Accounts Date, save for disposals in the ordinary
                course of
                its business, the assets of the Company and its subsidiaries have
                been in
                the possession of, or under the control of, the
                Group.

            

    

    

    
      	4.3	
              The
                fixed and loose plant, machinery, vehicles and other equipment used
                in
                connection with the business of the Group are in a good and safe
                state of
                repair and condition and satisfactory working order and have been
                regularly and properly maintained. 

            

    

    

    
      	5.	
              Litigation,
                disputes and winding
                up

            

    

    

    
      	5.1	
              Except
                as plaintiff in the collection of debt arising in the usual and ordinary
                course of business (none of which exceeds HK$500,000), no member
                of the
                Group is engaged in (nor is any director in relation to the affairs
                of any
                member of the Group engaged in) any legal proceedings (including
                litigation, arbitration and prosecution) and no such proceedings
                are
                pending or threatened, nor are there any facts likely to give rise
                to such
                proceedings known or which would on reasonable enquiry be known to
                any
                member of the Group or their respective
                directors.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	5.2	
              None
                of the member of the Group, the Vendor and the Guarantors has in
                relation
                to the any company of the Group committed nor are they liable for
                any
                criminal, illegal, unlawful or unauthorised act or breach of any
                obligation whether imposed by or pursuant to the laws of Hong Kong,
                the
                PRC or otherwise.

            

    

    

    
      	5.3	
              No
                order has been made, or petition presented, or resolution passed
                for the
                winding up of or the taking of any analogous proceedings against
                any
                member of the Group; nor has any distress, execution or other process
                been
                levied in respect of the Group which remains undischarged; nor is
                there
                any unfulfilled or unsatisfied judgment or court order outstanding
                against
                any member of the Group.

            

    

    

    
      	6.	
              Company
                records

            

    

    

    
      	6.1	
              Each
                member of the Group has kept duly made up all requisite books of
                account
                (reflecting in accordance with good accounting principles all the
                financial transactions of the relevant member of the Group), minute
                books,
                registers, records and these and all other deeds and documents (properly
                stamped where necessary) belonging to or which ought to be in the
                possession of a member of the Group and its seal are in the possession
                of
                the relevant member of the Group or the lender(s) to the member of
                the
                Group concerned (where such documents form part of the loan or security
                documents for loans made to the Group or documents required to be
                delivered under such loan or security
                documents).

            

    

    

    
      	6.2	
              All
                accounts, books, ledgers, and other financial records of each member
                of
                the Group:

            

    

    

    
      	
            	(a)	
              have
                been properly maintained, are in the possession of the Company and
                contain
                due and accurate records of all matters required by law to be entered
                therein;

            

    

    

    
      	
            	(b)	
              do
                not contain or reflect any material inaccuracies or discrepancies;
                and

            

    

    

    
      	
            	(c)	
              give
                and reflect a true and fair view of the matters which ought to appear
                therein and no notice or allegation that any of the same is incorrect
                has
                been received, or if the Company has received such notice or allegation,
                the incorrectness or errors have been
                rectified.

            

    

    

    
      	6.3	
              Without
                prejudice to the generality of paragraph 6.1 the minute book of directors’
                meetings and the minute book of shareholders’ meetings respectively of
                each member of the Group contain full and accurate records of all
                resolutions passed by the directors and the shareholders of the member
                of
                the Group concerned and no resolutions have been passed by either
                the
                directors or shareholders of the member of the Group concerned which
                are
                not recorded in the relevant minute
                books.

            

    

    

    
      	6.4	
              All
                documents requiring to be filed with the registrar of companies or
                equivalent government bureau in the jurisdiction in which any member
                of
                the Group is incorporated or any other relevant authority by the
                relevant
                member of the Group have been properly made up and
                filed.

            

    

    

    
      	7.	
              Properties

            

    

    

    
      	
              7.1

            	
              The
                property (the “Property”)
                referred to in the Management Accounts comprises all the land and
                premises
                occupied by the Group at the date hereof and all the estate, interest,
                right and title whatsoever of the Group in, under, over or in respect
                of
                any land or premises and the descriptions and user set out therein
                are
                correct and not misleading in all material
                respects.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              7.2

            	
              The
                Group has exclusive and unfettered possession and is the sole occupier
                of
                the Property.

            

    

    

    
      	
              7.3

            	
              There
                are no covenants, restrictions, burdens, stipulations, conditions,
                terms
                or outgoings affecting the Property which are of an unusual or onerous
                nature or which affect the use or intended use of the Property and
                there
                are no other matters which adversely affect the right of the Group
                thereto.

            

    

    

    
      	
              7.4

            	
              All
                covenants, restrictions, stipulations, conditions and other terms
                affecting the Property have been observed and performed and there
                are no
                circumstances which would entitle or require the government or any
                landlord or other person to exercise any powers of entry and taking
                possession or which would otherwise restrict or terminate the continued
                possession of occupation of the
                Property.

            

    

    

    
      	
              7.5

            	
              The
                present use of the Property is the permitted use for the purpose
                of the
                relevant planning of building regulations and is not adversely affected
                or
                likely to be adversely affected by any planning proposals and the
                Group is
                not a temporary user or user subject to onerous or unusual conditions
                giving rise to abnormal
                expenditure.

            

    

    

    
      	
              7.6

            	
              The
                Property is not affected by any order or notice of or proceedings
                involving any governmental or local authority or other body or any
                agreement with any of the same or by notices serviced by the Group
                on any
                such authority or body.

            

    

    

    
      	
              7.7

            	
              The
                construction of all buildings and erections on the Property comply
                with
                all statutes, regulations, bye-laws and other relevant
                legislation.

            

    

    

    
      	
              7.8

            	
              All
                policies of insurance relating to the Property effected by the Group
                (including fixtures, fittings and contents) are current and valid,
                cover
                the full re-instatement value thereof and are not subject to any
                special
                or unusual terms or restrictions or to the payment of any premium
                in
                excess of the normal rate for policies of the same kind and conform
                in all
                material respects with the requirements of the lease under which
                the
                Property is held.

            

    

    

    
      	
              7.9

            	
              No
                structural or other material defects have appeared in respect of
                or is
                affecting the buildings and structures on or comprising the Property
                or
                nay parts thereof and all such buildings are in good and substantial
                repair and condition.

            

    

    

    
      	
              7.10

            	
              There
                are not in force or required to be in force any licences under any
                applicable legislation or regulations which apply to the
                Property.

            

    

    

    
      	
              7.11

            	
              The
                Property is accessible by public roads and enjoys the services of
                water,
                gas, electricity, telephone line, sewerage and other utility services
                and
                the accessibility of such roads and these services are reasonably
                adequate
                for the operations of the business of the
                Group.

            

    

    

    
      	7.12	
              There
                are no circumstances under which by operation of law or otherwise
                the
                Group’s right to remain at or use the Property for the purposes for which
                it is now used may be adversely affected for any reason
                whatsoever.

            

    

    

    
      	8.	
              Corporate
                status

            

    

    

    
      	8.1	
              The
                contents of Schedules 1 and 2 are true and accurate in all material
                respects.

            

    

    

    
      	8.2	
              Each
                member of the Group has been duly incorporated and constituted, and
                is
                legally subsisting under the law of its place of incorporation and
                has the
                requisite corporate power and all permits, authorities, licences
                and
                consents (whether granted by public or private authority) necessary
                to
                carry on its business in the matter and in the places in which its
                business is now carried on and there are no circumstances which might
                lead
                to the suspension or cancellation of any such permits, authorities,
                licences or consents, and there has been no resolution, petition
                or order
                for the winding-up of any member of the Group and no receiver has
                been
                appointed in respect thereof or any part of the assets thereof, nor
                are
                any such resolutions, orders and appointments imminent or
                likely.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	8.3	
              No
                events or omissions have occurred whereby the constitution, subsistence
                or
                corporate status of any member of the Group have been or are likely
                to be
                adversely affected.

            

    

    

    
      	9.	
              The
                business

            

    

    

    
      	9.1	
              Since
                the Management Account Date and save as Disclosed:
                

            

    

    

    
      	
            	(a)	
              each
                member of the Group has carried on its business in the ordinary and
                usual
                course without having entered into any material transaction, assumed
                any
                material liability, or made any material payment not provided for
                in the
                Management Accounts which is not in the ordinary course of its business,
                and there has not been any material adverse interruption or alteration
                in
                the nature, scope or manner of its business which would likely to
                prejudice the interests of the Purchaser as a prospectively purchaser
                of
                the Sale Shares;

            

    

    

    
      	
            	(b)	
              each
                member of the Group has paid its creditors within the time agreed
                with
                such creditors and there are no debts outstanding by the Company
                which
                have been due for more than six months other than intra-group indebtedness
                which does not exceed HK$500,000 in aggregate for the Group as a
                whole or
                moneys borrowed from third parties of a non-trade nature (which do
                not
                exceed HK$500,000 in aggregate for the Group as a
                whole;

            

    

    

    
      	
            	(c)	
              the
                Group has not entered into, or agreed to enter into, any capital
                commitments in an amount exceeding the aggregate of HK$1,000,000
                (or its
                equivalent in any other currency);

            

    

    

    
      	
            	(d)	
              no
                share or loan capital has been issued or agreed to be issued by the
                respective companies;

            

    

    

    
      	
            	(e)	
              no
                distribution of capital or income has been declared, made or paid
                in
                respect of any share capital of any member of the Group and (excluding
                fluctuations in overdrawn current accounts with bankers) no loan
                or loan
                capital of any member of the Group has been repaid in whole or part
                or has
                become liable to be repaid in advance of their scheduled dates of
                repayment; and

            

    

    

    
      	
            	(f)	
              there
                has been no material deterioration in the financial position or prospects
                or turnover of the Group (taken as a
                whole).

            

    

    

    
      	9.2	
              The
                acquisition of Sale Shares by the Purchaser and compliance with the
                terms
                of this Agreement will not:

            

    

    

    
      	
            	(a)	
              cause
                any member of the Group to lose the benefit of any right or privilege
                it
                presently enjoys or cause any person who normally does business with
                the
                Group not to continue to do so on the same basis as
                previously;

            

    

    

    
      	
            	(b)	
              relieve
                any person of any obligation to the Group (whether contractual or
                otherwise) or enable any person to determine any such obligation
                or any
                right or benefit enjoyed by the Group or to exercise any right whether
                under an agreement with or otherwise in respect of any of
                them;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	(c)	
              result
                in any present or future indebtedness of the Group becoming due or
                capable
                of being declared due and payable prior to its stated
                maturity;

            

    

    

    
      	
            	(d)	
              give
                rise to or cause to become exercisable any right of pre-emption;
                or

            

    

    

    
      	
            	(e)	
              adversely
                affect the Group’s relationships with its clients, customers, suppliers or
                employees.

            

    

    

    
      	10.	
              The
                Group’s contracts

            

    

    

    
      	10.1	
              All
                documents (which is likely to have a material effect on the financial
                or
                trading position or prospects of any member of the Group or involves
                or is
                likely to involve (i) expenditure by any member of the Group in excess
                of
                HK$1,000,000 in respect of any such document or (ii) obligations
                or
                restrictions of any member of the Group of an unusual or exceptional
                nature or magnitude and not in the ordinary and usual course of business)
                to which any member of the Group is a party and other documents owned
                by
                or which ought to be in the possession of the Group have been properly
                stamped and are in the Group’s possession and true and complete copies
                thereof have been delivered to the
                Purchaser.

            

    

    

    
      	10.2	
              No
                member of the Group is a party to any agreement, transaction, obligation,
                commitment, understanding, arrangement or liability in which
                it:

            

    

    

    
      	
            	(a)	
              is
                incapable of complete performance in accordance with its terms within
                six
                months after the date on which it was entered into or
                undertaken;

            

    

    

    
      	
            	(b)	
              is
                known or is likely to result in a loss to the Group on completion
                of
                performance;

            

    

    

    
      	
            	(c)	
              cannot
                readily be fulfilled or performed by the member of the Group on time
                without undue or unusual expenditure of money and
                effort;

            

    

    

    
      	
            	(d)	
              involves
                or is likely to involve obligations, restrictions, expenditure or
                receipts
                of an unusual, onerous or exceptional
                nature;

            

    

    

    
      	
            	(e)	
              is
                a lease or a contract for hire or rent, hire purchase or purchase
                by way
                of credit sale or periodical
                payment;

            

    

    

    
      	
            	(f)	
              is
                a contract with any trade union or body authorized representing the
                Company’s employees;

            

    

    

    
      	
            	(g)	
              requires
                an aggregate consideration payable by the Company in excess of HK$500,000
                otherwise than in the usual and ordinary course of business of the
                Group;

            

    

    

    
      	
            	(h)	
              is
                a contract for services (other than normal office
                services);

            

    

    

    
      	
            	(i)	
              in
                any way restricts the Company’s freedom to carry on the whole or any part
                of its business in any part of the world in such manner as it thinks
                fit;
                or

            

    

    

    
      	
            	(j)	
              is
                in any way otherwise than in the ordinary and proper course of the
                Company’s or the respective subsidiary’s
                business.

            

    

    

    
      	10.3	
              No
                member of the Group is a party to any agreement under which the member
                of
                the Group or any other party is in default, being a default which
                is
                material in relation to the financial or trading position of the
                Company
                nor are there any circumstances likely to give rise to such a
                default.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	10.4	
              No
                person other than a member of the Group has given any guarantee of
                or
                security for any overdraft, loan or loan facility granted to any
                member of
                the Group.

            

    

    

    
      	10.5	
              There
                are in force no powers of attorney given by a member of the Group.
                No
                person, as agent or otherwise, is entitled or authorised to bind
                or commit
                a member of the Group to any obligation not in the ordinary course
                of the
                relevant member’s business.

            

    

    

    
      	11.	
              Insurance

            

    

    

    
      	11.1	
              The
                Group has maintained insurance covers in respect of all risks and
                up to an
                extent that may reasonably be expected of a prudent businessman operating
                a business similar to that of the
                Group.

            

    

    

    
      	11.2	
              All
                insurance policies taken out by the Group are valid, binding, in
                full
                force and effect and not voidable. To the best knowledge of the Vendor
                and
                the Guarantors, there are no circumstances which might lead to any
                liability under any such insurance policies being avoided by the
                insurers
                or the premiums being increased and there is no claim outstanding
                under
                any such policy nor are there any circumstances likely to give rise
                to a
                claim.

            

    

    

    
      
        
          	12.	
                  Employment
                    and
                    disputes

                

        

      

    

    

    
      	
              12.1

            	
              There
                has been no past and there is no existing or pending industrial or
                labour
                dispute with the employees of any member of the Group which is of
                a
                material nature exists or is
                imminent.

            

    

    

    
      	
              12.2

            	
              To
                the best of knowledge, information and belief of the Vendor and the
                Guarantors, there is no existing or imminent material labour disturbance
                by the employees of any of the principal suppliers, manufacturers
                or
                contractors of any member of the Group which might be expected to
                result
                in any material adverse change in the condition, financial or otherwise,
                or in the earnings, business affairs or business prospects of any
                member
                of the Group.

            

    

    

    
      	12.3	
              No
                member of the Group has established or incurred an obligation to
                establish
                or given any undertaking in respect of any retirement, death or disability
                scheme or arrangement relating to any present or past employee or
                director
                of any member of the Group or any other person under which any obligation
                or liability has arisen or might reasonably be expected to arise
                which is
                material.

