Document:

comtech_8k-1001.htm

    Exhibit
      10.1

     

    
      STOCK
        PURCHASE AGREEMENT

      

      STOCK
        PURCHASE AGREEMENT, dated August 1, 2007, by and among Comtech Group, a company
        incorporated in the Cayman Islands, the registered office of which is situated
        at PO Box 309GT, Ugland House, South Church Street, Grand Cayman, Cayman
        Islands
        (the “Purchaser”), on the one hand, and First King
        International Limited, a company incorporated in the
        British Virgin Islands, the registered office of which is situated at P.O.
        Box
        957, Offshore Incorporation Center, Road Town, Tortola, British Virgin Islands
        (the “Seller”), Keen Awards Limited (奇利光电香港有限公司)
        a company organized and existing under the laws of Hong Kong ( the
“Company”) and Shenzhen Hui Cheng Yun Tong Company
        Limited (深圳汇诚运通科技有限公司),
        a company organized and existing under the laws of the People’s Republic of
        China (“SZ”, collectively with the Company, the
“Company Group” ), and the natural
        persons listed on
        Part I of Schedule I attached hereto (the “Individual
        Shareholders”), on the other hand.

      

      W
        I T N E
        S S E T H:

      

      WHEREAS,
        the Company Group is currently engaged in the business of distributing and
        trading electronic components and providing design and engineering service
        for
        solution of integrated display technology (the
“Business”);

      

      

      WHEREAS,
        the Individual Shareholders are beneficial and/or record owners
        of  all of the outstanding capital stock, share capital and equity
        securities of the Seller, the Company and SZ,   each shareholding
        ratio set forth opposite in Part II of Schedule I;

      

      WHEREAS,
        upon consummation of the Pre-Closing Restructuring (as hereinafter defined),
        the Seller will own Ten Thousand (10,000) Ordinary Shares, HKD1.00
        par
        value per share, of the Company, which shares represent all of the outstanding
        capital stock, share capital and equity securities of the Company (the
“Shares”);

      

      WHEREAS,
        the Purchaser wishes to invest in the Business and, to that end, wishes to
        purchase all of the Shares of the Company and take over all employees with
        respect to the Business of SZ pursuant to the terms of this
        Agreement;

      

      WHEREAS,
        the Seller desires to sell to the Purchaser, and the Purchaser desires to
        purchase from the Seller, all of the Shares for the consideration and on
        the
        terms set forth in this Agreement;

      

      WHEREAS,
        the Individual Shareholders and SZ desire to transfer to the Purchaser or
        its
        designee(s), and the Purchaser or its designee(s) desire to acquire from
        the
        Individual Shareholders and SZ, all employees with respect to the Business
        of SZ
        upon the terms and subject to the conditions set forth in this Agreement;
        and

      

      WHEREAS,
        certain capitalized terms used in this Agreement are defined in
        Section 11.14 below.

      

      NOW,
        THEREFORE, in consideration of the mutual covenants hereinafter set forth,
        and
        for other good and valuable consideration, the receipt and adequacy of which
        are
        hereby acknowledged, the parties hereto agree as follows:

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        I

      Purchase
        and Sale of Shares.

      

      Section
        1.1    Sale of Shares.  Subject to the
        terms and conditions of this Agreement, the Seller shall at the Closing sell,
        transfer, convey, assign and set over (“Transfer”) to
        the Purchaser, and the Purchaser shall at the Closing purchase and acquire
        from
        the Seller, all of the Seller’ s right, title and interest in and to the
        Shares.  In furtherance of the foregoing, the Seller shall at the
        Closing Transfer beneficial and record ownership of the Shares to the Purchaser,
        and execute one or more stock powers, endorsements or assignments as the
        Purchaser may reasonably request.

      

      ARTICLE
        II

      Purchase
        Price

      

      Section
        2.1.   Purchaser Price.  In consideration of the
        Transfer to the Purchaser of the Shares at the Closing, subsequent Transfer
        to
        the Purchaser, and/or any designated persons of the Purchaser substantially
        all
        business, assets and employees relating to the Business of the Company Group
        and
        of the other representations, warranties and covenants herein:

      

      (a)           Subject
        to satisfaction of all relevant operating and financial milestones of the
        Business of the Company Group agreed upon by the Parties and on the terms
        and
        conditions contained herein, the Purchaser shall pay to the Seller US$16
        million
        (the “Purchase Price”), consisting of US$12 million in
        cash and US$4 million in shares of the Purchaser (“COGO
        Shares”).  The schedule of payment and adjustment of the
        Purchase Price shall be separately agreed upon by the Parties.

      

      (b)           in
        addition to the payments described in Section 2.1(a), based on and subject
        to
        the satisfaction and attainment of all post-Closing operating and financial
        milestones of the Business, the Purchaser shall pay additional US$4 million
        to
        the Seller and the whole amount shall be used immediately to purchase 20%
        of the
        Company’s shares (the “Trust Shares”) on an a
        fully-diluted basis, by the Seller, which will act as a trustee for the Company
        (the “Company Trust”) on August 31, 2009 and the
        beneficiaries of the Company Trust shall be determined by the
        Purchaser.

       

      Section
        2.2   Restrictions on Transfer.  The Trust
        Shares issued to the Seller pursuant to Section 2.1 (b) are restrictive shares,
        which shall not be transferred, assigned or subject to any pledge or encumbrance
        without the consent of the Purchaser.  If any member of the senior
        management personnel terminates his/her employment with the Company for whatever
        reason, the Company Trust will have a right to repurchase all his/ her interests
        in the Company Trust at a nominal price and may resell such interests to
        other
        members of the senior management personnel of the Company.  As a
        result, the senior management of the Company as a group will continue to
        own
        beneficially 20% shares of the Company.

      

      Section
        2.3   COGO Shares.  Subject to all applicable
        conditions and requirements of the US securities law, the COGO Shares granted
        to
        Seller pursuant to Section 2.1(a) may be traded freely on the
        NASDAQ.  In the event that COGO Shares is changed into or exchanged
        for a different number or kind of shares of the Purchaser or other securities
        of
        the Purchaser or of any third corporation, by reason of reorganization, merger,
        consolidation, recapitalization, reclassification, stock split up, stock
        dividend or combination of shares, the Purchaser shall make an appropriate
        and
        equitable adjustment to the number of COGO Shares to be issued to the Seller
        or
        any appropriate substitution of a different security for such COGO Shares
        as the
        case may be.  Any such adjustment made by the Purchaser shall be final
        and binding upon the Seller.

      

      
        
          
          

        

        
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      Section
        2.4   Offset Right. Notwithstanding anything herein to the
        contrary, the Purchaser shall be entitled to offset, against any consideration
        otherwise payable to the Seller pursuant to Article II, any payment payable
        by
        the Seller, SZ or any Individual Shareholders to the Purchaser under this
        Agreement, including but not limited to any indemnification payment under
        Section 11.13 (a) herein pursuant to the terms of this Agreement or any other
        Closing Documents  (whether before, at or after the
        Closing).

      

      ARTICLE
        III

      Closing.

      

      Section
        3.1  Closing Date.  The closing of the transactions
        contemplated hereby (the “Closing”) shall be held in
        Hong Kong or other place mutually agreed by the parties, on the Closing
        Date.  All matters at the Closing shall be considered to take place
        simultaneously.  As used herein, the term “Closing
        Date” shall mean the date which is two Business Days after all of
        the conditions in Article IX have been satisfied (or waived in writing by
        the
        party entitled to provide such a waiver), provided that the Closing Date
        shall
        not be later than August 31, 2007,
        unless the parties hereto mutually agree otherwise in writing.

      

      Section
        3.2  Documents of Conveyance, Etc.  The Seller and
        the Purchaser shall deliver to each other at the Closing such certificates,
        consents, approvals, agreements, and documents relating to the transactions
        contemplated by this Agreement (collectively with this Agreement, the
“Closing Documents”).  Each party hereto
        further agrees that at or subsequent to the Closing, upon the written request
        of
        the other party, it will promptly execute and deliver or cause to be promptly
        executed and delivered any further assignments, instruments of transfer and
        bills of sale or conveyances reasonably necessary or desirable to vest fully
        in
        the Purchaser all of the Seller’ right, title and interest in and to the
        Shares.

      

      ARTICLE
        IV

      Seller’s
        Retention and Assumption of Liabilities.

      

      Section
        4.1.  Approved Liabilities.  The parties hereto agree
        that it is their mutual intent and desire that the only Liabilities of the
        Company Group as of August 1, 2007 be those expressly described and itemized
        on
        Schedule 4.1 (collectively, the “Approved
        Liabilities”).  As used herein, the term
“Liabilities” means any and all liabilities,
        claims,
        obligations, expenses or damages, whether known or unknown, contingent or
        absolute, named or unnamed, disputed or undisputed, legal or equitable,
        determined or indeterminable, or liquidated or unliquidated.

      

      Section
        4.2   Unapproved Liabilities. Notwithstanding anything
        contained in this Agreement or the Schedules hereto, or any other Closing
        Document, to the contrary, the Individual Shareholders and the Seller jointly
        and severally covenant to pay, perform and discharge, and guarantee the payment,
        performance and discharge of, the Unapproved Liabilities in accordance with
        their respective terms.  The term “Unapproved
        Liabilities”, as used herein, shall mean any and all Liabilities
        of the Company Group which are not specifically listed on Schedule 4.1 or
        which
        exceed the amounts of such Liabilities as listed on Schedule 4.1.  In
        addition, as to any Liability listed on Schedule 4.1 as an Approved Liability
        arising under any Commitment, such Liability shall constitute an Approved
        Liability under such Commitment only to the extent arising from and after
        Closing in accordance with the terms of such Commitment, and all other
        Liabilities of the Company under such Commitment, including without limitation
        any Liabilities relating to any breach of such Commitment prior to Closing,
        shall constitute Unapproved Liabilities.

