Document:

SHARE PURCHASE AGREEMENT

THIS AGREEMENT dated the ------- day of --------- , 2004.

BETWEEN:

                  HU, FANG;

                  And

                  YU, BO

                  (collectively, the "Vendors")

AND:
                  XIN NET  CORP.,  a company duly incorporated under the laws of
                  of Florida and having the business office at 950 - 789 West
                  Pender Street, Vancouver, BC, V6C 1H2

                  (the "Purchaser")

AND:
            BEIJING QUICKNET TELECOMMUCATION CORP. LTD. , a company duly incorp-
            orated under the laws of China and having the business office at
            Room 305 Soho Office Building, Beijing, China (the "Company")

WHEREAS:

A.     The Vendors are the registered and beneficial owner of all the issued
       and outstanding shares (collectively, the "Shares") in the capital of
       the Company;

B.     The Vendors agreed to sell and the Purchaser agreed to purchase the
       Shares;

NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged by the parties), the parties
covenant and agree as follows:

                                    SECTION 1
                                 INTERPRETATION

1.1      Definitions.

(a)  "Business" means the business currently carried on by the Company which is
     the operation of providing mobile value added services including short
     message system (SMS) to Chinese enterprises and individuals;

<PAGE>

(b)  "Closing" means the completion of the transactions herein on the Closing
     Date;

(c)  "Closing Date" means Jan. 20, 2004 or such later date which may be
     agreed between the parties;

(d)  "Contracts" means all of those agreements, contracts and commitments,
     written or verbal, entered into by the Company that are in effect as of the
     Closing Date;

(e)  "Employees" means any and all present and former employees and staff of the
     Business and the Company;

(f)  "Financial Statements" means the audited financial statements of the
     Company for the year 2003, consisting of a balance sheet and a statement of
     operations and deficit, copies of which are attached as Schedule 1.1(f);

(g)  "Premises" means the land and buildings which are currently occupied by the
     Company  and from  which  the  Company  carried  on the  Business;

(h)  "Purchase Price" means the sum described in Section 3.1.

(i) "Option Written Notice Date" means the date the Vendors received the written
    notice given by the Purchaser according to the relevant terms and conditions
    of this agreement.

                                    SECTION 2
                                SALE AND PURCHASE

2.1      Sale and Purchase. Subject to the terms and conditions of this
         Agreement and based on the warranties and representations herein
         contained the Vendors agree to sell to the Purchaser, and the Purchaser
         agrees to purchase from the Vendors, the Shares for the Purchase Price.

                                    SECTION 3
                           PURCHASE AND OPTION PRICES

3.1  On Closing Date, Purchaser will acquire 51% of the Company for a price of
     U$3,060,000 (three million and sixty thousand US dollars) in form of
     issuing 6,120,000 (six million one hundred and twenty thousand ) common
     shares of the Purchaser's stock at the deemed price of U$0.50 per share.
     Furthermore, Purchaser has the option to acquire the remaining 49% of the
     Company within 2 years from the Closing Date. If Purchaser exercises the
     option to purchase the remaining 49% of the Company within first year from
     the Closing Date, the purchase price will be US$4,000,000 (four million US
     dollars); if Purchaser exercises the option to purchase the remaining 49%
     of the Company within the second year from the Closing Date, the purchase
     price will be US$5,000,000 (five million US dollars). The Vendors will
     receive the payment, as a general rule, 50% in the Purchaser's common stock
     and 50% in cash, but the final percentage of stock versus cash can be
     negotiated between the parties. The stock issuance is subject to SEC's
     approval.

<PAGE>

3.2  If the Purchaser decided to exercise the option, the Purchaser will provide
     the Vendor a written notice (Option Written Notice) and the board
     resolution of the Purchaser approving the exercise of the option. Upon
     receiving of these documents, the Vendor will fulfill its obligation under
     section 5(2) to facilitate the transaction contemplated herein.

                                    SECTION 4
                         REPRESENTATIONS AND WARRANTIES

4.1       Representations  and  Warranties  of the Vendors.  The Vendors  hereby
          represent  and  warrant,  as of the date  hereof and as of the Closing
          Date, that:

         (a)      the Vendors have full right and authority to enter into this
                  Agreement on the terms and conditions herein set forth and to
                  sell and transfer the legal and beneficial title and ownership
                  of the Shares and the Company and its directors and
                  shareholders have taken all necessary or desirable actions and
                  proceedings to approve and authorize, validly and effectively,
                  the entering into and the execution, delivery and performance
                  of this Agreement and the transactions contemplated hereby;
                  and this Agreement is a legal, valid and binding obligation of
                  the Vendors, enforceable against each of them in accordance
                  with its terms;

         (b)      each of the Vendors is a non-resident of Canada within
                  the meaning of the Income Tax Act (Canada);

         (c)      the execution, delivery and performance of this Agreement and
                  the completion of the transactions contemplated hereby will:

                  (i)   not constitute a breach by the Vendors of any statute,
                        bylaw or regulation or of the Company's memorandum or
                        articles of association;

                  (ii)  not result in a breach of any terms or provisions, or
                        constitute a default under any agreement, indenture,
                        mortgage, instrument, court order, judgment or decree to
                        which the Vendors or the Company is a party or by which
                        the Vendors or the Company is bound; and

                  (iii) not result in the creation of any lien, encumbrance or
                        other charge on the Shares;

         (d)      no person, firm or corporation has any agreement or option or
                  a right capable of becoming an agreement for the purchase of
                  the Shares or any other shares in the capital of the Company
                  or any right capable of becoming an agreement for the
                  purchase, subscription or issuance of any of the unissued
                  shares in the capital of the Company, or for the acquisition
                  from the Company of any of its undertaking, property or
                  assets;

         (e)    the Vendors hold 100% of the ownership of the Company.;

<PAGE>

         (f)      the Shares are duly authorized, validly issued and outstanding
                  as fully paid and non-assessable shares and constitute 100% of
                  all of the issued and outstanding shares in the capital of the
                  Company;

         (g)      the Vendors are the registered and beneficial owner of the
                  Shares have good and marketable title to the Shares and the
                  Shares are free and clear of all liens, claims, charges and
                  encumbrances of every nature and kind whatsoever;

         (h)      the Company is a company duly organized under the laws of
                  China, is not a reporting company and  is a valid and subsist-
                  ing company in good standing;

         (i)      the Company has the power to own all of its property and
                  assets and to carry on the Business, is duly qualified to
                  carry on the Business;

         (j)      the Company is not a partner or participant in any
                  partnership, joint venture, profit-sharing arrangement or
                  other association of any kind, nor is the Company a party to
                  or bound by any agreement which would restrict or limit its
                  right to carry on any business or activity or to solicit
                  business from any person or in any geographical area or
                  otherwise to conduct the Business as the Company may
                  determine;