            

    

    

    
      	
              12.4

            	
              The
                Group has neither given notice of any redundancies or layoffs nor
                started
                consultations with any independent trade union or employees’
                representatives regarding redundancies, lay offs or dismissals within
                the
                period of one year prior to the date hereof. No circumstances have
                arisen
                under which the Group is likely to be required to pay damages for
                wrongful
                dismissal, to make any statutory severance, redundancy or long service
                payment or to make or pay any compensation for unreasonable dismissal
                or
                to make any other payment under any employment protection legislation
                or
                to reinstate or re-engage any former employee. No circumstances have
                arisen under which the Group is likely to be required to pay damages
                or
                compensation, or suffer any penalty or be required to take corrective
                action or be subject to any form of discipline under any laws conferring
                protection against discrimination, harassment, victimisation or
                vilification by reason of age, gender, family circumstances, race,
                religion or disability. So far as the Group is aware, there are no
                current, pending or threatened claims of any type against it by any
                existing or former employees.

            

    

    

    
      	
              12.5

            	
              There
                are no existing service or other agreements or contracts between
                the Group
                and any of its directors or executives or employees which cannot
                be
                lawfully terminated by six calendar months’ notice or less without giving
                rise to any claim for damages or compensation other than a statutory
                redundancy or severance or long service payment, and the Group has
                complied with all its obligations under all ordinances, statutes
                and
                regulations, codes, orders and awards in connection with its employees
                and
                with all collective agreements with respect to trade unions or to
                employees of the Group.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              13.

            	
              Environment
                issues

            

    

    

    
      	
              13.1

            	
              The
                Group is currently complying with all environmental laws in Hong
                Kong, the
                PRC and other relevant jurisdictions and has at all times complied
                with
                all environmental laws.

            

    

    

    
      	
              13.2

            	
              No
                discharge, release, leaching, emission or escape into the environment
                of
                any hazardous substance or any substance regulated by any relevant
                environmental law has occurred or is occurring in the conduct of
                the
                business of the Group or in the conduct by the Group of any former
                business or in connection with or in relation to any assets of the
                Group
                or in connection with or in relation to any former assets of the
                Group
                while such former assets were in the ownership or under the control
                of the
                Group and no such discharge, release, leaching, emission or escape
                has
                occurred or is occurring for which the Company might otherwise be
                held
                liable.

            

    

    

    
      
        	13.3	
                Allwaste
                  which is or has been used, produced, controlled or disposed of
                  by the
                  Group and all waste which is or has been located at the Group’s properties
                  is and has been stored, labelled, handled, released, treated, processed,
                  deposited, transported, documented and disposed of in accordance
                  with all
                  environmental laws.

              

      

    

    

    
      	13.4	
              The
                Group in carrying on its business has ensured that the best available
                techniques not entailing excessive cost are used for preventing the
                discharge, release, leaching, emission or escape into the environment
                of
                any hazardous substance or of any substance regulated by relevant
                environmental laws.

            

    

    

    
      	13.5	
              There
                have not been nor are there threatened or pending any civil or criminal
                actions, notices of violations, investigations, administrative proceedings
                or written communications from any regulatory authority under any
                environmental laws against the Group or any of its assets or any
                of its
                directors, employees, officers or agents and, so far as the Group
                is
                aware, there are no facts or circumstances which may give rise to
                the
                same.

            

    

    

    
      	14.	
              Intellectual
                property rights and trade
                secrets

            

    

    

    
      	14.1	
              The
                business of the Group (and of any licensee under a licence granted
                by the
                Group) as now carried on, does not, and is not likely to, infringe
                any
                intellectual property right (that is to say, patent, patent application,
                knowhow, trade or service mark, trade or service mark application,
                trade
                name, registered design, copyright, logo or other similar intellectual,
                industrial or commercial right) of any other person (and would not
                do so
                if the same were valid).

            

    

    

    
      	14.2	
              To
                the extent that the Group has been granted any licence for the use
                of any
                intellectual property right, all such licences are in full force
                and
                effect.

            

    

     

    
      	14.3	
              Without
                prejudice to paragraph 14.1 above, the Group does not use any processes
                and is not engaged in any activities which involve the misuse of
                any
                knowhow, lists of customers or suppliers, trade secrets, technical
                processes or other confidential information (together “Confidential
                Information”)
                belonging to any third party. There has been no actual or alleged
                misuse
                by any person of any of its Confidential Information. The Group has
                not
                disclosed to any person any of its Confidential Information except
                where
                such disclosure was properly made in the usual and ordinary course
                of the
                Group’s business and was made subject to an agreement under which the
                recipient is obliged to maintain the confidentiality of such Confidential
                Information and is restrained from further disclosing it or using
                it other
                than for the purposes for which it was disclosed by the
                Group.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	14.4	
              The
                Group has not (otherwise than in the ordinary and normal course of
                business and to its staff and officers whose province it is to know
                and
                its professional advisers) disclosed, or permitted to be disclosed,
                or
                undertaken or arranged to disclose, to any person other than the
                Purchaser
                any of its knowhow, trade secrets, confidential information, price
                lists
                or lists of customers or suppliers.

            

    

    

    
      	15.	
              Events
                since the Management Accounts
                Date

            

    

    

    Since
      the
      Management Accounts Date:

    

    
      	
            	(a)	
              there
                has been no material adverse change in the financial condition or
                prospects of any of the members of the Group and each of the members
                of
                the Group has entered into transactions and incurred liabilities
                only in
                the ordinary course of trading;

            

    

    

    
      	
            	(b)	
              no
                resolution of any of the members of the Group in general meeting
                has been
                passed other than resolutions relating to the business of an annual
                general meeting which was not special
                business;

            

    

    

    
      	
            	(c)	
              the
                financial year end of each of the members of the Group has continued
                to be
                and has not changed;

            

    

    

    
      	
            	(d)	
              no
                event has occurred which would entitle any third party (with or without
                the giving of notice) to call for the repayment of indebtedness prior
                to
                its normal maturity date;

            

    

    

    
      	
            	(e)	
              the
                business of each of the members of the Group has been carried on
                in the
                ordinary and usual course and in the same manner (including nature
                and
                scope) as in the past, no fixed asset or stock has been written up
                nor any
                debt written off, and no unusual or abnormal contract has been entered
                into by any of the members of the
                Group;

            

    

    

    
      	
            	(f)	
              no
                asset of any of the members of the Group has been acquired or disposed,
                or
                has been agreed to be acquired or disposed of, otherwise than in
                the
                ordinary course of business and there has been no disposal or parting
                with
                possession of any of its property, assets (including know-how) or
                stock in
                trade or any payments by any of the members of the Group, and no
                contract
                involving expenditure by it on capital account has been entered into
                by
                any of the members of the Group, and no liability has been created
                or has
                otherwise arisen (other than in the ordinary course of business as
                previously carried on);

            

    

    

    
      	
            	(g)	
              there
                has been no disposal of any asset (including stock) or supply of
                any
                service or business facility of any kind (including a loan of money
                or the
                letting, hiring or licensing of any property whether tangible or
                intangible) in circumstances where the consideration actually received
                or
                receivable for such disposal or supply was less than the consideration
                which could be deemed to have been received for tax
                purposes;

            

    

    

    
      	
            	(h)	
              no
                event has occurred which gives rise to a tax liability to any of
                the
                members of the Group or deemed (as opposed to actual) income, profits
                or
                gains or which results in the relevant company becoming liable to
                pay or
                bear a tax liability directly or primarily chargeable against or
                attributable to another person, firm or company;
                and

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
            	(i)	
              no
                remuneration (including bonuses) or benefit payable to any officer
                or
                employee of any of the members of the Group has been increased nor
                has any
                of the members of the Group undertaken any obligation to increase
                any such
                remuneration at any future date with or without retrospective
                effect.

            

    

    

    
      	16.	
              General

            

    

    

    All
      information contained in this Agreement or in the documents referred to herein
      and therein and all other information concerning the Group 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 Agreement to the
      Purchaser 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 Agreement or which if disclosed
      might reasonable be expected to influence adversely the Purchaser’s decision to
      purchase the Sale Shares on the terms of this Agreement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      4

    

    TAX
      INDEMNITY

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    DATE:
      [            ]
      2006

    

    WOO
      YUEN YU

    (as
      the Covenantor)

    

    AND

    

    TECH
      TEAM INVESTMENT LIMITED

    (as
      the Purchaser)

    

    AND

    

    LIGHTSCAPE
      HOLDING LTD.

    (as
      the Company)

    

     

     

      
        

      

    

     

    DEED
      OF INDEMNITY

     

      
        

      

    

     

     

      
        

      

    

    

    
       

      

       

      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: 53667-00002/NKA/CWF

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    THIS
      DEED OF INDEMNITY is
      made
      on [           ]
      2006

    

    BY:

    

    WOO
      YUEN YU, holder
      of
      Hong Kong Identity Card No. B977792(5) and whose correspondence address is
      at
      Room 1112, 11/F., Cammer Commercial Building, 30 Cameron Road, Tsimshatsui,
      Kowloon, Hong Kong (the
      “Covenantor”),

    

    IN
      FAVOUR OF:

    

    
      	(1)	
              TECH
                TEAM INVESTMENT LIMITED,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at Sea Meadow House, Blackburne Highway, Road Town,
                Tortola, British Virgin Islands (the “Purchaser”);
                and

            

    

    

    
      	(2)	
              LIGHTSCAPE
                HOLDING LTD.,
                a
                company incorporated in the British Virgin Islands and having its
                registered office at OMC Chambers, P.O. Box 3152, Road Town, Tortola,
                British Virgin Islands (the “Company”)
                on its own behalf and as trustee for its subsidiary whose
                name, place of incorporation and attributable interest of the Company
                are
                set out in Schedule 2 to the Agreement (as defined
                below).

            

    

    

    WHEREAS:

    

    
      	
              (A)

            	
              By
                an agreement (the “Agreement”,
                such expression shall include the same as supplemented and amended
                from
                time to time)
                dated [—]
                2006 and made by, among others, (i) the Covenantor, as vendor; and
                (ii)
                the Purchaser as purchaser whereby the parties agreed, among other
                matters, for the sale and purchase of such number of Shares which
                shall be
                equivalent to 60% of the issued share capital of the
                Company.

            

    

    

    
      	
              (B)

            	
              It
                is a condition of the Agreement that the Covenantor shall enter into
                this
                Deed to provide the Company with an indemnity subject to the terms
                and
                conditions herein contained.

            

    

    

    NOW
      THIS DEED WITNESSES AND IT IS HEREBY AGREED as
      follows:

    

    
      	
              1.

            	
              (a)

            	
              Words
                and expressions used herein, unless otherwise expressed or required
                by
                context, shall have the same meanings as those used or defined in
                the
                Agreement.

            

    

    

    
      	 	
              (b)

            	
              In
                this Deed, in addition to the definitions in the Agreement, the following
                words and expressions shall have the following
                meanings:

            

    

    

    
      	
            	“Claim”	
              any
                assessment, notice, demand or other documents issued or action taken
                by or
                on behalf of the Inland Revenue Department of Hong Kong or any other
                statutory or governmental authority whatsoever in Hong Kong, the
                PRC or
                any other part of the world from which it appears that the Companies
                or
                any of them are liable or are sought to be made liable for any payment
                of
                any form of Taxation or to be deprived of any Relief or right to
                repayment
                of any form of Taxation which Relief or right to repayment would
                but for
                the Claim have been available to the Companies or any of
                them

            

    

    

    
      	
            	“Companies”	
              the
                Company and its subsidiary;

            

    

    

    
      	
            	“Relief”	
              any
                relief, allowance, concession, set off or deduction in computing
                profits,
                income or expenditure against which a Taxation is assessed, or any
                credit
                granted by or pursuant to any legislation or otherwise relating to
                all
                forms of Taxation;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              “Taxation”

            	
              (i)

            	
              any
                liability to any form of taxation whenever created or imposed and
                whether
                of Hong Kong, Singapore or of any other part of the world and without
                prejudice to the generality of the foregoing includes profits tax,
                provisional profits tax, interest tax, salaries tax, property tax,
                provisional profits tax, business tax on gross income, income tax,
                value
                added tax, interest tax, salaries tax, property, estate duty, death
                duty,
                capital duty, stamp duty, payroll tax, withholding tax, rates, social
                welfare tax, social welfare insurance, sales and lease tax, dividend
                tax,
                import customs and exercise duties and generally any tax duty, impost,
                levy or rate or any amount payable to the revenue, customs or fiscal
                authorities of local, municipal, governmental, state, provincial,
                federal
                level whether of Hong Kong, Singapore or of any other part of the
                world;

            

    

    

    
      	
            	(ii)	
              such
                amount or amounts as is referred to in Clause l(c) hereof;
                and

            

    

    

    
      	
            	(iii)	
              all
                interest, penalties, costs, charges and expenses incidental or relating
                to
                the liability to Taxation or the deprivation of any Relief or of
                a right
                to repayment of Taxation which is the subject of the indemnity contained
                herein to the extent that the same is payable or suffered by the
                Company.

            

    

    

    
      	 	
              (c)

            	
              In
                the event of deprivation of any Relief or of a right to repayment
                of any
                form of Taxation, there shall be treated as an amount of Taxation
                for
                which a liability has arisen the amount of such Relief or repayment
                or (if
                smaller) the amount by which the liability to any such Taxation of
                the
                Companies or any of them would have been reduced by such Relief if
                there
                had been no such deprivation as aforesaid, applying the relevant
                rates of
                Taxation in force in the period or periods in respect of which such
                Relief
                would have applied or (where the rate has at the relevant time not
                been
                fixed) the last known rate and assuming that the Companies or any
                of them
                (as the case may be) had sufficient profits against which such Relief
                might be set or given.

            

    

    

    
      	
              2.

            	
              Subject
                as hereinafter provided, the Covenantor hereby covenants and agrees
                with
                the Purchaser (for itself and as trustee for its successors in title,
                and
                as separate covenants with each of the Companies that she will fully
                and
                effectually indemnify and at all times keep fully and effectually
                indemnified the Purchaser and/or each of the Companies from and
                against:

            

    

    

    
      	 	
              (a)

            	
              the
                amount of any and all Taxation falling on the Companies or any of
                them
                from or by reference to any income, profits, gains, transactions,
                events,
                matters or things earned, accrued, received, entered into or occurring
                on
                or before the Completion Date or any event or transaction on or before
                the
                Completion Date whether alone or in conjunction with any other
                circumstances whenever occurring and whether or not such Taxation
                is
                chargeable against or attributable to any other person, firm or company,
                including any and all Taxation resulting from the receipt by the
                Companies
                of any amounts paid by the Covenantor under this Deed;
                and

            

    

    

    
      	 	
              (b)

            	
              all
                reasonable costs (including all legal costs), expense or other liabilities
                which the Purchaser or the Companies may incur in connection
                with:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (i)

            	
              the
                settlement of any claim under this
                Deed;

            

    

    

    
      	 	
              (ii)

            	
              any
                legal proceedings in which the Purchaser or any of the Companies
                claims
                under or in respect of this Deed and in which judgment is given for
                the
                Purchaser or any of the Companies;
                or

            

    

    

    
      	 	
              (iii)

            	
              the
                enforcement of any such settlement or
                judgment.

            

    

    

    
      	
              3.

            	
              This
                Deed does not cover any Claim and the Covenantor shall be under no
                liability under this Deed in respect of
                Taxation:

            

    

    

    
      	 	
              (a)

            	
              to
                the extent that provision has been made for such Taxation in the
                Management Accounts; or

            

    

    

    
      	 	
              (b)

            	
              which
                would not have arisen but for any act or omission by the Purchaser
                or any
                of the Companies effected without the prior written consent or agreement
                of the Covenantor, otherwise than in the ordinary course of business
                after
                the date hereof; or

            

    

    

    
      	 	
              (c)

            	
              for
                which each of the Companies is primarily liable as a result of
                transactions in the ordinary course of normal day to day trading
                operations since the Completion Date;
                or

            

    

    

    
      	 	
              (d)

            	
              to
                the extent that such Claim arises or is incurred as a result of the
                imposition of Taxation as a consequence of any retrospective change
                in the
                law or practice coming into force after the date hereof or to the
                extent
                such Claim arises or is increased by an increase in rates of Taxation
                after the date hereof with retrospective
                effect.