      

      ARTICLE
        V

      Representations
        and Warranties by the Warrantors.

      

      Section
        5.1   Representations and Warranties.  Each of
        the Warrantors hereby jointly and severally makes the following representations
        and warranties to the Purchaser:

      

      
        
          
          

        

        
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      (a)           Corporate
        Existence and Qualification of the Company; Due Execution, Etc.

      

      (i)           The
        Company is private company limited by shares duly organized, validly existing,
        in good standing and subsisting under the laws of Hong Kong and has the
        requisite corporate power and authority to own, lease or otherwise hold its
        assets and to carry on its business as conducted through the Closing
        Date.

      

      (ii)           The
        Company does not own or control, directly or indirectly, any interest in
        any
        other Person.  The Company is not a participant in any joint venture,
        partnership, or similar arrangement involving the sharing of profits or
        losses.

      

      (iii)           Each
        of the Individual Shareholders, the Seller and the Company has all requisite
        power and authority to execute, deliver and perform this Agreement and the
        Closing Documents to which each is a party, and to consummate the transactions
        contemplated hereby and thereby.  This Agreement and the Closing
        Documents to which the Individual Shareholders, the Seller and the Company
        are
        parties constitute valid and binding obligations of the Individual Shareholders,
        the Seller and the Company enforceable in accordance with their respective
        terms.

      

      (iv)           The
        authorized capital stock of the Company consists of One Million (1,000,000)
        Ordinary Shares, of which Ten Thousand (10,000) are issued and outstanding
        upon
        the date hereof.

      

      The
        Shares constitute all of the issued and outstanding capital stock, share
        capital
        and equity securities of the Company.  The Shares are duly authorized,
        were validly issued and are fully paid and non-assessable, and are not subject
        to any preemptive rights.  There are no outstanding securities or
        share capital of the Company other than the Shares and there are no outstanding
        rights or options to acquire securities of the Company, and the Company is
        not
        subject to any obligation to issue, deliver, redeem, or otherwise acquire
        or
        retire any shares of capital stock.  The Seller is not entitled to the
        payment of any dividends or other distributions from the Company after the
        date
        hereof on account of the Seller’s ownership of the Shares on or before the date
        hereof.

      

      (v)           As
        of the Closing, the Seller is the sole beneficial owner and shareholder of
        record of the Shares, free and clear of any Lien and with all rights to vote
        and
        transfer such Shares without any restrictions.  The Seller has sole
        and absolute authority to Transfer the Shares to the Purchaser pursuant to
        this
        Agreement.

       

      (c)           Corporate
        Existence and Qualification of SZ; Due Execution, Etc.

       

      (i)           SZ
        is a wholly domestic-owned limited liability company duly established and
        validly existing under the laws of the PRC and has the requisite corporate
        power
        and authority to own, lease or otherwise hold its assets and to carry on
        its
        business as conducted through the Closing Date.  SZ has no
        subsidiaries.

      

      (ii)           True
        and complete copies of the Charter Documents of SZ, as in effect on the date
        hereof, have been delivered by the Seller to the Purchaser. Hong
        Li is the Legal Representative of SZ.

      

      (iii)           As
        of the date hereof, the registered capital of SZ is Rmb 1,000,000, all of
        which
        has been fully paid in accordance with SZ’s Charter Documents.  Hong
        Li and Bo Zhang hold 60% and 40%, respectively, of the equity interests in
        SZ.

      

      (iv)           SZ
        has all requisite power and authority to execute, deliver and perform this
        Agreement and the Closing Documents to which SZ is a party, and to consummate
        the transactions contemplated hereby and thereby.

      

      
        
          
          

        

        
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      (d)           No
        Violation.

      

      (i)           Neither
        the execution and delivery by each of the Warrantors of this Agreement and
        the
        Closing Documents to be executed by each of the Warrantors, nor the consummation
        by each of the Warrantors of the transactions contemplated hereby or thereby:
        (1) violates or will violate any Law applicable to any of the Warrantors;
        (2)
        violates or will violate any order, ruling, writ, judgment, injunction or
        decree
        of any Governmental Entity (an “Order”) applicable to
        any of the Warrantors; (3) conflicts or will conflict with, or results or
        will
        result in a breach of or default under, the Charter Documents of any of the
        Company Group or the Seller; or (4) results or will result in the imposition
        of
        any Lien on any of the Assets, the Business or the Shares.  No
        consent, authorization, or approval from, or registration or filing with,
        any
        Governmental Entity or other third party (not obtained or made as of the
        date
        hereof) is required to be obtained or made by or with respect to the Seller,
        any
        of the Company Group or the Business in connection with the execution and
        delivery of this Agreement or the Closing Documents or the consummation by
        each
        of Warrantors of the transactions contemplated hereby or thereby.

      

      As
        used
        herein, the term “Lien” means any lien, mortgage,
        security interest, charge, pledge or encumbrance of any kind.

      

      (ii)           The
        execution, delivery and performance by each of Warrantors of this Agreement
        and
        the other Closing Documents, and the consummation of the transactions hereunder
        and thereunder, will not create a default by any of the Company Group under,
        or
        give any Governmental Entity or other third party the right to terminate
        or
        accelerate any Commitment, any permits, licenses, approvals, consents and
        authorizations issued by any Governmental Entity (collectively,
“Licenses”).

      

      (e)           Financial
        Statements.  Attached hereto as Schedule 5.1(e) are pro forma
        unaudited consolidate financial statements, balance sheets, statements of
        operations and other financial information of the Company Group, the Business
        and the Assets (collectively, the “Financial
        Statements”) for the period ended on June 30, 2007, which was
        provided by the management of the Company Group and prepared in accordance
        with
        management account, consistently applied throughout the periods involved,
        and
        all such Financial Statements respectively; all of which present fairly,
        in all
        material respects, the financial position of the Company Group, and the Business
        at the dates indicated in such Financial Statements and the results of the
        operations of the Business and the Company Group, for the periods stated
        therein.

       

      (f)          Absence
        of Certain Transactions.  Since June 30, 2007: (i) the Business
        has been operated by the Company Group only in the ordinary course, consistent
        with past historical practice (taking into account seasonal changes consistent
        with historical seasonal changes); and (ii) there has been no Material Adverse
        Effect. Without limiting the foregoing, but excluding the transactions
        contemplated by this Agreement, since such date none of the Company Group
        has:

       

      (i)           changed
        its authorized capital; or sold or issued any of its capital stock or share
        capital; or purchased, redeemed or otherwise reacquired any of its capital;
        or
        granted any stock options or rights to purchase shares of its capital or
        other
        securities, issued any securities convertible into capital or equity interests,
        or granted any registration rights with respect to any securities;

       

      (ii)           amended
        its Charter Documents;

       

      (iii)           paid
        any bonuses, or increase in salaries or other compensation to any of its
        directors, officers, or employees except for bonus awards and increases in
        salaries in the Ordinary Course of Business, as required by applicable Laws
        or
        pursuant to any Commitment listed on Schedule 5.1(f);

       

      
        
          
          

        

        
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      (iv)           mortgaged,
        pledged, hypothecated or permitted any of its Assets to be subjected to any
        Lien;

       

      (v)           sold
        or otherwise disposed of any Asset material to the operation of the
        Business;

       

      (vi)           cancelled
        or waived any claims or rights against third Persons or forgiven any debt,
        except in the Ordinary Course of Business;

       

      (vii)           changed
        its accounting methods or principles;

       

      (viii)           entered
        into, amended, terminated or received notice of termination of any Commitment
        requiring annual payments in excess of Rmb 100,000;

       

      (ix)           suffered
        any damage to or destruction or loss of any Asset of the Company Group material
        to the operation of the Business or valued at more than Rmb
        100,000;

       

      (x)           adopted
        or increased any payments to or benefits under any employment plans, except
        in
        the Ordinary Course of Business;

       

      (xi)           effected
        or been a party to or any merger, consolidation, business combination, share
        exchange, reorganization or similar transaction;

       

      (xii)           declared,
        accrued, set aside or paid any dividends or made any other distribution in
        respect of any shares of capital stock or other securities;

       

      (xiii)           leased
        or licensed any Asset from any third Person except in the Ordinary Course
        of
        Business;

       

      (xiv)           made
        any capital expenditure in excess of Rmb 100,000  individually or in
        the aggregate;

       

      (xv)           written
        off as uncollectible, or established any extraordinary reserve with respect
        to,
        any account receivable or other indebtedness in excess of Rmb
        100,000  in the aggregate;

      

      (xvi)           made
        any loan or advance; or

       

      (xvii)           agreed,
        orally or in writing, to do any of the foregoing.

       

      As
        used herein, the
“Ordinary Course of Business” means the ordinary
        course of the Business, as operated by the Company Group prior to the Closing
        Date, in each case consistent with past practices.

       

      
        
          
          

        

        
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                (g)

              	
                Material
                  Contracts and Obligations.

              

      

       

      (i)           The
        Seller and each of the Company Group have made available to the Purchaser
        true
        and correct copies of all Approved Commitments which are in written form
        and any
        amendments thereto.  No Unapproved Commitment (as defined below) is
        material to the operation of the Business, and each Commitment which is material
        to the operation of the Business is an Approved Commitment.  Each
        Approved Commitment is listed on Part I of Schedule 5.1(g), will be in full
        force and effect immediately following the Transfer of the Purchased Shares
        of
        the Company and the employees of SZ at the Closing, and represents the valid
        and
        binding obligation of the Company and the applicable the Purchaser or its
        designee(s).