         (l)      no dividend declared by the Company has remained unpaid;

         (m)      neither the Vendors nor any present or former officer,
                  director, Employee or shareholder of the Company is indebted
                  or under obligation to the Company on any account whatsoever,
                  and the Company will not at Closing be indebted to the
                  Vendors, or any director, officer or Employee of the Company
                  or any affiliate or associate of any of them, on any account
                  whatsoever;

         (n)      there are no liabilities, obligations, commitments or
                  indebtedness of any nature whatsoever (whether accrued,
                  absolute, contingent or otherwise) of the Company which have
                  not been disclosed to the Purchaser and which the Purchaser
                  has not agreed to assume or which the Vendors will not pay
                  subsequent to Closing;

         (o)      the Company has no Contracts, bonus plans, undertakings or
                  arrangements whether oral, written or implied with Employees,
                  lessees, licensees, managers, accountants, suppliers, agents,
                  distributors, officers, directors, lawyers or others;

         (x)      except as has been previously disclosed to the Purchaser, the
                  Company holds all permits, licenses, consents and authorities
                  issued by any governmental authority, or any subdivision there
                  -of, which are necessary or desirable in connection with the
                  conduct and operation of the Business and the ownership or
                  leasing of its assets and the Company is not in breach of or
                  in default under any term or condition of any thereof;

<PAGE>

         (aa)     except as has been previously disclosed to the Purchaser, the
                  Company is not in breach of any laws, ordinances, statutes,
                  regulations, by-laws, orders or decrees to which it is subject
                  or which apply to it, and neither the Premises nor their use
                  violates any zoning or other by-law, law, ordinance or
                  regulation applicable to them;

         (ab)     to the best knowledge of the Vendors, there is no basis for
                  and there are no actions, suits, judgments, investigations or
                  arbitration or governmental proceedings in progress,
                  outstanding, pending or threatened against or relating to the
                  Company or affecting the Business, Premises, or the Shares at
                  law or in equity or before or by any governmental authority,
                  commission or agency, domestic or foreign;

         (ac)     no security or other encumbrance has been granted by the
                  Company;

         (ad)     the documents and information to be delivered to the Purchaser
                  pursuant to this Agreement shall be accurate and complete and,
                  without restricting the generality of the foregoing, the
                  Financial Statements that have been provided to the Purchaser
                  and attached hereto as part of Schedule 1.1(f), have been
                  prepared in accordance with generally accepted accounting
                  principles in Hong Kong, applied on a consistent basis and
                  fairly represent the financial position and the corporate
                  affairs of the Company;

         (ae)     the Company has good and marketable title to all of its
                  properties and assets, including those reflected in the
                  Financial Statements or acquired since the date of the most
                  recent Financial Statement, free and clear of all mortgages,
                  pledges, liens, encumbrances or charges of any kind whatsoever
                  and none of the Company's assets or properties are in the
                  possession of or under the control of any other person;

         (af)     the Company has no guarantees with respect to the obligations
                  of any other person and has no indemnities or contingent or
                  indirect obligations with respect to the obligation of any
                  other person;

         (ag)     except as previously disclosed to the Purchaser, neither the
                  Company nor the Vendors is under any obligation, contractual
                  or otherwise, to notify or to request or obtain the consent of
                  any person, and no permits, licenses, certifications,
                  authorizations or approvals of, or notifications to, any
                  federal, provincial, municipal or local government or
                  governmental agency, board, commission or authority, or any
                  foreign government or other authority, are required to be
                  obtained or given by the Company or the Vendors:

                  (i)      in connection with the execution, delivery or perform
                           -ance by the Vendors or the Company of this Agreement
                           or the completion of any of the transactions contem-
                           plated herein;

                  (ii)     to avoid the loss of any permit, license, certifica-
                           tion or other authorization; or

<PAGE>

                  (iii)    in order to enable the Company to carry on the
                           Business in the ordinary course as of and following
                           the closing of the transactions contemplated hereby.

         (ah)     the Vendors covenant and represent and warrant in favour of
                  the Purchaser that all of the representations and warranties
                  set forth herein shall be true and correct at the time of
                  Closing as if made on that date.

4.2      Representations and Warranties in Closing Documents. All statements
         contained in a certificate or other instrument delivered by or on
         behalf of the Vendors pursuant hereto or in connection with the
         transactions contemplated hereby shall be deemed to be representations
         and warranties by the Vendors hereunder.

4.3      Survival of Representations and Warranties of the Vendors. The
         representations and warranties of the Vendors contained in this
         Agreement shall survive the Closing and the payment of the Purchase
         Price and, notwithstanding the Closing and the payment of the Purchase
         Price, the representations and warranties of the Vendors shall continue
         in full force and effect for the benefit of the Purchaser, subject to
         the following:

         (a)      the representations and warranties of the Vendors contained in
                  Sections 4.1 (n), (p), (r), (w), (x), (y), (z), (aa), (ab),
                  (ac), (ad), (ae), (af) and (ag) shall survive for a period of
                  eighteen (18) months following the Closing Date;

         (b)      notwithstanding paragraph (a) above, any claim which is based
                  on intentional misrepresentation or fraud by the Vendors may
                  be made or brought by the Purchaser at any time.

         provided that if a written notice of claim is made before the expiry of
         the applicable period, then the representation and warranty to which
         such notice applies shall survive in respect of that claim until the
         final determination or settlement of that claim.

4.4      The Purchaser hereby represents and warrants to the Vendors as follows:

         (a)      the Purchaser is a company duly organized, validly existing
                  and in good standing under the laws of Florida with respect to
                  the filing of annual reports, and its shares are traded on the
                  OTC Bulletin Board in the United States;

         (b)      the Purchaser has all corporate power, authority and capacity
                  to acquire the Shares and to perform its obligation hereunder.
                  The execution and delivery of this Agreement has been duly
                  authorized by all necessary corporate action on the part of
                  the Purchaser and this Agreement constitutes a valid and
                  binding obligation of the Purchaser. The Purchaser is not a
                  party to, bound by or subject to any indenture, mortgage,
                  lease, Agreement, instrument, statute, regulation, order,
                  judgment, decree or law which would be violated, contravened

<PAGE>

                  or breached by or under which any default would occur as a
                  result of the execution and delivery by the Purchaser of this
                  Agreement or the performance by the Purchaser of any of the
                  terms hereof;

         (c)      the Purchaser covenants and represents and warrants in favour
                  of the Vendors that all of the representations and warranties
                  set forth herein shall be true and correct at the time of
                  Closing as if made on that date.

4.5      Survival of Representations and Warranties of Purchaser. The
         representations and warranties of the Purchaser contained in this
         Agreement shall survive the Closing and the purchase of the Shares and,
         notwithstanding the Closing and the purchase of the Shares and the
         representations and warranties of the Purchaser shall continue in full
         force and effect for the benefit of the Vendors for a period of
         eighteen (18) months from the Closing Date.