            

    

    

    
      	4.            
              (a) 	
              No
                claim under this Deed shall be made by the Purchaser or more than
                one of
                the Companies in respect of the same
                Taxation.

            

    

    

    
      	 	
              (b)

            	
              No
                claim under this Deed shall be made if a Claim in respect thereof
                has been
                made pursuant to the Agreement.

            

    

    

    
      	 	
              (c)

            	
              The
                Covenantor shall not be liable in respect of any Claim under this
                Deed
                after the sixth anniversary of the Completion Date except for Claims
                notice of which has been given to the Covenantor on or prior to such
                sixth
                anniversary. 

            

    

     

    
      
        	5.            
                (a) 	
                In
                  the event of any Claim arising, the Purchaser and the Companies
                  or any of
                  them shall, by way of covenant but not as a condition precedent
                  to the
                  liability of the Covenantor hereunder, give or procure that notice
                  thereof
                  is given, as soon as reasonably practicable, to the Covenantor
                  and, as
                  regards any Claim, the Companies or any of them and/or the Purchaser
                  shall
                  at the request of the Covenantor take such action, or procure that
                  such
                  action be taken, to cause the Claim to be withdrawn, or to dispute,
                  resist, appeal against, compromise or defend the Claim and any
                  determination in respect thereof, but subject to the Purchaser
                  and the
                  Companies or any of them being indemnified and secured to its reasonable
                  satisfaction by the Covenantor from and against any and all losses,
                  liabilities (including additional Taxation), damages, interest,
                  penalties,
                  costs, charges and expenses which may be thereby sustained or
                  incurred.

              

      

    

    

    
      	 	
              (b)

            	
              Without
                the prior approval of the Purchaser (which shall not be unreasonably
                withheld), the Covenantor shall make no settlement of any Claim nor
                agree
                any matter in the course of disputing any Claim likely to affect
                the
                amount thereof or the future taxation liability of the
                Company.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              6.

            	
              If,
                after the Covenantor has made any payment pursuant to this Deed,
                any of
                the Companies shall receive a refund of all or part of the relevant
                Taxation, the relevant company shall repay to the Covenantor a sum
                corresponding to the balance of the refund remaining after deducting
                the
                aggregate of (a) any costs, charges and expenses payable or sustained
                or
                incurred by the Company and/or the Purchaser in recovering such refund,
                and (b) the amount of any additional Taxation which may be suffered
                or
                incurred by the Company in consequence of such
                refund.

            

    

    

    
      	
              7.

            	
              The
                indemnities, agreements and undertakings herein contained shall bind
                the
                assigns or successors of the Covenantor and shall enure for the benefit
                of
                each party’s successors or assigns. The whole or any part of the benefit
                of this Deed may be assigned by the Purchaser and the Companies or
                any of
                them.

            

    

    

    
      	
              8.

            	
              The
                provisions of the Agreement relating to service of notice shall be
                incorporated in and be deemed to be part of this
                Deed.

            

    

    

    
      	
              9.

            	
              Time
                shall be of the essence of this
                Deed.

            

    

    

    
      	
              10.

            	
              This
                Deed shall be governed by and construed in all respects in accordance
                with
                the laws of Hong Kong and the parties irrevocably submit to the
                non-exclusive jurisdiction of the Hong Kong courts in relation to
                any
                proceedings arising out of or in connection with this Deed, but this
                Deed
                may be enforced in any other courts of competent
                jurisdiction.

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    AS
      WITNESS
      whereof
      this Deed has been duly executed on the day and year first above
      written.

    

    

    THE
      COVENANTOR

    

      
        	
                SIGNED,
                  SEALED AND DELIVERED 

              	
                )

              
	
                by
                  WOO YUEN YU

              	
                )

              
	
                in
                  the presence of: 

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	 	 
	
                THE
                  PURCHASER

              	 
	 	 
	
                SEALED
                  with the common seal of and 

              	
                )

              
	
                 

              	
                )

              
	
                SIGNED
                  by 

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of 

              	
                )

              
	
                 

              	
                )

              
	
                TECH
                  TEAM INVESTMENT LIMITED 

              	
                )

              
	
                 

              	
                )

              
	
                in
                  the presence of: 

              	
                )

              
	 	 
	 	 
	 	 
	 	 
	
                THE
                  COMPANY

              	 
	 	 
	
                SEALED
                  with the common seal of and 

              	
                )

              
	
                 

              	
                )

              
	
                SIGNED
                  by 

              	
                )

              
	
                 

              	
                )

              
	
                for
                  and on behalf of 

              	
                )

              
	
                 

              	
                )

              
	
                LIGHTSCAPE
                  HOLDING LTD. 

              	
                )

              
	
                 

              	
                )

              
	
                in
                  the presence of: 

              	
                )

              

      

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      5

    

    NON-U.S.
      SHAREHOLDER CERTIFICATE

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    CERTIFICATE
      OF NON-U.S. SHAREHOLDER

     

    OF

     

    GLOBAL
      INNOVATIVE SYSTEMS, INC.

    

    In
      connection with the issuance of 3,000,000 shares of common stock (“Pubco
      Common Stock”)
      of
      Global Innovative Systems Inc., a Nevada corporation (“Pubco”),
      to
      the undersigned pursuant to the Share Purchase Agreement dated [28] March 2006
      (the “Agreement”),
      the
      undersigned and the Guarantors (as defined in the Agreement), I hereby agree,
      represent and warrant (where applicable) that:

    

    
      	1.	
              I
                am not a “U.S.
                Person”
                as such term is defined by Rule 902 of Regulation S under the United
                States Securities Act of 1933, as amended (“Securities
                Act”)
                (the definition of which includes, but is not limited to, an individual
                resident in the United States of America (“U.S.”)
                and an estate or trust of which any executor or administrator or
                trust,
                respectively is a U.S. Person and any partnership or corporation
                organized
                or incorporated under the laws of the
                U.S.);

            

    

    

    
      	2.	
              I
                will not, during the period commencing on the purchase date of the
                Pubco
                Common Stock (“Purchase
                Date”)
                and ending one year after the Purchase Date (the “Distribution
                Compliance Period”),
                offer, sell, pledge or otherwise transfer any or all shares of the
                Pubco
                Common Stock in the U.S., its territories or possessions, or to a
                U.S.
                Person or for the account or benefit of a U.S. Person (other than
                distributors), other than in accordance with Rules 903 or 904 of
                Regulation S under the Securities Act, pursuant to registration under
                the
                Securities Act or an available exemption therefrom and, in any case,
                in
                accordance with applicable state and foreign securities laws;

            

    

    

    
      	3.	
              Neither
                I, any of my affiliates, nor any person acting on my or their behalf
                has
                engaged, or will engage, in any Directed Selling Efforts (as defined
                in
                Regulation S) with respect to the Pubco Common Stock or any distribution,
                as that term is used in the definition of Distributor in Regulation
                S
                under the Securities Act, with respect to the Pubco Common
                Stock;

            

    

    

    
      	4.	
              Neither
                I, any of my affiliates, nor any person acting on my or their behalf
                has
                undertaken or carried out any activity for the purpose of, or that
                could
                reasonably be expected to have the effect of, conditioning the market
                in
                the U. S., its territories or possessions, for any of the Pubco Common
                Stock;

            

    

    

    
      	5.	
              If
                I offer and sell any shares of the Pubco Common Stock during the
                Distribution Compliance Period, then I will do so only (a) in
                accordance with the provisions of Regulation S, (b) pursuant to
                registration of the Pubco Common Stock under the Securities Act,
                or
                (c) pursuant to an available exemption from the registration
                requirements of the Securities Act. I will not engage in any hedging
                transactions involving the shares of Pubco Common Stock unless such
                hedging transaction is conducted in compliance with the Securities
                Act;

            

    

    

    
      	6.	
              The
                transactions contemplated by the Agreement (a) have not been
                prearranged with a purchaser located in the U.S., its territories
                or
                possessions, or who is a U.S. person, and (b) are not part of a plan
                or scheme to evade the registration provisions of the Securities
                Act;

            

    

    

    
      	7.	
              I
                am not part of a group that has been formed principally for the purpose
                of
                investing in securities not registered under the Securities
                Act;

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              8.

            	
              I
                have not undertaken, and will have no obligation, to register any
                of the
                Pubco Common Stock under the Securities
                Act;

            

    

    

    
      	9.	
              Pubco
                is entitled to rely on the acknowledgements, agreements, representations
                and warranties and the statements and answers of me contained in
                the
                Agreement and this Certificate, and I will hold harmless Pubco from
                any
                loss or damage either one may suffer as a result of any such
                acknowledgements, agreements, representations and/or warranties made
                by me
                not being true and correct;

            

    

    

    
      	10.	
              I
                have been advised to consult my own legal, tax and other advisors
                with
                respect to the merits and risks of an investment in the Pubco Common
                Stock
                and, with respect to applicable resale restrictions, am solely responsible
                (and Pubco is not in any way responsible) for compliance with applicable
                resale restrictions;

            

    

    

    
      	11.	
              I
                acknowledge that the Pubco Common Stock is not listed on any other
                stock
                exchange or automated dealer quotation system and no representation
                has
                been made to me that the Pubco Common Stock will become listed on
                any
                other stock exchange or automated dealer quotation system, except
                that
                currently certain market makers make market in the common shares
                of Pubco
                on the OTCBB (as defined in the
                Agreement);

            

    

    

    
      	12.	
              At
                the time of the origination of contact concerning the purchase of
                the
                Pubco Common Stock, and at the date of execution and delivery of
                the Sale
                and Purchase Agreement relating thereto, I, and any person acting
                on my
                behalf, was and am outside the U.S., its territories and possessions
                when
                receiving and executing the Agreement and am acquiring the Pubco
                Common
                Stocks as principal for my own account, for investment purposes only,
                and
                not with a view to, or for, resale, distribution or fractionalization
                thereof, in whole or in part, and no other person has a direct or
                indirect
                beneficial interest in the Pubco Common
                Stocks;

            

    

     

    
      	13.	
              I
                acknowledge that neither the Securities Exchange Commission of the
                U.S.
                nor any other securities commission or similar regulatory authority
                has
                reviewed or passed on the merits of the Pubco Common
                Stock;

            

    

    

    
      	14.	
              I
                acknowledge that the Pubco Common Stock is not being acquired, directly
                or
                indirectly, for the account or benefit of a U.S. Person or a person
                in the
                U.S.;

            

    

    

    
      	15.	
              I
                acknowledge and agree that Pubco shall refuse to register any transfer
                of
                Pubco Common Stocks not made in accordance with the provisions of
                Regulation S, pursuant to registration under the Securities Act,
                or
                pursuant to an available exemption from registration under the Securities
                Act; and

            

    

    

    
      	16.	
              I
                understand and agree that the
                Pubco Common Stocks
                will bear the following legend:

            

    

    

    “NONE
      OF
      THE SHARES OF COMMON STOCK OF THE COMPANY HAVE BEEN REGISTERED UNDER THE UNITED
      STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”),
      OR
      ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED
      OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS
      DEFINED HEREIN) 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 CONFIRMED BY AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER AND ONLY
      IN
      ACCORDANCE WITH APPLICABLE STATE AND PROVINCIAL SECURITIES LAWS. HEDGING
      TRANSACTIONS INVOLVING THE SECURITIES REPRESENTED HEREBY MAY NOT BE CONDUCTED
      UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, I have executed this Certificate of Non-U.S.
      Shareholder.

    

    
      	
               

               

               

              ____________________

              By:
                WOO
                YUEN YU

            

    

    

    

    Date: _________________,
      2006

    

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      6

    

    EMPLOYMENT
      AGREEMENTS

    

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2006

     

    LUMINOUS
      LED TECHNOLOGIES LIMITED

    

    

    and

    

    

    [name
      of Employee]

     

    
 

    

    
      
        

      

       

    

    EMPLOYMENT
      AGREEMENT

    

    
      

    

     

    
       

      

       

      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: 53667-00002/NKA/CWF

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    THIS
      AGREEMENT
      is made
      on     2006

    

    Between:

    

    
      	
              (1)

            	
              LUMINOUS
                LED TECHNOLOGIES LIMITED,
                incorporated under the laws of Hong Kong, whose registered office
                is at
                Level 25, Bank of China Tower, 1 Garden Road, Central, Hong Kong
                (the
                Company);
                and

            

    

     

    
      	
              (2)

            	
              [name
                of Employee]
                (holder
                of Hong Kong/PRC identity card/holder of US Passport no. [·])
                of
                [address]
                (the Employee).

            

    

     

    Whereas:

    

    
      	(A)	
              Prior
                to the execution of this agreement, the Employee was employed by
                the
                Company. The Company and the Employee have agreed to reduce the terms
                of
                the employment in writing as recorded by the provisions
                herein.

            

    

    

    
      	(B)	
              The
                Employee will be deemed to have continuous service with the Company
                from
                the [date
                employment commenced with relevant company]
                and all accrued entitlements will be recognised by the
                Company.

            

    

    

    IT
      IS AGREED
      as
      follows:

    

    Definitions

    

    
      	1.	
              In
                this Agreement the following expressions shall have the following
                meanings:

            

    

    

    Businesses
      means
      all
      and any trades or other commercial activities of the Company or any Group
      Company with which the Employee has been informed or concerned or involved
      with
      to any material extent at any time during [his/her] appointment by the Company
      which the Company or any Group Company carries on with a view to
      profit;

    

    Board
      means
      the board of directors of the Company or a duly constituted committee of the
      board of directors;

    

    Companies
      Ordinance means
      Chapter 32 of the Laws of the Hong Kong Special Administrative
      Region;

    

    Confidential
      Information
      means
      all and any information of a confidential nature or which the Employee should
      reasonably have known is of a confidential nature (whether or not recorded
      in
      documentary form or on computer disk or tape) relating to the business methods,
      corporate plans, management systems, finances, new business opportunities,
      research and development projects of the Company or any Group Company and any
      and all trade secrets, secret formulae, process, inventions, designs, know-how,
      discoveries, technical specifications and other technical information relating
      to the creation, production or supply of any past, present or future product
      or
      service of the Company or any Group Company, but does not include information
      that is already in the public domain;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Effective
      Date
      means
      the date upon which completion of the Sale and Purchase Agreement takes
      place;

    

    Employment
      means
      the Employee’s employment in accordance with the terms and conditions of this
      Agreement;

    

    Employment
      Ordinance
      means
      Chapter 57 of the Laws of the Hong Kong Special Administrative
      Region;

    

    Group
      Company means
      the
      Company and any company which is a direct or indirect subsidiary of the Company
      from time to time; 

    

    Sale
      and Purchase Agreement means
      the
      sale and purchase agreement among Woo Yuen Yu, Tech Team Investment Limited,
      Michelle Siu Kwan Lam and Joseph Sui Kei Lam dated [*] 2006 to effect the sale
      of certain ordinary shares in the Company from Woo Yuen Yu to Tech Team
      Investment Limited;

    

    subsidiary
      and
subsidiaries
      shall be
      construed in accordance with sections 2(4) to 2(6) of the Companies Ordinance;
      and

    

    Termination
      Date
      means
      the date on which the Employment is terminated howsoever caused (including,
      without limitation, termination by the Company which is in repudiatory breach
      of
      this Agreement).