       

      (ii)           With
        respect to each Approved Commitment to which any of the Company Group is
        a
        party, each of the Company Group and, to the knowledge of the Seller, the
        other
        party or parties thereto, has performed in all material respects all obligations
        required to be performed by it thereunder through the Closing Date, and none
        of
        the Company Group is (with or without the lapse of time or the giving of
        notice,
        or both) in default under any such Approved Commitment (other than a default
        under any Approved Commitment which is not material to the Business and which
        default will not result in a Material Adverse Effect) and, as of the date
        hereof, none of the Company Group has received any notice of any default
        (whether monetary or nonmonetary) or termination of any such Approved Commitment
        from any other party thereto.

       

      (iii)           Without
        limiting the generality of the foregoing, Part I of Schedule 5.1(g) accurately
        lists each Approved Commitment, whether written or oral and including all
        amendments thereto, to which any Company Group is a party of the types described
        below and Part II of Schedule 5.1(g) accurately lists each Commitment which
        is
        not an Approved Commitment (an “Unapproved
        Commitment”), whether written or oral and including all amendments
        thereto, in each case to which any Company Group is a
        party of the following types:

      

      (a)
        any
        employment, severance or consulting Commitment with any employee or former
        employee; (b) any Commitment relating to acquisition or construction of
        fixed assets requiring aggregate future payments or expenditures in excess
        of
        Rmb 100,000 in total; (c) any Commitment under which any Company Group is a
        lessee or lessor of real or personal property (excluding any such Commitment
        under which any of the Company Group is a lessee of
        personal property and which requires less than Rmb 100,000 in annual payments
        and Rmb 100,000 in total payments by any Company Group); (d) any Commitment
        pursuant to which any of the Company Group has acquired licensee or other
        user
        rights in any software or other Intellectual Property; or (e) any other
        Commitment which (i) involves aggregate future payments by any Company
        Group in excess of Rmb 100,000, (ii) would reasonably be expected to result
        in a Material Adverse Effect, (iii) has been entered into with an Affiliate
        of any Company Group or (iv) is otherwise material to any Company
        Group or the conduct of the Business.

      

      Notwithstanding
        anything herein to the contrary, none of the Company Group has any Commitments:
        (a) relating to cleanup, abatement or other actions in connection with any
        environmental condition; (b) granting to any person a first-refusal,
        first-offer or other right to purchase or acquire any Assets and Business;
        (c) with respect to Intellectual Property which requires future payments to
        or from any of the  Company Group, except as routine maintenance;
        (d) under which commissions are payable and which is not terminable without
        penalty on 30 days’ or less prior notice; (e) under which any of
        the  Company Group is or has agreed to become a joint venturer or
        partner; (f) granting a power of attorney binding upon any of the Company
        Group; (g) with respect to letters of credit, surety or other bonds or
        pursuant to which any assets or properties of any of the Company Group are,
        or
        are to be, subjected to a Lien; (h) limiting or restricting the ability of
        any of the Company Group to enter into or engage in any market or line of
        business; or (i) relating to any borrowing, or any full or partial
        guarantee or similar Liability in respect of any Liability of any person
        or
        entity other than any of the Company Group.

      

      
        
          
          

        

        
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      (iv)           No
        member of the Company Group has given to or received from any Person any
        notice
        or other communication (whether oral or written) regarding any actual, alleged,
        possible, or potential material violation or material breach of, or material
        default under, any Material Contract.

       

      (h)           Title
        to Assets. Schedule 5.1(h) sets forth substantially all of the fixed assets
        owned, leased or held by the Company Group.  Except as set forth on
        Schedule 5.1(h), each of the Company Group, as appropriate, has good and
        marketable title to all fixed assets described in such Schedule as being
        owned
        by each of the Company Group and all other Assets, free and clear of all
        Liens.  Each material fixed assets, and all Assets in the aggregate,
        are in reasonable operating condition, normal wear and tear
        excepted.

      

      (i)           Intellectual
        Property.  Set forth on Schedule 5.1(i) is a list of all
        Intellectual Property which is material to the Business.  Each of the
        Company Group, as appropriate, has all rights to use all such Intellectual
        Property in all areas in which such entity conducts business, including without
        limitation such names, in the manner used by each of the Company Group in
        the
        operation of the Business, and such usage does not infringe on the rights
        of any
        other party. Each of the Company Group has undertaken all commercially
        reasonable efforts to protect from unauthorized usage or disclosure all
        Intellectual Property.

      

      (j)           Litigation.                      There
        are no Legal Proceedings pending or, to the knowledge of each of Warrantors,
        threatened against the Company Group, or the Seller, any legal proceeding
        that
        seeks to enjoin or obtain damages in respect of the consummation of the
        transactions contemplated by this Agreement or any other Closing
        Document.

      

      (k)           Compliance
        With Laws.  None of the Company Group is in default with respect
        to any Order and the Business is operated and has been operated by the Company
        Group in all material respects in compliance with all applicable Laws, including
        without limitation any and all Laws relating to foreign and/or domestic
        ownership of the Assets or the Business and all Licenses relating
        thereto.

       

      (l)           Conflict
        of Interests.  Except as set forth on Schedule 5.1(l) and except
        for their ownership in the Company Group, none of the Seller and the Individual
        Shareholders, and to the knowledge of each of Warrantors, none of the officers
        or key employees of any of the Company Group, currently directly or indirectly,
        owns, manages, operates, finances, or controls, or participates in the
        ownership, management, operation, financing or control of, or is associated
        as a
        director, partner, lender, investor or representative in connection with,
        any
        profit or not-for-profit business or enterprise which competes with the
        Purchaser and the Company Group.

       

      (m)           Employee
        Benefits. Schedule 5.1(m) accurately lists all of the employees employed by
        the Company Group in connection with the Business and all Benefit Arrangements
        (as defined below).  All Benefit Arrangements have been operated and
        administered in all material respects in accordance with its provisions and
        in
        compliance with the requirements prescribed by any and all Laws.  No
        Person is or may become entitled to post-employment or severance benefits
        or
        payments of any kind, or any other non-pension benefits, other than those
        which
        are mandated by the applicable Laws, by reason of their employment by any
        of the
        Company Group in connection with the Business or termination of such employment,
        or the consummation of the transactions contemplated
        hereby.   Each of the Company Group has duly performed all of
        their applicable legal obligation to make social security and housing fund
        contributions for their employees in full and on time.

      

      
        
          
          

        

        
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      As
        used
        herein, the term “Benefit Arrangements” means all
        material employment policies, practices or other arrangements to provide
        employee or executive compensation or benefits with respect to employees
        and/or
        their spouses or beneficiaries which are or have been provided or offered
        to any
        Person by any of the Company Group, including without limitation any such
        policies or practices relating to life and health insurance, hospitalization,
        savings, bonus, deferred compensation, incentive compensation, holiday,
        vacation, severance pay, sick pay, sick leave, disability, tuition refunds,
        service awards, company cars, scholarships, relocation, patent awards, fringe
        benefits, contracts, collective bargaining agreements, individual employment,
        consultancy or severance contracts.

      

      (n)           Labor
        Relations.  None of the Company Group is a party to or subject to
        any collective bargaining or similar agreements.  To the knowledge of
        each of Warrantors, there are and have been, no strikes or work slowdowns
        pending or threatened against or affecting the Business.  None of the
        Company Group is currently a party to, and, to the knowledge of each of
        Warrantors, none of the Company Group is now threatened with, any Legal
        Proceeding by any of its employee or former employee arising out of employment
        by any of the Company Group in connection with the Business, including without
        limitation any such Legal Proceeding or other proceeding for unlawful employment
        practices or discrimination in employment.

      

      (o)           Taxes.

      

      (i)           All
        Tax Returns (as hereinafter defined) required to be filed on or before the
        Closing Date by any member of the Company Group in connection with the Business
        have been filed on a timely basis under the Laws of each applicable
        jurisdiction.  All such Tax Returns were complete and accurate as
        filed in all respects.  All Taxes shown as owing on each such Tax
        Return and all other Taxes owed by each member of the Company Group have
        been
        paid when due.  None of the Company Group has executed or filed with
        any taxing authority or other Governmental Entity any agreement extending
        the
        period for filing any Tax Return relating to or otherwise affecting the Business
        or the Assets.  No claim for assessment or collection of Taxes
        relating to or otherwise affecting any of the Company Group, the Business
        or the
        Assets is currently pending or, to the knowledge of each of Warrantors, has
        been
        asserted against any of the Company Group.  None of the Company Group
        is a party to any pending Legal Proceeding by any Governmental Entity for
        the
        assessment or collection of Taxes relating to or otherwise affecting any
        of the
        Company Group, the Business or the Assets, nor do the Warrantors have any
        knowledge of any basis for any such Legal Proceeding.

      

      (ii)           No
        waivers of statutes of limitation in respect of any Tax Returns relating
        to or
        otherwise affecting the Company Group, the Business or the Assets have been
        given or requested by the Company Group, nor has any of the Company Group
        agreed
        to any extension of time with respect to a Tax assessment or deficiency relating
        to or otherwise affecting the Company Group, the Business or the
        Assets.  No claim has been made at any time by a Governmental Entity
        in a jurisdiction where the Company Group do not currently file Tax Returns
        that
        it is or may be subject to taxation by that jurisdiction relating to or
        otherwise affecting the Company Group, the Business or the Assets, nor do
        the
        Warrantors have knowledge that any such assertion of jurisdiction is
        threatened.  No Liens have been imposed upon or asserted against any
        of the Assets as a result of or in connection with any failure, or alleged
        failure, to pay any Tax.  No ruling with respect to Taxes has been
        requested by or on behalf of any of the Company Group with respect to any
        of the
        Company Group, the Business or any Assets.  There is no claim or
        dispute concerning any Tax liability of any of the Company Group either (A)
        claimed or raised by any Governmental Entity in writing or (B) as to which
        the
        Warrantors have any knowledge.

