Document:

<PAGE>

                              EMPLOYMENT AGREEMENT

         AGREEMENT made as of the 27th day of June, 2006, by and between
Interactive Systems Worldwide Inc., a Delaware corporation (the "Corporation"),
and Bernard Albanese ("Employee").

                              W I T N E S S E T H:

         WHEREAS, the Corporation is in the business of developing, producing,
marketing, licensing and servicing computerized sports wagering and related
software and systems;

         WHEREAS, the Corporation desires to continue to employ Employee as its
Chief Executive Officer, President and Employee desires to serve the Corporation
in such capacity; and

         WHEREAS, the Corporation desires to provide certain benefits to the
Employee upon termination of this Agreement, as herein provided.

         NOW, THEREFORE, in consideration of the mutual promises herein
contained, the parties hereto agree as follows:

         1. EMPLOYMENT. Subject to the terms and conditions herein contained,
the Corporation hereby employs Employee as its Chief Executive Officer and
President and Employee hereby agrees to serve the Corporation in such capacity.

         2. DUTIES.

            2.1. Employee agrees, during the "Term" (as hereinafter defined), to
devote his full business attention and best efforts to the business of the
Corporation and to perform such duties of an executive and administrative nature
as the Board or Board of Directors of the Corporation, acting reasonably, shall
assign or direct (i) consistent with his status and position as Chief Executive
Officer and President including, without limitation, such duties as would
typically be performed by persons holding similar positions in other companies,
and (ii) such other duties of a managerial nature relating to operations,
finance, personnel or support.

<PAGE>

            2.2. Employee shall conduct himself at all times in a manner
consistent with his position with the Corporation.

         3. TERM.

            3.1. The term of Employee's employment (the "Term") pursuant to this
Agreement shall commence on the date hereof, and shall commence on July 1, 2006
and terminate on June 30, 2007; provided that this Agreement shall be subject to
earlier termination only (i) in the event of Employee's death; (ii) at the
option of the Corporation, in the event of Employee's "disability" (as
hereinafter defined) for 90 consecutive working days or an aggregate of 120
working days during any consecutive six month period during the Term; (iii) for
cause; or (vi) as provided in Sections 3.3, 5.2 or 7.

            3.2. For the purpose of this Agreement, "disability" shall mean any
injury or any physical or mental condition or illness which shall render
Employee unable to perform his duties in accordance with this Agreement.

            3.3. Notwithstanding anything to the contrary herein provided, the
Employee shall have the right to retire from his employment with the Corporation
by giving the Corporation not less than 60 days prior written notice. Upon the
effective date of Employee's retirement, Employee shall be entitled to the
benefits referred to in Article 6.

         4. COMPENSATION AND BENEFITS. As compensation for all services to be
rendered by Employee to the Corporation and its subsidiaries in all capacities,
the Corporation shall pay to Employee during the Term, a minimum of the
following, payable in accordance with the standard payroll practice of the
Corporation:

            4.1. The Employee shall receive a base salary of not less than
$240,000 per annum (the "Base Salary").

                                       2
<PAGE>

            4.2. In addition to the Base Salary, during the Term the Employee
shall be entitled to receive incentive compensation as follows: Provided that
Employee's employment with the Corporation has not terminated pursuant to
Section 3.1(i), (ii) or (iii), or Sections 5.2 or 7, for each $1 million of
revenue realized by the Corporation and its subsidiaries on a consolidated
basis, as determined in accordance with generally accepted accounting principles
applied on a consistent basis ("Revenue"), the Employee shall be entitled to a
bonus of $30,000 up to a maximum bonus of $120,000 if the Corporation realized
Revenue of $4,000,000 during the Term.

         Commencing with the Corporation's quarter ending September 30, 2006 and
with each of the next three quarters through June 30, 2007, the Corporation will
determine whether the Corporation's Revenue as of the end of such quarter meets
or exceeds the Revenue set forth above. If any such Revenue thresholds are met,
the Employee shall be paid the applicable Bonus promptly after the determination
that such Revenue threshold has been met.

            4.3. In addition, Employee shall be entitled to receive (a) such
salary increases, bonuses or other incentive compensation as may be approved by
the Board of Directors; (b) four weeks vacation during each year of the Term;
(c) such health insurance as the Corporation may from time to time provide to
its other executive employees; (d) such life insurance as the Corporation may
provide to its other executive employees; (e) such other fringe benefits as the
Corporation may provide to its employees; and (f) at the Corporation's expense,
the use of a leased automobile plus payment of all expenses of operating such
automobile, including but not limited to insurance and maintenance costs.

            4.4. In the event that during the Term, the Employee's employment is
terminated without cause, the Corporation shall pay to the Employee (i) an
amount equal to $300,000 less the aggregate Base Salary and Bonus paid pursuant
to Section 4.2 paid to the Employee from July 1, 2006 through the date of
termination, which amount shall be payable in a lump sum on the date of such
termination; (ii) continuation of all benefits described in Sections 4.2 and 9
until the end of the Term; and (iii) the Severance Benefits described in Section
6.

                                       3
<PAGE>

         5. REQUIRED RELOCATION.

            5.1. During the Term, the Corporation shall not require the Employee
to relocate outside of the New York City/New Jersey metropolitan area (the
"Area").

            5.2. In the event that prior to the end of the Term, or after the
Term of this Agreement if the Employee continues to be employed by the
Corporation on an at will basis, the Corporation requires the Employee to
relocate outside the Area and the Employee elects in his discretion, not to do
so, the Employee may voluntarily terminate his employment with the Corporation
and in such event the Corporation shall pay to the Employee (i) an amount equal
to $300,000 less the aggregate Base Salary and Bonus paid pursuant to Section
4.2 paid to the Employee from July 1, 2006 through the date of termination,
which amount shall be payable in a lump sum on the date of such termination;
(ii) continuation of all benefits described in Sections 4.2 and 9 until the end
of the Term; and (iii) the Severance Benefits described in Section 6.

            5.3. Notwithstanding the foregoing, the Employee may be required to
travel away from his home for reasonable periods of time in fulfillment of his
responsibilities for the Corporation.

         6. SEVERANCE BENEFITS.

            6.1. Upon (a) expiration or termination of the Term of this
Agreement as provided in Section 3.1, other than for cause, (b) retirement of
the Employee as provided in Section 3.3, (c) if a new agreement is not entered
into by Employee and the Corporation on the terms and conditions described in
Section 7.1, (d) as a result of a Change of Control, or (e) pursuant to Section
5.2, the Corporation shall pay to the Employee (or the Employee's personal
representative if the Agreement is terminated as a result of the Employee's
death), the following severance benefits (collectively the "Severance Benefits")
for a period of one year after such termination:

                                       4
<PAGE>

                  (a) An amount equal to $300,000, payable in a lump sum on the
         date of such expiration, retirement or termination; and

                  (b) Continuation of the benefits provided in Section 4.3(c),
         (d) if applicable, (e) and (f), and Section 9, for a period of one year
         after the date of such expiration, retirement or termination.

            6.2. In addition, the Corporation shall continue to provide the
Employee with the benefits described in Section 4.3(f) for the remainder of the
term of the lease of the leased automobile that was provided to the Employee on
the date of termination of this Agreement.

         7. NON-RENEWAL OF EMPLOYMENT AGREEMENT; DEATH OR DISABILITY.

            7.1. In the event that at the end of the Term of this Agreement, a
new employment agreement is not entered into on terms and conditions at least as
beneficial to the Employee as each of the terms and conditions contained herein,
and the Employee's employment with the Corporation is terminated by the
Corporation, other than for cause, or by the Employee, in his discretion, the
Corporation shall pay to the Employee the Severance Benefits described in
Section 6.

            7.2. In the event this Agreement is terminated as a result of the
death or disability of the Employee during the Term or, after the end of the
Term while the Employee is still employed by the Corporation on an at-will
basis, the Employee or his personal representative, as the case may be, shall be
paid the Severance Benefits described in Section 6.

         8. CHANGE OF CONTROL.

            8.1. Notwithstanding any other provision of this Agreement, in the
event of a "Change of Control" (as hereafter defined) during the Term, the
Employee shall be entitled, at his option, which option shall be exercised by
giving not less than 60 days' prior written notice to the Corporation, to
terminate this Agreement. Whether the Employee terminates this Agreement, or
this Agreement is terminated by the Corporation after a Change of Control, for
any reason whatsoever other than termination of this Agreement by the
Corporation for cause, Employee shall be entitled to the following:

                                       5
<PAGE>

                  (a) If the termination is during the Term, the Employee shall
         be entitled to be paid (i) an amount equal to $300,000 less the
         aggregate Base Salary and Bonus paid to the Employee pursuant to
         Section 4.2, which amount shall be payable in a lump sum on the date of
         such termination, and (ii) continuation of all of the benefits as
         provided in Sections 4.3 (c), (d), if applicable, (e) and (f), and
         Section 9 until the end of the Term. In addition to the foregoing, the
         Employee shall be entitled to the Severance Benefits described in
         Section 6.

                  (b) If the termination occurs after the Term, while the
         Employee is still employed by the Corporation on an at-will basis, the
         Employee shall be entitled to the Severance Benefits described in
         Section 6.

            8.2. "Change of Control" shall mean, if any person, or any two or
more persons acting a "group" (as defined in the Securities Exchange Act of
1934, as amended (the "Exchange Act")), and all affiliates of such person or
persons who prior to such time "beneficially" owned (as defined in Rule 13d-3
under the Exchange Act) less than a total of 50% of the number of shares of
Common Stock outstanding plus the number of shares of Common Stock into which
any outstanding shares of Preferred Stock or other convertible securities of the
Corporation are then convertible at the then conversion rate, shall acquire
additional shares of Common Stock, Preferred Stock or other convertible
securities of the Corporation in one or more transactions or series of
transactions, such that following such transaction or transactions, such person
or group and affiliates beneficially own 50% or more of the Common Stock
outstanding and Common Stock into which any Preferred Stock or other convertible
securities is convertible, or 50% or more of the voting power of the
Corporation.