    

    Term
      and Appointment

    

    
      	2.1	
              According
                to the terms of this Agreement, the Employee shall be appointed as
                the
                [insert
                Employee’s Job Title].

            

    

    

    
      	2.2	
              Subject
                to clause 10, the Employment commences on the Effective Date and
                shall continue unless or until terminated by either party according
                to
                clause 11. 

            

    

    

    Duties

    

    
      	3.1	
              During
                the Employment, the Employee will:

            

    

    

    
      	 	
              (a)

            	
              diligently
                perform all such duties and exercise all such powers as are lawfully
                and
                properly assigned to [him/her] from time to time by the Company or
                any
                authorised employee of the Company, whether such duties or powers
                relate
                to the Company or any other Group
                Company;

            

    

     

    
      	 	
              (b)

            	
              comply
                with all directions lawfully and properly given to [him/her] by the
                Company or any authorised employee of the Company;
                

            

    

     

    
      	 	
              (c)

            	
              unless
                prevented by sickness, injury or other incapacity, devote the whole
                of
                [his/her] time, attention and abilities to the business of the Company
                or
                any other Group Company for which [he/she] is required to perform
                duties
                and shall not (without the Company’s prior written consent) be directly or
                indirectly engaged, concerned or interested in any other business
                activity, trade or occupation; and

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (d)

            	
              promptly
                provide the Company with all such information as it may require in
                connection with the business or affairs of the Company and of any
                other
                Group Company for which [he/she] is required to perform
                duties.

            

    

     

    
      	3.2	
              The
                Employee shall be required to work the Company’s normal business hours
                from [9] a.m. to [6] p.m., Monday to Friday, together with such additional
                hours as are required in the proper performance of [his/her] duties.
                The
                Employee acknowledges that [he/she] has no entitlement to additional
                remuneration for any hours worked in excess of the Company’s normal
                business hours.

            

    

    

    
      	3.3	
              The
                Employee’s normal place of work is [Hong Kong]. However, the Employee may
                be assigned to work in either of the Company’s offices in [insert
                appropriate destinations]
                and may be required to make overseas business trips as may be required
                for
                the proper performance of [his/her] duties under the
                Employment.

            

    

    

    Salary

    

    
      	4.1	
              The
                Employee’s initial salary is [insert
                amount]
                per annum (less any required deductions) paid monthly in arrears
                in [12]
                monthly instalments by autopay on or before the [28th] day of every
                calendar month or, if that is not a bank business day, on the immediately
                preceding bank business day. The Company shall also make mandatory
                contributions as required by the Mandatory Provident Fund Ordinance.
                The
                amount of the salary will not be increased for periods prior to [*]
                2006
                but will be reviewed by the Company each year during the term of
                the
                Employment. Any increase in salary shall, unless specified by the
                Board or
                the Employment is terminated in accordance with the terms herein,
                become
                effective for all periods after 31 December of the year in which
                it is
                notified to the Employee. Such increase in salary shall not exceed
                [15]
                per cent. per annum of the amount of salary paid during the previous
                12
                month period.

            

    

    

    [Insert
      provisions for any increases or salary review if
      relevant.]

    

    
      	4.2	
              The
                Employee’s salary is inclusive of all fees and other remuneration to which
                [he/she] may be or become entitled as an officer of the Company or
                of any
                other Group Company.

            

    

    

    Bonus

    

    
      	5.1	
              The
                Employee shall be entitled to, on completion of every 12 months of
                service, a management bonus in respect of each financial year of
                the
                Company after [31 December 2006] in an amount to be determined by
                the
                Board in its absolute discretion, provided that the total amount
                of
                bonuses payable to all employees for the time being of the Company
                shall
                not exceed [five (5)] per cent. of the combined or, as the case may
                be,
                consolidated audited net profit of the Group (after taxation and
                minority
                interests and the payment of such bonuses but before extraordinary
                items)
                for that financial year. Payment of such bonus shall be made on such
                date
                as the Board may resolve.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              5.2

            	
              After
                the Termination Date the Employee will not be entitled to the bonus
                in
                clause 5.1 and the payment of any bonus to which the Employee may be
                eligible for after the Termination Date will be at the sole discretion
                of
                the Company.

            

    

    

    Mandatory
      provident Fund
      and Medical Scheme

    

    
      	6.1	
              The
                Employee is entitled to join the Mandatory Provident Fund Scheme
                and the
                medical scheme open to membership by employees of the Company, subject
                to
                the terms and conditions of the trust deed and rules governing the
                Mandatory Provident Fund from time to time in force, and to the terms
                and
                conditions of the medical scheme from time to time in
                force.

            

    

    

    
      	6.2	
              The
                Employee’s contribution to the Mandatory Provident Fund Scheme shall be
                deducted from [his/her] salary.

            

    

    

    Holiday

    

    
      	7.1	
              The
                Employee is entitled to [10] working days’ paid holiday (inclusive of
                statutory annual leave according to the Employment Ordinance) per
                calendar
                year during [his/her] Employment (plus public holidays in Hong Kong),
                to
                be taken at a time or times convenient to the Company and in any
                case
                within 12 months of accruing. The right to paid holiday will accrue
                pro
                rata during each calendar year of the Employment. Holidays in excess
                of
                statutory annual leave may not be carried over from one year to the
                next
                and payment will not be made in lieu of holidays not taken. Any holidays
                in excess of statutory annual leave will be forfeited if not taken
                within
                12 months of accruing.

            

    

    

    
      	7.2	
              On
                termination of the Employment, the Employee shall be entitled to
                payment
                in lieu of accrued but untaken holiday (other than holidays forfeited
                in
                accordance with clause 7.1) on a pro rata
                basis.

            

    

    

    Sickness
      and Other Incapacity

    

    
      	8.1	
              Subject
                to the Employee’s compliance with the Company’s policy on notification and
                certification of periods of absence from work, the Employee will
                continue
                to be paid [his/her] full salary during any period of absence from
                work
                due to sickness, injury or other incapacity, up to a maximum of [two
                (2)]
                days for each completed month of service in the first year of service
                and
                [four (4)] days for each completed month of service thereafter.
                

            

    

    

    
      	8.2	
              The
                Employee will not be paid during any period of absence from work
                (other
                than due to holiday, sickness, injury or other incapacity) without
                the
                prior permission of the Company.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Intellectual
      Property

    

    
      	9.1	
              The
                Employee shall forthwith disclose full details of any inventions,
                designs,
                know-how or discoveries, whether registrable or not, or whether patentable
                or a copyright work (Inventions)
                in confidence to the Company and shall regard [himself/herself] in
                relation thereto as a trustee for the
                Company.

            

    

    

    
      	9.2	
              All
                intellectual property rights in such Inventions shall vest absolutely
                in
                the Company which shall be entitled, so far as the law permits, to
                the
                exclusive use thereof.

            

    

    

    
      	9.3	
              Notwithstanding
                clause 9.2 above, the Employee shall at any time assign to the Company
                the
                copyright (by way of assignment of copyright) and other intellectual
                property rights, if any, in respect of all works written, originated,
                conceived or made by the Employee (except only those works written,
                originated, conceived or made by the Employee wholly outside [his/her]
                normal working hours hereunder and wholly unconnected with the Employment)
                during the continuance of the
                Employment.

            

    

    

    
      	9.4	
              The
                Employee agrees and undertakes that at any time during or after the
                termination of [his/her] employment [he/she] will execute such deeds
                or
                documents and do all such acts and things as the Company may deem
                necessary or desirable to substantiate its rights in respect of the
                Inventions and other intellectual property rights referred to in
                this
                clause 9, including for the purpose of obtaining letters patent or
                other
                privileges in all such countries as the Company may
                require.

            

    

    

    Termination

    

    
      	10.1	
              Either
                party may terminate the Employment by providing the other party with
                [three/six/twelve] months’ written notice. The Company may, in its sole
                discretion, also terminate the Employment by making a payment in
                lieu of
                notice. 

            

    

    

    
      	10.2	
              At
                any time during the Employment the Company may also terminate the
                Employment immediately and with no liability to make any further
                payment
                to the Employee (other than in respect of amounts accrued due as
                at the
                date of termination) for serious misconduct, including, without
                limitation, if the Employee:

            

    

    

    
      	 	
              (a)

            	
              commits
                any serious or repeated breach of any of [his/her] obligations under
                this
                Agreement or [his/her] Employment;

            

    

     

    
      	 	
              (b)

            	
              is
                guilty of serious misconduct which, in the Board’s reasonable opinion, has
                damaged or may damage the business or affairs of the Company or any
                other
                Group Company;

            

    

     

    
      	 	
              (c)

            	
              is
                guilty of conduct which, in the Board’s reasonable opinion, brings or is
                likely to bring [himself/herself], the Company or any other Group
                Company
                into disrepute;

            

    

     

    
      	 	
              (d)

            	
              is
                charged with a criminal offence (other than a road traffic offence
                not
                subject to a custodial sentence);

            

    

     

    
      	 	
              (e)

            	
              is
                disqualified from acting as a director of a company by order of a
                competent court;

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (f)

            	
              is
                or becomes incapacitated or ill to the extent that [he/she] is unable
                to
                perform the inherent requirements of the Employment and the Employee
                has
                exhausted all of [his/her] entitlement to paid sickness leave set
                out in
                clause 8, or 

            

    

     

    
      	 	
              (g)

            	
              is
                declared bankrupt or makes any arrangement with or for the benefit
                of
                [his/her] creditors.

            

    

     

    Any
      delay
      or forbearance by the Company in exercising any right of termination shall
      not
      constitute a waiver of it.

     

    
      	10.3	
              On
                termination of the Employment for whatever reason (and whether in
                breach
                of contract or otherwise) the Employee
                will:

            

    

    

    
      	 	
              (a)

            	
              immediately
                deliver to the Company all books, documents, papers, computer records,
                computer data, and any other property relating to the business of
                or
                belonging to the Company or any other Group Company which is in [his/her]
                possession or under [his/her] control. The Employee is not entitled
                to
                retain copies or reproductions of any documents, papers or computer
                records relating to the business of or belonging to the Company or
                any
                other Group Company;

            

    

     

    
      	 	
              (b)

            	
              immediately
                resign from any office [he/she] holds with the Company or any other
                Group
                Company (and from any related trusteeships) without any compensation
                for
                loss of office. Should the Employee fail to do so [he/she] hereby
                irrevocably authorises the Company to appoint some person in [his/her]
                name and on [his/her] behalf to sign any documents and do any thing
                to
                give effect to [his/her] resignation from office;
                and

            

    

     

    
      	 	
              (c)

            	
              immediately
                pay to the Company or, as the case may be, any other Group Company
                all
                outstanding loans or other amounts due or owed to the Company or
                any other
                Group Company. The Employee confirms that, should [he/she] fail to
                do so,
                the Company is to be treated as authorised to deduct from any amounts
                due
                or owed to the Employee by the Company (or any other Group Company)
                a sum
                equal to such amounts. 

            

    

     

    
      	10.4	
              The
                Employee will not at any time after termination of the Employment
                represent [himself/herself] as being in any way concerned with or
                interested in the business of, or employed by, the Company or any
                other
                Group Company.

            

    

    

    
      	10.5	
              The
                Employee agrees that any payments pursuant to this clause 11 will
                be in
                full and final settlement of any and all claims the Employee may
                have
                against the Company or any other Group Company arising out of or
                in
                connection with [his/her] Employment or its
                termination.

            

    

    

    Suspension

    

    
      	11.1	
              Where
                notice of termination has been served by either party whether in
                accordance with clause 10.1 or otherwise, the Company shall be under
                no obligation to provide work for or assign any duties to the Employee
                for
                the whole or any part of the relevant notice period and may require
                [him/her]:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (a)

            	
              not
                to attend any premises of the Company or any other Group Company;
                and/or

            

    

     

    
      	 	
              (b)

            	
              to
                resign with immediate effect from any offices [he/she] holds with
                the
                Company or any other Group Company (and any related trusteeships);
                and/or

            

    

     

    
      	 	
              (c)

            	
              to
                refrain from business contact with any customers, clients or employees
                of
                the Company or any Group Company;
                and/or

            

    

     

    
      	 	
              (d)

            	
              to
                take any holiday which has accrued under clause 7.1 during any period
                of suspension under this
                clause 11.1.

            

    

     

    
      	11.2	
              The
                provisions of clauses 12 and 13 shall remain in full force and effect
                during any period of suspension under
                clause 11.1.

            

    

    

    
      	11.3	
              Any
                suspension under clause 11.1 shall be on full salary and benefits
                during any period of suspension).

            

    

    

    Confidential
      Information 

    

    
      	12.1	
              The
                Employee acknowledges:

            

    

    

    
      	 	
              (a)

            	
              that
                the Confidential Information is valuable to the Company and other
                Group
                Companies;

            

    

     

    
      	 	
              (b)

            	
              that
                the Company will provide the Employee with access to Confidential
                Information so that the Employee is properly able to carry out the
                duties
                pursuant to this Agreement;

            

    

     

    
      	 	
              (c)

            	
              that
                the Employee owes, without limitation, a duty of trust and confidence
                to
                the Company and a duty to act at all times in the best interests
                of the
                Company;

            

    

     

    
      	 	
              (d)

            	
              that
                the disclosure of any Confidential Information to any customer or
                actual
                or potential competitor of the Company or any Group Company would
                place
                the Company at a serious competitive disadvantage and would cause
                immeasurable damage to the Businesses and therefore the restrictions
                contained in clauses 12 and 13 are reasonable to protect the
                Company;

            

    

     

    and
      the
      Employee undertakes that [he/she] will not at any time (whether during the
      Employment or for a period of [36] months from the Termination Date) use for
      [his/her] own or another’s advantage, or reveal to any person, firm, company or
      organisation and shall use [his/her] best endeavours to prevent the publication
      or disclosure of any Confidential Information concerning the business or affairs
      of the Company or any other Group Company or any of its or their
      customers.

    

    
      	12.2	
              The
                restrictions in this clause shall not apply so as to prevent the
                Employee
                from using [his/her] own personal skill in any business in which
                [he/she]
                may be lawfully engaged after the Employment is
                ended.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Restrictive
      Covenants

    

    
      	13.1	
              The
                Employee covenants with the Company (for itself and as trustee and
                agent
                for each other Group Company) that [he/she] shall not, whether directly
                or
                indirectly, on [his/her] own behalf or on behalf of or in conjunction
                with
                any other person, firm, company or other
                entity:

            

    

    

    
      	 	
              (a)

            	
              during
                the Employment or for the period of [12] months following the Termination
                Date, solicit or entice away or endeavour to solicit or entice away
                from
                the Company or any Group Company any person, firm, company or other
                entity
                who is, or was, in the [six (6)] months immediately prior to the
                Termination Date, a client of the Company or any Group Company with
                whom
                the Employee had business dealings during the course of [his/her]
                employment in that [six (6)] month period. Nothing in this
                clause 13.1(a) shall prohibit the seeking or doing of business not in
                direct or indirect competition with the business of the Company or
                any
                Group Company;

            

    

     

    
      	 	
              (b)

            	
              during
                the Employment or for the period of [12] months following the Termination
                Date, solicit or entice away or endeavour to solicit or entice away
                any
                individual person who is employed or engaged by the Company or any
                Group
                Company either as a director or in a managerial or technical capacity;
                or
                who is in possession of Confidential Information belonging to the
                Company
                and/or any Group Company and with whom the Employee had business
                dealings
                during the course of [his/her] employment in the [six (6)] month
                period
                immediately prior to the Termination Date;

            

    

     

    
      	 	
              (c)

            	
              during
                the Employment or for the period of [12] months following the Termination
                Date, carry on, set up, be employed, engaged or interested in a business
                anywhere in Hong Kong, at the Termination Date which is in, whether
                directly or indirectly, competition with the business of the Company
                or
                any Group Company as at the Termination Date with which the Employee
                was
                actively involved during the [six (6)] month period immediately prior
                to
                the Termination Date. It is agreed that if any such company ceases
                to be
                in competition with the Company and/or any Group Company this
                clause 13.1(c) shall, with effect from that date, cease to apply in
                respect of such company. The provisions of this clause 13.1(c) shall
                not, at any time following the Termination Date, prevent the Employee
                from
                holding shares or other capital not amounting to more than [five
                (5)] per
                cent. of the total issued share capital of any company whether listed
                on
                any recognised stock exchange or not and, in addition, shall not
                prohibit
                the seeking or doing of business not in direct or indirect competition
                with the business of the Company or any Group
                Company.