      

      (iii)           None
        of the Company Group has entered into any agreement, whether or not written,
        providing for the payment of Taxes or entitlement to refunds and related
        matters
        with any other party.  The Company Group have withheld and paid all
        Taxes required to be withheld or paid in connection with any amounts paid
        or
        owing to any employee, creditor, independent contractor, stockholder or other
        third party.  None of the Assets has in the past been held, and none
        of the Assets was immediately prior to Closing held, in an arrangement for
        which
        Tax Returns as a partnership have been or may be filed.

      

      
        
          
          

        

        
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      (p)           Assets
        Necessary to Conduct Business.  The Assets comprise all of the
        assets necessary for the Company Group to operate the Business.  As of
        the date hereof and as of the Closing, no Person except for the Company Group
        (a) owns or holds or will own or hold any assets or properties used in the
        Business and (b) conducts the Business (or any business competitive with
        the
        Business).  The Business is the only business of the Company Group and
        the Assets are the only assets, rights or properties of the Company
        Group.

      

      (r)           Related-Party
        Transactions.    No employee, officer, or director of
        each   Company Group (a “Related Party”) or member of such
        Related Party’s immediate family, or any corporation, partnership or other
        entity in which such Related Party is an officer, director or partner, or
        in
        which such Related Party has significant ownership interests or otherwise
        controls, is indebted to each Company Group, nor is each Company Group indebted
        (or committed to make loans or extend or guarantee credit) to any of
        them.  None of such persons has any direct or indirect ownership
        interest in any firm or corporation with which each Company Group is affiliated
        or with which each Company Group has a business relationship, or any firm
        or
        corporation that competes with each Company Group, except that employees,
        officers, or directors of each Company Group and members of such Related
        Party’s
        immediate families may own securities in publicly traded companies that may
        compete with each Company Group.  No Related Party or member of their
        immediate family is directly or indirectly interested in any material contract
        with each Company Group.

       

      (s)           Permits.    Each
        Company Group has all franchises, permits, licenses, and any similar authority
        necessary for the conduct of its business as now being conducted by it, the
        lack
        of which could materially and adversely affect the business, properties,
        prospects or financial condition of each Company Group, and each Company
        Group
        believes it can obtain, without undue burden or expense, any similar authority
        for the conduct of its business as planned to be conducted.  Each
        Company Group is not in default in any material respect under any of such
        franchises, permits, licenses, or other similar authority.

       

      (t)           Brokers’
        Fees.  None of Warrantors has made any agreement or taken any
        other action which will cause the Purchaser or any of the Company Group to
        become obligated for any broker’s or other fee or commission as a result of any
        of the transactions contemplated by this Agreement.

      

      (u)           Disclosure.  Each
        member of the Company Group and each Individual Shareholders has fully provided
        the Purchaser with all the information that the Purchaser has requested for
        deciding whether to purchase the Shares. No information provided by or on
        behalf
        of any of Warrantors in any Closing Document furnished or to be furnished
        at or
        after the Closing contains or will contain any untrue statement of a material
        fact, or omits or will omit to state any material fact necessary, in light
        of
        the circumstances under which it was or will be made, in order to make the
        statements herein or therein not misleading.

      

      ARTICLE
        VI

      Representations
        and Warranties of the Purchaser.

      

      Section
        6.1    Representations and Warranties.  The
        Purchaser represents and warrants to the Seller that:

      

      (a)           Existence
        and Qualification of The Purchaser; Due Execution, Etc.  The
        Purchaser is a company duly organized, validly existing and in good standing
        under the Laws of Cayman Islands and has all requisite corporate power and
        authority to execute, deliver and perform this Agreement and the Closing
        Documents to be executed by it and to consummate the transactions contemplated
        hereby and thereby.  The execution and delivery of this Agreement and
        the Closing Documents to be executed by the Purchaser and the consummation
        by
        the Purchaser of the transactions contemplated hereby and thereby have been
        duly
        authorized by all requisite corporate action.  This Agreement and the
        Closing Documents to be executed by the Purchaser constitute valid and binding
        obligations of the Purchaser enforceable against it in accordance with their
        respective terms.

      

      
        
          
          

        

        
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      (b)           No
        Violation.  Neither the execution and delivery by the Purchaser of
        this Agreement or the Closing Documents to be executed by the Purchaser,
        nor the
        consummation of the transactions contemplated hereby or thereby: (1) violates
        or
        will violate any Order applicable to the Purchaser or (2) results or will
        result
        in a breach of or default under the Charter Documents of the
        Purchaser.

      

      ARTICLE
        VII

      Post
        Closing Covenants

       

       Section
        7.1   Transfer of Employees and Dissolution of SZ.  The
        Individual Shareholders shall procure each employee of SZ to terminate his/her
        employment with SZ and becomes an employee of the wholly-owned PRC subsidiary
        of
        the Company to be established after Closing (the “WFOE”) or a PRC designee(s) of
        the Purchaser five (5) working days after establishment of the WFOE, or,
        with
        respect to the PRC designee(s), within five (5) working days after the
        Closing.  Any compensation and other payments payable to such
        transferred employees in connection with such transfer shall be borne by
        the
        Individual Shareholders. The Individual Shareholders shall procure each of
        the
        key transferred employees identified by the Purchaser to enter into a 2-year
        Non-Competition Agreement and a Non-solicitation and Confidentiality Agreement
        in form and substance reasonably satisfactory to the
        Purchaser.   In addition, the Individual Shareholders shall
        procure SZ to cease operation and shall be subsequently dissolved within
        6
        months after completion of such transfer.

       

      Section
        7.2   Non-Competition and Non-Solicitation.

      

      (i)           For
        a period of four (4) years after the Closing (the “Restricted Period”), the
        Seller and the Individual Shareholders, jointly and severally, covenant with
        the
        Purchaser that  neither of the them shall engage, directly or
        indirectly, in any business anywhere in the PRC or Hong Kong that manufactures,
        produces or supplies products or services of the kind manufactured, produced
        or
        supplied by the Business as of the Closing Date other than through the Company
        and any Affiliates of the Purchaser or, without the prior written consent
        of the
        Purchaser, directly or indirectly, own an interest in, manage, operate, join,
        control, lend money or render financial or other assistance to or participate
        in
        or be connected with, as an officer, employee, partner, shareholder, consultant
        or otherwise, any person that competes with the  Company or the
        Business in manufacturing, producing or supplying products or services of
        the
        kind manufactured, produced or supplied by the  Business as of the
        Closing Date other than through the Company and any Affiliates of the
        Purchaser.  Notwithstanding the foregoing, in the event that the
        Company together with all Affiliates of the Purchaser decide not to conduct
        any
        Business as of the Closing Date in the future (other than disposing of the
        Business through a trade sale or otherwise for a consideration), the Seller
        and
        the Individual Shareholders shall be released from the non-competition
        obligations related to the Business as of the Closing Date contained herein
        on
        the date the Company and all Affiliates of the Purchaser cease to conduct
        any
        Business as of the Closing Date; provided that the Individual Shareholders
        shall
        continue to be bound by the non-competition obligations as an employee of
        the
        Company or other Affiliates of the Purchaser.

       

      (ii)           As
        a separate and independent covenant, the  Seller and the Individual
        Shareholders agree with the Purchaser that, for a period of four (4) years
        following the Closing, neither of them will,  directly or indirectly,
        interfere with or attempt to interfere with any officers, employees,
        representatives or agents of the Company, the Company or the Business, or
        induce
        or attempt to induce any of them to leave the employ of the Purchaser or
        the
        Company or hire any officers, employees, representatives, or agents of the
        Company, the  Purchaser or the Business or induce or
        attempt  to induce any of them to violate the terms of their
        contracts, or any employment arrangements, with the Purchaser.

       

      
        
          
          

        

        
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      Section
        7.3    Cut-Off Date and Transfer of Economic
        Benefits.The Warrantors hereby covenant to the Purchaser that all activities
        related to the Business shall be conducted through the Company or any other
        designee of the Purchaser after August 1, 2007 (the “Cut-Off
        Date”).  All revenue and profits generated by either the Company or SZ
        on or after the Cut-Off Date shall belong to the Purchaser.  To the
        extent that any transaction related to the Business have to be conducted
        by any
        entity other than the Company on or after the Cut-Off Date, the Warrantors
        shall
        make their best efforts to transfer all economic benefits of such transactions
        to the Company at no additional costs of either the Company or the
        Purchaser.  In addition, the Individual Shareholders shall make
        available all bank and financial information of the Company and SZ to the
        Purchaser and shall appoint a person designated by the Purchaser to be the
        signatory of the bank accounts of the Company and SZ immediately after the
        Cut-Off Date.

       

      Section
        7.4    Closing and Post Closing Obligation for Certain
        Taxes.  Each party shall be responsible for its own sales, use,
        transfer, stamp, conveyance, value added or other similar taxes, duties,
        excises
        or governmental charges imposed by any taxing jurisdiction, domestic or foreign,
        and all recording or filing fees, notarial fees and other similar costs of
        Closing applicable to the Transfer of the Shares and the employees of
        SZ  In accordance with the applicable law.