                                       6
<PAGE>

            8.3. "Good Reason", when used with reference to a voluntary
termination by the Employee of his employment with the Corporation, shall mean:

                  (a) the assignment to the Employee of any duties inconsistent
         in a material way with, or the reduction of powers or functions
         associated with, his positions, duties, responsibilities and status
         with the Corporation, Employee's reporting responsibilities or any
         removal of the Employee from, or any failure to reelect the Employee
         to, any significant positions or offices the Employee held immediately
         prior to the time of the Change in Control, except in connection with
         the termination of the Employee's employment by the Corporation for
         cause or for death or disability;

                  (b) a reduction by the Corporation in the Employee's base
         salary or benefits that existed immediately prior to the Change in
         Control; or

                  (c) a change in the Employee's principal work location, except
         for required travel on the Corporation's business to an extent
         substantially consistent with the Employee's business travel
         obligations immediately prior to the Change of Control;

provided, however, that no event shall constitute a Good Reason unless the
Employee notifies the Corporation that it has committed an action or inaction
specified in clauses (a) through (c) (a "Covered Action") and the Corporation
does not cure such Covered Action within 30 days after such notice, at which
time such Good Reason shall be deemed to have arisen. Notwithstanding the
immediately preceding sentence, no action by the Corporation shall give rise to
Good Reason if it results from the Employee's termination for cause, or from the
Employee's resignation for other than a Good Reason. If the Employee has Good
Reason to resign, he may in fact resign for Good Reason by notice of termination
given within 60 days after the Good Reason arises.

                                       7
<PAGE>

         9. REIMBURSEMENT OF EXPENSES. The Corporation shall reimburse the
Employee for all reasonable business expenses paid or incurred by him on behalf
of the Corporation, including, but not limited to, travel and entertainment
expenses, that he shall incur during the Term in connection with the performance
of his duties hereunder, provided that he submits, in a timely manner, receipts
or other expense records in such detail as may be required by the Corporation.

         10. TERMINATION/STOCK OPTIONS. In the event that Employee's employment
with the Corporation terminates for any reason whatsoever, including death or
disability of the Employee, other than (i) by the Corporation for cause, (ii) or
voluntarily by the Employee (other than as permitted herein), all stock options
theretofore granted to the Employee which have not vested and become exercisable
on the date of such termination shall automatically vest and become exercisable
and remain exercisable in accordance with the terms of the Corporation's 1995,
1996 and 2006 Stock Option Plans and the stock option agreements thereunder.

         11. NO CONFLICTING COMMITMENTS. Employee represents and warrants that
he has no commitments or obligations of any kind whatsoever inconsistent with
this Agreement which would impair, infringe upon or limit his ability to enter
into this Agreement or to perform the services required of him hereunder.

         12. PROPRIETARY INFORMATION; NON-COMPETITION.

            12.1. Prior to the execution of this Employment Agreement, Employee
signed a Proprietary Information Agreement the terms of which shall continue in
full force and effect.

            12.2. During the Term of this Agreement and until one year following
the termination or nonrenewal of this Agreement, the Employee shall not in any
way compete with the business of the Corporation. In furtherance thereof, during
the period described in the preceding sentence, the Employee shall not become a
stockholder, director, employee, consultant, agent or representative of any
person, firm or entity whose business is competitive with the business of the
Corporation; provided that the foregoing shall not preclude the Employee from
owning less than 5% of the stock or other securities of any person, firm or
entity whose business is competitive with the business of the Corporation.

                                       8
<PAGE>

         13. DIRECTORS' AND OFFICERS' LIABILITY INSURANCE. During the Term and
for at least two years after (i) the end of the Term or (ii) earlier termination
or expiration of the Agreement or retirement of the Employee, whichever of (i)
or (ii) last occurs, the Company shall, at its sole cost and expense, procure
for the benefit of the Employee, directors' and officers' liability in an amount
of at least $5 million and with terms and conditions substantially similar to
the terms of such insurance in effect on the date hereof.

         14. ENTIRE AGREEMENT. This Agreement embodies the entire understanding
and agreement of the parties hereto in relation to the subject matter hereof,
and no promise, condition, representation or warranty, express or implied, not
herein set forth shall bind any party hereto. None of the terms or conditions of
this Agreement may be changed, modified, waived or cancelled orally or otherwise
except in a writing signed by both the parties hereto, specifying such change,
modification, waiver or cancellation. A waiver at any time of compliance with
any of the terms and conditions of this Agreement shall not be considered a
modification, cancellation or waiver of such terms and conditions of any
preceding or succeeding breach thereof unless expressly so stated. The
Employment Agreement dated as of June 22, 2005, as amended, is hereby
terminated.

         15. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective legal representatives,
successors and assigns.

         16. GOVERNING LAW; FEES. This Agreement shall be governed by the
internal laws of the State of New Jersey without regard to principles of
conflicts of law. In the event of any litigation relating to the terms of this
Agreement, the prevailing party shall be awarded all of its fees and expenses in
pursuing or defending such litigation, including all reasonable legal fees and
expenses.

                                       9
<PAGE>

         17. NOTICES. Any notice or other communication required or desired to
be given shall be in writing and shall be sent by registered or certified mail
return receipt requested or by express mail. Each such notice shall be deemed
given at the time it is mailed in any post office maintained by the United
States to the following respective addresses, which either party may change as
to such party upon ten (10) days' notice to the other.

                  To the Corporation:

                           Interactive Systems Worldwide Inc.
                           2 Andrews Drive, 2nd Floor
                           West Paterson, NJ 07424
                           Attn:  Chief Financial Officer
                  With a copy to:

                           Richard M. Hoffman, Esq.
                           Friedman Kaplan Seiler & Adelman LLP
                           1633 Broadway (46th Floor)
                           New York, NY 10019

                  To Employee:

                           Mr. Bernard Albanese
                           18 Doremus Drive
                           Towaco, NJ 07082

         18. EXTRAORDINARY RELIEF. Employee acknowledges and agrees that
irreparable damage will result to the Corporation in the event of a breach of
the Proprietary Information Agreement or Section 12 of this Agreement.
Accordingly, Employee agrees that the Corporation shall be entitled to enforce
its rights under said Proprietary Information Agreement and Section 12 of this
Agreement, in the event of a breach or threatened breach thereof, in the court
of equity, and shall be entitled to a decree of specific performance or
appropriate injunctive relief. Such remedies shall be cumulative and not
exclusive and shall be in addition to any other rights or remedies available to
the Corporation.

         19. INVALIDITY. Any provision of this Agreement found to be prohibited
by law shall be ineffective as written without invalidating the remainder of
this Agreement and shall be deemed amended to the fullest extent allowable by
applicable law to effectuate the purposes of said provision.

                                       10
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.

                              INTERACTIVE WORLDWIDE SYSTEMS INC.

                              By:   /s/ James McDade
                                    -----------------------------------------
                                    James McDade, Chief Financial Officer

                                    /s/ Bernard Albanese
                                    -----------------------------------------
                                    Bernard AlbaneseExhibit
      10.1

    
 

    
      FUHWA
        BANK

      

      ACKNOWLEDGEMENT
        OF INDEBTEDNESS 

      FOR
        A 

      LOAN
        EXTENSION 

      (USED
        FOR DEMAND LOAN)

      

      Customer
        Number: 11589

      

      This
        Acknowledgement of Indebtedness (“I.O.U.”) is executed by Kidcastle Internet
        Technology Co. Ltd. (the “Borrower”) for a loan extended by Fuhwa Bank
        (including its headquarter and all branches) (the “Bank”). The Borrower invites
        the joint and several guarantor(s) to provide a guarantee to jointly and
        severally guarantee the Borrower’s performance of the obligations under the
        I.O.U. and agrees to the following terms and conditions: 

      

      【GENERAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      The
        amount of credit extended is: NT$10,000,000
        (the “Loan”)

      

      ARTICLE
        2:

      

      The
        Loan
        is deemed to have been received by the Borrower when the Loan is remitted
        to the
        account that the Borrower has opened in the Bank or is transferred to be
        used
        for the purpose designated by the Borrower.

      

      ARTICLE
        3:

      

      This
        Loan
        can be drawdown by different tranches on a revolving basis. Each revolving
        period and repayment methods are as follow:

      

      
        	1.	
                The
                  revolving period shall commence from August 5, 2005 and end on
                  August 4,
                  2006.

              

      

      

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      
        	2.	
                Within
                  the agreed period, the Loan shall be drawn down by Borrower’s submission
                  of the drawdown requests within the agreed amount. The term of
                  each
                  tranche that has been drawdown shall not exceed 6 months. The Borrower
                  shall repay the fund of each tranche within the above
                  period.

              

      

      

      ARTICLE
        4:

      

      The
        Borrower and the joint and several guarantor(s) shall be jointly and severally
        responsible for repaying all the funds that the Borrower has borrowed from
        the
        Bank within the period provided hereunder in accordance with the terms and
        conditions herein, although the day for repaying such funds is after such
        period.

      

      ARTICLE
        5:

      

      
        	1.	
                The
                  interests incurred from the borrowed funds shall be paid on a monthly
                  basis. The interests shall be calculated in accordance with Item
                  (4),
                  below:

              

      

      

      
        	
              	(1)	
                The
                  interest rate incurred for the Loan is calculated at the annual
                  interest
                  rate of % (which is determined according to the base rate for a
                  loan
                  extension at the time when the agreement of credit extension is
                  executed
                  plus a markup of annual rate of %) The interests for the newly
                  borrowed
                  fund shall be determined according to the base interest rate available
                  at
                  the time when the new fund is borrowed plus a standard markup rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest rate. The markup of the annual
                  interest
                  rate shall, after the execution of the agreement for credit extension,
                  be
                  adjusted every three months in accordance with the Bank’s then current
                  “Guidelines Governing the Markup of Base Interest Rate for Credit
                  Extension.”

              

      

      

      If
        the
        Bank’s base interest rate for the credit extension and/or the Guidelines
        Governing the Markup of Base Interest Rate for Credit Extension as provided
        in
        the preceding paragraph are adjusted and/or revised after the execution of
        the
        agreement for credit extension, the Borrower agrees that the Bank may publicize
        such adjusted and revised base interest rate for the credit extension and/or
        the
        Guidelines Governing the Markup of Base Interest rate for Credit Extension
        in
        its place of business and to be bound thereby.

      

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      
        	
              	(2)	
                The
                  interest rate for each tranche of the loan shall be determined
                  by
                  negotiations between the Borrower and the Bank at the time of borrowing
                  and be calculated and paid at the agreed fixed interest rate. If
                  the
                  Borrower fails to repay the principal and pay for the interests
                  according
                  to the agreed terms, commencing from the day of the delay, the
                  interest
                  rate shall be calculated and paid by adding 2.5% of annual rate
                  to the
                  base rate applied by the Bank.