                                    SECTION 5
                            COVENANTS OF THE VENDORS

5.1      Vendors' Covenants. The Vendors' covenant, agree and undertake with the
         Purchaser that from and after the date of execution of this Agreement
         to the Closing Date the Vendors will:

         (a)      cause the Company to conduct its business in the ordinary and
                  normal course and will not permit the Company to do or fail to
                  do anything that would result in the representations and
                  warranties of the Vendors herein not to be true and correct at
                  the time of Closing;

        (b)       ensure the execution and delivery of all documents and
                  instruments required to be executed and delivered by the
                  Vendors and the Company hereunder and will take all steps and
                  proceedings and execute such further assurances and documents
                  as may be required to effect the transfer to and register the
                  Shares in the name of the Purchaser and to fulfill the terms
                  and conditions of this Agreement;

         (d)      deliver to the Purchaser true and complete copies of all
                  documents and instruments referred to in this Agreement or in
                  the Schedules hereto and will not permit the Company to amend
                  any of them or enter into any other contract or agreement
                  without the prior written consent of the Purchaser;

         (e)     execute and deliver on the Closing Date the certificate
                  contemplated by Section 8.1(d) hereof dated the Closing Date
                  in a form satisfactory to the Purchaser's solicitors;

         (g)      obtain all necessary shareholders and directors resolutions to
                  effect the transactions contemplated by this Agreement and do
                  all other things reasonably necessary to facilitate the
                  transactions contemplated herein;

<PAGE>

         (j)      have delivered or caused to be delivered to the Purchaser
                  complete originals, when available, or otherwise true and
                  complete copies of such originals (including all amendments)
                  of all Contracts, leases and other documents referred to in
                  this Agreement or any Schedule hereto or required to be
                  disclosed hereby;

         (r)      ensure that at the Time of Closing, the Company's financial
                  situation shall in line with the financial situation contained
                  in the financial reports set forth as of December 31, 2003 in
                  the Schedule attached hereto, except that the Company may have
                  some financial changes incurred in its normal course of
                  business for the period from December 31, 2003 to the Date of
                  Closing.

5.2         The Vendors' further covenant, agree and undertake with the
            Purchaser that within 2 years after the Closing Date, upon receiving
            of the Purchaser's Option Written Notice, the Vendors will
            (1)  resign their positions as directors and/or officers of the
                 Company or cause to resign the existing directors and/or
                 officers of the Company, if the Purchaser chose to do so,
                 effective 90 days from the date Vendors received the Option
                 Written Notice;
            (2)  obtain all necessary shareholders and directors resolutions to
                 effect the transaction contemplated by this Agreement within 10
                 days of the Option Written Notice Date and do all other things
                 reasonably necessary to facilitate the transactions
                 contemplated herein;

5.3      Indemnity by the Vendors. Without prejudicing any other remedy
         available to the Purchaser at law or in equity, the Vendors shall fully
         indemnify and save harmless the Purchaser from and against any and all
         costs, losses, damages or expenses suffered or incurred by the
         Purchaser or the Company in any manner arising out of or relating to:

         (a)      any representation or warranty of the Vendors set forth in
                  this Agreement being untrue or incorrect or the failure of the
                  Vendors to observe or perform any of its obligations pursuant
                  hereto, including, but not limited to, the obligations set
                  forth in Section 5.1 hereof;

         (b)      any and all indebtedness or liability of the Company existing
                  at the time of the Closing which was not disclosed in writing
                  to the Purchaser by the Vendors;

         (c)      any misrepresentation in or omission from any certificate or
                  other instrument furnished to the Purchaser hereunder;
                  and

         (d)      any and all actions, suits, proceedings, demands, assessments,
                  judgments, costs and legal and other expenses incident to any
                  of the foregoing.

5.3      Indemnity Notwithstanding Holdback. For greater certainty, the indem-
         nity provided by the Vendors under Section 5.3 shall apply notwithstand
         -ing the existence of the Holdback or the release of the Holdback from
         trust.

<PAGE>

5.4      Claims Under Vendors' Indemnity. If any claim is made by any person
         against the Purchaser or the Company in respect of which the Purchaser
         or the Company may incur or suffer damages, losses, costs or expenses
         that might reasonably be considered to be subject of the indemnity
         obligation of the Vendors as provided in paragraph 5.2, the Purchaser
         will notify the Vendors as soon as reasonably practicable of the nature
         of such claim and the Vendors shall be entitled (but not required) to
         assume the defence of any suit brought to enforce such claim.
         Notwithstanding the foregoing, if the person making the claim threatens
         or takes any action which does or could affect the assets of the
         business of the Company or the Purchaser then the Vendors shall, within
         ten (10) days of being notified of such threat or action, post with the
         Court sufficient security to satisfy the claim and costs related
         thereto, failing which the Vendors shall not have the right to defend
         or continue to defend the claim. The defence of any such claim (whether
         assumed by the Vendors or not) shall be through legal counsel and shall
         be conducted in a manner acceptable to the Purchaser and the Vendors,
         acting reasonably, and no settlement may be made by the Vendors or the
         Purchaser without the prior written consent of the other. If the
         Vendors assumes the defence of any claim then the Purchaser and the
         Purchaser's counsel shall co-operate with the Vendors and their counsel
         in the course of the defence, such co-operation to include using
         reasonable best efforts to provide or make available to the Vendors and
         his counsel documents and information and witnesses for attendance at
         examinations for discovery and trials. The reasonable legal fees and
         disbursements and other costs of such defence shall, from and after
         such assumption, be borne by the Vendors.

                                    SECTION 6
                           COVENANTS OF THE PURCHASER

6.1      Purchaser's Covenants.  The Purchaser covenants, agrees and undertakes
         with the Vendors that:

         (a)      it will pay on the Closing Date the Purchase Price in the
                  manner described in this Agreement;

6.2      Purchaser's Covenants. The Purchaser covenants, agrees and undertakes
         with the Vendors that the Purchaser shall operate the Company in a
         professional and businesslike manner after the Closing Date.

6.3      Indemnity by the Purchaser. The Purchaser shall fully indemnify and
         save harmless the Vendors from and against any and all costs, losses,
         damages or expenses suffered or incurred by the Vendors in any manner
         arising out of or relating to:

         (a)      any misrepresentation or nonfulfillment of any covenant on the
                  part of the Purchaser under this Agreement; and

         (b)      any and all actions, suits, proceedings, demands, assessments,
                  judgments, costs and legal and other expenses incident to any
                  of the foregoing.