       

      Section
        7.5  Maintenance of Management Personnel.  The
        Individual Shareholders shall procure the senior management personnel of
        the
        Business to continue working for the Company within 24 months after the Closing
        and the directors of the Company appointed pursuant to Section 9.6 remain
        the
        same for the same period of time.  The Purchaser shall not terminate
        the employment agreement with any senior management personnel of the Company
        without a contractual and statutory cause during such 24-month
        period.

      

      Section
        7.6  Endeavor to Growth of Business.  The Purchaser shall
        use commercially reasonable efforts to grow the Business, including leveraging
        the Company Group’s customer base and logistic support as well as facilitate
        bank credit line of the Company to finance the operation of the Business
        as it
        reasonably requires, and to assist the Company in achieving the best economic
        results and efficiency in operational and financial
        administrations.

       

      Section
        7.7   Compliance with the Purchaser’s
        Practice.  The Individual Shareholders shall procure the Company
        to conduct business on all aspects, such as L/C policy, customer, supplier,
        credit line granting in compliance with normal business standards acceptable
        to
        the Purchaser.  The Purchaser shall have a right to decline any
        business that is not conformable to such standards.

      

      Section
        7.8   Centralized Control.  The Individual
        Shareholders shall procure the Company to conduct business in strict compliance
        with financial procedures and control policy adopted by the Purchaser, which
        include but not limited to the IT system, human resources policy and customer
        services of the Purchaser.  The Purchaser shall appoint a Financial
        Controller for the Business.  Bank accounts relating to the Business
        shall be consolidated for the Purchaser’s centralized control and authorized
        signatories of such bank accounts shall be appointed by the Financial Department
        of the Purchaser.

      

      
        
          
          

        

        
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      ARTICLE
        VIII

      

      Pre-Closing
        Covenants

      

      Section
        8.1.   Covenants Regarding Closing
        Conditions.  The parties shall use their respective reasonable
        efforts to bring about the satisfaction as soon as practicable of all the
        conditions to Closing contained in Article IX.  Without limiting the
        generality of the foregoing, the parties shall apply for and diligently
        prosecute all applications for, and shall use their respective reasonable
        efforts promptly to obtain, (1) such consents, waivers, releases, authorizations
        and approvals from such Governmental Entities as shall be necessary to permit
        the consummation of the Contemplated Transactions (as defined in Section
        9.3);
        (2) such consents, waivers, valuations, authorizations and approvals as may
        be
        required under Charter Documents of each of the Company Group; and (3) such
        consents, waivers, releases, authorizations and approvals from such third
        parties as shall be necessary to permit the consummation of the Contemplated
        Transactions.

      

      Section
        8.2    Access and Investigation.  Prior to
        the Closing, upon reasonable notice from the Purchaser to the Seller given
        in
        accordance with this Agreement, the Seller will afford to the officers,
        attorneys, accountants or other authorized representatives of the Purchaser
        reasonable access during normal business hours to the facilities, assets,
        books
        and records, and management personnel of the Company Group, so as to afford
        the
        Purchaser a reasonable opportunity to make, at its sole cost and expense,
        such
        additional review, examination and investigation of the Company Group, the
        Assets, the Business and the Shares as the Purchaser may reasonably desire
        to
        make.  The Seller shall instruct its accountants and advisers to
        reasonably cooperate with the Purchaser and to provide Purchaser with reasonable
        access to such accountants (including their work papers to the extent available
        to the Seller) and advisers, all at Purchaser’s cost and
        expense.  

      

      Section
        8.3    Operation of the
        Businesses.  Between the date of this Agreement and the Closing
        Date, except as otherwise expressly provided in or contemplated by this
        Agreement, or waived or consented to by Purchaser in writing, the Seller
        shall
        cause the Company Group to:

      

      (a)           conduct
        the Business only in the Ordinary Course of Business;

      

      (b)           keep
        available the services of the current officers, employees and agents of each
        of
        the Company Group, and maintain the relations and good will with suppliers,
        customers, landlords, creditors and others having material business
        relationships with any of the Company Group;

      

      (c)           confer
        with the Purchaser concerning operational and financial matters regarding
        the
        Business which are of a material nature, it being understood that,
        notwithstanding anything to the contrary herein, until the Closing the Seller
        shall have sole authority to operate the Businesses; 

      

      (d)           maintain
        all leased and owned real property comprising any of the Assets in accordance
        with the Ordinary Course of Business;

      

      (e)           not
        approve any new capital expenditure or other financial commitment in excess
        of
        Rmb 100,000; 

      

      (f)           not
        dispose of or incur, create or assume any Lien, other than Permitted Liens,
        on
        any individual capital asset of any of the Company Group or the Businesses
        if
        the greater of the book value or the fair market value of such capital asset
        exceeds Rmb 100,000;

      

      
        
          
          

        

        
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      (g)           not
        incur any indebtedness for money borrowed (excluding trade payables incurred
        in
        the Ordinary Course of Business or intercompany borrowings) that constitutes
        a
        Liability of any of the Company Group in excess of Rmb 100,000;

      

      (h)           not
        (1) amend their Charter Documents, (2) issue, sell, redeem or otherwise acquire
        any capital stock, bonds, debentures, notes or other securities or grant
        any
        options (including any employee stock options), warrants or other rights
        entitling any person to require the issuance or delivery of any capital stock,
        bonds, debentures, notes or other securities, or (3) declare, or set aside
        for
        payment, any dividend to be paid subsequent to the Closing Date;

      

      (i)           not
        enter into any material transaction with any Affiliate except on commercially
        reasonable terms and in the Ordinary Course of Business; 

      

      (j)           not
        grant material salary or wage increases, or change or amend any benefit plan
        covering transferred employees in any way that materially changes the amount
        such employees are entitled to receive under such plan other than pursuant
        to
        existing salary and wage plans except in the Ordinary Course of Business;
        and

      

      (k)                not
        take any action or otherwise omit to take any action which would reasonably
        be
        expected to cause a breach of the Warrantors’ representations, warranties,
        covenants and agreements herein set forth. 

      

      Section
        8.4   Completion of Pre-Closing
        Restructuring.  Each of Xiaoqing Wang, Yufeng Zhang and Hong Li
        undertakes, jointly and severally, to the Purchaser that he or she will use
        best
        efforts to complete the Pre-Closing Restructuring set forth in Schedule II,
        which consists of: transfer of all the Shares of the Company from Hong Li
        to the
        Seller.

      

      Section
        8.5   Notification.  Between the date of this
        Agreement and the Closing, the Warrantors will promptly notify the Purchaser
        in
        writing if the Warrantors become aware of any fact or condition that causes
        or
        constitutes a breach of any of the Warrantors’ representations and warranties as
        of the date of this Agreement, or if the Warrantors become aware of the
        occurrence after the date of this Agreement of any fact or condition that
        would
        (except as expressly required by this Agreement) cause or constitute a breach
        of
        any such representation or warranty had such representation or warranty been
        made as of the time of occurrence or discovery of such fact or condition.
        

      

      Section
        8.6   Publicity.  No press release or public
        announcement related to this Agreement, or the transactions contemplated
        hereby
        or thereby, shall be issued or made without the joint approval of both parties,
        unless required by Law (in the reasonable opinion of outside counsel) or
        other
        Governmental Entity, rule or regulation, in which case the parties shall
        use
        reasonable efforts to give the other the opportunity to review such press
        release or announcement prior to publication and, where practicable, agree
        to
        the form and wording of such release or announcement.

      

      ARTICLE
        IX

      Closing
        Conditions

      

      The
        Purchaser’s obligation to purchase the Shares and to take the other actions
        required to be taken by the Purchaser at the Closing, is subject to the
        satisfaction, at or prior to the Closing, of each of the following conditions
        (any of which may be waived by the Purchaser, in whole or in part):

      

      Section
        9.1   Accuracy of Representations.  Each of the
        Warrantors’ representations and warranties set forth in this Agreement must have
        been true and correct as of the date of this Agreement, and must be true
        and
        accurate as of the Closing Date as if made on the Closing Date (except for
        representations and warranties made as of a certain date, which shall be
        true
        and correct as of such date).

      

      
        
          
          

        

        
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      Section
        9.2   Warrantors’ Performance.  Each of the
        covenants and obligations that the Warrantors are required to perform or
        to
        comply with pursuant to this Agreement at or prior to the Closing must have
        been
        duly performed and complied with, and the Warrantors must have executed and
        delivered each of the documents required to be delivered by it hereunder,
        including under Section 3.2 and Schedule 3.2.

      

      Section
        9.3   No Injunction.  Since the date of this
        Agreement, there must not be in effect any injunction or other Order issued
        by a
        court of competent jurisdiction restraining or prohibiting the consummation
        of
        the transactions contemplated by this Agreement, or in any other Closing
        Document, including the Transfer of the Shares and the transfer of the employees
        of SZ (collectively, the “Contemplated
        Transactions”).

      

      Section
        9.4   Non-Competition, Confidentiality and Employment
        Agreements  Xiaoqing Wang and Yufeng Zhang and each of the key
        management personnel of the Company as designated by the Purchaser have entered
        into a Non-Competition Agreement, Non-solicitation and Confidentiality Agreement
        and a 2-year Employment Agreement with the Company in which he or she agrees
        to
        commit substantially all of his or her working time to the Company and the
        Business in form and substance reasonably satisfactory to the
        Purchaser.

      

      Section
        9.5   Transfer of Employees of the
        Company.   Each of the employees of SZ shall have terminated
        his or her employment with SZ and have signed a standard employment agreement
        with a designee of the Purchaser.