              

      

      

      
        	
              	(3)	
                The
                  interest rate incurred for the Loan is calculated according to
                  the
                  applicable base rate for a loan extension at the time of borrowing
                  ( %)
                  plus a markup of annual rate of % (i.e. %). The interests for the
                  newly
                  borrowed fund shall be determined according to the base interest
                  rate
                  available at the time when the new fund is borrowed plus a markup
                  rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest
                  rate.

              

      

      

      The
        above
        base interest rate applied by the Bank is the average fixed interest rate
        (the
        exact figure shall be based upon the announcement of the Central Bank of
        China)
        of the interest rates applied to “One-year Term Time Deposit” by 10 domestic
        banks + a fixed rate (risk discount of the Bank + administrative cost).

      

      If
        the
        composition of the base interest rate provided in the preceding paragraph
        is
        adjusted or revised after the execution of the agreement for credit extension,
        the Borrower and the joint and several guarantor(s) agree that the Bank may
        announce the adjusted and/or revised details in its place of business and
        to be
        bound thereby.

      

      Explanation:

      

      
        	 	
                (i)

              	
                The
                  reference banks for the average fixed interest rate of the interest
                  rates
                  applied to “One-year Term Time Deposit” include: The Bank of Taiwan,
                  Taiwan Cooperative Bank, The Land Bank, The First Bank, Chang Hwa
                  Bank,
                  Hua Nan Bank, Taiwan Business Bank, Cathay United Bank, The International
                  Commercial Bank of China and Taipei
                  Bank.

              

      

      

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      
        	 	
                (ii)

              	
                The
                  periods of sampling, interest rate adjustment dates and periods
                  of
                  application are as below:

              

      

      

      
        	
                Period
                  of sampling

              	
                Interest
                  rate adjustment date

              	
                Period
                  of application

              
	
                2/16
                  -
                  2/22

              	
                2/23

              	
                2/24
                  - 5/23

              
	
                5/16
                  -
                  5/22

              	
                5/23

              	
                5/24
                  - 8/23

              
	
                8/16
                  -
                  8/22

              	
                8/23

              	
                8/24
                  - 11/23

              
	
                11/16
                  -
                  11/22

              	
                11/23

              	
                11/24
                  - 2/23

              

      

      

      
        	
              	Note:	
                (A)
                  The data shall be based upon the data announced by the Central
                  Bank of
                  China at 11:30 AM of that current day. (B) Indexes shall only allow
                  two
                  numbers after the decimal point. The third number after the decimal
                  point,
                  if it is bigger than or equal to 5, shall be rounded up, and if
                  it is
                  smaller than or equal to 4, shall be rounded
                  down.

              

      

      

      
        	 	
                (iii)

              	
                At
                  present, the average fixed interest rate of the interest rates
                  applied by
                  10 domestic banks to “One-year Term Time Deposit”
                  is     %.

              

      

      

      
        	 	
                (iv)

              	
                Under
                  the following circumstances, the Borrower and the joint and several
                  guarantor(s) agree that the Bank has the absolute right and at
                  its sole
                  discretion to change the reference banks providing the composition
                  of the
                  indexes for the base interest rate and separately designate another
                  domestic bank to substitute:

              

      

      

      
        	
              	(A)	
                The
                  reference bank merges with other bank, is merged into other bank,
                  is
                  extinguished, suspends the business, closes the business, is re-organized;
                  or any event under Article 62 of the Banking Law, which includes:
                  being
                  ordered to suspend the business, being put under custody, being
                  effected a
                  mandatory takeover, etc. occurs to the reference
                  bank.

              

      

      

      
        	
              	(B)	
                The
                  short-term credit rating of the reference bank is lower than Taiwan
                  ratings. 

              

      

      

      
        	
              	(C)	
                The
                  reference bank ceases selling one-year-term time deposit
                  products.

              

      

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      (4) The
        interests are collected based on a flexible rate calculated according to
        the
        following formula: The index of the time deposit of the Bank +
        7.29%
        (i.e.
        the annual interest rate of 5%). 

       

      ARTICLE
        6:

      

      If
        the
        Borrower fails to repay the principal and the interests according to the
        I.O.U.,
        the Borrower agrees to pay for the delay interest rate calculated according
        to
        the interest rate applicable to this Loan for the delayed principal amount.
        The
        Borrower further agrees to pay for penalties calculated according to the
        following formula for the delayed payment for the principal and the interests:
        The penalty for the delayed payment for the principal shall be calculated
        from
        the maturity date and that for the delayed payment of the interests shall
        be
        calculated from the interests payment day at the, at the rate of 10 % of
        the
        interest rate for this Loan for the delay period within six months and at
        the
        rate of 20% of the interest rate for this Loan for the delay period above
        six
        months.

      

      ARTICLE
        7:

      

      The
        purpose of use of this Loan shall be limited to .

      

      ARTICLE
        8:

      

      In
        order
        to perform the obligations owed to the Bank, the Borrower and the joint and
        several guarantor(s) agree to authorize the Bank from time to time and at
        the
        Bank’s sole discretion to deduct from the demand accounts opened by the Borrower
        and/or the joint and several guarantor(s) in their names (account number:
        ) any
        amount at the time of maturity or the time of advancement to pay for the
        principal, interests, default interests, penalty advances and other expenses
        (including the insurance premium for the collaterals), without the necessary
        to
        present the passbook and the withdrawal slip.

      

      ARTICLE
        9:

      

      The
        term
“obligation” or “all obligations” referred to hereunder shall mean the loan,
        instruments, advances, guarantee, overdraft and other obligations, including
        but
        not limited to interests, default interests, penalty, compensation of damages,
        the insurance premium, expenses for executing mortgages, expenses to obtain
        an
        enforcement title and other related expenses. 

      

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      ARTICLE
        10:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        agree that the Joint Credit Information Center and its member financial
        institutions, Clearing Houses, Small and Medium Business Credit Guarantee
        Fund,
        National Credit Card Center, Financial Information Service Co., Ltd., the
        assignees/transferees of the Bank’s obligations/rights hereunder and the
        participants (or the entity which plans to be assigned/transferred) in the
        Loan,
        the person auditing the appraisal of the value of the debts or any agent
        appointed by the Bank to handle the outsourced work, or other domestic or
        overseas institutions handling financial affairs (including SWIFT) and other
        relevant institutions corresponding with the Bank, may collect, proceed with
        computer processing on, conduct international transmission of, use and provide
        to each other the following information and data of the Borrower, joint and
        several guarantor(s) and provider of the collaterals:

      

      Credit
        reports, credit extension data (including overdue, collection and bad debts
        records), deposits data, financial data, collaterals and other movables or
        real
        property information, credit information regarding the instruments, credit
        cards
        (including IC Cards and magnetic cards)credit card information, credit
        information in the credit card merchants and other personal information relating
        to the credit extension or transactions.

      

      The
        computer processing of such data and information and the period of the use
        in
        relevant institutions shall be the approved period of preservation for such
        files and data which relevant institutions applied with the competent
        authorities for registration.

      

      The
        Borrower agrees that the Bank may from time to time monitor the Borrower’s use
        of the Loan extended to the Borrower and the business and financial status
        of
        the Borrower, examine/custody the collaterals, examine relevant accounts
        and
        books, statements (including the consolidated financial statements of the
        affiliates), check and review certificates, slips and documents. When the
        Bank
        deems necessary, the Bank may request the Borrower to fill out the requested
        information and deliver the requested data and information to the bank on
        a
        regular basis, or provide to the Bank the financial statements audited by
        the
        CPA approved by the Bank and request such CPA to provide relevant drafts
        of
        his/her work. If the Bank considers that the financial statements or other
        documents delivered by the Borrower are false, as soon as receiving the notice
        from the Bank, such will be deemed as a default by the Borrower; provided,
        however, the Bank does not have the obligation to monitor, audit, examine,
        custody and check such statements and documents. If the Bank considers that
        the
        Borrower’s financial structure should be improved, the Bank may demand the
        Borrower to take actions to improve its financial structure. The Borrower
        shall
        comply with such demand to improve.

      

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      ARTICLE
        11:

      

      Any
        individual/entity holding the receipt or custody certificate issued by the
        Bank
        or the Borrower’s chop or the receipt documents signed by the Borrower goes to
        the Bank to request for returning or replacing the collaterals and the documents
        related thereto shall be deemed as the agent of the Borrower. The Bank may
        approve to return or replace.

      

      ARTICLE
        12:

      

      If
        the
        obligations hereunder are covered by the collaterals obtained from the extension
        of this Loan or from other credit extensions, except for complying with the
        terms and conditions set forth in the respective collaterals agreements,
        the
        Borrower shall comply with the following provisions:

      

      
        	1.	
                For
                  the collaterals which are insurable, the Borrower and the provider
                  of such
                  collaterals shall in each year procure appropriate fire insurance
                  (including earthquake insurance) or other insurance coverage required
                  by
                  the Bank for the collaterals form the insurance company for the
                  period
                  starting from the commencement of the term of the Loan and ending
                  on the
                  day that the Loan is repaid. In such insurances, the Borrower shall
                  include the Bank as the mortgagee to apply with the insurance company
                  to
                  add special terms and conditions for the mortgage. The insured
                  amount and
                  the terms and conditions of the insurance policies shall be approved
                  by
                  the Bank. The Borrower and the collaterals provider shall be jointly
                  and
                  severally responsible for paying the insurance premium and other
                  related
                  costs. The original copy of the insurance policy and the photocopy
                  of the
                  receipt for the insurance premium shall be kept by the Bank. If
                  the
                  Borrower and the collaterals provider forget to procure the insurance
                  or
                  renew the insurance, the Bank may use this I.O.U. as an authorization
                  letter to procure/renew the insurance on their behalf. If the Bank
                  has
                  advanced the insurance premium, the Borrower and the collaterals
                  provider
                  shall repay the advanced fund immediately. If the Borrower and
                  the
                  collaterals provider fail to repay the advanced fund immediately,
                  the Bank
                  may add such advanced fund into the mount owed by the Borrower
                  and collect
                  interests incurred thereon according to the interest rate provided
                  hereunder. However, the Bank does not have the obligation to procure
                  or
                  renew he insurance policy or pay for the insurance premium. If
                  unfortunately the insured collaterals are damages, lost or destroyed
                  and
                  the insurance company refuses or delays to pay for the compensation
                  for
                  the damages which the insurance company is required to pay for
                  whatever
                  reasons, the Bank may set a certain period of time to request the
                  Borrower
                  to provide a security approved by the Bank having the value equal
                  to the
                  reduced value of such collaterals within such time period. If the
                  Borrower
                  fails to provide such a security within the set time period, the
                  Bank is
                  entitled to request the Borrower to repay the debts
                  immediately.