<PAGE>

6.4      Claims Under Purchaser's Indemnity. If any claim is made by any person
         against the Vendors in respect of which the Vendors may incur or suffer
         damages, losses, costs or expenses that might reasonably be considered
         to be subject to the indemnity obligation of the Purchaser as provided
         in Section 6.3, the Vendors will notify the Purchaser as soon as
         reasonably practicable of the nature of such claim and the Purchaser
         and the Company shall be entitled (but not required) to assume the
         defence of any suit brought to enforce such claim. Notwithstanding the
         foregoing, if the person making the claim threatens or takes any action
         which does or could affect the assets of the business of the Vendors
         then the Purchaser shall, within ten (10) days of being notified of
         such threat or action, post with the Court sufficient security to
         satisfy the claim and costs related thereto, failing which the
         Purchaser and the Company shall not have the right to defend or
         continue to defend the claim. The defence of any such claim (whether
         assumed by the Purchaser and/or the Company or not) shall be through
         legal counsel and shall be conducted in a manner acceptable to the
         Purchaser and the Vendors, acting reasonably, and no settlement may be
         made by the Vendors or the Purchaser without the prior written consent
         of the other. If the Purchaser or the Company assumes the defence of
         any claim then the Vendors and the Vendors' counsel shall co-operate
         with the Purchaser and the Company and their counsel in the course of
         the defence, such co-operation to include using reasonable best efforts
         to provide or make available to the Purchaser and the Company and their
         counsel documents and information and witnesses for attendance at
         examinations for discovery and trials. The reasonable legal fees and
         disbursements and other costs of such defence shall, from and after
         such assumption, be borne by the Purchaser or the Company, as the case
         may be.

                                    SECTION 7
               CONDITIONS PRECEDENT TO THE PURCHASER'S OBLIGATIONS

7.1      Purchaser's Conditions Precedent.  Notwithstanding anything herein
         contained, the obligation of the Purchaser to complete the transactions
         hereunder is conditional upon the fulfillment of the following condi-
         tions precedent:

         (a)      all covenants and agreements of the Vendors to be performed on
                  or before the Closing Date pursuant to the terms and
                  conditions of this Agreement have been duly performed;

         (b)      on or before the Closing Date, no injunction or restraining
                  order of a court or administrative tribunal of competent
                  jurisdiction shall be in effect which prohibits the
                  transactions contemplated hereunder and no action or
                  proceeding shall have been instituted and remain pending
                  before any such court or administrative tribunal to restrain
                  or prohibit the transactions contemplated hereby;

         (c)      the Vendors shall deliver to the Purchaser on the Closing Date
                  a certificate signed by the Vendors that the conditions set
                  out in Section 7.1(a) have been satisfied;

<PAGE>

         (d)      the representations and warranties of the Vendors contained in
                  this Agreement shall be true on and as of the Closing Date
                  with the same effect as though such representations and
                  warranties had been made on and as of the Closing Date; and

         (e)      since the date hereof and prior to the Closing Date, no loss
                  or damage by fire, negligence or otherwise shall occur to the
                  property and assets of the Company or Premises.

7.2      Conditions for Benefit of Purchaser. The preceding conditions are for
         the exclusive benefit of the Purchaser and such conditions must be
         fulfilled as described in subsection 8.1 or may be waived in whole or
         in part by the Purchaser on or prior to the Closing Date by delivery to
         the Vendors of a written waiver to that effect, signed by the
         Purchaser.

                                    SECTION 8
                               GENERAL PROVISIONS

8.1     Time of Essence.  Time shall be of the essence of this Agreement.

8.2     Force Majeure.  If the transaction fails to close due to an act of God,
         no compensation shall be made to either party.

8.3      No Merger and Survival. The representations, warranties, covenants,
         indemnities and agreements contained in this Agreement or pursuant
         hereto shall not merge at the Closing nor upon release of the Holdback
         from trust, and shall survive and continue in full force and effect
         from the Closing Date.

8.4      Notice. Any notice, waiver or other communication required or permitted
         to be given hereunder shall be in writing and signed by or on behalf of
         such party and shall be given to the other party by delivery thereto,
         or by sending by prepaid registered mail or facsimile to the address of
         the other party as herein set forth or to such other address of which
         notice is given, and any notice shall be deemed not to have been
         sufficiently given until it is received. Any notice or other
         communication contemplated herein shall be deemed to have been received
         on the day delivered, if delivered, on the fourth business day
         following the mailing thereof, if sent by registered mail, and the
         second business day following the transmittal thereof, if sent by
         facsimile. If normal mail or facsimile service shall be interrupted by
         strike, slowdown, force majeure or other cause, the party sending the
         notice shall utilize any of such services which have not been so
         interrupted or shall deliver such notice in order to ensure prompt
         receipt of same by the other party.

8.5      Waiver. No waiver of any of the provisions of this Agreement will be
         deemed or will constitute a waiver of any other provision (whether or
         not similar) nor will any waiver constitute a continuing waiver unless
         otherwise expressly provided.

<PAGE>

8.6      Modifications and Approvals. No amendment, modification, supplement,
         termination or waiver of any provision of this Agreement will be
         effective unless in writing signed by the appropriate party and then
         only in the specific instance and for the specific purpose given.

8.7      Further Assurances. Each of the parties hereby covenants and agrees to
         execute any further and other  documents and instruments and to do any
         further and other things that may be necessary to implement  and carry
         out the intent of this Agreement.

8.8      Ensurement and Assignment. This Agreement will ensure to the benefit of
         and will be binding upon the Vendors and the Purchaser, and their
         respective personal representatives, heirs, executors, administrators,
         successors and permitted assigns. Neither party will assign its rights
         or obligations under this Agreement or any part thereof, provided that
         the Purchaser may assign this Agreement, without consent, but upon
         notification to the Vendors, to another corporation.

11.9     Remedies. Notwithstanding any other provision hereof, the Purchaser
         shall be entitled to any and all remedies at law or in equity, and the
         mechanisms in this Agreement regarding the Holdback shall be without
         prejudice and in addition to any and all other remedies available to
         the Purchaser. The remedies of the Purchaser shall be cumulative and
         not alternative.

8.10     Counterparts. This Agreement may be executed in counterparts or by
         facsimile and each such Agreement or facsimile so executed shall be
         deemed to be an original and such counterparts together shall
         constitute one and the same Agreement.

8.11     Severability. If any one or more of the provisions contained in this
         Agreement should be invalid, illegal or unenforceable in any respect,
         the validity, legality and enforceability of such provision or
         provisions shall not in any way be affected or impaired thereby in any
         other jurisdiction and the validity, legality, and enforceability of
         the remaining provisions shall not in any way be affected or impaired
         thereby in any other jurisdiction and the validity, legality and
         enforceability of the remaining provisions contained herein shall not
         in any way be affected or impaired thereby.

8.12     Included Words. Words importing the singular include the plural and
         vice-versa, and words importing gender include all genders.