            

    

     

    
      	13.2	
              While
                the Parties agree that the restrictions contained in Clause 12 and
                13 are
                reasonable in all the circumstances, it is agreed that if any court
                of
                competent jurisdiction holds that the length of the post-termination
                covenants contained in clauses 12 and 13 are not reasonable, the
                parties
                agree that:

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (a)

            	
              the
                covenants are to apply for a period of [nine (9)] months from the
                Termination Date; or, if this period is held to be
                unreasonable;

            

    

     

    
      	 	
              (b)

            	
              for
                a period of [six (6)] months from the Termination Date; or if this
                period
                is held to be unreasonable;

            

    

     

    
      	 	
              (c)

            	
              for
                such other period as any court of competent jurisdiction decides
                is
                reasonable.

            

    

     

    
      	13.3	
              The
                period during which the restrictions referred to in clauses 13.1(a)
                to (c) inclusive which apply following the Termination Date shall
                be
                reduced by the amount of time during which, if at all, the Company
                suspends the Employee under the provisions of clause 11.1.
                

            

    

    

    Miscellaneous

    

    
      	14.1	
              This
                Agreement, together with any other documents referred to in this
                Agreement, supersedes all other agreements both oral and in writing
                between the Company and the Employee (other than those expressly
                referred
                to herein). The Employee acknowledges that [he/she] has not entered
                into
                this Agreement in reliance upon any representation, warranty or
                undertaking which is not set out in this Agreement or expressly referred
                to in it as forming part of the Employee’s contract of
                employment.

            

    

    

    
      	14.2	
              The
                Employee represents and warrants to the Company that [he/she] will
                not by
                reason of entering into the Employment, or by performing any duties
                under
                this Agreement, be in breach of any terms of employment with a third
                party
                whether express or implied or of any other obligation binding on
                [him/her].

            

    

    

    
      	14.3	
              Any
                notice to be given under this Agreement to the Employee may be served
                by
                being handed to [him/her] personally or by being sent by registered
                post
                to [him/her] at [his/her] usual or last known address; and any notice
                to
                be given to the Company may be served by being left at or by being
                sent by
                registered post to its registered office for the time being. Any
                notice
                served by registered post shall be deemed to have been served two
                days
                (excluding Sundays and statutory holidays) after the date of the
                registered post receipt. 

            

    

    

    
      	14.4	
              The
                provisions of clauses 12, 13 and 14 shall remain in full force and
                effect after the Termination Date. 

            

    

    

    
      	14.5	
              This
                Agreement and the relationship between the parties shall be governed
                by,
                and interpreted in accordance with, the laws of the Hong Kong Special
                Administrative Region of the People’s Republic of China (Hong
                Kong).
                Each of the parties agrees that the courts of the Hong Kong are to
                have
                non-exclusive jurisdiction to settle any disputes (including claims
                for
                set-off and counterclaims) which may arise in connection with the
                creation, validity, effect, interpretation or performance of, or
                the legal
                relationships established by, this Agreement or otherwise arising
                in
                connection with this Agreement, and for such purposes irrevocably
                submit
                to the non-exclusive jurisdiction of the courts of the Hong
                Kong.

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF THIS AGREEMENT
      has
      been
      signed on the date the day and year first above written.

    

    

      
        	
                SIGNED
                  for
                  and on behalf of

              	
                )

              
	
                LUMINOUS
                  LED

              	
                )

              
	
                TECHNOLOGIES
                  LIMITED

              	
                )
                  

              
	
                in
                  the presence of:

              	
                )

              
	 	 
	
                SIGNED
                  by
                  the [name
                  of Employee]

              	
                )

              
	
                in
                  the presence of: 

              	
                )

              

      

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS
      whereof
      this Agreement has been duly executed by all parties hereto the day and year
      first above written.

    

      
        	
                THE
                  VENDOR

              	 	 
	 	 	 
	
                SIGNED
                  

              	
                )

              	 
	
                by
                  MICHELLE
                  SIU KWAN LAM 

              	
                )

              	 
	
                lawful
                  attorney for WOO
                  YUEN YU 

              	
                )
                  

              	
                SGD.

              
	
                in
                  the presence of: 

              	
                )

              	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
                THE
                  PURCHASER

              	 	 
	 	 	 
	
                SIGNED
                  by
                  TAN, BONDY 

              	
                )

              	 
	
                 

              	
                )

              	 
	
                for
                  and on behalf of 

              	
                )

              	 
	
                 

              	
                )
                  

              	
                SGD.

              
	
                TECH
                  TEAM INVESTMENT 

              	
                )

              	 
	
                LIMITED
                  

              	
                )

              	 
	
                 

              	
                )

              	 
	
                in
                  the presence of: 

              	
                )

              	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
                THE
                  GUARANTORS

              	 	 
	 	 	 
	
                SIGNED,
                  SEALED AND DELIVERED 

              	
                )

              	 
	
                by
                  MICHELLE
                  SIU KWAN LAM 

              	
                )
                  

              	
                SGD.

              
	
                in
                  the presence of: 

              	
                )

              	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
                SIGNED,
                  SEALED AND DELIVERED 

              	
                )

              	 
	
                by
                  JOSEPH
                  SUI KEI LAM 

              	
                )
                  

              	
                SGD.

              
	
                in
                  the presence of: 

              	
                )

              	 

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ANNEXURE

    

    Management
      AccountsEXHIBIT 10.31
                                                                   -------------

           AMENDED AND RESTATED STANDBY EQUITY DISTRIBUTION AGREEMENT

         THIS AMENDED AND RESTATED AGREEMENT dated as of the 12th day of
December 2005 (the "Agreement") between CORNELL CAPITAL PARTNERS, LP, a Delaware
limited partnership (the "Investor"), and SPEECHSWITCH, INC., a corporation
organized and existing under the laws of the State of New Jersey (the
"Company").

         WHEREAS, on August 31, 2005, the parties hereto entered into a Standby
Equity Distribution Agreement. This Agreement shall amend and restate the
Standby Equity Distribution Agreement dated August 31, 2005 (the "Original
Agreement");

         WHEREAS, any and all agreements, documents and instruments in
connection with the Standby Equity Distribution Agreement dated August 31, 2005,
including without limitation the Registration Rights Agreement and Placement
Agent Agreement, shall be superseded by this Agreement, the Registration Rights
Agreement and Placement Agreement, each of even date herewith;

         WHEREAS, the Escrow Agreement dated August 31, 2005 has been
terminated;

         WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue and sell to the Investor,
from time to time as provided herein, and the Investor shall purchase from the
Company up to Ten Million Dollars ($10,000,000) of the Company's Class A common
stock, no par value per share (the "Common Stock");

         WHEREAS, such investments will be made in reliance upon the provisions
of Regulation D ("Regulation D") of the Securities Act of 1933, as amended, and
the regulations promulgated thereunder (the "Securities Act"), and or upon such
other exemption from the registration requirements of the Securities Act as may
be available with respect to any or all of the investments to be made hereunder;
and

         WHEREAS, the Company has engaged Monitor Capital, Inc. (the "Placement
Agent"), to act as the Company's exclusive placement agent in connection with
the sale of the Company's Common Stock to the Investor hereunder pursuant to the
Placement Agent Agreement dated the date hereof by and among the Company, the
Placement Agent and the Investor (the "Placement Agent Agreement").

         NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I.
                               CERTAIN DEFINITIONS

         Section 1.1. "Advance" shall mean the portion of the Commitment Amount
requested by the Company in the Advance Notice.

<PAGE>

         Section 1.2. "Advance Date" shall mean the first (1st) Trading Day
after expiration of the applicable Pricing Period for each Advance.

         Section 1.3. "Advance Notice" shall mean a written notice in the form
of Exhibit A attached hereto to the Investor executed by an officer of the
Company and setting forth the Advance amount that the Company requests from the
Investor.

         Section 1.4. "Advance Notice Date" shall mean each date the Company
delivers to the Investor an Advance Notice requiring the Investor to advance
funds to the Company, subject to the terms of this Agreement. No Advance Notice
Date shall be less than five (5) Trading Days after the prior Advance Notice
Date.

         Section 1.5. "Bid Price" shall mean, on any date, the closing bid price
(as reported by Bloomberg L.P.) of the Common Stock on the Principal Market or
if the Common Stock is not traded on a Principal Market, the highest reported
bid price for the Common Stock, as furnished by the National Association of
Securities Dealers, Inc.

         Section 1.6. "Closing" shall mean one of the closings of a purchase and
sale of Common Stock pursuant to Section 2.3.

         Section 1.7. "Commitment Amount" shall mean the aggregate amount of up
to Ten Million Dollars ($10,000,000) which the Investor has agreed to provide to
the Company in order to purchase the Company's Common Stock pursuant to the
terms and conditions of this Agreement.

         Section 1.8. "Commitment Period" shall mean the period commencing on
the earlier to occur of (i) the Effective Date, or (ii) such earlier date as the
Company and the Investor may mutually agree in writing, and expiring on the
earliest to occur of (x) the date on which the Investor shall have made payment
of Advances pursuant to this Agreement in the aggregate amount of Ten Million
Dollars ($10,000,000), (y) the date this Agreement is terminated pursuant to
Section 2.4, or (z) the date occurring twenty-four (24) months after the
Effective Date.

         Section 1.9. "Common Stock" shall mean the Company's Class A common
stock, no par value per share.

         Section 1.10. "Condition Satisfaction Date" shall have the meaning set
forth in Section 7.2.

         Section 1.11. "Damages" shall mean any loss, claim, damage, liability,
costs and expenses (including, without limitation, reasonable attorney's fees
and disbursements and costs and expenses of expert witnesses and investigation).

         Section 1.12. "Effective Date" shall mean the date on which the SEC
first declares effective a Registration Statement registering the resale of the
Registrable Securities as set forth in Section 7.2(a).

         Section 1.13. INTENTIONALLY OMITTED.

                                        2
<PAGE>

         Section 1.14. "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.

         Section 1.15. "Material Adverse Effect" shall mean any condition,
circumstance, or situation that would prohibit or otherwise materially interfere
with the ability of the Company to enter into and perform any of its obligations
under this Agreement or the Registration Rights Agreement in any material
respect.

         Section 1.16. "Market Price" shall mean the lowest closing Bid Price of
the Common Stock during the Pricing Period.

         Section 1.17. "Maximum Advance Amount" shall be Six Hundred Thousand
Dollars ($600,000) per Advance Notice.

         Section 1.18. "NASD" shall mean the National Association of Securities
Dealers, Inc.

         Section 1.19. "Person" shall mean an individual, a corporation, a
partnership, an association, a trust or other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof.

         Section 1.20. "Placement Agent" shall mean Monitor Capital, Inc., a
registered broker-dealer.

         Section 1.21. "Pricing Period" shall mean the five (5) consecutive
Trading Days after the Advance Notice Date.

         Section 1.22. "Principal Market" shall mean the Nasdaq National Market,
the Nasdaq SmallCap Market, the American Stock Exchange, the OTC Bulletin Board
or the New York Stock Exchange, whichever is at the time the principal trading
exchange or market for the Common Stock.

         Section 1.23. "Purchase Price" shall be set at ninety five percent
(95%) of the Market Price during the Pricing Period.

         Section 1.24. "Registrable Securities" shall mean the shares of Common
Stock to be issued hereunder (i) in respect of which the Registration Statement
has not been declared effective by the SEC, (ii) which have not been sold under
circumstances meeting all of the applicable conditions of Rule 144 (or any
similar provision then in force) under the Securities Act ("Rule 144") or (iii)
which have not been otherwise transferred to a holder who may trade such shares
without restriction under the Securities Act, and the Company has delivered a
new certificate or other evidence of ownership for such securities not bearing a
restrictive legend.

         Section 1.25. "Registration Rights Agreement" shall mean the
Registration Rights Agreement dated the date hereof, regarding the filing of the
Registration Statement for the resale of the Registrable Securities, entered
into between the Company and the Investor.

         Section 1.26. "Registration Statement" shall mean a registration
statement on Form S-1 or SB-2 (if use of such form is then available to the
Company pursuant to the rules of the SEC

                                        3
<PAGE>

and, if not, on such other form promulgated by the SEC for which the Company
then qualifies and which counsel for the Company shall deem appropriate, and
which form shall be available for the resale of the Registrable Securities to be
registered thereunder in accordance with the provisions of this Agreement and
the Registration Rights Agreement, and in accordance with the intended method of
distribution of such securities), for the registration of the resale by the
Investor of the Registrable Securities under the Securities Act.

         Section 1.27. "Regulation D" shall have the meaning set forth in the
recitals of this Agreement.

         Section 1.28. "SEC" shall mean the Securities and Exchange Commission.

         Section 1.29. "Securities Act" shall have the meaning set forth in the
recitals of this Agreement.

         Section 1.30. "SEC Documents" shall mean Annual Reports on Form 10-KSB,
Quarterly Reports on Form 10-QSB, Current Reports on Form 8-K and Proxy
Statements of the Company as supplemented to the date hereof, filed by the
Company for a period of at least twelve (12) months immediately preceding the
date hereof or the Advance Date, as the case may be, until such time as the
Company no longer has an obligation to maintain the effectiveness of a
Registration Statement as set forth in the Registration Rights Agreement.

         Section 1.31. "Trading Day" shall mean any day during which the New
York Stock Exchange shall be open for business.

         Section 1.32. "VWAP" shall mean the volume weighted average price of
the Company's Common Stock as quoted by Bloomberg, LP.

                                   ARTICLE II.
                                    ADVANCES

         Section 2.1. Advances.

                  Upon the terms and conditions set forth herein (including,
without limitation, the provisions of Article VII hereof), the Company may
request an Advance by the Investor by the delivery of an Advance Notice. The
number of shares of Common Stock that the Investor shall purchase pursuant to
each Advance shall be determined by dividing the amount of the Advance by the
Purchase Price. No fractional shares shall be issued. Fractional shares shall be
rounded to the next higher whole number of shares. The aggregate maximum amount
of all Advances that the Investor shall be obligated to make under this
Agreement shall not exceed the Commitment Amount.

         Section 2.2. Mechanics.

                  (a) Advance Notice. At any time during the Commitment Period,
the Company may deliver an Advance Notice to the Investor, subject to the
conditions set forth in Section 7.2; provided, however, the amount for each
Advance as designated by the Company in the applicable Advance Notice, shall not
be more than the Maximum Advance Amount. The

                                        4
<PAGE>

aggregate amount of the Advances pursuant to this Agreement shall not exceed the
Commitment Amount. The Company acknowledges that the Investor may sell shares of
the Company's Common Stock corresponding with a particular Advance Notice after
the Advance Notice is received by the Investor. There shall be a minimum of five
(5) Trading Days between each Advance Notice Date.