      

      Section
        9.6   Appointment to and Resignation from the
        Board.  All corporate and other actions shall have been taken to
        (a) appoint at least three (3) persons nominated by the Purchaser as directors
        of the Company, and (b) ensure the resignation or removal of Hong Li as a
        director of the Company, in each case with effect from and as of the
        Closing.

      

      Section
        9.7   No Prohibition.  The proposed Transfer of
        the Shares and the employees of SZ contemplated hereunder will not contravene,
        or materially conflict with, or result in a violation of any applicable Law
        or
        Order.

      

      Section
        9.8   No Material Adverse Event.  There shall
        have been no Material Adverse Events with respect to any member of the Company
        Group since the date hereof relating to the Business.

       

      Section
        9.9   Due Diligence.  The Purchaser shall have
        completed its business, legal, financial and other due diligence review on
        the
        Company Group and their respective conditions and affairs and the results
        of
        such review are to the Purchaser’s satisfaction.

      

      ARTICLE
        X

      Termination
        Rights

      

      Section
        10.1   Termination Events.  This Agreement may,
        by notice given prior to or at the Closing, be terminated:

      

      (a)           by
        mutual written consent of the Purchaser, the Seller;

      

      (b)           by
        the Purchaser, if any of the conditions in Article IX has not been satisfied
        as
        of the Closing or if satisfaction of any such condition is or becomes impossible
        (other than through the failure of the Purchaser to comply with its obligations
        under this Agreement) and the Purchaser has not waived such condition at
        or
        before the Closing;

       

      
        
          
          

        

        
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      (c)           by
        either the Purchaser, on the one hand, or the Seller, on the other hand,
        if the
        other party (or parties) has materially breached their obligations hereunder
        such that the conditions set forth in Article IX (as appropriate) cannot
        be
        satisfied within 10 days following receipt of notice of a breach from the
        non-breaching party;

       

      (d)           by
        either the Purchaser, on the one hand, or the Seller, on the other hand,
        if the
        Closing has not occurred (other than through the failure of any party seeking
        to
        terminate this Agreement to comply fully with its obligations under this
        Agreement) on or before August 31, 2007 or such later date as the parties
        may
        mutually agree upon in writing; or

      

      (e)           by
        either the Purchaser, on the one hand, or the Seller, on the other hand,
        if any
        court of competent jurisdiction or any Governmental, Entity shall have issued
        an
        Order or taken any other action permanently enjoining, restraining or otherwise
        prohibiting the Transfer of the Shares or the employees
        of  SZ.

      

      Section
        10.2   Procedures for Termination.  In the event
        of termination by the Seller, on the one hand or the Purchaser, on the other
        hand, pursuant to Section 10.1, written notice thereof shall forthwith be
        given to the other parties in accordance with Section 11.8, and the Contemplated
        Transactions shall be terminated without further action by any
        party.

      

      ARTICLE
        XI

      Miscellaneous.

      

      Section
        11.1   Entire Agreement; Amendment.  This
        Agreement, its supplementary agreement and the documents referred to herein
        constitute the entire agreement among the parties with respect to the subject
        matter of this Agreement.  Any prior or contemporaneous agreement,
        discussion, understanding or correspondence among the parties (including
        any
        prior representations or warranties given by the parties) regarding the subject
        matter of this Agreement is superseded by this Agreement.

      

      Section
        11.2   Amendments.  Any term of this Agreement
        may be amended only with the written consent of the parties hereto.

      

      Section
        11.3   Successors and Assigns.  This Agreement
        shall inure to the benefit of and be binding upon the parties hereto, and
        their
        respective successors and permitted assigns.  This Agreement is freely
        assignable by the Purchaser to any of its affiliates after the Closing Date
        but
        may not be assigned by the Seller without the prior written consent of the
        Purchaser; provided, however, that any such assignment by the Purchaser shall
        not relieve it of its obligations hereunder.

      

      Section
        11.4   Counterparts.  This Agreement may be
        executed in one or more counterparts, each of which shall be deemed to be
        an
        original for all purposes and all of which together shall constitute one
        and the
        same instrument.

      

      Section
        11.5   Headings and Section References.  The
        headings of the sections and paragraphs of this Agreement are included for
        convenience only and are not intended to be a part of, or to affect the meaning
        or interpretation of, this Agreement.  All section references herein,
        unless otherwise clearly indicated, are to sections within this
        Agreement.

      

      Section
        11.6   Waiver.  No failure or delay by either
        the Purchaser, on the one hand or the Seller, on the other hand, in exercising
        any right, power or privilege hereunder shall operate as a waiver thereof;
        nor
        shall any single or partial exercise thereof preclude any other or further
        exercise thereof or the exercise of any other right, power or
        privilege.  The rights and remedies herein provided are cumulative and
        not exclusive of any rights or remedies otherwise provided by law.

      

      
        
          
          

        

        
          -16-

          
            

          

        

        
          
          

        

      

      Section
        11.7   Expenses.  Except as otherwise
        specifically provided for in this Agreement the Seller and the Purchaser
        shall
        each pay all costs and expenses incurred by it or on its behalf in connection
        with this Agreement and the transactions contemplated hereby, including,
        without
        limitation, fees and expenses of its own financial consultants, accountants
        and
        counsel.

      

      Section
        11.8   Notices.  Unless otherwise provided, any
        notice required or permitted under this Agreement shall be given in writing
        and
        shall be deemed effectively given upon personal delivery to the party to
        be
        notified or on the 10th day after the date mailed, by registered or certified
        mail, postage prepaid and addressed to the party to be notified at the address
        indicated for such party on the signature page hereof, or at such other address
        as such party may designate by ten (10) days' advance written notice to the
        other parties, or on the first business day following the date of transmission
        by facsimile.

      

      Section
        11.9    Governing Law and
        Arbitration.  This Agreement and the legal relations among the
        parties hereto shall be construed in accordance with, and all disputes,
        controversies or claims arising out of or in connection with this Agreement
        or
        the breach, termination or invalidity thereof (collectively,
“Disputes”) hereunder shall be governed by, the laws
        of Hong Kong without regard to conflicts of laws principles thereof.  In
        the event of a Dispute, the parties shall use their good faith efforts to
        resolve the same.  If no resolution can be reached through such efforts
        within 30 days from the date on which one party first notifies the other
        party
        in writing of the existence of a Dispute, then any party may submit the Dispute
        to the Hong Kong International Arbitration Center for arbitration by three
        arbitrators appointed in accordance with the Arbitration Rules (as defined
        below, the “Arbitrators”) in accordance with the
        UNCITRAL Arbitration Rules in force on the date hereof (the “Arbitration
        Rules”). In the event of any discrepancy between such Arbitration Rules and the
        provisions of this Section 11.9, the provisions of this Section 11.9 shall
        prevail.  The arbitration shall be conducted by the Arbitrators in
        English and shall be held in Hong Kong.  Each party hereby submits to
        the jurisdiction of the Arbitrators, and expressly and irrevocably waives
        any
        claim or defense based on any alleged lack of personal jurisdiction, improper
        venue, forum non convenience, or any similar basis with respect to such
        arbitration.  The arbitration award shall be final and binding upon
        the parties, and the parties agree to be bound thereby and to act
        accordingly.  The costs of arbitration and the costs of enforcing the
        arbitration award (including in each case witness expenses and reasonable
        attorneys’ fees and disbursements) shall be borne by the losing party, unless
        otherwise determined by the arbitration award.  In any arbitration
        proceeding, any legal proceeding to enforce any arbitration award and in
        any
        legal action between the parties pursuant to or relating to this Agreement,
        each
        party expressly waives any defense based on the fact or allegation that it
        is an
        agency or instrumentality of a sovereign state.  When any Dispute occurs
        and when any Dispute is under arbitration or any other proceedings, the parties
        shall continue to exercise their respective rights, and fulfill their
        obligations under this Agreement.

      

      Section
        11.10   Severability.  If any provisions
        hereof shall be held by any court of competent jurisdiction to be illegal,
        void,
        or unenforceable, such provisions shall be of no force and effect, but the
        illegality or unenforceability shall have no effect upon, and shall not impair
        the enforceability of, any other provision of this Agreement.

      

      Section
        11.11   “Knowledge”.  Whenever “to its
        knowledge,” “known” or a similar phrase is used to qualify a representation of
        the Warrantors, the “knowledge” so referred to shall be deemed to be (a) the
        actual knowledge of each of the Warrantors, and (b) the knowledge that any
        such
        person would reasonably be expected to acquire in the prudent discharge of
        his
        or her duties with respect to the Company Group.

      

      Section
        11.12   Rights of Third Parties.  Nothing
        expressed or implied in this Agreement is intended or will be construed to
        confer upon or give any person or entity other than the parties hereto and
        their
        respective successors and permitted assigns any rights or remedies under
        or by
        reason of this Agreement or any transaction contemplated hereby.

      

      
        
          
          

        

        
          -17-

          
            

          

        

        
          
          

        

      

      Section
        11.13    Indemnification: Survival of Representations
        and Warranties.