8.13     Headings and Interpretation. The section and subsection headings are
         included solely for convenience, are not intended to be full or
         accurate descriptions of the content, or to be considered part of this
         Agreement. The parties hereto acknowledge that their respective legal
         counsel have reviewed and participated in settling the terms of this
         Agreement, and agree that any rule of construction to the effect that
         any ambiguity is to be resolved against the drafting party shall not be
         applicable in the interpretation of this Agreement.

8.14     Governing Law. This Agreement shall be construed and enforced in
         accordance with the laws of the People's Republic of China, and will
         be treated in all respects as a Chinese contract.

<PAGE>

8.15     Entire Agreement. This Agreement, together with the contract and all
         Schedules to this Agreement, constitutes the entire agreement between
         the parties regarding the subject matter hereof. In the event of any
         inconsistency between this Agreement and the interim contract, the
         provisions of this Agreement shall prevail.

IN WITNESS WHEREOF the parties have executed this Agreement on the date first
above written.

EXECUTED and DELIVERED by                           )
                                                    )
/s/ HU, FANG in the                                 )
-----------------------------                       )
presence of:                                        )
                                                    )
                                                    )
/s/ YU, BO                                          )
------------------------------                      )
Witness Name - Signature                            )
                                                    )

BEIJING QUICKNET TELECOMMUNICATION CORP. LTD.

Per:    /s/ HU, FANG
        -----------------------------------
        Name:   HU, FANG
        Title:     President

XIN NET CORP.

Per:    /s/ Ernest Cheung
        -----------------------------------
        Name:  Ernest Cheung
        Title:     Director

<PAGE>

                                 SCHEDULE 1.1(f)

                              FINANCIAL STATEMENTS

<PAGE>

                                  SCHEDULE 3.2

                  LIST OF INVENTORY AND FIXTURES OF THE COMPANYEXHIBIT 10.4.1
                                                                  --------------

                          EXTENDED SYSTEMS INCORPORATED

                            1998 DIRECTOR OPTION PLAN

                            (adopted December, 1997)
                    (approved by stockholders January, 1998)
                     (amended and restated January 23, 2001)
                     (amended and restated October 15, 2003)

            1. Purposes of the Plan. The purposes of this 1998 Director Option
Plan are to attract and retain the best available personnel for service as
Outside Directors (as defined herein) of the Company, to provide additional
incentive to the Outside Directors of the Company to serve as Directors, and to
encourage their continued service on the Board.

            All options granted hereunder shall be nonstatutory stock options.

            2. Definitions. As used herein, the following definitions shall
apply:

                        (a) "Annual Meeting of Stockholders" means the annual
            meeting of stockholders held each year on a date and at a time
            designated by the Board and as defined in the Company's bylaws.

                        (b) "Audit Committee" means the audit committee of the
            Board or any successor committee of the Board performing similar
            functions.

                        (c) "Board" means the Board of Directors of the Company.

                        (d) "Code" means the Internal Revenue Code of 1986, as
            amended.

                        (e) "Common Stock" means the Common Stock of the
            Company, par value $0.001 per share.

                        (f) "Company" means Extended Systems Incorporated, a
            Delaware corporation.

                        (g) "Compensation Committee" means the compensation
            committee of the Board of any successor committee of the Board
            performing similar functions.

                        (h) "Director" means a member of the Board.

                        (i) "Employee" means any person, including officers and
            Directors, employed by the Company or any Parent or Subsidiary of
            the Company. The payment of a Director's fee by the Company shall
            not be sufficient in and of itself to constitute "employment" by the
            Company.

                        (j) "Exchange Act" means the Securities Exchange Act of
            1934, as amended.

                        (k) "Fair Market Value" means, as of any date, the value
            of Common Stock determined as follows:

<PAGE>

                                    (i) If the Common Stock is listed on any
                        established stock exchange or a national market system,
                        including without limitation the NASDAQ National Market
                        or The NASDAQ Small Cap Market of The NASDAQ Stock
                        Market, its Fair Market Value shall be the closing sales
                        price for such stock (or the closing bid, if no sales
                        were reported) as quoted on such exchange or system on
                        the date of determination, as reported in The Wall
                        Street Journal or such other source as the Administrator
                        deems reliable;

                                    (ii) If the Common Stock is regularly quoted
                        by a recognized securities dealer but selling prices are
                        not reported, the Fair Market Value of a Share of Common
                        Stock shall be the mean between the high bid and low
                        asked prices for the Common Stock on the date of
                        determination, as reported in The Wall Street Journal or
                        such other source as the Board deems reliable; or

                                    (iii) In the absence of an established
                        market for the Common Stock, the Fair Market Value
                        thereof shall be determined in good faith by the Board.

                        (l) "Inside Director" means a Director who is an
            Employee.

                        (m) "Option" means a stock option granted pursuant to
            the Plan.

                        (n) "Optioned Stock" means the Common Stock subject to
            an Option or Restricted Stock award.

                        (o) "Optionee" means a Director who holds an Option.

                        (p) "Outside Director" means a Director who is not an
            Employee.

                        (q) "Parent" means a "parent corporation," whether now
            or hereafter existing, as defined in Section 424(e) of the Code.

                        (r) "Plan" means this 1998 Director Option Plan.

                        (s) "Restricted Stock" means a grant of Shares subject
            to a forfeiture restriction that lapses over time.

                        (t) "Share" means a share of the Common Stock, as
            adjusted in accordance with Section 10 of the Plan.

                        (u) "Subsidiary" means a "subsidiary corporation,"
            whether now or hereafter existing, as defined in Section 424(f) of
            the Internal Revenue Code of 1986.

            3. Stock Subject to the Plan.

                        (a) Plan Pool. Subject to the provisions of Section 10
            of the Plan, the maximum aggregate number of Shares which may be
            granted as Restricted Stock or optioned and sold pursuant to an
            Option under the Plan is 250,000 Shares of Common Stock (the
            "Pool"). The Shares may be authorized, but unissued, or reacquired
            Common Stock.

<PAGE>

                        (b) Shares Returned to Pool. Unless the Plan has
            previously been terminated, the following events will result in
            Shares being returned to the Pool to be available for future grant
            under the Plan:

                                    (i) An Option expires or becomes
                        unexercisable without having been exercised in full;

                                    (ii) Unvested Restricted Stock is forfeited;
                        and

                                    (iii) Shares tendered to the Company to
                        exercise an Option.

                                    Shares that have actually been issued under
                        the Plan shall not be returned to the Plan and shall not
                        become available for future distribution under the Plan.

            4. Administration of Options under the Plan.

                        (a) Procedures for Grant. The provisions set forth in
            this Section 4(a) shall not be amended more than once every six
            months, other than to comport with changes in the Code, the Employee
            Retirement Income Security Act of 1974, as amended, or the rules
            thereunder. All grants of Options to Outside Directors under this
            Plan shall be automatic and nondiscretionary and shall be made
            strictly in accordance with the following provisions:

                                    (i) No person shall have any discretion to
                        select which Outside Directors shall be granted Options
                        or to determine the number of Shares to be covered by
                        Options granted to Outside Directors.