                  (b) Date of Delivery of Advance Notice. An Advance Notice
shall be deemed delivered on (i) the Trading Day it is received by facsimile or
otherwise by the Investor if such notice is received prior to 12:00 noon Eastern
Time, or (ii) the immediately succeeding Trading Day if it is received by
facsimile or otherwise after 12:00 noon Eastern Time on a Trading Day or at any
time on a day which is not a Trading Day. No Advance Notice may be deemed
delivered on a day that is not a Trading Day.

         Section 2.3. Closings. On each Advance Date (i) the Company shall
deliver to the Investor shares of the Company's Common Stock, representing the
amount of the Advance specified in such Advance Notice pursuant to Section 2.1
herein, registered in the name of the Investor and (ii) simultaneously, the
Investor shall deliver to the Company the amount of the Advance specified in the
Advance Notice by wire transfer of immediately available funds. In addition, on
or prior to the Advance Date, each of the Company and the Investor shall deliver
to the other all documents, instruments and writings required to be delivered by
either of them pursuant to this Agreement in order to implement and effect the
transactions contemplated herein. The extent the Company has not paid the fees,
expenses, and disbursements of the Investor or the Company's counsel in
accordance with Section 12.4, the amount of such fees, expenses, and
disbursements may be deducted by the Investor (and shall be paid to the relevant
party) directly out of the proceeds of the Advance with no reduction in the
amount of shares of the Company's Common Stock to be delivered on such Advance
Date.

         Section 2.4. Termination of Investment. The obligation of the Investor
to make an Advance to the Company pursuant to this Agreement shall terminate
permanently (including with respect to an Advance Date that has not yet
occurred) in the event that (i) there shall occur any stop order or suspension
of the effectiveness of the Registration Statement for an aggregate of fifty
(50) Trading Days, other than due to the acts of the Investor, during the
Commitment Period, or (ii) the Company shall at any time fail materially to
comply with the requirements of Article VI and such failure is not cured within
thirty (30) days after receipt of written notice from the Investor, provided,
however, that this termination provision shall not apply to any period
commencing upon the filing of a post-effective amendment to such Registration
Statement and ending upon the date on which such post effective amendment is
declared effective by the SEC.

         Section 2.5. Agreement to Advance Funds. The Investor agrees to advance
the amount specified in the Advance Notice to the Company after the completion
of each of the following conditions and the other conditions set forth in this
Agreement:

                   (a) the execution and delivery by the Company, and the
Investor, of this Agreement and the Exhibits hereto;

                   (b) The Investor shall have received the shares of Common
Stock applicable to the Advance in accordance with Section 2.3. Such shares
shall be free of restrictive legends.

                                        5
<PAGE>

                   (c) the Company's Registration Statement with respect to the
resale of the Registrable Securities in accordance with the terms of the
Registration Rights Agreement shall have been declared effective by the SEC;

                   (d) the Company shall have obtained all material permits and
qualifications required by any applicable state for the offer and sale of the
Registrable Securities, or shall have the availability of exemptions therefrom.
The sale and issuance of the Registrable Securities shall be legally permitted
by all laws and regulations to which the Company is subject;

                   (e) the Company shall have filed with the Commission in a
timely manner all reports, notices and other documents required of a "reporting
company" under the Exchange Act and applicable Commission regulations;

                   (f) the fees as set forth in Section 12.4 below shall have
been paid or can be withheld as provided in Section 2.3; and

                   (g) the conditions set forth in Section 7.2 shall have been
satisfied.

                   (h) the Company shall have provided to the Investor an
acknowledgement, from the Company's independent certified public accountants as
to its ability to provide all consents required in order to file a registration
statement in connection with this transaction;

                   (i) The Company's transfer agent shall be DWAC eligible.

         Section 2.6. Lock Up Period. On the date hereof, the Company shall
obtain from each officer and director a lock-up agreement, as defined below, in
the form annexed hereto as Schedule 2.6 agreeing to only sell in compliance with
the volume limitation of Rule 144.

         Section 2.7. Hardship. In the event the Investor sells shares of the
Company's Common Stock after receipt of an Advance Notice and the Company fails
to perform its obligations as mandated in Section 2.3, and specifically the
Company fails to deliver to the Investor on the Advance Date the shares of
Common Stock corresponding to the applicable Advance, the Company acknowledges
that the Investor shall suffer financial hardship and therefore shall be liable
for any and all losses, commissions, fees, or financial hardship caused to the
Investor.

                                  ARTICLE III.
                   REPRESENTATIONS AND WARRANTIES OF INVESTOR

         Investor hereby represents and warrants to, and agrees with, the
Company that the following are true and correct as of the date hereof and as of
each Advance Date:

         Section 3.1. Organization and Authorization. The Investor is duly
incorporated or organized and validly existing in the jurisdiction of its
incorporation or organization and has all requisite power and authority to
purchase and hold the securities issuable hereunder. The decision to invest and
the execution and delivery of this Agreement by such Investor, the performance
by such Investor of its obligations hereunder and the consummation by such
Investor of the transactions contemplated hereby have been duly authorized and
requires no other

                                        6
<PAGE>

proceedings on the part of the Investor. The undersigned has the right, power
and authority to execute and deliver this Agreement and all other instruments
(including, without limitations, the Registration Rights Agreement), on behalf
of the Investor. This Agreement has been duly executed and delivered by the
Investor and, assuming the execution and delivery hereof and acceptance thereof
by the Company, will constitute the legal, valid and binding obligations of the
Investor, enforceable against the Investor in accordance with its terms.

         Section 3.2. Evaluation of Risks. The Investor has such knowledge and
experience in financial, tax and business matters as to be capable of evaluating
the merits and risks of, and bearing the economic risks entailed by, an
investment in the Company and of protecting its interests in connection with
this transaction. It recognizes that its investment in the Company involves a
high degree of risk.

         Section 3.3. No Legal Advice From the Company. The Investor
acknowledges that it had the opportunity to review this Agreement and the
transactions contemplated by this Agreement with his or its own legal counsel
and investment and tax advisors. The Investor is relying solely on such counsel
and advisors and not on any statements or representations of the Company or any
of its representatives or agents for legal, tax or investment advice with
respect to this investment, the transactions contemplated by this Agreement or
the securities laws of any jurisdiction.

         Section 3.4. Investment Purpose. The securities are being purchased by
the Investor for its own account, and for investment purposes. The Investor
agrees not to assign or in any way transfer the Investor's rights to the
securities or any interest therein and acknowledges that the Company will not
recognize any purported assignment or transfer except in accordance with
applicable Federal and state securities laws. No other person has or will have a
direct or indirect beneficial interest in the securities. The Investor agrees
not to sell, hypothecate or otherwise transfer the Investor's securities unless
the securities are registered under Federal and applicable state securities laws
or unless, in the opinion of counsel satisfactory to the Company, an exemption
from such laws is available.

         Section 3.5. Accredited Investor. The Investor is an "Accredited
Investor" as that term is defined in Rule 501(a)(3) of Regulation D of the
Securities Act.

         Section 3.6. Information. The Investor and its advisors (and its
counsel), if any, have been furnished with all materials relating to the
business, finances and operations of the Company and information it deemed
material to making an informed investment decision. The Investor and its
advisors, if any, have been afforded the opportunity to ask questions of the
Company and its management. Neither such inquiries nor any other due diligence
investigations conducted by such Investor or its advisors, if any, or its
representatives shall modify, amend or affect the Investor's right to rely on
the Company's representations and warranties contained in this Agreement. The
Investor understands that its investment involves a high degree of risk. The
Investor is in a position regarding the Company, which, based upon employment,
family relationship or economic bargaining power, enabled and enables such
Investor to obtain information from the Company in order to evaluate the merits
and risks of this investment. The Investor has sought such accounting, legal and
tax advice, as it has considered necessary to make an informed investment
decision with respect to this transaction.

                                        7
<PAGE>

         Section 3.7. Receipt of Documents. The Investor and its counsel have
received and read in their entirety: (i) this Agreement and the Exhibits annexed
hereto; (ii) all due diligence and other information necessary to verify the
accuracy and completeness of such representations, warranties and covenants; and
(iii) answers to all questions the Investor submitted to the Company regarding
an investment in the Company; and the Investor has relied on the information
contained therein and has not been furnished any other documents, literature,
memorandum or prospectus.

         Section 3.8. Registration Rights Agreement. The parties have entered
into the Registration Rights Agreement dated the date hereof.

         Section 3.9. No General Solicitation. Neither the Company, nor any of
its affiliates, nor any person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act) in connection with the offer or sale of
the shares of Common Stock offered hereby.

         Section 3.10. Not an Affiliate. The Investor is not an officer,
director or a person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with
the Company or any "Affiliate" of the Company (as that term is defined in Rule
405 of the Securities Act).

         Section 3.11. Trading Activities. The Investor's trading activities
with respect to the Company's Common Stock shall be in compliance with all
applicable federal and state securities laws, rules and regulations and the
rules and regulations of the Principal Market on which the Company's Common
Stock is listed or traded. Neither the Investor nor its affiliates has an open
short position in the Common Stock of the Company, the Investor agrees that it
shall not, and that it will cause its affiliates not to, engage in any short
sales of or hedging transactions with respect to the Common Stock, PROVIDED that
the Company acknowledges and agrees that upon receipt of an Advance Notice the
Investor has the right to sell the shares to be issued to the Investor pursuant
to the Advance Notice during the applicable Pricing Period.

                                   ARTICLE IV.
                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

         Except as stated below, on the disclosure schedules (the "Disclosure
Schedules") attached hereto as Exhibit "B," the Company hereby represents and
warrants to, and covenants with, the Investor that the following are true and
correct as of the date hereof:

         Section 4.1. Organization and Qualification. The Company is duly
incorporated or organized and validly existing in the jurisdiction of its
incorporation or organization and has all requisite corporate power to own its
properties and to carry on its business as now being conducted. Each of the
Company and its subsidiaries is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which the nature of
the business conducted by it makes such qualification necessary, except to the
extent that the failure to be so qualified or be in good standing would not have
a Material Adverse Effect on the Company and its subsidiaries taken as a whole.

                                        8
<PAGE>

         Section 4.2. Authorization, Enforcement, Compliance with Other
Instruments. (i) The Company has the requisite corporate power and authority to
enter into and perform this Agreement, the Registration Rights Agreement, the
Placement Agent Agreement and any related agreements, in accordance with the
terms hereof and thereof, (ii) the execution and delivery of this Agreement, the
Registration Rights Agreement, the Placement Agent Agreement and any related
agreements by the Company and the consummation by it of the transactions
contemplated hereby and thereby, have been duly authorized by the Company's
Board of Directors and no further consent or authorization is required by the
Company, its Board of Directors or its stockholders, (iii) this Agreement, the
Registration Rights Agreement, the Placement Agent Agreement and any related
agreements have been duly executed and delivered by the Company, (iv) this
Agreement, the Registration Rights Agreement, the Placement Agent Agreement and
assuming the execution and delivery thereof and acceptance by the Investor and
any related agreements constitute the valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, except
as such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of creditors'
rights and remedies.

         Section 4.3. Capitalization. As of the date hereof, the authorized
capital stock of the Company consists of 10,000,000,000 shares of Class A Common
Stock, no par value per share, 50,000,000 shares of Class B Common Stock, par
value $0.01 per share, 20,000,000 shares of Class C Common Stock, par value $.01
per share and 1,000,000 shares of Preferred Stock, par value $1.00 per share
("Preferred Stock"), of which 10,050,000 shares of Class A Common Stock and no
shares of Class B Common Stock, Class C Common Stock or Preferred Stock were
issued and outstanding. All of such outstanding shares have been validly issued
and are fully paid and nonassessable. Except as disclosed in the Disclosure
Schedules, no shares of Common Stock are subject to preemptive rights or any
other similar rights or any liens or encumbrances suffered or permitted by the
Company. Except as disclosed in the Disclosure Schedules, as of the date hereof,
(i) there are no outstanding options, warrants, scrip, rights to subscribe to,
calls or commitments of any character whatsoever relating to, or securities or
rights convertible into, any shares of capital stock of the Company or any of
its subsidiaries, or contracts, commitments, understandings or arrangements by
which the Company or any of its subsidiaries is or may become bound to issue
additional shares of capital stock of the Company or any of its subsidiaries or
options, warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, any
shares of capital stock of the Company or any of its subsidiaries, (ii) there
are no outstanding debt securities (iii) there are no outstanding registration
statements other than on Form SB-2 and (iv) there are no agreements or
arrangements under which the Company or any of its subsidiaries is obligated to
register the sale of any of their securities under the Securities Act (except
pursuant to the Registration Rights Agreement). There are no securities or
instruments containing anti-dilution or similar provisions that will be
triggered by this Agreement or any related agreement or the consummation of the
transactions described herein or therein. The Company has furnished to the
Investor true and correct copies of the Company's Certificate of Incorporation,
as amended and as in effect on the date hereof (the "Certificate of
Incorporation"), and the Company's By-laws, as in effect on the date hereof (the
"By-laws"), and the terms of all securities convertible into or exercisable for
Common Stock and the material rights of the holders thereof in respect thereto.

                                        9
<PAGE>

         Section 4.4. No Conflict. The execution, delivery and performance of
this Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby will not (i) result in a violation of the
Certificate of Incorporation, any certificate of designations of any outstanding
series of preferred stock of the Company or By-laws or (ii) conflict with or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its subsidiaries is a party, or result
in a violation of any law, rule, regulation, order, judgment or decree
(including federal and state securities laws and regulations and the rules and
regulations of the Principal Market on which the Common Stock is quoted)
applicable to the Company or any of its subsidiaries or by which any material
property or asset of the Company or any of its subsidiaries is bound or affected
and which would cause a Material Adverse Effect. Except as disclosed in the
Disclosure Schedules, neither the Company nor its subsidiaries is in violation
of any term of or in default under its Articles of Incorporation or By-laws or
their organizational charter or by-laws, respectively, or any material contract,
agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or
order or any statute, rule or regulation applicable to the Company or its
subsidiaries. The business of the Company and its subsidiaries is not being
conducted in violation of any material law, ordinance, regulation of any
governmental entity. Except as specifically contemplated by this Agreement and
as required under the Securities Act and any applicable state securities laws,
the Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency in order
for it to execute, deliver or perform any of its obligations under or
contemplated by this Agreement or the Registration Rights Agreement in
accordance with the terms hereof or thereof. All consents, authorizations,
orders, filings and registrations which the Company is required to obtain
pursuant to the preceding sentence have been obtained or effected on or prior to
the date hereof. The Company and its subsidiaries are unaware of any fact or
circumstance which might give rise to any of the foregoing.

         Section 4.5. Financial Statements. The financial statements of the
Company disclosed in the Disclosure Schedules (the "Financial Statements")
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and, fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). No other
information provided by or on behalf of the Company to the Investor which is not
included in the Disclosure Schedules contains any untrue statement of a material
fact or omits to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.

                                       10
<PAGE>

         Section 4.6. 10b-5. The Disclosure Schedules do not include any untrue
statements of material fact, nor do they omit to state any material fact
required to be stated therein necessary to make the statements made, in light of
the circumstances under which they were made, not misleading.

         Section 4.7. No Default. Except as disclosed in the Disclosure
Schedules, the Company is not in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust or other material instrument or agreement to
which it is a party or by which it is or its property is bound and neither the
execution, nor the delivery by the Company, nor the performance by the Company
of its obligations under this Agreement or any of the exhibits or attachments
hereto will conflict with or result in the breach or violation of any of the
terms or provisions of, or constitute a default or result in the creation or
imposition of any lien or charge on any assets or properties of the Company
under its Certificate of Incorporation, By-Laws, any material indenture,
mortgage, deed of trust or other material agreement applicable to the Company or
instrument to which the Company is a party or by which it is bound, or any
statute, or any decree, judgment, order, rules or regulation of any court or
governmental agency or body having jurisdiction over the Company or its
properties, in each case which default, lien or charge is likely to cause a
Material Adverse Effect on the Company's business or financial condition.