      

      (a)           Indemnification
        by Seller and Individual Shareholders. The Seller and the Individual
        Shareholders hereby jointly and severally agree to defend, hold harmless
        and
        indemnify the Purchaser and its Affiliates and their respective employees,
        officers, directors, stockholders, partners and representatives from and
        against
        any losses, assessments, Liabilities, claims, damages, costs and expenses
        (including without limitation reasonable attorneys’ fees and disbursements)
        which arise out of or relate to:

      

      (i)           any
        misrepresentation in, breach of or failure to comply with, any of the
        representations, warranties, covenants or agreements of any Warrantor contained
        in this Agreement, including without limitation in the Disclosure Schedule,
        in
        the post closing covenants or in any other Closing Document or in any
        certificate or other instrument or document furnished or to be furnished
        by any
        Seller or other Warrantors pursuant to this Agreement or any of the Closing
        Documents or in connection with the transactions contemplated hereby or thereby
        (including but not limited to any undertaking letter issued by the Seller
        and/or
        Individual Shareholders in connection with the transactions contemplated
        hereby
        and any non-compliance with the applicable Hong Kong ordinance in connection
        with the sole director arrangement of the Company);

      

      (ii)           any
        Liabilities of any member of the Company Group other than the Approved
        Liabilities;  or

      

      (iii)           without
        limiting the generality of the preceding clauses (i) and (ii), (1) the operation
        of the Business prior to the Closing but excluding, for purposes of this
        sub-clause (a), the Approved Liabilities; and (2) any Taxes attributable
        to or
        owing by the Business and the Company Group for all periods prior to Closing,
        and all other Taxes of the Seller or their Affiliates; in each case under
        the
        foregoing sub-clauses (1) and (2), inclusive, regardless of whether such
        losses,
        assessments, Liabilities, claims, damages, costs and expenses, or the facts
        or
        circumstances relating thereto, were disclosed hereunder or in the Disclosure
        Schedule or otherwise;

      

      and
        all
        such losses, assessments, Liabilities, claims, damages, costs and expenses
        so
        arising out of or relating to any of the foregoing clauses (i) through (iii),
        inclusive, of this Section 11.13(a), or the matters described therein, are
        referred to hereinafter as the “Purchaser’s
        Losses.”

      

      (b)           Indemnification
        by the Purchaser.  The Purchaser hereby agrees to defend, hold
        harmless and indemnify the Seller and their Affiliates and their respective
        employees, officers, directors, stockholders, partners and representatives
        from
        and against any losses, assessments, Liabilities, claims, damages, costs
        and
        expenses (including without limitation reasonable attorneys’ fees and
        disbursements) which arise out of or relate to any misrepresentation in,
        breach
        of or failure to comply with, any of the representations, warranties, covenants
        or agreements of the Purchaser or its Affiliates contained in this Agreement
        or
        in any other Closing Document or in any certificate or other instrument or
        document furnished or to be furnished by the Purchaser or its Affiliate pursuant
        to this Agreement or any of the Closing Documents or in connection with the
        transactions contemplated hereby or thereby (collectively, the
“Seller’ Losses”).

      

      (c)           Survival
        of Representations and Warranties. The Warrantors’ and the Purchaser’s
        representations and warranties under this Agreement, and the indemnification
        obligations arising solely from such representations and warranties under
        Section 11.13(a)(i) and 11.13(b), respectively, shall survive the Closing
        and
        shall expire and terminate on the date(s) ninety (90) calendar days following
        the expiration of the maximum applicable statutes of limitations applicable
        to
        any claim giving rise to the Purchaser’s Losses or Seller’ Losses, respectively,
        to which such representations and warranties relate.  Notwithstanding
        the foregoing, the termination of the representations and warranties as
        aforesaid shall not affect the rights of a party in respect of any claim
        made by
        such party prior to such termination.

      

      
        
          
          

        

        
          -18-

          
            

          

        

        
          
          

        

      

      (d)           Procedures.

      

      (i)           In
        the event that any Legal Proceeding shall be threatened or instituted in
        respect
        to which indemnification may be sought by one party hereto from another party
        under the provisions of this Section 11.13, the party seeking indemnification
        (“Indemnitee”) shall, reasonably promptly after
        acquiring actual knowledge of such threatened or instituted Legal Proceeding,
        cause written notice in reasonable detail of such threatened or instituted
        Legal
        Proceeding and which is covered by this indemnification, to be forwarded
        to the
        other party from which indemnification is being sought
        (“Indemnitor”), provided, however, that the failure to
        provide such notice as of any particular date as aforesaid will not affect
        any
        rights to indemnification hereunder, except to the extent, and only to such
        extent, that such failure to provide such notice actually and materially
        prejudices the Indemnitor’s ability to adequately defend such Legal
        Proceeding.

      

      (ii)           In
        the event of the initiation of any Legal Proceeding against an Indemnitee
        by a
        third party, the Indemnitor shall have the absolute right after the receipt
        of
        the notice described in Section 11.13(d)(i), at its option and at its own
        expense, to be represented by counsel of its choice, and (subject to Section
        11.13(d)(iii)) to defend against, negotiate, settle or otherwise deal with
        any
        Legal Proceeding or demand that relates to any Purchaser’s Losses or Seller’
Losses, as the case may be, indemnified against hereunder, and, in such event,
        the Indemnitee will reasonably cooperate with the Indemnitor and its
        representatives in connection with such defense, negotiation, settlement
        or
        dealings (and the Indemnitee’s costs and expenses arising therefrom or relating
        thereto shall constitute Purchaser’s Losses, if the Indemnitee is the Purchaser,
        or Seller’ Losses, if the Indemnitee is a Seller or a Founder); provided,
        however, that the Indemnitee may directly participate in any such Legal
        Proceeding so defended with counsel of its choice at its own expense, except
        that, if the Indemnitor fails to take reasonable steps necessary to defend
        diligently such third party claim within 15 business days after receiving
        written notice from the Indemnitee that the Indemnitee reasonably believes
        the
        Indemnitor has failed to take such steps or if the Indemnitor has not undertaken
        fully to indemnify the Indemnitee in respect of all such Purchaser’s or Seller’
Losses, as the case may be, relating to the matter and as required hereunder,
        the Indemnitee may assume its own defense, and, in such event (a) the Indemnitor
        will be liable for all Purchaser’s or Seller’ Losses, as the case may be,
        reasonably paid or incurred in connection therewith, and (b) the Indemnitor
        shall, in any case, reasonably cooperate, at its own expense, with the
        Indemnitee and its representatives in connection with such defense.

      

      (iii)           Without
        the prior written consent of the Indemnitee, which shall not be unreasonably
        withheld, the Indemnitor will not enter into any settlement of any third
        party
        claim which would lead to Liability or create any financial or other obligation
        on the part of the Indemnitee for which the Indemnitee is not entitled to
        indemnification hereunder or which would otherwise adversely affect the Assets
        or the Business.  If a firm offer is made to settle a third party
        claim without leading to Liability or the creation of a financial or other
        obligation on the part of the Indemnitee for which the Indemnitee is not
        entitled to indemnification hereunder and the Indemnitor desires to accept
        and
        agree to such offer, the Indemnitor will give written notice to the Indemnitee
        to that effect.  If the Indemnitee notifies the Indemnitor that it
        does not consent to such firm offer within 10 calendar days after its receipt
        of
        such notice from the Indemnitor, the Indemnitee may continue to contest or
        defend such third party claim and, in such event, the maximum Liability of
        the
        Indemnitor as to such third party claim will not exceed the amount of such
        settlement offer, plus the Purchaser’s Losses or Seller’s Losses, as the case
        may be, reasonably paid or incurred by the Indemnitee through the end of
        such
        10-calendar day period.

      

      
        
          
          

        

        
          -19-

          
            

          

        

        
          
          

        

      

      (iv)           After
        any final judgment or award shall have been rendered by a Governmental Entity
        of
        competent jurisdiction and the time in which to appeal therefrom has expired,
        or
        a settlement shall have been consummated, or the Indemnitee and the Indemnitor
        shall have arrived at a mutually binding agreement with respect to each separate
        matter alleged to be indemnified by the Indemnitor hereunder, the Indemnitee
        shall forward to the Indemnitor notice of any sums due and owing by it with
        respect to such matter, and the Indemnitor shall pay all of the sums so owing
        to
        the Indemnitee by wire transfer or certified or bank cashier’s check within 30
        days after the date of such notice.  Any and all Purchaser’s Losses or
        Seller’ Losses, other than those described in the preceding sentence (including
        Purchaser’s Losses or Seller’ Losses incurred in the absence of any threatened
        or pending Legal Proceeding, or Purchaser’s Losses or Seller’ Losses incurred
        after any such Legal Proceeding has been threatened or instituted but prior
        to
        the rendering of any final judgment or award in connection therewith), shall
        be
        paid by the Indemnitor on a current basis, and, without limiting the generality
        of the foregoing, the Indemnitee shall have the right to invoice the Indemnitor
        for such Purchaser’s Losses or Seller’ Losses, as the case may be, as frequently
        as it deems appropriate, and the amount of any such Purchaser’s Losses or
        Seller’ Losses, as the case may be, which are described or listed in any such
        invoice shall be paid to the Indemnitee, by wire transfer or certified or
        bank
        cashier’s check, within 30 days after the date of such invoice.

      

      Section
        11.14    Certain Definitions and Interpretive
        Matters.

      

      (a)           Certain
        Definitions.  The following terms shall have the following
        meanings:

      

      
        	
                 

              	
                (i)

              	
                “Affiliate”
                  means, with respect to a Person, any other Person that, directly
                  or
                  indirectly, controls, is controlled by or is under common control
                  with
                  such Person.

              

      

      

      
        	
                 

              	
                (ii)

              	
                “Approved
                  Commitment” means each Commitment of any of the Company
                  Group listed on Part I of Schedule
                  5.1(g).

              

      

      

      
        	
                 

              	
                (iii)

              	
                “Assets”
                  means all of the properties, rights, claims, contracts and assets
                  relating
                  to the Business, tangible or intangible, choate or inchoate, and
                  wherever
                  located, of (a) the Company; and (b)
                  SZ.

              

      

      

      
        	
                 

              	
                (iv)

              	
                “Business”
                  has the meaning set forth in the
                  recital.