              

      

      

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      
        	2.	
                If
                  the payment made by the Borrower or the payment made though automatic
                  transfer from the Borrower’s account according to the agreement is
                  insufficient to repay all of the overdue loan owed by the Borrower,
                  the
                  collaterals shall be used to set off against the various expenses
                  (including the insurance premium for the collaterals advanced by
                  the
                  Bank), penalty, interests, delay interests and the principal in
                  the same
                  order.

              

      

      

      
        	3.	
                The
                  Bank’s headquarter and all of its branches may share and exercise the
                  rights over the collaterals provided by the Borrower and/or the
                  collaterals provider hereunder, irrespective of whether their rights
                  are
                  created earlier or later, to obtain guarantee from such collaterals
                  to
                  secure the present debts (including those already occurred but
                  not being
                  repaid and not limited to the total amount of credit extension
                  agreed
                  hereunder) and future debts owed by the Borrower in the form of
                  instruments, loans, advances, insurances and all other debts, together
                  with the incurred interests, delay interests, penalties, damages
                  and all
                  of the expenses required for performing the obligations of the
                  above
                  debts.

              

      

      

      ARTICLE
        13:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), the Bank may from time to time reduce the extended
        credit
        amount or shorten the period of the credit extension without the necessity
        to
        send any prior notice or demand for a correction or remedial action in the
        first
        place:

      

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      
        	1.	
                Failing
                  to repay the principal for any indebtedness according to the
                  agreement.

              

      

      

      
        	2.	
                The
                  Borrower and/or the joint and several guarantor(s) file for reconciliation
                  or is declared bankruptcy according to the Bankruptcy Act, apply
                  for
                  reorganization according to eh Company Law, are declared by the
                  clearing
                  houses to be a company/individual with which the transactions are
                  rejected, suspend the business operation or proceed a debt
                  arrangement..

              

      

      

      
        	3.	
                The
                  Borrower and/or the joint and several guarantor(s) have the obligation
                  to
                  provide guarantees according to the original agreement, but fail
                  to
                  provide such guarantees.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) die and their
                  heirs
                  declare a limited inheritance or waive their rights to
                  inherit.

              

      

      

      
        	5.	
                The
                  Borrower and/or the joint and several guarantor(s) are declared
                  a
                  confiscation of their major properties in criminal
                  cases.

              

      

      

      ARTICLE
        14:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), after the Bank has given a notice or demand within
        a
        reasonable period, the Bank may reduce the extended credit amount or shorten
        the
        period of the credit extension or treat all of the loan as matured:

      

      
        	1.	
                The
                  interests incurred on any debt are not
                  paid.

              

      

      

      
        	2.	
                The
                  collateral is foreclosed or the collateral is lost, or the value
                  of which
                  is reduced or is insufficient to secure the
                  obligations.

              

      

      

      
        	3.	
                The
                  actual use of the fund obtained from the loan extended by the Bank
                  does
                  not conform to the purpose of use selected by the
                  Bank.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) are subject
                  to
                  compulsory execution, provisional attachment, provisional measures
                  or
                  other protecting measures, which has made the Bank to face a threat
                  that
                  the debt may not be repaid. 

              

      

      

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      ARTICLE
        15:

      

      If
        the
        Bank transfers/assigns all or part of the rights claimable by the Bank according
        to the I.O.U. (including the rights to claim against the Borrower and the
        joint
        and several guarantor(s) to pay for the interests and the repay the loan),
        together with the mortgages and insurance benefits the Bank obtained according
        to the agreement, to a third party, it is the Bank or the transferee/assignee’s
        obligation to notify the Borrower. After the Borrower, the joint and several
        guarantor(s) and collaterals provider agreed to such transfer/assignment
        and the
        Bank or the transferee/assignee has notified the Borrower, if any changes
        of the
        mortgages registration or the beneficiary under the insurance contract are
        required due to such transfer/assignment, they shall cooperate to change
        the
        mortgages registration and/or the beneficiary without any objection.

      

      If
        such
        transfer/assignment is for securitizing the Bank’s financial assets or the
        transferee/assignee is an asset management company, the notice stated in
        the
        preceding paragraph can be replaced by public announcement.

      

      ARTICLE
        16:

      

      The
        Bank
        may exercise the rights of set-off against the various funds deposited by
        the
        Borrower and the joint and several guarantor(s) in the Bank (including the
        deposits in the checking accounts which have been suspended according to
        the
        agreement) and all the rights claimable against the Bank, whether or not
        such
        funds and/or rights have matured.

      

      The
        expression of intention to exercise the right of set-off as provided in the
        preceding paragraph shall become effective as soon as the Bank records such
        set-off and deduction on its books and accounts. In the meantime, the deposit
        slips, the passbook and other certificates shall, within the set-off amount,
        loose their effect.

      

      ARTICLE
        17:

      

      If
        the
        debt certificates evidencing the various debts owed by the Borrower and the
        joint and several guarantor(s) are lost, destroyed or damaged, unless the
        amounts stated on the Bank’s accounts and books, vouchers, computer generated
        certificates/slips, debt certificates and micro-copies of the correspondences
        are proved by the Borrower and the joint and several guarantor(s) to be
        erroneous and the Bank shall immediately correct such errors, the Borrower
        and
        the joint and several guarantor(s) shall admit the full amounts stated thereon
        and, when such amounts mature, immediately pay for various expenses incurred
        for
        such amounts, penalties and the principal and interests, or at the Bank’s
        request issue another debt certificates before the maturity to the Bank for
        the
        Bank’s safe-keeping.

      

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      ARTICLE
        18:

      

      In
        the
        event that the Borrower changes its name, organization, contents of its articles
        of association, seal/chop, representative, scope of authority delegated to
        the
        representative, or the occurrence of any event which may affect the rights
        and
        interests of the Bank, the Borrower shall immediately notify the Bank in
        writing
        of such events and complete the procedures of change or cancel the seal/chop
        specimen kept in the Bank. 

      

      The
        Borrower and the joint and several guarantor(s) shall be responsible for
        the
        transactions conducted before sending the notice and completing the procedures
        as provided in the preceding paragraph and compensate the Bank for any damages
        it has suffered which were resulted thereof.

      

      ARTICLE
        19:

      

      In
        the
        event that the Borrower and the joint and several guarantor(s) change their
        addresses, Borrower and the joint and several guarantor(s) shall immediately
        notify the Bank. If Borrower and the joint and several guarantor(s) fail
        to send
        the above notice and the Bank sends relevant documents to the addresses provided
        hereunder or to the last addresses notified by the Borrower and the joint
        and
        several guarantor(s), such documents shall be deemed to have been served
        upon
        the Borrower and the joint and several guarantor(s) at the expiry of the
        traveling period normally required by the post office. 

      

      ARTICLE
        20:

      

      The
        requirements, effects and the formalities of the legal action for the creation
        of the debts incurred to the Borrower and the joint and several guarantor(s)
        based upon this I.O.U. shall be governed by the laws of the Republic of
        China.

      

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      ARTICLE
        21:

      

      The
        place
        for performing the obligation hereunder shall be the business place of the
        Bank.
        Any disputes arising out of or in connection with this I.O.U. shall be subject
        to the Taipei District Of Taiwan for the first instance; provided, however,
        if
        the law mandates a court to have exclusive jurisdiction over such dispute,
        such
        mandated exclusive jurisdiction shall prevail.

      

      ARTICLE
        22:

      Any
        matters not provided for in this I.O.U. shall be negotiated by the Borrower
        and
        the joint and several guarantor(s) with the Bank separately.

      

      【SPECIAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      In
        the
        event that any amount deposited by the Borrower and the joint and several
        guarantor(s) in the Bank is attached or frozen by other person according
        to the
        law, the Bank may from time to time reduce the extended credit amount or
        shorten
        the period of the credit extension or deem all of the debts as matured, without
        the necessity to send any prior notice or demand for a correction or remedial
        action in the first place:

      

      
        	1.	
                The
                  checks issued by the Borrower and the joint and several guarantor(s)
                  are
                  bounced due to insufficient fund deposit; or the checks prepared
                  for
                  making the payment as provided by them are rejected after being
                  presented
                  for payment.

              

      

      

      
        	2.	
                The
                  debts owed by the Borrower and the joint and several guarantor(s)
                  to other
                  financial institutions are overdue and not
                  paid.

              

      

      

      
        	3.	
                The
                  occurrence of matters that are against the principles of good faith,
                  such
                  as there exist false statements or omission of statements in the
                  financial
                  statements or other data/documents delivered by the Borrower and
                  the joint
                  and several guarantor(s) to the
                  Bank.

              

      

      

      
        	4.	
                The
                  Borrower and the joint and several guarantor(s) fail to perform
                  or violate
                  the written agreements reached with the Bank or the
                  promises.

              

      

      

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      
        	5.	
                The
                  certificates, licenses or approvals required by relevant programs
                  under
                  the I.O.U. are suspended, canceled or revoked for certain
                  reasons.

              

      

      

      
        	6.	
                The
                  chattels over which the mortgages are created in favor of the Bank
                  have
                  been removed, sold, transferred or subject to other disposal
                  measures.

              

      

      

      
        	7.	
                Failing
                  to honor the promise made when entering into the contract to build
                  the
                  factory according to the promised speed.

              

      

      

      ARTICLE
        2:

      

      Unless
        the Bank agrees in writing, the Borrower and the collaterals provider shall
        not
        sell (or transfer, lease out or lend) the collaterals, or create any
        encumbrances over such collaterals or, if the collateral is an empty land),
        build any illegal buildings on the unoccupied land where the mortgage is
        created. In case of any violation of the above provisions, the Bank may set
        a
        certain time period to request the Borrower or the collaterals provider to
        provide another collateral of the same value approved by the Bank or request
        the
        Borrower to settle the debts within the set time period and compensate all
        of
        the damages suffered by the Bank as a result.