         Section 4.8. Absence of Events of Default. Except for matters described
in the Disclosure Schedules and/or this Agreement, no Event of Default, as
defined in the respective agreement to which the Company is a party, and no
event which, with the giving of notice or the passage of time or both, would
become an Event of Default (as so defined), has occurred and is continuing,
which would have a Material Adverse Effect on the Company's business,
properties, prospects, financial condition or results of operations.

         Section 4.9. Intellectual Property Rights. The Company and its
subsidiaries own or possess adequate rights or licenses to use all material
trademarks, trade names, service marks, service mark registrations, service
names, patents, patent rights, copyrights, inventions, licenses, approvals,
governmental authorizations, trade secrets and rights necessary to conduct their
respective businesses as now conducted. The Company and its subsidiaries do not
have any knowledge of any infringement by the Company or its subsidiaries of
trademark, trade name rights, patents, patent rights, copyrights, inventions,
licenses, service names, service marks, service mark registrations, trade secret
or other similar rights of others, and, to the knowledge of the Company, there
is no claim, action or proceeding being made or brought against, or to the
Company's knowledge, being threatened against, the Company or its subsidiaries
regarding trademark, trade name, patents, patent rights, invention, copyright,
license, service names, service marks, service mark registrations, trade secret
or other infringement; and the Company and its subsidiaries are unaware of any
facts or circumstances which might give rise to any of the foregoing.

         Section 4.10. Employee Relations. Neither the Company nor any of its
subsidiaries is involved in any labor dispute nor, to the knowledge of the
Company or any of its subsidiaries, is any such dispute threatened. None of the
Company's or its subsidiaries' employees is a member of a union and the Company
and its subsidiaries believe that their relations with their employees are good.

                                       11
<PAGE>

         Section 4.11. Environmental Laws. The Company and its subsidiaries are
(i) in compliance with any and all applicable material foreign, federal, state
and local laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), (ii) have received all permits, licenses
or other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) are in compliance with all terms
and conditions of any such permit, license or approval.

         Section 4.12. Title. Except as set forth in the Disclosure Schedules,
the Company has good and marketable title to its properties and material assets
owned by it, free and clear of any pledge, lien, security interest, encumbrance,
claim or equitable interest other than such as are not material to the business
of the Company. Any real property and facilities held under lease by the Company
and its subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by the Company
and its subsidiaries.

         Section 4.13. Insurance. The Company and each of its subsidiaries are
insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as management of the Company believes to be
prudent and customary in the businesses in which the Company and its
subsidiaries are engaged. Neither the Company nor any such subsidiary has been
refused any insurance coverage sought or applied for and neither the Company nor
any such subsidiary has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely affect the condition,
financial or otherwise, or the earnings, business or operations of the Company
and its subsidiaries, taken as a whole.

         Section 4.14. Regulatory Permits. The Company and its subsidiaries
possess all material certificates, authorizations and permits issued by the
appropriate federal, state or foreign regulatory authorities necessary to
conduct their respective businesses, and neither the Company nor any such
subsidiary has received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit.

         Section 4.15. Internal Accounting Controls. The Company and each of its
subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance with
management's general or specific authorization and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

         Section 4.16. No Material Adverse Breaches, etc. Except as set forth in
the Disclosure Schedules, neither the Company nor any of its subsidiaries is
subject to any charter, corporate or other legal restriction, or any judgment,
decree, order, rule or regulation which in the judgment of the Company's
officers has or is expected in the future to have a Material Adverse Effect on
the business, properties, operations, financial condition, results of operations
or prospects of the

                                       12
<PAGE>

Company or its subsidiaries. Except as set forth in the Disclosure Schedules,
neither the Company nor any of its subsidiaries is in breach of any contract or
agreement which breach, in the judgment of the Company's officers, has or is
expected to have a Material Adverse Effect on the business, properties,
operations, financial condition, results of operations or prospects of the
Company or its subsidiaries.

         Section 4.17. Absence of Litigation. Except as set forth in the
Disclosure Schedules, there is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending against or affecting the Company,
the Common Stock or any of the Company's subsidiaries, wherein an unfavorable
decision, ruling or finding would (i) have a Material Adverse Effect on the
transactions contemplated hereby (ii) adversely affect the validity or
enforceability of, or the authority or ability of the Company to perform its
obligations under, this Agreement or any of the documents contemplated herein,
or (iii) except as expressly disclosed in the Disclosure Schedules, have a
Material Adverse Effect on the business, operations, properties, financial
condition or results of operation of the Company and its subsidiaries taken as a
whole.

         Section 4.18. Subsidiaries. Except as disclosed in the Disclosure
Schedules, the Company does not presently own or control, directly or
indirectly, any interest in any other corporation, partnership, association or
other business entity.

         Section 4.19. Tax Status. Except as disclosed in the Disclosure
Schedules, the Company and each of its subsidiaries has made or filed all
federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which it is subject and (unless and only to the
extent that the Company and each of its subsidiaries has set aside on its books
provisions reasonably adequate for the payment of all unpaid and unreported
taxes) has paid all taxes and other governmental assessments and charges that
are material in amount, shown or determined to be due on such returns, reports
and declarations, except those being contested in good faith and has set aside
on its books provision reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the Company know of no
basis for any such claim.

         Section 4.20. Certain Transactions. Except as set forth in the
Disclosure Schedules none of the officers, directors, or employees of the
Company is presently a party to any transaction with the Company (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which any officer, director, or any such employee has a substantial interest or
is an officer, director, trustee or partner.

         Section 4.21. Fees and Rights of First Refusal. The Company is not
obligated to offer the securities offered hereunder on a right of first refusal
basis or otherwise to any third parties including, but not limited to, current
or former shareholders of the Company, underwriters, brokers, agents or other
third parties.

                                       13
<PAGE>

         Section 4.22. Use of Proceeds. The Company shall use the net proceeds
from this offering for general corporate purposes, including, without
limitation, the payment of loans incurred by the Company. However, in no event
shall the Company use the net proceeds from this offering for the payment (or
loan to any such person for the payment) of any judgment, or other liability,
incurred by any executive officer, officer, director or employee of the Company,
except for any liability owed to such person for services rendered, or if any
judgment or other liability is incurred by such person originating from services
rendered to the Company, or the Company has indemnified such person from
liability.

         Section 4.23. Further Representation and Warranties of the Company. For
so long as any securities issuable hereunder held by the Investor remain
outstanding, the Company acknowledges, represents, warrants and agrees that it
will maintain the listing of its Common Stock on the Principal Market.

         Section 4.24. Opinion of Counsel. Investor shall receive an opinion
letter from counsel to the Company on the date hereof.

         Section 4.25. Opinion of Counsel. The Company will obtain for the
Investor, at the Company's expense, any and all opinions of counsel which may be
reasonably required in order to sell the securities issuable hereunder without
restriction.

         Section 4.26. Dilution. The Company is aware and acknowledges that
issuance of shares of the Company's Common Stock could cause dilution to
existing shareholders and could significantly increase the outstanding number of
shares of Common Stock.

                                   ARTICLE V.
                                 INDEMNIFICATION

         The Investor and the Company represent to the other the following with
respect to itself:

         Section 5.1. Indemnification.

                  (a) In consideration of the Investor's execution and delivery
of this Agreement, and in addition to all of the Company's other obligations
under this Agreement, the Company shall defend, protect, indemnify and hold
harmless the Investor, and all of its officers, directors, partners, employees
and agents (including, without limitation, those retained in connection with the
transactions contemplated by this Agreement) (collectively, the "Investor
Indemnitees") from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Investor Indemnitee is a
party to the action for which indemnification hereunder is sought), and
including reasonable attorneys' fees and disbursements (the "Indemnified
Liabilities"), incurred by the Investor Indemnitees or any of them as a result
of, or arising out of, or relating to (a) any misrepresentation or breach of any
representation or warranty made by the Company in this Agreement or the
Registration Rights Agreement or any other certificate, instrument or document
contemplated hereby or thereby, (b) any breach of any covenant, agreement or
obligation of the Company contained in this Agreement or the Registration Rights
Agreement or any other certificate, instrument or document contemplated hereby
or thereby, or (c) any cause of action, suit or claim brought or made against
such Investor

                                       14
<PAGE>

Indemnitee not arising out of any action or inaction of an Investor Indemnitee,
and arising out of or resulting from the execution, delivery, performance or
enforcement of this Agreement or any other instrument, document or agreement
executed pursuant hereto by any of the Investor Indemnitees. To the extent that
the foregoing undertaking by the Company may be unenforceable for any reason,
the Company shall make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities, which is permissible under applicable
law.

                  (b) In consideration of the Company's execution and delivery
of this Agreement, and in addition to all of the Investor's other obligations
under this Agreement, the Investor shall defend, protect, indemnify and hold
harmless the Company and all of its officers, directors, shareholders, employees
and agents (including, without limitation, those retained in connection with the
transactions contemplated by this Agreement) (collectively, the "Company
Indemnitees") from and against any and all Indemnified Liabilities incurred by
the Company Indemnitees or any of them as a result of, or arising out of, or
relating to (a) any misrepresentation or breach of any representation or
warranty made by the Investor in this Agreement, the Registration Rights
Agreement, or any instrument or document contemplated hereby or thereby executed
by the Investor, (b) any breach of any covenant, agreement or obligation of the
Investor(s) contained in this Agreement, the Registration Rights Agreement or
any other certificate, instrument or document contemplated hereby or thereby
executed by the Investor, or (c) any cause of action, suit or claim brought or
made against such Company Indemnitee based on misrepresentations or due to a
breach by the Investor and arising out of or resulting from the execution,
delivery, performance or enforcement of this Agreement or any other instrument,
document or agreement executed pursuant hereto by any of the Company
Indemnitees. To the extent that the foregoing undertaking by the Investor may be
unenforceable for any reason, the Investor shall make the maximum contribution
to the payment and satisfaction of each of the Indemnified Liabilities, which is
permissible under applicable law.

                  (c) The obligations of the parties to indemnify or make
contribution under this Section 5.1 shall survive termination.

                                   ARTICLE VI.
                            COVENANTS OF THE COMPANY

         Section 6.1. Registration Rights. The Company shall cause the
Registration Rights Agreement to remain in full force and effect and the Company
shall comply in all material respects with the terms thereof.

         Section 6.2. Listing of Common Stock. The Company shall maintain the
Common Stock's authorization for quotation on the National Association of
Securities Dealers Inc.'s Over the Counter Bulletin Board.

         Section 6.3. Exchange Act Registration. The Company will cause its
Common Stock to continue to be registered under Section 12(g) of the Exchange
Act, will file in a timely manner all reports and other documents required of it
as a reporting company under the Exchange Act and will not take any action or
file any document (whether or not permitted by Exchange Act or

                                       15
<PAGE>

the rules thereunder) to terminate or suspend such registration or to terminate
or suspend its reporting and filing obligations under said Exchange Act.

         Section 6.4. Transfer Agent Instructions. Upon effectiveness of the
Registration Statement the Company shall deliver instructions to its transfer
agent to issue shares of Common Stock to the Investor free of restrictive
legends on or before each Advance Date

         Section 6.5. Corporate Existence. The Company will take all steps
necessary to preserve and continue the corporate existence of the Company.

         Section 6.6. Notice of Certain Events Affecting Registration;
Suspension of Right to Make an Advance. The Company will immediately notify the
Investor upon its becoming aware of the occurrence of any of the following
events in respect of a registration statement or related prospectus relating to
an offering of Registrable Securities: (i) receipt of any request for additional
information by the SEC or any other Federal or state governmental authority
during the period of effectiveness of the Registration Statement for amendments
or supplements to the registration statement or related prospectus; (ii) the
issuance by the SEC or any other Federal or state governmental authority of any
stop order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose; (iii) receipt of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; (iv) the happening of any event that makes any statement made in the
Registration Statement or related prospectus of any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or
that requires the making of any changes in the Registration Statement, related
prospectus or documents so that, in the case of the Registration Statement, it
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and that in the case of the related prospectus, it will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and (v) the Company's reasonable determination that a post-effective
amendment to the Registration Statement would be appropriate; and the Company
will promptly make available to the Investor any such supplement or amendment to
the related prospectus. The Company shall not deliver to the Investor any
Advance Notice during the continuation of any of the foregoing events.

         Section 6.7. Consent of Investor to Sell Capital Stock. During the
Commitment Period, the Company shall not, without the prior written consent of
the Investor, (i) issue or sell any Common Stock or Preferred Stock without
consideration or for a consideration per share less than the Bid Price of the
Common Stock determined immediately prior to its issuance, (ii) issue or sell
any Preferred Stock warrant, option, right, contract, call, or other security or
instrument granting the holder thereof the right to acquire Common Stock without
consideration or for a consideration per share less than such Common Stock's Bid
Price determined immediately prior to its issuance, or (iii) file any
registration statement on Form S-8, except for the registration of an employee,
officer and/or stock option plan. Notwithstanding to the contrary, the Company
may issue Common Stock issuable pursuant to the Company's obligations upon the
conversion of stock options, convertible debt or Class B Common Stock.

                                       16
<PAGE>

         Section 6.8. Consolidation; Merger. The Company shall not, at any time
after the date hereof, effect any merger or consolidation of the Company with or
into, or a transfer of all or substantially all the assets of the Company to
another entity (a "Consolidation Event") unless the resulting successor or
acquiring entity (if not the Company) assumes by written instrument the
obligation to deliver to the Investor such shares of stock and/or securities as
the Investor is entitled to receive pursuant to this Agreement.

         Section 6.9. Issuance of the Company's Common Stock. The sale of the
shares of Common Stock shall be made in accordance with the provisions and
requirements of Regulation D and any applicable state securities law.

                                  ARTICLE VII.
                CONDITIONS FOR ADVANCE AND CONDITIONS TO CLOSING

         Section 7.1. Conditions Precedent to the Obligations of the Company.
The obligation hereunder of the Company to issue and sell the shares of Common
Stock to the Investor incident to each Closing is subject to the satisfaction,
or waiver by the Company, at or before each such Closing, of each of the
conditions set forth below.

                  (a) Accuracy of the Investor's Representations and Warranties.
The representations and warranties of the Investor shall be true and correct in
all material respects.

                  (b) Performance by the Investor. The Investor shall have
performed, satisfied and complied in all respects with all covenants, agreements
and conditions required by this Agreement and the Registration Rights Agreement
to be performed, satisfied or complied with by the Investor at or prior to such
Closing.

         Section 7.2. Conditions Precedent to the Right of the Company to
Deliver an Advance Notice and the Obligation of the Investor to Purchase Shares
of Common Stock. The right of the Company to deliver an Advance Notice and the
obligation of the Investor hereunder to acquire and pay for shares of the
Company's Common Stock incident to a Closing is subject to the fulfillment by
the Company, on (i) the date of delivery of such Advance Notice and (ii) the
applicable Advance Date (each a "Condition Satisfaction Date"), of each of the
following conditions:

                  (a) Registration of the Common Stock with the SEC. The Company
shall have filed with the SEC a Registration Statement with respect to the
resale of the Registrable Securities in accordance with the terms of the
Registration Rights Agreement. As set forth in the Registration Rights
Agreement, the Registration Statement shall have previously become effective and
shall remain effective on each Condition Satisfaction Date and (i) neither the
Company nor the Investor shall have received notice that the SEC has issued or
intends to issue a stop order with respect to the Registration Statement or that
the SEC otherwise has suspended or withdrawn the effectiveness of the
Registration Statement, either temporarily or permanently, or intends or has
threatened to do so (unless the SEC's concerns have been addressed and the
Investor is reasonably satisfied that the SEC no longer is considering or
intends to take such action), and (ii) no other suspension of the use or
withdrawal of the effectiveness of the

                                       17
<PAGE>

Registration Statement or related prospectus shall exist. The Registration
Statement must have been declared effective by the SEC prior to the first
Advance Notice Date.