              

      

      

      
        	
                 

              	
                (v)

              	
                “Charter
                  Documents” means, with respect to any entity, means the
                  memorandum and articles of association, corporate charter, certificate
                  or
                  articles of incorporation or formation, by-laws, partnership or
                  operating
                  agreement, and similar documents of such entity, as
                  applicable.

              

      

      

      
        	
                 

              	
                (vi)

              	
                “Commitments”
                  means all contracts, agreements, other rights of a contractual
                  nature and
                  franchises of the Company Group.

              

      

      

      
        	
                 

              	
                (vii)

              	
                “Company
                  Group” means each and all of (a) the Company and (b)
                  SZ.

              

      

      

      
        	
                 

              	
                (viii)

              	
                “Governmental
                  Entity” means any domestic or foreign court, government,
                  governmental agency, authority, entity or instrumentality.
                  

              

      

      

      
        	
                 

              	
                (ix)

              	
                “Intellectual
                  Property” means copyrights or trademarks, trademark rights,
                  service marks, service mark rights, trade names, trade name rights
                  owned
                  or used by the Company Group.

              

      

      

      
        	
                 

              	
                (x)

              	
                “Laws”
                  shall mean any federal, state, county or local statute, law, ordinance,
                  rule, regulation, order, judgment or
                  ruling.

              

      

      

      
        
          
          

        

        
          -20-

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                (xi)

              	
                “Material
                  Adverse Effect” means any fact, circumstance, event, change
                  or effect that is materially adverse to (a) any of the Company
                  Group, the
                  Assets or the financial condition of the Business or (b) the ability
                  to
                  operate the Business as operated by the Company Group as of the
                  Closing
                  Date.

              

      

      

      
        	
                 

              	
                (xii)

              	
                “Person”
                  means any person, company, corporation, joint venture,
                  partnership, legal association, or other entity, including any
                  Governmental Entity.

              

      

      

      
        	
                 

              	
                (xiii)

              	
                “PRC”
                  means the Peoples’ Republic of
                  China;

              

      

      

      
        	
                 

              	
                (xiv)

              	
                “Schedule”
                  or “Disclosure Schedule” shall mean the
                  Schedules, inclusive, attached hereto, which Schedules are incorporated
                  herein and made a part hereof, fully as if the same were herein
                  set forth
                  in their entirety.

              

      

      

      
        	
                 

              	
                (xv)

              	
                “Warrantors”
                  means the Seller, the Company and SZ and the Individual
                  Shareholders.

              

      

      

      Unless
        the context otherwise requires, (i) each accounting term not otherwise defined
        in this Agreement has the meaning assigned to it in accordance with the United
        States Generally Accepted Accounting Principles, consistently applied
        (“US GAAP”), (ii) “or” is disjunctive but not
        necessarily exclusive, and (iii) all references to “US$” or dollar amounts mean
        lawful currency of the United States of America.

      

      (b)           Interpretive
        Matters.  No provision of this Agreement will be interpreted in
        favor of, or against, any of the parties hereto by reason of the extent to
        which
        any such party or its counsel participated in the drafting thereof or by
        reason
        of the extent to which any such provision is inconsistent with any prior
        draft
        hereof or thereof.

      

      [The
        remainder of this page has been intentionally left blank.]

       

      
        
          
          

        

        
          -21-

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF the parties have executed and delivered this Agreement as
        of the
        date first set forth above.

       

      

      Purchaser

      

      

      Comtech
        Group

       

      /s/ Jeffrey Kang

      Name:
        Jeffrey Kang

      Title:    CEO

      Address:
        PO Box 309GT, Ugland House, South Church Street, Grand Cayman,
        Cayman Islands

       

      

      Seller

      

      

      First
        King International Limited

       

       

      /s/ Xiaoqing Wang

      Name:
        Xiaoqing Wang

      Title:    Director

      Address:

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      Company
        Group

      

      

      KEEN
        AWARDS LIMITED (奇利光电香港有限公司)

       

      /s/ Hong Li

      Name:
        Hong Li

      Title:    Director

      Address:

      

      

      

      Shenzhen
        Hui Cheng Yun Tong Company Limited (深圳汇诚运通科技有限公司)

       

       

      /s/ Hong Li

      Name:
        Hong Li

      Title:    Director

      Address:

      

      

      

      Individual
        Shareholders

      

       

      /s/ Hong Li

      Hong
        Li

      Address:

      

       

      
        /s/
          Xiaoqing Wang

        Xiaoqing
          Wang

      

      Address:

      

       

      
        /s/
          Yufeng Zhang

        Yufeng
          Zhang

      

      Address:

      

       

      
        /s/
          Bo
          Zhang

        Bo
          Zhang

      

      Address:

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      Schedule I

      

      Part
        I –The Individual Shareholders

      

      
        	
                Individual
                  Shareholders’ Name

              
	
                Hong
                  Li(李红)

              
	
                Xiaoqing
                  Wang(王晓青)

              
	
                Yufeng
                  Zhang(张宇锋)

              
	
                Bo
                  Zhang(张波)

              

      

      

      

      

      Part
        II – Shareholding Ratio of the Company Group

      

      Shareholding
        Ratio of the Company

      

      
        	
                Shareholders’
                  Name

              	
                Number
                  of Shares Held

              	
                Shareholding
                  Ratio

              
	
                 Hong
                  Li

              	
                10,000

              	
                100%

              

      

      

      

      Shareholding
        Ratio of SZ

      

      
        	
                Shareholders’
                  Name

              	
                Capital
                  Contribution

              	
                Shareholding
                  Ratio

              
	
                Hong
                  Li

              	
                600,000

              	
                60%

              
	
                Bo
                  Zhang

              	
                400,000

              	
                40%

              
	
                Total

              	
                1,000,000

              	
                100%

              

      

      

      

      Shareholding
        Ratio of the Seller

      

      
        	
                Shareholders’
                  Name

              	
                Number
                  of Shares Held

              	
                Shareholding
                  Ratio

              
	
                Xiaoqing
                  Wang

              	
                25,000

              	
                50%

              
	
                Yufeng
                  Zhang

              	
                25,000

              	
                50%

              
	
                Total

              	
                50,000

              	
                100%f_exh.htm

    AMENDMENT
      TO AGREEMENT FOR WHOLESALE FINANCING

    AND
      BUSINESS FINANCING AGREEMENT

    

    This
      Amendment is made to (i) that certain Agreement for Wholesale Financing dated
      August 31, 2000, between ePlus Technology, inc. ("Dealer") and
GE Commercial Distribution Finance Corporation ("CDF"), as
      amended ("AWF) and (ii) that certain Business Financing Agreement between Dealer
      and CDF dated August 31, 2000, as amended ("BFA").

    

    FOR
      VALUE
      RECEIVED, CDF and Dealer agree as follows:

    

    1.  Section
      2.1 of the BFA is
      hereby amended in its entirety to read as follows:

    

    "2.1
      Accounts Receivable Facility.  Subject to the terms of this
      Agreement, CDF agrees to provide to Dealer an Accounts Receivable Facility
      of
Thirty Million Dollars ($30,000,000.00); provided, however,
      that:  (i) at no time during the Temporary Increase Period (as defined
      below) will the principal amount outstanding under the Accounts Receivable
      Facility and Dealer's inventory floorplan credit facility with CDF exceed,
      in
      the aggregate, One Hundred Million Dollars ($100,000,000.00),
      and (ii) at no time other than from June 19, 2007 through September 30,
      2007 (“Temporary Increase Period”) will the principal amount outstanding under
      the Accounts Receivable Facility and Dealer’s inventory floorplan credit
      facility with CDF exceed, in the aggregate, Eighty-Five Million Dollars
      ($85,000,000.00).  CDF's decision to advance funds will not
      be binding until the funds are actually advanced."

    

    In
      addition, subject to the terms of the AWF, CDF agrees to provide to Dealer
      an
      inventory floorplan credit facility of:  (a) One Hundred
      Million Dollars ($100,000,000.00) during the Temporary Increase Period,
      and (b) at all times other than the Temporary Increase Period,
Eighty-Five Million Dollars ($85,000,000.00); provided,
      however, that (i) at no time during the Temporary Increase Period will the
      principal amount outstanding under the Accounts Receivable Facility and Dealer's
      inventory floorplan credit facility with CDF exceed, in the aggregate,
One Hundred Million Dollars ($100,000,000.00), and (ii) at no
      time other than during the Temporary Increase Period will the principal amount
      outstanding under the Accounts Receivable Facility and Dealer’s inventory
      floorplan credit facility with CDF exceed, in the aggregate, Eighty-Five
      Million Dollars ($85,000,000.00).  CDF's decision to advance
      funds will not be binding until the funds are actually advanced.

    

    Dealer
      waives notice of CDF's acceptance of this Amendment.

    

    All
      other
      terms and provisions of the AWF and BFA, to the extent not inconsistent with
      the
      foregoing, are ratified and remain unchanged and in full force and
      effect.

    

    IN
      WITNESS WHEREOF, Dealer and CDF have executed this Amendment on this
      2nd day
      of August, 2007.

                                                                                       

    
      
        	 	EPLUS
                TECHNOLOGY, INC.
	 	 
	 	By:  
                /s/ Steven
                J. Mencarini, CFO
	 	        
                Steven J. Mencarini, Chief Financial
                Officer

      

    

                                                                          
      

     

    
      
        	 	
                GE
                  COMMERCIAL DISTRIBUTION FINANCE 

                CORPORATION

              
	 	 
	 	By:   
                /s/ David Mintert 
	 	         
                David Mintert, Vice President of
                Operations

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00127-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00127-of-00352.parquet"}]]