      

      ARTICLE
        3:

      

      Before
        the Borrower repays all of the debts incurred hereon, if the Bank based upon
        the
        Borrower’s request considers there is a need to extend the repayment schedule or
        allow the debts to be repaid by installments, the Bank shall immediately
        notify
        the joint and several guarantor(s) in writing. The joint and several
        guarantor(s) agree to continue to bear the joint and several guarantee liability
        when the written notice from the Bank has arrived or is deemed to have been
        served upon such joint and several guarantor(s). 

      

      ARTICLE
        4:

      

      The
        Bank
        is authorized to apply with the tax offices to check the tax information
        and
        properties of the Borrower and the joint and several guarantor(s), if any
        events
        provided in Article hereof has occurred to them.

      

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      ARTICLE
        5:

      

      The
        Bank
        and the joint and several guarantor(s) agree that the Bank may outsource
        the
        work to collect the debts owed by them to the bank to a third
        party.

      

      ARTICLE
        6:

      

      If
        the
        Bank and the joint and several guarantor(s) fail to provide sufficient
        collaterals for the credit extension for this Loan, the property the information
        of which had been provided by the Bank and/or the joint and several guarantor(s)
        to the Bank for documentary review before applying for the credit extension
        shall not be used to create a trust.

      

      ARTICLE
        7:

      

      The
        scope
        and amounts of the debts guaranteed by the collaterals which are provided
        by the
        collaterals provider to the Bank to create mortgages, together with the period
        of the mortgages, shall not be affected by the transfer of the collaterals
        pursuant to a trust.

      

      ARTICLE
        8:

      

      The
        joint
        and several guarantor(s) shall be responsible for repaying all the debts
        owed by
        the Borrower hereunder jointly and severally with the Borrower. Each joint
        and
        several guarantor(s) shall also be individually repaying all the debts owed
        by
        the Borrower hereunder. The joint and several guarantor(s) further agree
        to the
        following:

      

      
        	1.	
                The
                  Bank is entitled to claim against the joint and several guarantor(s)
                  for
                  repayment of the debts before seeking to be paid from the
                  collaterals.

              

      

      

      
        	2.	
                After
                  the joint and several guarantor(s) repaid the debts for the Borrower
                  and
                  request the Bank to transfer the collaterals according to applicable
                  laws,
                  the joint and several guarantor(s) shall not raise any objection
                  to
                  contend that the rights to the collaterals are
                  defective.

              

      

      

      
        	3.	
                The
                  guarantor(s) shall be jointly and severally responsible for repaying
                  all
                  of the debts owed by the Borrower hereunder. Such responsibility
                  shall not
                  be affected by the fact that the Bank releases any or several joint
                  and
                  several guarantor(s)’ liabilities or agree to replace any or several joint
                  and several guarantor(s) with others. Also, such responsibility
                  shall not
                  be discharged by the fact that the instruments, notes or other
                  relevant
                  documents and certificates issued by the Borrower hereunder have
                  not been
                  signed by the guarantor(s).

              

      

      

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        hereby declare that the Article of the above SPECIAL TERMS AND CONDITIONS
        has
        been reviewed article by article and stamp their chops as below: 

      

      Borrower:

      

      Kidcastle
        Internet Technology Co. Ltd.

      Responsible
        Person: Wang, Kuo An

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Joint
        and
        several guarantor(s):

      Provider
        of the collaterals: Wang, Kuo An

      

      TO:
        FUHWA
        BANK:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        hereby represent that they have reviewed all of the terms and conditions
        contained in this I.O.U. within a reasonable period of time, have fully
        understood its contents and agree to execute this I.O.U. as below.

      

      Borrower:
        Kidcastle Internet Technology Co. Ltd.

      Responsible
        person: Wang, Kuo An

      Address:
        1st Fl., 148, Chien Kuo Rd., Hsin Dian City

      

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Address:
        2nd
        Fl.,
        299, Si Yuan Rd., 10 Lin, Chung Shan Borough, Hsin Dian City, Taipei County
        

      

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Address:
        No. 71, Nan Chang Rd., Section 1, Long Fu Borough, Chung Shan District,
        Taipei

      

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      Joint
        and
        several guarantor(s):

      Address:

      

      Joint
        and
        several guarantor(s):

      Address:

      

      
        	Date:	
                August
                  5, 2005

              

      

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      

      FUHWA
        BANK

      

      ACKNOWLEDGEMENT
        OF INDEBTEDNESS 

      FOR
        A 

      LOAN
        EXTENSION 

      (USED
        FOR FIXED-TERM LOAN)

      

      Customer
        Number: 11589

      

      This
        Acknowledgement of Indebtedness (“I.O.U.”) is executed by Kidcastle Internet
        Technology Co. Ltd. (the “Borrower”) for a loan extended by Fuhwa Bank
        (including its headquarter and all branches) (the “Bank”). The Borrower invites
        the joint and several guarantor(s)(s) to provide a guarantee to jointly and
        severally guarantee the Borrower’s performance of the obligations under the
        I.O.U. and agrees to the following terms and conditions: 

      

      【GENERAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      The
        amount of the credit extended is: NT$7,000,000
        (the “Loan”)

      

      ARTICLE
        2:

      

      The
        term
        of the Loan is provided and the methods of repayment shall be made in accordance
        with Section of this Article:

      

      
        	1.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the interest incurred on the Loan shall be paid by monthly.
                  The
                  total principal shall be repaid at the
                  maturity.

              

      

      

      
        	2.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the principal shall be divided into installments. The
                  first
                  installment starts from _______. Thereafter, every month(s) is
                  counted as
                  one installment. The principal shall be repaid according to the
                  installments. Interests shall be paid by
                  monthly.

              

      

      

      
        
           

        

        
          17

          
            

          

        

        
           

        

      

      
        	3.	
                The
                  term of the Loan is 5 years (0 months), commencing from August
                  10, 2005 to
                  August 10, 2008. After the borrowing, the Loan shall be divided
                  into 60
                  installments and the principal and interests thereon be repaid
                  on the
                  10th
                  day of each according to the annuity method.

              

      

      

      
        	4.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the first ____ years are the grace period and the interests
                  shall be paid monthly. Commencing from the year, the Loan shall
                  be divided
                  into installments and the principal and interests thereon be repaid
                  on the
                  10th
                  day of each according to the annuity
                  method.

              

      

      

      ARTICLE
        3:

      

      
        	1.	
                The
                  interests incurred from the borrowed funds shall be paid on a monthly
                  basis. The interests shall be calculated in accordance with
                  Item
                  3,
                  below:

              

      

      

      
        	
              	(1)	
                The
                  interest rate incurred for the Loan is calculated at the annual
                  interest
                  rate of % (which is determined according to the base rate for a
                  loan
                  extension at the time when the agreement of credit extension is
                  executed
                  plus a markup of annual rate of %) The interests for the newly
                  borrowed
                  fund shall be determined according to the base interest rate available
                  at
                  the time when the new fund is borrowed plus a standard markup rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest rate. The markup of the annual
                  interest
                  rate shall, after the execution of the agreement for credit extension,
                  be
                  adjusted every three months in accordance with the Bank’s then current
                  “Guidelines Governing the Markup of Base Interest Rate for Credit
                  Extension.”

              

      

      

      If
        the
        Bank’s base interest rate for the credit extension and/or the Guidelines
        Governing the Markup of Base Interest Rate for Credit Extension as provided
        in
        the preceding paragraph are adjusted and/or revised after the execution of
        the
        agreement for credit extension, the Borrower agrees that the Bank may publicize
        such adjusted and revised base interest rate for the credit extension and/or
        the
        Guidelines Governing the Markup of Base Interest rate for Credit Extension
        in
        its place of business and to be bound thereby.

      

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

      
        	
              	(2)	
                The
                  interest rate for each tranche of the loan shall be determined
                  by
                  negotiations between the Borrower and the Bank at the time of borrowing
                  and be calculated and paid at the agreed fixed interest rate. If
                  the
                  Borrower fails to repay the principal and pay for the interests
                  according
                  to the agreed terms, commencing from the day of the delay, the
                  interest
                  rate shall be calculated and paid by adding 2.5% of annual rate
                  to the
                  base rate applied by the Bank.

              

      

      

      
        	
              	(3)	
                The
                  interest rate incurred for the Loan is calculated according to
                  the
                  applicable base rate for a loan extension at the time of borrowing
                  ( %)
                  plus a markup of annual rate of % (i.e. %). The interests for the
                  newly
                  borrowed fund shall be determined according to the base interest
                  rate
                  available at the time when the new fund is borrowed plus a markup
                  rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest
                  rate.

              

      

      

      The
        above
        base interest rate applied by the Bank is the average fixed interest rate
        (the
        exact figure shall be based upon the announcement of the Central Bank of
        China)
        of the interest rates applied to “One-year Term Time Deposit” by 10 domestic
        banks + a fixed rate (risk discount of the Bank + administrative cost).

      

      If
        the
        composition of the base interest rate provided in the preceding paragraph
        is
        adjusted or revised after the execution of the agreement for credit extension,
        the Borrower and the joint and several guarantor(s) agree that the Bank may
        announce the adjusted and/or revised details in its place of business and
        to be
        bound thereby.

      

      Explanation:

      

      
        	 	
                (i)

              	
                The
                  reference banks for the average fixed interest rate of the interest
                  rates
                  applied to “One-year Term Time Deposit” include: The Bank of Taiwan,
                  Taiwan Cooperative Bank, The Land Bank, The First Bank, Chang Hwa
                  Bank,
                  Hua Nan Bank, Taiwan Business Bank, Cathay United Bank, The International
                  Commercial Bank of China and Taipei
                  Bank.

              

      

      

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      
        	 	
                (ii)

              	
                The
                  periods of sampling, interest rate adjustment dates and periods
                  of
                  application are as below:

              

      

      

      
        	
                Period
                  of sampling

              	
                Interest
                  rate adjustment date

              	
                Period
                  of application

              
	
                2/16
                  -
                  2/22

              	
                2/23

              	
                2/24
                  - 5/23

              
	
                5/16
                  -
                  5/22

              	
                5/23

              	
                5/24
                  - 8/23

              
	
                8/16
                  -
                  8/22

              	
                8/23

              	
                8/24
                  - 11/23

              
	
                11/16
                  -
                  11/22

              	
                11/23

              	
                11/24
                  - 2/23

              

      

      

      
        	
              	Note:	
                (A)
                  The data shall be based upon the data announced by the Central
                  Bank of
                  China at 11:30 AM of that current day. (B) Indexes shall only allow
                  two
                  numbers after the decimal point. The third number after the decimal
                  point,
                  if it is bigger than or equal to 5, shall be rounded up, and if
                  it is
                  smaller than or equal to 4, shall be rounded
                  down.