                                    (ii) Initial Board Grant. Each Outside
                        Director shall be automatically granted an Option to
                        purchase 20,000 Shares (the "First Option") on the date
                        on which the later of the following events occurs:

                                                (A) the effective date of this
                                    Plan, as determined in accordance with
                                    Section 6 hereof, or

                                                (B) the date on which such
                                    person first becomes an Outside Director,
                                    whether through election by the stockholders
                                    of the Company or appointment by the Board
                                    to fill a vacancy; provided, however, that
                                    an Inside Director who ceases to be an
                                    Inside Director but who remains a Director
                                    shall not receive a First Option.

                                    (iii) Annual Board Option Grant. Each
                        Outside Director shall be automatically granted an
                        Option to purchase 10,000 Shares (a "Subsequent Option")
                        on the date of the Company's Annual Meeting of
                        Stockholders of each year provided he or she is then an
                        Outside Director and if as of such date, he or she shall
                        have served on the Board for at least the preceding six
                        (6) months.

                                    (iv) 2003 Transition Option Grant. Each
                        Outside Director appointed by the Board to fill a
                        vacancy after July 1, 2003 who is also elected by the
                        stockholders of the Company at the Company's 2003 Annual
                        Meeting of Stockholders shall be automatically granted
                        an Option to purchase 5,000 Shares (a "Transition
                        Option") on the date of the Company's 2003 Annual
                        Meeting of Stockholders provided he or she is then an
                        Outside Director.

<PAGE>

                                    (v) Annual Board Restricted Stock Grant.
                        Each Outside Director shall be automatically granted a
                        number of Shares of Restricted Stock on the date of the
                        Company's Annual Meeting of Stockholders, determined by
                        dividing (a) $16,000 by (b) the Fair Market Value of a
                        Share on the date of the Company's Annual Meeting of
                        Stockholders of each year provided he or she is then an
                        Outside Director.

                                    (vi) Annual Chairman of the Board Restricted
                        Stock Grant. The Chairman of the Board of Directors
                        shall be automatically granted a number of Shares of
                        Restricted Stock on the date of the Company's Annual
                        Meeting of Stockholders, determined by dividing (a)
                        $20,000 by (b) the Fair Market Value of a Share on the
                        date of the Company's Annual Meeting of Stockholders of
                        each year provided he or she is then an Outside
                        Director.

                                    (vii) Annual Chairman of the Audit Committee
                        Restricted Stock Grant. The Chairman of the Audit
                        Committee Board of Directors shall be automatically
                        granted a number of Shares of Restricted Stock on the
                        date of the Company's Annual Meeting of Stockholders,
                        determined by dividing (a) $12,500 by (b) the Fair
                        Market Value of a Share on the date of the Company's
                        Annual Meeting of Stockholders of each year provided he
                        or she is then an Outside Director.

                                    (viii) Annual Chairman of the Compensation
                        Committee Restricted Stock Grant. The Chairman of the
                        Audit Committee Board of Directors shall be
                        automatically granted a number of Shares of Restricted
                        Stock on the date of the Company's Annual Meeting of
                        Stockholders, determined by dividing (a) $7,500 by (b)
                        the Fair Market Value of a Share on the date of the
                        Company's Annual Meeting of Stockholders of each year
                        provided he or she is then an Outside Director.

                                    (ix) Notwithstanding the provisions of
                        subsections (ii) and (iii) hereof, any exercise of an
                        Option granted or vesting of a Restricted Stock grant
                        before the Company has obtained stockholder approval of
                        the Plan in accordance with Section 16 hereof shall be
                        conditioned upon obtaining such stockholder approval of
                        the Plan in accordance with Section 16 hereof.

                                    (x) First Option Terms. The terms of a First
                        Option granted hereunder shall be as follows:

                                                (A) the term of the First Option
                                    shall be ten (10) years,

                                                (B) the First Option shall be
                                    exercisable only while the Outside Director
                                    remains a Director of the Company, except as
                                    set forth in Sections 8 and 10 hereof,

                                                (C) the exercise price per Share
                                    shall be 100% of the Fair Market Value per
                                    Share on the date of grant of the First
                                    Option. In the event that the date of grant
                                    of the First Option is not a trading day,
                                    the exercise price per Share shall be the
                                    Fair Market Value on the next trading day
                                    immediately following the date of grant of
                                    the First Option.

<PAGE>

                                                (D) subject to Section 10 hereto
                                    the First Option shall be exercisable, in
                                    whole or in part, according to the following
                                    vesting schedule: 33% of the total Shares
                                    subject to option shall vest twelve months
                                    after the date of grant, and 1/36 of the
                                    Shares subject to the First Option shall
                                    vest each month thereafter subject to the
                                    Optionee continuing to be a Director.

                                    (xi) Subsequent Option Terms. The terms of a
                        Subsequent Option granted hereunder shall be as follows:

                                                (A) term of the Subsequent
                                    Option shall be ten (10) years.

                                                (B) the Subsequent Option shall
                                    be exercisable only while the Outside
                                    Director remains a Director of the Company,
                                    except as set forth in Sections 8 and 10
                                    hereof,

                                                (C) the exercise price per Share
                                    shall be 100% of the Fair Market Value per
                                    Share on the date of grant of the Subsequent
                                    Option. In the event that the date of grant
                                    of the Subsequent Option is not a trading
                                    day, the exercise price per Share shall be
                                    the Fair Market Value on the next trading
                                    day immediately following the date of grant
                                    of the Subsequent Option.

                                                (D) subject to Section 10 hereto
                                    the Subsequent Option shall become vested
                                    and exercisable, in whole or in part, on the
                                    earlier of the first anniversary of the date
                                    of grant of the Subsequent Option or the
                                    date of the next Annual Meeting of
                                    Stockholders, provided that the Optionee
                                    continues to serve as a Director on such
                                    dates.

                                    (xii) 2003 Transition Option Terms. The
                        terms of a 2003 Transition Option granted hereunder
                        shall be as follows:

                                                (A) term of the 2003 Transition
                                    Option shall be ten (10) years.

                                                (B) the 2003 Transition Option
                                    shall be exercisable only while the Outside
                                    Director remains a Director of the Company,
                                    except as set forth in Sections 8 and 10
                                    hereof,

                                                (C) the exercise price per Share
                                    shall be 100% of the Fair Market Value per
                                    Share on the date of grant of the 2003
                                    Transition Option. In the event that the
                                    date of grant of the 2003 Transition Option
                                    is not a trading day, the exercise price per
                                    Share shall be the Fair Market Value on the
                                    next trading day immediately following the
                                    date of grant of the Subsequent Option.