                  (b) Authority. The Company shall have obtained all permits and
qualifications required by any applicable state in accordance with the
Registration Rights Agreement for the offer and sale of the shares of Common
Stock, or shall have the availability of exemptions therefrom. The sale and
issuance of the shares of Common Stock shall be legally permitted by all laws
and regulations to which the Company is subject.

                  (c) Fundamental Changes. There shall not exist any fundamental
changes to the information set forth in the Registration Statement which would
require the Company to file a post-effective amendment to the Registration
Statement.

                  (d) Performance by the Company. The Company shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement (including, without
limitation, the conditions specified in Section 2.5 hereof) and the Registration
Rights Agreement to be performed, satisfied or complied with by the Company at
or prior to each Condition Satisfaction Date.

                  (e) No Injunction. No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction that prohibits or directly and adversely affects any of the
transactions contemplated by this Agreement, and no proceeding shall have been
commenced that may have the effect of prohibiting or adversely affecting any of
the transactions contemplated by this Agreement.

                  (f) No Suspension of Trading in or Delisting of Common Stock.
The trading of the Common Stock is not suspended by the SEC or the Principal
Market (if the Common Stock is traded on a Principal Market). The issuance of
shares of Common Stock with respect to the applicable Closing, if any, shall not
violate the shareholder approval requirements of the Principal Market (if the
Common Stock is traded on a Principal Market). The Company shall not have
received any notice threatening the continued listing of the Common Stock on the
Principal Market (if the Common Stock is traded on a Principal Market).

                  (g) Maximum Advance Amount. The amount of an Advance requested
by the Company shall not exceed the Maximum Advance Amount. In addition, in no
event shall the number of shares issuable to the Investor pursuant to an Advance
cause the aggregate number of shares of Common Stock beneficially owned by the
Investor and its affiliates to exceed nine and 9/10 percent (9.9%) of the then
outstanding Common Stock of the Company. For the purposes of this section
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act.

                  (h) No Knowledge. The Company has no knowledge of any event
which would be more likely than not to have the effect of causing such
Registration Statement to be suspended or otherwise ineffective.

                                       18
<PAGE>

                  (i) Executed Advance Notice. The Investor shall have received
the Advance Notice executed by an officer of the Company and the representations
contained in such Advance Notice shall be true and correct as of each Condition
Satisfaction Date.

                                  ARTICLE VIII.
         DUE DILIGENCE REVIEW; NON-DISCLOSURE OF NON-PUBLIC INFORMATION

         Section 8.1. Due Diligence Review. Prior to the filing of the
Registration Statement the Company shall make available for inspection and
review by the Investor, its advisors and representatives, and any underwriter
participating in any disposition of the Registrable Securities on behalf of the
Investor pursuant to the Registration Statement, any such registration statement
or amendment or supplement thereto or any blue sky, NASD or other filing, all
financial and other records, all Disclosure Schedules and other filings with the
SEC, and all other corporate documents and properties of the Company as may be
reasonably necessary for the purpose of such review, and cause the Company's
officers, directors and employees to supply all such information reasonably
requested by the Investor or any such representative, advisor or underwriter in
connection with such Registration Statement (including, without limitation, in
response to all questions and other inquiries reasonably made or submitted by
any of them), prior to and from time to time after the filing and effectiveness
of the Registration Statement for the sole purpose of enabling the Investor and
such representatives, advisors and underwriters and their respective accountants
and attorneys to conduct initial and ongoing due diligence with respect to the
Company and the accuracy of the Registration Statement.

         Section 8.2. Non-Disclosure of Non-Public Information.

                  (a) The Company shall not disclose non-public information to
the Investor, its advisors, or its representatives, unless prior to disclosure
of such information the Company identifies such information as being non-public
information and provides the Investor, such advisors and representatives with
the opportunity to accept or refuse to accept such non-public information for
review. The Company may, as a condition to disclosing any non-public information
hereunder, require the Investor's advisors and representatives to enter into a
confidentiality agreement in form reasonably satisfactory to the Company and the
Investor.

                  (b) Nothing herein shall require the Company to disclose
non-public information to the Investor or its advisors or representatives, and
the Company represents that it does not disseminate non-public information to
any investors who purchase stock in the Company in a public offering, to money
managers or to securities analysts, provided, however, that notwithstanding
anything herein to the contrary, the Company will, as hereinabove provided,
immediately notify the advisors and representatives of the Investor and, if any,
underwriters, of any event or the existence of any circumstance (without any
obligation to disclose the specific event or circumstance) of which it becomes
aware, constituting non-public information (whether or not requested of the
Company specifically or generally during the course of due diligence by such
persons or entities), which, if not disclosed in the prospectus included in the
Registration Statement would cause such prospectus to include a material
misstatement or to omit a material fact required to be stated therein in order
to make the statements, therein, in light of the circumstances in which they
were made, not misleading. Nothing contained in this Section 8.2 shall be
construed to mean that such persons or entities other than the Investor (without
the

                                       19
<PAGE>

written consent of the Investor prior to disclosure of such information) may not
obtain non-public information in the course of conducting due diligence in
accordance with the terms of this Agreement and nothing herein shall prevent any
such persons or entities from notifying the Company of their opinion that based
on such due diligence by such persons or entities, that the Registration
Statement contains an untrue statement of material fact or omits a material fact
required to be stated in the Registration Statement or necessary to make the
statements contained therein, in light of the circumstances in which they were
made, not misleading.

                                   ARTICLE IX.
                           CHOICE OF LAW/JURISDICTION

         Section 9.1. Governing Law. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of New Jersey without
regard to the principles of conflict of laws. The parties further agree that any
action between them shall be heard in Hudson County, New Jersey, and expressly
consent to the jurisdiction and venue of the Superior Court of New Jersey,
sitting in Hudson County, New Jersey and the United States District Court of New
Jersey, sitting in Newark, New Jersey, for the adjudication of any civil action
asserted pursuant to this paragraph.

                                   ARTICLE X.
                             ASSIGNMENT; TERMINATION

         Section 10.1. Assignment. Neither this Agreement nor any rights of the
Company hereunder may be assigned to any other Person.

         Section 10.2. Termination. The obligations of the Investor to make
Advances under Article II hereof shall terminate twenty-four (24) months after
the Effective Date.

                                   ARTICLE XI.
                                     NOTICES

         Section 11.1. Notices. Any notices, consents, waivers, or other
communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by facsimile,
provided a copy is mailed by U.S. certified mail, return receipt requested;
(iii) three (3) days after being sent by U.S. certified mail, return receipt
requested, or (iv) one (1) day after deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the party to
receive the same. The addresses and facsimile numbers for such communications
shall be:

     If to the Company, to:         SpeechSwitch, Inc.
                                    750 Highway 34
                                    Matawan, NJ 07747
                                    Attention: Bruce Knef
                                    Telephone: (732) 441-7700
                                    Facsimile: (732) 441-9895

                                       20
<PAGE>

     With a copy to:                Meritz & Muenz LLP
                                    2021 O Street, NW
                                    Washington, DC 20036
                                    Attention: Lawrence A. Muenz, Esq.
                                    Telephone: (202) 787-1964
                                    Facsimile: (202) 787-3909

     If to the Investor(s):         Cornell Capital Partners, LP
                                    101 Hudson Street -Suite 3700
                                    Jersey City, NJ 07302
                                    Attention: Mark Angelo
                                               Portfolio Manager
                                    Telephone: (201) 985-8300
                                    Facsimile: (201) 985-8266

     With a Copy to:                David Gonzalez, Esq.
                                    101 Hudson Street - Suite 3700
                                    Jersey City, NJ 07302
                                    Telephone: (201) 985-8300
                                    Facsimile: (201) 985-8266

Each party shall provide five (5) days' prior written notice to the other party
of any change in address or facsimile number.

                                  ARTICLE XII.
                                  MISCELLANEOUS

         Section 12.1. Counterparts. This Agreement may be executed in two or
more identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party. In the event any signature page is
delivered by facsimile transmission, the party using such means of delivery
shall cause four (4) additional original executed signature pages to be
physically delivered to the other party within five (5) days of the execution
and delivery hereof, though failure to deliver such copies shall not affect the
validity of this Agreement.

         Section 12.2. Entire Agreement; Amendments. This Agreement supersedes
all other prior oral or written agreements between the Investor, the Company,
their affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor the Investor makes any representation,
warranty, covenant or undertaking with respect to such matters. No provision of
this Agreement may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.

         Section 12.3. Reporting Entity for the Common Stock. The reporting
entity relied upon for the determination of the trading price or trading volume
of the Common Stock on any given

                                       21
<PAGE>

Trading Day for the purposes of this Agreement shall be Bloomberg, L.P. or any
successor thereto. The written mutual consent of the Investor and the Company
shall be required to employ any other reporting entity.

         Section 12.4. Fees and Expenses. The Company hereby agrees to pay the
following fees:

                  (a) Structuring Fees. Each of the parties shall pay its own
fees and expenses (including the fees of any attorneys, accountants, appraisers
or others engaged by such party) in connection with this Agreement and the
transactions contemplated hereby, except that on the date hereof, the Company
shall issue to Yorkville Advisors Management, LLC 325,000 shares of the
Company's Common Stock, which shall have "piggy-back" registration rights.
Subsequently on each advance date, the Company will pay Yorkville Advisors
Management, LLC a structuring fee of Five Hundred Dollars ($500) directly out of
the gross proceeds of each Advance.

                  (b) Commitment Fees.

                           (i) On each Advance Date the Company shall pay to the
Investor, directly from the gross proceeds of each Advance, an amount equal to
six percent (6%) of the amount of each Advance. The Company hereby agrees that
if such payment, as is described above, is not made by the Company on the
Advance Date, such payment will be made at the direction of the Investor as
outlined and mandated by Section 2.3 of this Agreement.

                           (ii) On the date hereof, the Company shall issue to
the Investor 150,000 shares of the Company's Common Stock (the "Investor's
Shares").

                           (iii) Fully Earned. The Investor's Shares shall be
deemed fully earned as of the date hereof.

                           (iv) Registration Rights. The Investor's Shares will
have "piggy-back" registration rights.

         Section 12.5. Brokerage. Each of the parties hereto represents that it
has had no dealings in connection with this transaction with any finder or
broker who will demand payment of any fee or commission from the other party.
The Company on the one hand, and the Investor, on the other hand, agree to
indemnify the other against and hold the other harmless from any and all
liabilities to any person claiming brokerage commissions or finder's fees on
account of services purported to have been rendered on behalf of the
indemnifying party in connection with this Agreement or the transactions
contemplated hereby.

                                       22
<PAGE>

         Section 12.6. Confidentiality. If for any reason the transactions
contemplated by this Agreement are not consummated, each of the parties hereto
shall keep confidential any information obtained from any other party (except
information publicly available or in such party's domain prior to the date
hereof, and except as required by court order) and shall promptly return to the
other parties all schedules, documents, instruments, work papers or other
written information without retaining copies thereof, previously furnished by it
as a result of this Agreement or in connection herein.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       23
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Standby Equity Distribution Agreement to be executed by the
undersigned, thereunto duly authorized, as of the date first set forth above.

                                       COMPANY:
                                       SPEECHSWITCH, INC.

                                       By: ______________________________
                                       Name:  Bruce Knef
                                       Title: CEO

                                       INVESTOR:
                                       CORNELL CAPITAL PARTNERS, LP

                                       BY:  YORKVILLE ADVISORS, LLC
                                       ITS: GENERAL PARTNER

                                       By: ______________________________
                                       Name:  Mark Angelo
                                       Title: Portfolio Manager

                                       24
<PAGE>

                                    EXHIBIT A

                                 ADVANCE NOTICE

                               SPEECHSWITCH, INC.

         The undersigned, Bruce Knef hereby certifies, with respect to the sale
of shares of Common Stock of SPEECHSWITCH, INC. (the "Company"), issuable in
connection with this Advance Notice and Compliance Certificate dated
___________________ (the "Notice"), delivered pursuant to the Standby Equity
Distribution Agreement (the "Agreement"), as follows:

         1. The undersigned is the duly elected CEO of the Company.

         2. There are no fundamental changes to the information set forth in the
Registration Statement which would require the Company to file a post effective
amendment to the Registration Statement.

         3. The Company has performed in all material respects all covenants and
agreements to be performed by the Company and has complied in all material
respects with all obligations and conditions contained in the Agreement on or
prior to the Advance Notice Date, and shall continue to perform in all material
respects all covenants and agreements to be performed by the Company through the
applicable Advance Date.

         4. The undersigned hereby represents, warrants and covenants that it
has made all filings ("SEC Filings") required to be made by it pursuant to
applicable securities laws (including, without limitation, all filings required
under the Securities Exchange Act of 1934, which include Forms 10-Q, 10-K, 8-K,
etc. All SEC Filings and other public disclosures made by the Company,
including, without limitation, all press releases, analysts meetings and calls,
etc. (collectively, the "Public Disclosures"), have been reviewed and approved
for release by the Company's attorneys and, if containing financial information,
the Company's independent certified public accountants. None of the Company's
Public Disclosures contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.

         5. The Advance requested is _____________________.

         The undersigned has executed this Certificate this __ day of _________.

                                                   SPEECHSWITCH, INC.

                                                   By: _______________________
                                                   Name:  Bruce Knef
                                                   Title: CEO

                                       25
<PAGE>

                                  SCHEDULE 2.6
                                  ------------

                               SPEECHSWITCH, INC.
                               ------------------

         The undersigned hereby agrees that for a period commencing on August
___, 2005 and expiring on the later of (a) the date that all amounts owed to
Cornell Capital Partners, LP (the "Investor"), or any successors or assigns,
under the Promissory Note dated February 28, 2005 issued from SpeechSwitch, Inc.
(the "Company") to the Investor have been paid or (b) the termination of the
Standby Equity Distribution Agreement dated August ___, 2005 between the Company
and the Investor (the "Lock-up Period"), he, she or it will not, directly or
indirectly, without the prior written consent of the Investor, issue, offer,
agree or offer to sell, sell, grant an option for the purchase or sale of,
transfer, pledge, assign, hypothecate, distribute or otherwise encumber or
dispose of any securities of the Company, including common stock or options,
rights, warrants or other securities underlying, convertible into, exchangeable
or exercisable for or evidencing any right to purchase or subscribe for any
common stock (whether or not beneficially owned by the undersigned), or any
beneficial interest therein (collectively, the "Securities") except in
accordance with the volume limitations set forth in Rule 144(e) of the General
Rules and Regulations under the Securities Act of 1933, as amended.
Notwithstanding to the contrary, the Company may issue Common Stock issuable
pursuant to the Company's obligations upon the conversion of stock options,
convertible debt or Class B Common Stock.

         In order to enable the aforesaid covenants to be enforced, the
undersigned hereby consents to the placing of legends and/or stop-transfer
orders with the transfer agent of the Company's securities with respect to any
of the Securities registered in the name of the undersigned or beneficially
owned by the undersigned, and the undersigned hereby confirms the undersigned's
investment in the Company.

Dated: _______________, 2005

                                       Signature

                                       _______________________________
                                       Name: _________________________
                                       Address: ______________________
                                       City, State, Zip Code: ________

                                       _______________________________
                                       Print Social Security Number
                                       or Taxpayer I.D. Number

                                       26

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