              

      

      

      
        	 	
                (iii)

              	
                At
                  present, the average fixed interest rate of the interest rates
                  applied by
                  10 domestic banks to “One-year Term Time Deposit” is
                  %.

              

      

      

      
        	 	
                (iv)

              	
                Under
                  the following circumstances, the Borrower and the joint and several
                  guarantor(s) agree that the Bank has the absolute right and at
                  its sole
                  discretion to change the reference banks providing the composition
                  of the
                  indexes for the base interest rate and separately designate another
                  domestic bank to substitute:

              

      

      

      
        	
              	(A)	
                The
                  reference bank merges with other bank, is merged into other bank,
                  is
                  extinguished, suspends the business, closes the business, is re-organized;
                  or any event under Article 62 of the Banking Law, which includes:
                  being
                  ordered to suspend the business, being put under custody, being
                  effected a
                  mandatory takeover, etc. occurs to the reference
                  bank.

              

      

      

      
        	
              	(B)	
                The
                  short-term credit rating of the reference bank is lower than Taiwan
                  ratings. 

              

      

      

      
        	
              	(C)	
                The
                  reference bank ceases selling one-year-term time deposit products.
                  

              

      

      

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

      (4) The
        interests are collected based on a flexible rate calculated according to
        the
        following formula: The index of the time deposit of the Bank õ
        7.29û
        (i.e.
        the annual interest rate of 5û). 

       

      ARTICLE
        4:

      

      If
        the
        Borrower fails to repay the principal and the interests according to the
        I.O.U.,
        the Borrower agrees to pay for the delay interest rate calculated according
        to
        the interest rate applicable to this Loan for the delayed principal amount.
        The
        Borrower further agrees to pay for penalties calculated according to the
        following formula for the delayed payment for the principal and the interests:
        The penalty for the delayed payment for the principal shall be calculated
        from
        the maturity date and that for the delayed payment of the interests shall
        be
        calculated from the interests payment day at the, at the rate of 10 % of
        the
        interest rate for this Loan for the delay period within six months and at
        the
        rate of 20% of the interest rate for this Loan for the delay period above
        six
        months.

      

      ARTICLE
        5:

      

      The
        purpose of use of this Loan shall be limited to .

      

      ARTICLE
        6:

      

      In
        order
        to perform the obligations owed to the Bank, the Borrower and the joint and
        several guarantor(s) agree to authorize the Bank from time to time and at
        the
        Bank’s sole discretion to deduct from the demand accounts opened by the Borrower
        and/or the joint and several guarantor(s) in their names (account number:
        ) any
        amount at the time of maturity or the time of advancement to pay for the
        principal, interests, default interests, penalty advances and other expenses
        (including the insurance premium for the collaterals), without the necessary
        to
        present the passbook and the withdrawal slip.

      

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

      ARTICLE
        7:

      

      The
        term
“obligation” or “all obligations” referred to hereunder shall mean the loan,
        instruments, advances, guarantee, overdraft and other obligations, including
        but
        not limited to interests, default interests, penalty, compensation of damages,
        the insurance premium, expenses for executing mortgages, expenses to obtain
        an
        enforcement title and other related expenses. 

      

      ARTICLE
        8:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        agree that the Joint Credit Information Center and its member financial
        institutions, Clearing Houses, Small and Medium Business Credit Guarantee
        Fund,
        National Credit Card Center, Financial Information Service Co., Ltd., the
        assignees/transferees of the Bank’s obligations/rights hereunder and the
        participants (or the entity which plans to be assigned/transferred) in the
        Loan,
        the person auditing the appraisal of the value of the debts or any agent
        appointed by the Bank to handle the outsourced work, or other domestic or
        overseas institutions handling financial affairs (including SWIFT) and other
        relevant institutions corresponding with the Bank, may collect, proceed with
        computer processing on, conduct international transmission of, use and provide
        to each other the following information and data of the Borrower, joint and
        several guarantor(s) and provider of the collaterals:

      

      Credit
        reports, credit extension data (including overdue, collection and bad debts
        records), deposits data, financial data, collaterals and other movables or
        real
        property information, credit information regarding the instruments, credit
        cards
        (including IC Cards and magnetic cards)credit card information, credit
        information in the credit card merchants and other personal information relating
        to the credit extension or transactions.

      

      The
        computer processing of such data and information and the period of the use
        in
        relevant institutions shall be the approved period of preservation for such
        files and data which relevant institutions applied with the competent
        authorities for registration.

      

      The
        Borrower agrees that the Bank may from time to time monitor the Borrower’s use
        of the Loan extended to the Borrower and the business and financial status
        of
        the Borrower, examine/custody the collaterals, examine relevant accounts
        and
        books, statements (including the consolidated financial statements of the
        affiliates), check and review certificates, slips and documents. When the
        Bank
        deems necessary, the Bank may request the Borrower to fill out the requested
        information and deliver the requested data and information to the bank on
        a
        regular basis, or provide to the Bank the financial statements audited by
        the
        CPA approved by the Bank and request such CPA to provide relevant drafts
        of
        his/her work. If the Bank considers that the financial statements or other
        documents delivered by the Borrower are false, as soon as receiving the notice
        from the Bank, such will be deemed as a default by the Borrower; provided,
        however, the Bank does not have the obligation to monitor, audit, examine,
        custody and check such statements and documents. If the Bank considers that
        the
        Borrower’s financial structure should be improved, the Bank may demand the
        Borrower to take actions to improve its financial structure. The Borrower
        shall
        comply with such demand to improve.

      

      
        
           

        

        
          22

          
            

          

        

        
           

        

      

      ARTICLE
        9:

      

      Any
        individual/entity holding the receipt or custody certificate issued by the
        Bank
        or the Borrower’s chop or the receipt documents signed by the Borrower goes to
        the Bank to request for returning or replacing the collaterals and the documents
        related thereto shall be deemed as the agent of the Borrower. The Bank may
        approve to return or replace.

      

      ARTICLE
        10:

      

      If
        the
        obligations hereunder are covered by the collaterals obtained from the extension
        of this Loan or from other credit extensions, except for complying with the
        terms and conditions set forth in the respective collaterals agreements,
        the
        Borrower shall comply with the following provisions:

      

      
        	1.	
                For
                  the collaterals which are insurable, the Borrower and the provider
                  of such
                  collaterals shall in each year procure appropriate fire insurance
                  (including earthquake insurance) or other insurance coverage required
                  by
                  the Bank for the collaterals form the insurance company for the
                  period
                  starting from the commencement of the term of the Loan and ending
                  on the
                  day that the Loan is repaid. In such insurances, the Borrower shall
                  include the Bank as the mortgagee to apply with the insurance company
                  to
                  add special terms and conditions for the mortgage. The insured
                  amount and
                  the terms and conditions of the insurance policies shall be approved
                  by
                  the Bank. The Borrower and the collaterals provider shall be jointly
                  and
                  severally responsible for paying the insurance premium and other
                  related
                  costs. The original copy of the insurance policy and the photocopy
                  of the
                  receipt for the insurance premium shall be kept by the Bank. If
                  the
                  Borrower and the collaterals provider forget to procure the insurance
                  or
                  renew the insurance, the Bank may use this I.O.U. as an authorization
                  letter to procure/renew the insurance on their behalf. If the Bank
                  has
                  advanced the insurance premium, the Borrower and the collaterals
                  provider
                  shall repay the advanced fund immediately. If the Borrower and
                  the
                  collaterals provider fail to repay the advanced fund immediately,
                  the Bank
                  may add such advanced fund into the mount owed by the Borrower
                  and collect
                  interests incurred thereon according to the interest rate provided
                  hereunder. However, the Bank does not have the obligation to procure
                  or
                  renew he insurance policy or pay for the insurance premium. If
                  unfortunately the insured collaterals are damages, lost or destroyed
                  and
                  the insurance company refuses or delays to pay for the compensation
                  for
                  the damages which the insurance company is required to pay for
                  whatever
                  reasons, the Bank may set a certain period of time to request the
                  Borrower
                  to provide a security approved by the Bank having the value equal
                  to the
                  reduced value of such collaterals within such time period. If the
                  Borrower
                  fails to provide such a security within the set time period, the
                  Bank is
                  entitled to request the Borrower to repay the debts
                  immediately.

              

      

      

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

      
        	2.	
                If
                  the payment made by the Borrower or the payment made though automatic
                  transfer from the Borrower’s account according to the agreement is
                  insufficient to repay all of the overdue loan owed by the Borrower,
                  the
                  collaterals shall be used to set off against the various expenses
                  (including the insurance premium for the collaterals advanced by
                  the
                  Bank), penalty, interests, delay interests and the principal in
                  the same
                  order.

              

      

      

      
        	3.	
                The
                  Bank’s headquarter and all of its branches may share and exercise the
                  rights over the collaterals provided by the Borrower and/or the
                  collaterals provider hereunder, irrespective of whether their rights
                  are
                  created earlier or later, to obtain guarantee from such collaterals
                  to
                  secure the present debts (including those already occurred but
                  not being
                  repaid and not limited to the total amount of credit extension
                  agreed
                  hereunder) and future debts owed by the Borrower in the form of
                  instruments, loans, advances, insurances and all other debts, together
                  with the incurred interests, delay interests, penalties, damages
                  and all
                  of the expenses required for performing the obligations of the
                  above
                  debts.

              

      

      

      ARTICLE
        11:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), the Bank may from time to time reduce the extended
        credit
        amount or shorten the period of the credit extension without the necessity
        to
        send any prior notice or demand for a correction or remedial action in the
        first
        place:

      

      
        
           

        

        
          24

          
            

          

        

        
           

        

      

      
        	1.	
                Failing
                  to repay the principal for any indebtedness according to the
                  agreement.

              

      

      

      
        	2.	
                The
                  Borrower and/or the joint and several guarantor(s) file for reconciliation
                  or is declared bankruptcy according to the Bankruptcy Act, apply
                  for
                  reorganization according to eh Company Law, are declared by the
                  clearing
                  houses to be a company/individual with which the transactions are
                  rejected, suspend the business operation or proceed a debt
                  arrangement..