                                                (D) subject to Section 10 hereto
                                    the 2003 Transition Option shall become
                                    vested and exercisable, in whole or in part,

<PAGE>

                                    on the earlier of the first anniversary of
                                    the date of grant of the 2003 Transition
                                    Option or the date of the next Annual
                                    Meeting of Stockholders, provided that the
                                    Optionee continues to serve as a Director on
                                    such dates.

                                                (xiii) Vesting of Restricted
                                    Stock. Subject to Section 10 hereto,
                                    Restricted Stock granted hereunder shall
                                    vest according to following vesting
                                    schedule: 33% of the total Shares subject to
                                    option shall vest on each of the first three
                                    anniversary dates of the restricted stock
                                    grant. In the event that the Optionee has
                                    attended at least 75% of all Board meetings
                                    (for Annual Board Restricted Stock grant and
                                    Annual Chairman of the Board of Directors
                                    Restricted Stock grant), Audit Committee
                                    meetings (for Annual Chairman of the Audit
                                    Committee Restricted Stock Grant) and
                                    Compensation Committee meetings (for Annual
                                    Chairman of the Compensation Committee
                                    Restricted Stock grant), held during the
                                    past year, as applicable, the Restricted
                                    Stock shall vest, in whole, on the earlier
                                    of the first anniversary of the date of
                                    grant of the Restricted Stock or the date of
                                    the next Annual Meeting of Stockholders,
                                    provided that the Optionee continues to
                                    serve as a Director on such dates.

                                    (xiii) In the event that any Option or
                        Restricted Stock granted under the Plan would cause the
                        number of Shares subject to outstanding Options plus the
                        number of Shares previously purchased under Options and
                        issued under Restricted Stock grants to exceed the Pool
                        then the remaining Shares available for grant shall be
                        granted to the Outside Directors on a pro rata basis. No
                        further grants shall be made until such time, if any, as
                        additional Shares become available for grant under the
                        Plan through action of the Board or the stockholders to
                        increase the number of Shares which may be issued under
                        the Plan or through cancellation or expiration of
                        Options previously granted hereunder.

            5. Eligibility. Options and Restricted Stock may be granted only to
Outside Directors. All Options and Restricted Stock shall be automatically
granted in accordance with the terms set forth in Section 4 hereof.

            The Plan shall not confer upon any Optionee any right with respect
to continuation of service as a Director or nomination to serve as a Director,
nor shall it interfere in any way with any rights which the Director or the
Company may have to terminate the Director's relationship with the Company at
any time.

            6. Term of Plan. The Plan shall become effective upon the date of
the effectiveness that the Company's registration statement for the purpose of
effecting the initial public offering of the Common Stock becomes effective
under the Securities Act of 1933, as amended (the Securities Act"). It shall
continue in effect for a term of ten (10) years unless sooner terminated under
Section 11 of the Plan.

            7. Form of Consideration. The consideration to be paid for the
Shares to be issued upon exercise of an Option, including the method of payment,
shall consist of:

            (i) cash, or

<PAGE>

            (ii) check, or

            (iii) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan provided
that Optionee is eligible to participate in such cashless exercise program, as
determined in the sole discretion of the Company, or

            (iv) other shares which (x) in the case of Shares acquired upon
exercise of an Option, have been owned by the Optionee for more than six (6)
months on the date of surrender, and (y) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised,

            (v) delivery of a properly executed exercise notice together with
such other documentation as the Company and the broker, if applicable, shall
require to effect an exercise of the Option and delivery to the Company of the
sale or loan proceeds required to pay the exercise price, or

            (vi) any combination of the foregoing methods of payment.

            8. Exercise of Option.

                        (a) Procedure for Exercise: Rights as a Stockholder. Any
            Option granted hereunder shall be exercisable at such times as are
            set forth in Section 4 hereof, provided, however, that no Options
            shall be exercisable until stockholder approval of the Plan in
            accordance with Section 16 hereof has been obtained.

                        An Option may not be exercised for a fraction of a
            Share.

                        An Option shall be deemed to be exercised when written
            notice of such exercise has been given to the Company in accordance
            with the terms of the Option by the person entitled to exercise the
            Option and full payment for the Shares with respect to which the
            Option is exercised has been received by the Company. Full payment
            may consist of any consideration and method of payment allowable
            under Section 7 of the Plan. Until the issuance (as evidenced by the
            appropriate entry on the books of the Company or of a duly
            authorized transfer agent of the Company) of the stock certificate
            evidencing such Shares, no right to vote or receive dividends or any
            other rights as a stockholder shall exist with respect to the
            Optioned Stock, notwithstanding the exercise of the Option. A share
            certificate for the number of Shares so acquired shall be issued to
            the Optionee as soon as practicable after exercise of the Option. No
            adjustment shall be made for a dividend or other right for which the
            record date is prior to the date the stock certificate is issued,
            except as provided in Section 10 of the Plan.

                        Exercise of an Option in any manner shall result in a
            decrease in the number of Shares which thereafter may be available,
            both for purposes of the Plan and for sale under the Option, by the
            number of Shares as to which the Option is exercised.

                        (b) Rule 16b-3. Options granted to Outside Directors
            must comply with the applicable provisions of Rule 16b-3 promulgated
            under the Exchange Act or any successor thereto and shall contain
            such additional conditions or restrictions as may be required

<PAGE>

            thereunder to qualify Plan transactions, and other transactions by
            Outside Directors that otherwise could be matched with Plan
            transactions, for the maximum exemption from Section 16 of the
            Exchange Act.

                        (c) Termination of Continuous Status as a Director.
            Subject to Section 10 hereof, in the event an Optionee's status as a
            Director terminates (other than upon the Optionee's death or total
            and permanent disability (as defined in Section 22(e)(3) of the
            Code)), the Optionee may exercise his or her Option, but only within
            twelve (12) months following the date of such termination, and only
            to the extent that the Optionee was entitled to exercise it on the
            date of such termination (but in no event later than the expiration
            of its ten (10) year term). To the extent that the Optionee was not
            entitled to exercise an Option on the date of such termination and
            to the extent that the Optionee does not exercise such Option (to
            the extent otherwise so entitled) within the time specified herein,
            the Option shall terminate. Unvested Restricted Stock held by a
            Director on the date of such termination shall be forfeited.

                        (d) Disability of 0ptionee. In the event Optionee's
            status as a Director terminates as a result of total and permanent
            disability (as defined in Section 22(e)(3) of the Code), the
            Optionee may exercise his or her Option, but only within twelve (12)
            months following the date of such termination, and only to the
            extent that the Optionee was entitled to exercise it on the date of
            such termination (but in no event later than the expiration of its
            ten 10) year term). To the extent that the Optionee was not entitled
            to exercise an Option on the date of termination, or if he or she
            does not exercise such Option (to the extent otherwise so entitled)
            within the time specified herein, the Option shall terminate.
            Unvested Restricted Stock held by a Director on the date of such
            termination shall be forfeited.