              

      

      

      
        	3.	
                The
                  Borrower and/or the joint and several guarantor(s) have the obligation
                  to
                  provide guarantees according to the original agreement, but fail
                  to
                  provide such guarantees.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) die and their
                  heirs
                  declare a limited inheritance or waive their rights to
                  inherit.

              

      

      

      
        	5.	
                The
                  Borrower and/or the joint and several guarantor(s) are declared
                  a
                  confiscation of their major properties in criminal
  cases.

              

      

      

      ARTICLE
        12:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), after the Bank has given a notice or demand within
        a
        reasonable period, the Bank may reduce the extended credit amount or shorten
        the
        period of the credit extension or treat all of the loan as matured:

      

      
        	1.	
                The
                  interests incurred on any debt are not
                  paid.

              

      

      

      
        	2.	
                The
                  collateral is foreclosed or the collateral is lost, or the value
                  of which
                  is reduced or is insufficient to secure the
                  obligations.

              

      

      

      
        	3.	
                The
                  actual use of the fund obtained from the loan extended by the Bank
                  does
                  not conform to the purpose of use selected by the
                  Bank.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) are subject
                  to
                  compulsory execution, provisional attachment, provisional measures
                  or
                  other protecting measures, which has made the Bank to face a threat
                  that
                  the debt may not be repaid. 

              

      

      

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

      ARTICLE
        13:

      

      If
        the
        Bank transfers/assigns all or part of the rights claimable by the Bank according
        to the I.O.U. (including the rights to claim against the Borrower and the
        joint
        and several guarantor(s) to pay for the interests and the repay the loan),
        together with the mortgages and insurance benefits the Bank obtained according
        to the agreement, to a third party, it is the Bank or the transferee/assignee’s
        obligation to notify the Borrower. After the Borrower, the joint and several
        guarantor(s) and collaterals provider agreed to such transfer/assignment
        and the
        Bank or the transferee/assignee has notified the Borrower, if any changes
        of the
        mortgages registration or the beneficiary under the insurance contract are
        required due to such transfer/assignment, they shall cooperate to change
        the
        mortgages registration and/or the beneficiary without any objection.

      

      If
        such
        transfer/assignment is for securitizing the Bank’s financial assets or the
        transferee/assignee is an asset management company, the notice stated in
        the
        preceding paragraph can be replaced by public announcement.

      

      ARTICLE
        14:

      

      The
        Bank
        may exercise the rights of set-off against the various funds deposited by
        the
        Borrower and the joint and several guarantor(s) in the Bank (including the
        deposits in the checking accounts which have been suspended according to
        the
        agreement) and all the rights claimable against the Bank, whether or not
        such
        funds and/or rights have matured.

      

      The
        expression of intention to exercise the right of set-off as provided in the
        preceding paragraph shall become effective as soon as the Bank records such
        set-off and deduction on its books and accounts. In the meantime, the deposit
        slips, the passbook and other certificates shall, within the set-off amount,
        loose their effect.

      

      ARTICLE
        15:

      

      If
        the
        debt certificates evidencing the various debts owed by the Borrower and the
        joint and several guarantor(s) are lost, destroyed or damaged, unless the
        amounts stated on the Bank’s accounts and books, vouchers, computer generated
        certificates/slips, debt certificates and micro-copies of the correspondences
        are proved by the Borrower and the joint and several guarantor(s) to be
        erroneous and the Bank shall immediately correct such errors, the Borrower
        and
        the joint and several guarantor(s) shall admit the full amounts stated thereon
        and, when such amounts mature, immediately pay for various expenses incurred
        for
        such amounts, penalties and the principal and interests, or at the Bank’s
        request issue another debt certificates before the maturity to the Bank for
        the
        Bank’s safe-keeping.

      

      
        
           

        

        
          26

          
            

          

        

        
           

        

      

      ARTICLE
        16:

      

      In
        the
        event that the Borrower changes its name, organization, contents of its articles
        of association, seal/chop, representative, scope of authority delegated to
        the
        representative, or the occurrence of any event which may affect the rights
        and
        interests of the Bank, the Borrower shall immediately notify the Bank in
        writing
        of such events and complete the procedures of change or cancel the seal/chop
        specimen kept in the Bank. 

      

      The
        Borrower and the joint and several guarantor(s) shall be responsible for
        the
        transactions conducted before sending the notice and completing the procedures
        as provided in the preceding paragraph and compensate the Bank for any damages
        it has suffered which were resulted thereof.

      

      ARTICLE
        17:

      

      In
        the
        event that the Borrower and the joint and several guarantor(s) change their
        addresses, Borrower and the joint and several guarantor(s) shall immediately
        notify the Bank. If Borrower and the joint and several guarantor(s) fail
        to send
        the above notice and the Bank sends relevant documents to the addresses provided
        hereunder or to the last addresses notified by the Borrower and the joint
        and
        several guarantor(s), such documents shall be deemed to have been served
        upon
        the Borrower and the joint and several guarantor(s) at the expiry of the
        traveling period normally required by the post office. 

      

      ARTICLE
        18:

      

      The
        requirements, effects and the formalities of the legal action for the creation
        of the debts incurred to the Borrower and the joint and several guarantor(s)
        based upon this I.O.U. shall be governed by the laws of the Republic of
        China.

      

      
        
           

        

        
          27

          
            

          

        

        
           

        

      

      ARTICLE
        19:

      

      The
        place
        for performing the obligation hereunder shall be the business place of the
        Bank.
        Any disputes arising out of or in connection with this I.O.U. shall be subject
        to the Taipei District Of Taiwan for the first instance; provided, however,
        if
        the law mandates a court to have exclusive jurisdiction over such dispute,
        such
        mandated exclusive jurisdiction shall prevail.

      

      ARTICLE
        20:

      Any
        matters not provided for in this I.O.U. shall be negotiated by the Borrower
        and
        the joint and several guarantor(s) with the Bank separately.

      

      【SPECIAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      In
        the
        event that any amount deposited by the Borrower and the joint and several
        guarantor(s) in the Bank is attached or frozen by other person according
        to the
        law, the Bank may from time to time reduce the extended credit amount or
        shorten
        the period of the credit extension or deem all of the debts as matured, without
        the necessity to send any prior notice or demand for a correction or remedial
        action in the first place:

      

      
        	1.	
                The
                  checks issued by the Borrower and the joint and several guarantor(s)
                  are
                  bounced due to insufficient fund deposit; or the checks prepared
                  for
                  making the payment as provided by them are rejected after being
                  presented
                  for payment.

              

      

      

      
        	2.	
                The
                  debts owed by the Borrower and the joint and several guarantor(s)
                  to other
                  financial institutions are overdue and not
                  paid.

              

      

      

      
        	3.	
                The
                  occurrence of matters that are against the principles of good faith,
                  such
                  as there exist false statements or omission of statements in the
                  financial
                  statements or other data/documents delivered by the Borrower and
                  the joint
                  and several guarantor(s) to the
                  Bank.

              

      

      

      
        
           

        

        
          28

          
            

          

        

        
           

        

      

      
        	4.	
                The
                  Borrower and the joint and several guarantor(s) fail to perform
                  or violate
                  the written agreements reached with the Bank or the
                  promises.

              

      

      

      
        	5.	
                The
                  certificates, licenses or approvals required by relevant programs
                  under
                  the I.O.U. are suspended, canceled or revoked for certain
                  reasons.

              

      

      

      
        	6.	
                The
                  chattels over which the mortgages are created in favor of the Bank
                  have
                  been removed, sold, transferred or subject to other disposal
                  measures.

              

      

      

      
        	7.	
                Failing
                  to honor the promise made when entering into the contract to build
                  the
                  factory according to the promised speed.

              

      

      

      ARTICLE
        2:

      

      Unless
        the Bank agrees in writing, the Borrower and the collaterals provider shall
        not
        sell (or transfer, lease out or lend) the collaterals, or create any
        encumbrances over such collaterals or, if the collateral is an empty land),
        build any illegal buildings on the unoccupied land where the mortgage is
        created. In case of any violation of the above provisions, the Bank may set
        a
        certain time period to request the Borrower or the collaterals provider to
        provide another collateral of the same value approved by the Bank or request
        the
        Borrower to settle the debts within the set time period and compensate all
        of
        the damages suffered by the Bank as a result.

      

      ARTICLE
        3:

      

      Before
        the Borrower repays all of the debts incurred hereon, if the Bank based upon
        the
        Borrower’s request considers there is a need to extend the repayment schedule or
        allow the debts to be repaid by installments, the Bank shall immediately
        notify
        the joint and several guarantor(s) in writing. The joint and several
        guarantor(s) agree to continue to bear the joint and several guarantee liability
        when the written notice from the Bank has arrived or is deemed to have been
        served upon such joint and several guarantor(s). 

      

      ARTICLE
        4:

      

      The
        Bank
        is authorized to apply with the tax offices to check the tax information
        and
        properties of the Borrower and the joint and several guarantor(s), if any
        events
        provided in Article hereof has occurred to them.

      

      
        
           

        

        
          29

          
            

          

        

        
           

        

      

      ARTICLE
        5:

      

      The
        Bank
        and the joint and several guarantor(s) agree that the Bank may outsource
        the
        work to collect the debts owed by them to the bank to a third
        party.

      

      ARTICLE
        6:

      

      If
        the
        Bank and/or the joint and several guarantor(s) fails to provide sufficient
        collaterals for the credit extension for this Loan, the property the information
        of which had been provided by the Bank and/or the joint and several guarantor(s)
        to the Bank for documentary review before applying for the credit extension
        shall not be used to create a trust.

      

      ARTICLE
        7:

      

      The
        scope
        and amounts of the debts guaranteed by the collaterals which are provided
        by the
        collaterals provider to the Bank to create mortgages, together with the period
        of the mortgages, shall not be affected by the transfer of the collaterals
        pursuant to a trust.

      

      ARTICLE
        8:

      

      The
        joint
        and several guarantor(s) shall be responsible for repaying all the debts
        owed by
        the Borrower hereunder jointly and severally with the Borrower. Each joint
        and
        several guarantor(s) shall also be individually repaying all the debts owed
        by
        the Borrower hereunder. The joint and several guarantor(s) further agree
        to the
        following:

      

      
        	1.	
                The
                  Bank is entitled to claim against the joint and several guarantor(s)
                  for
                  repayment of the debts before seeking to be paid from the
                  collaterals.