                        (e) Death of Optionee. In the event of an Optionee's
            death, the Optionee's estate or a person who acquired the right to
            exercise the Option by bequest or inheritance may exercise the
            Option, but only within twelve (12) months following the date of
            death, and only to the extent that the Optionee was entitled to
            exercise it on the date of death (but in no event later than the
            expiration of its ten (IO) year term). To the extent that the
            Optionee was not entitled to exercise an Option on the date of
            death, and to the extent that the Optionee's estate or a person who
            acquired the right to exercise such Option does not exercise such
            Option (to the extent otherwise so entitled) within the time
            specified herein, the Option shall terminate. Unvested Restricted
            Stock held by a Director on the date of such termination shall be
            forfeited.

            9. Non-Transferability of Options. The Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee, only by the Optionee.

            10. Adjustments Upon Changes in Capitalization, Dissolution, Merger
or Asset Sale.

                        (a) Changes in Capitalization. Subject to any required
            action by the stockholders of the Company, the number of Shares
            covered by each outstanding Option or Restricted Stock award, the
            number of Shares which have been authorized for issuance under the
            Plan but as to which no Options or Restricted Stock awards have yet
            been granted or which have been returned to the Plan upon
            cancellation or expiration of an Option or Restricted Stock award,

<PAGE>

            as well as the price per Share covered by each such outstanding
            Option, and the number of Shares issuable pursuant to the automatic
            grant provisions of Section 4 hereof shall be proportionately
            adjusted for any increase or decrease in the number of issued Shares
            resulting from a stock split, reverse stock split, stock dividend,
            combination or reclassification of the Common Stock, or any other
            increase or decrease in the number of issued Shares effected without
            receipt of consideration by the Company; provided, however, that
            conversion of any convertible securities of the Company shall not be
            deemed to have been "effected without receipt of consideration."
            Except as expressly provided herein, no issuance by the Company of
            shares of stock of any class, or securities convertible into shares
            of stock of any class, shall affect, and no adjustment by reason
            thereof shall be made with respect to, the number or price of Shares
            subject to an Option or Restricted Stock award.

                        (b) Dissolution or Liquidation. In the event of the
            proposed dissolution or liquidation of the Company, to the extent
            that an Option has not been previously exercised, it shall terminate
            immediately prior to the consummation of such proposed action.

                        (c) Merger or Asset Sale. In the event of a merger of
            the Company with or into
            another corporation or the sale of substantially all of the assets
            of the Company, outstanding Options and Restricted Stock awards may
            be assumed or equivalent options and Restricted Stock awards may be
            substituted by the successor corporation or a Parent or Subsidiary
            thereof (the "Successor Corporation"). If an Option or Restricted
            Stock award is assumed or substituted for, the Option or equivalent
            option shall continue to be exercisable as provided in Section 4
            hereof for so long as the Optionee serves as a Director or a
            director of the Successor Corporation. Following such assumption or
            substitution, if the Optionee's status as a Director or director of
            the Successor Corporation, as applicable, is terminated other than
            upon a voluntary resignation by the Optionee, the Option or option
            or Restricted Stock award shall become fully exercisable, including
            as to Shares for which it would not otherwise be exercisable.
            Thereafter, the Option or option shall remain exercisable in
            accordance with Sections 8(c) through (e) above.

                        If the Successor Corporation does not assume an
            outstanding Option or Restricted Stock award or substitute for it an
            equivalent option or award, the Option or Restricted Stock award
            shall become fully vested and exercisable, including as to Shares
            for which it would not otherwise be exercisable. In such event the
            Board shall notify the Optionee that the Option shall be fully
            exercisable for a period of thirty (30) days from the date of such
            notice, and upon the expiration of such period the Option shall
            terminate.

                        For the purposes of this Section 10(c), an Option or
            Restricted Stock award shall be considered assumed if, following the
            merger or sale of assets, the Option or Restricted Stock award
            confers the right to purchase or receive, for each Share of Optioned
            Stock subject to the Option or Restricted Stock award immediately
            prior to the merger or sale of assets, the consideration (whether
            stock, cash, or other securities or property) received in the merger
            or sale of assets by holders of Common Stock for each Share held on
            the effective date of the transaction (and if holders were offered a
            choice of consideration the type of consideration chosen by the
            holders of a majority of the outstanding Shares). If such
            consideration received in the merger or sale of assets is not solely
            common stock of the successor corporation or its Parent, the
            Administrator may, with the consent of the successor corporation
            provide for the consideration to be received upon the exercise or
            vesting of the Option or Restricted Stock award, for each Share of

<PAGE>

            Optioned Stock subject to the Option or Restricted Stock award, to
            be solely common stock of the successor corporation or its Parent
            equal in fair market value to the per share consideration received
            by holders of Common Stock in the merger or sale of assets.

            11. Amendment and Termination of the Plan.

                        (a) Amendment and Termination. Except as set forth in
            Section 4, the Board may at any time amend, alter, suspend, or
            discontinue the Plan, but no amendment, alteration, suspension, or
            discontinuation shall be made which would impair the rights of any
            Optionee under any grant theretofore made, without his or her
            consent. In addition, to the extent necessary and desirable to
            comply with Rule 16b-3 under the Exchange Act (or any other
            applicable law or regulation), the Company shall obtain stockholder
            approval of any Plan amendment in such a manner and to such a degree
            as required.

                        (b) Effect of Amendment or Termination. Any such
            amendment or termination of the Plan shall not affect Options or
            Restricted Stock already granted and such Options and Restricted
            Stock shall remain in full force and effect as if this Plan had not
            been amended or terminated.

            12. Time of Granting Options and Restricted Stock. The date of grant
of an Option or Restricted Stock grant shall, for all purposes, be the date
determined in accordance with Section 4 hereof.

            13. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option or grant of Restricted Stock unless the
issuance and delivery of such Shares pursuant thereto, and in the case of an
Option, the exercise of such Option shall comply with all relevant provisions of
law, including, without limitation, the Securities Act, the Exchange Act, the
rules and regulations promulgated thereunder, state securities laws, and the
requirements of any stock exchange upon which the Shares may then be listed, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.

            As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares, if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.

            Inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.

            14. Reservation of Shares. The Company, during the term of this
Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.

            15. Option or Restricted Stock Agreement. Options and or Restricted
Stock awards shall be evidenced by written agreements in such form as the Board
shall approve.

<PAGE>

            16. Stockholder Approval. Continuance of the Plan shall be subject
to approval by the stockholders of the Company at or prior to the first annual
meeting of stockholders held subsequent to the granting of an Option hereunder.
Such stockholder approval shall be obtained in the degree and manner required
under applicable state and federal law.

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