              

      

      

      
        	2.	
                After
                  the joint and several guarantor(s) repaid the debts for the Borrower
                  and
                  request the Bank to transfer the collaterals according to applicable
                  laws,
                  the joint and several guarantor(s) shall not raise any objection
                  to
                  contend that the rights to the collaterals are
                  defective.

              

      

      

      
        
           

        

        
          30

          
            

          

        

        
           

        

      

      
        	3.	
                The
                  guarantor(s) shall be jointly and severally responsible for repaying
                  all
                  of the debts owed by the Borrower hereunder. Such responsibility
                  shall not
                  be affected by the fact that the Bank releases any or several joint
                  and
                  several guarantor(s)’ liabilities or agree to replace any or several joint
                  and several guarantor(s) with others. Also, such responsibility
                  shall not
                  be discharged by the fact that the instruments, notes or other
                  relevant
                  documents and certificates issued by the Borrower hereunder have
                  not been
                  signed by the guarantor(s).

              

      

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        hereby declare that the Article of the above SPECIAL TERMS AND CONDITIONS
        have
        been reviewed article by article and stamp their chops as below: 

      

      Borrower:

      

      Kidcastle
        Internet Technology Co. Ltd.

      Responsible
        Person: Wang, Kuo An

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Joint
        and
        several guarantor(s):

      Provider
        of the collaterals: Wang, Kuo An

      

      TO:
        FUHWA
        BANK:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        hereby represent that they have reviewed all of the terms and conditions
        contained in this I.O.U. within a reasonable period of time, have fully
        understood its contents and agree to execute this I.O.U. as below.

      

      Borrower:
        Kidcastle Internet Technology Co. Ltd.

      Responsible
        person: Wang, Kuo An

      Address:
        1st Fl., 148, Chien Kuo Rd., Hsin Dian City

      

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Address:
        2nd
        Fl.,
        299, Si Yuan Rd., 10 Lin, Chung Shan Borough, Hsin Dian City, Taipei County
        

      

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Address:
        No. 71, Nan Chang Rd., Section 1, Long Fu Borough, Chung Shan District,
        Taipei

      

      
        
           

        

        
          31

          
            

          

        

        
           

        

      

      Joint
        and
        several guarantor(s):

      Address:

      

      Joint
        and
        several guarantor(s):

      Address:

      

      
        	Date:	
                August
                  5, 2005

              

      

       

      
        
           

        

        
          32

          
            

          

        

        
           

        

      

      FUHWA
        BANK

      

      ACKNOWLEDGEMENT
        OF INDEBTEDNESS 

      FOR
        A 

       

      LOAN
        EXTENSION 

      (USED
        FOR FIXED-TERM LOAN)

      

      Customer
        Number: 11589

      

      This
        Acknowledgement of Indebtedness (“I.O.U.”) is executed by Kidcastle Internet
        Technology Co. Ltd. (the “Borrower”) for a loan extended by Fuhwa Bank
        (including its headquarter and all branches) (the “Bank”). The Borrower invites
        the joint and several guarantor(s)(s) to provide a guarantee to jointly and
        severally guarantee the Borrower’s performance of the obligations under the
        I.O.U. and agrees to the following terms and conditions: 

      

      【GENERAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      The
        amount of the credit extended is: NT$31,000,000
        (the “Loan”)

      

      ARTICLE
        2:

      

      The
        term
        of the Loan is provided and the methods of repayment shall be made in accordance
        with Section of this Article:

      

      
        	1.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the interest incurred on the Loan shall be paid by monthly.
                  The
                  total principal shall be repaid at the
                  maturity.

              

      

      

      
        	2.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the principal shall be divided into installments. The
                  first
                  installment starts from _______. Thereafter, every month(s) is counted as
                  one installment. The principal shall be repaid according to the
                  installments. Interests shall be paid by
                  monthly.

              

      

      

      
        
           

        

        
          33

          
            

          

        

        
           

        

      

      
        	3.	
                The
                  term of the Loan is years (months), commencing from __________
                  to___________. After the borrowing, the Loan shall be divided into
                  installments and the principal and interests thereon be repaid
                  on the
                  ___th
                  day of each according to the annuity method.

              

      

      

      
        	4.	
                The
                  term of the Loan is years, commencing from ______ to __________.
                  After the
                  borrowing, the first ____ years are the grace period and the interests
                  shall be paid monthly. Commencing from the year, the Loan shall
                  be divided
                  into installments and the principal and interests thereon be repaid
                  on the
                  10th
                  day of each according to the annuity method.

              

      

      

      
        	5.	
                The
                  term of the Loan is 7 years (0 months), commencing from August
                  10, 2005 to
                  August 10, 2012. After the borrowing, the Loan shall be divided
                  into 84
                  installments. Each installment is one month. The principal and
                  interests
                  thereon be repaid by monthly according to the annuity method for
                  180
                  payment terms. The unpaid balance shall become matured and be paid
                  at the
                  expiry of the term of the Loam. .

              

      

      

      ARTICLE
        3:

      

      
        	1.	
                The
                  interests incurred from the borrowed funds shall be paid on a monthly
                  basis. The interests shall be calculated in accordance with Item
                  (3),
                  below:

              

      

      

      
        	
              	(1)	
                The
                  interest rate incurred for the Loan is calculated at the annual
                  interest
                  rate of % (which is determined according to the base rate for a
                  loan
                  extension at the time when the agreement of credit extension is
                  executed
                  plus a markup of annual rate of %) The interests for the newly
                  borrowed
                  fund shall be determined according to the base interest rate available
                  at
                  the time when the new fund is borrowed plus a standard markup rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest rate. The markup of the annual
                  interest
                  rate shall, after the execution of the agreement for credit extension,
                  be
                  adjusted every three months in accordance with the Bank’s then current
                  “Guidelines Governing the Markup of Base Interest Rate for Credit
                  Extension.”

              

      

      

      
        
           

        

        
          34

          
            

          

        

        
           

        

      

      If
        the
        Bank’s base interest rate for the credit extension and/or the Guidelines
        Governing the Markup of Base Interest Rate for Credit Extension as provided
        in
        the preceding paragraph are adjusted and/or revised after the execution of
        the
        agreement for credit extension, the Borrower agrees that the Bank may publicize
        such adjusted and revised base interest rate for the credit extension and/or
        the
        Guidelines Governing the Markup of Base Interest rate for Credit Extension
        in
        its place of business and to be bound thereby.

      

      
        	
              	(2)	
                The
                  interest rate for each tranche of the loan shall be determined
                  by
                  negotiations between the Borrower and the Bank at the time of borrowing
                  and be calculated and paid at the agreed fixed interest rate. If
                  the
                  Borrower fails to repay the principal and pay for the interests
                  according
                  to the agreed terms, commencing from the day of the delay, the
                  interest
                  rate shall be calculated and paid by adding 2.5% of annual rate
                  to the
                  base rate applied by the Bank.

              

      

      

      
        	
              	(3)	
                The
                  interest rate incurred for the Loan is calculated according to
                  the
                  applicable base rate for a loan extension at the time of borrowing
                  ( %)
                  plus a markup of annual rate of % (i.e. %). The interests for the
                  newly
                  borrowed fund shall be determined according to the base interest
                  rate
                  available at the time when the new fund is borrowed plus a markup
                  rate.
                  Thereafter, when the Bank adjusts the base interest rate, the interest
                  rate shall be calculated according to the adjusted base rate plus
                  a markup
                  of the annual floating interest
                  rate.

              

      

      

      The
        above
        base interest rate applied by the Bank is the average fixed interest rate
        (the
        exact figure shall be based upon the announcement of the Central Bank of
        China)
        of the interest rates applied to “One-year Term Time Deposit” by 10 domestic
        banks + a fixed rate (risk discount of the Bank + administrative cost).

      

      If
        the
        composition of the base interest rate provided in the preceding paragraph
        is
        adjusted or revised after the execution of the agreement for credit extension,
        the Borrower and the joint and several guarantor(s) agree that the Bank may
        announce the adjusted and/or revised details in its place of business and
        to be
        bound thereby.

      

      
        
           

        

        
          35

          
            

          

        

        
           

        

      

      Explanation:

      

      
        	 	
                (i)

              	
                The
                  reference banks for the average fixed interest rate of the interest
                  rates
                  applied to “One-year Term Time Deposit” include: The Bank of Taiwan,
                  Taiwan Cooperative Bank, The Land Bank, The First Bank, Chang Hwa
                  Bank,
                  Hua Nan Bank, Taiwan Business Bank, Cathay United Bank, The International
                  Commercial Bank of China and Taipei
                  Bank.

              

      

      

      
        	 	
                (ii)

              	
                The
                  periods of sampling, interest rate adjustment dates and periods
                  of
                  application are as below:

              

      

      

      
        	
                Period
                  of sampling

              	
                Interest
                  rate adjustment date

              	
                Period
                  of application

              
	
                2/16
                  -
                  2/22

              	
                2/23

              	
                2/24
                  - 5/23

              
	
                5/16
                  -
                  5/22

              	
                5/23

              	
                5/24
                  - 8/23

              
	
                8/16
                  -
                  8/22

              	
                8/23

              	
                8/24
                  - 11/23

              
	
                11/16
                  -
                  11/22

              	
                11/23

              	
                11/24
                  - 2/23

              

      

      

      
        	
              	Note:	
                (A)
                  The data shall be based upon the data announced by the Central
                  Bank of
                  China at 11:30 AM of that current day. (B) Indexes shall only allow
                  two
                  numbers after the decimal point. The third number after the decimal
                  point,
                  if it is bigger than or equal to 5, shall be rounded up, and if
                  it is
                  smaller than or equal to 4, shall be rounded
                  down.

              

      

      

      
        	 	
                (iii)

              	
                At
                  present, the average fixed interest rate of the interest rates
                  applied by
                  10 domestic banks to “One-year Term Time Deposit” is
                  %.

              

      

      

      
        	 	
                (iv)

              	
                Under
                  the following circumstances, the Borrower and the joint and several
                  guarantor(s) agree that the Bank has the absolute right and at
                  its sole
                  discretion to change the reference banks providing the composition
                  of the
                  indexes for the base interest rate and separately designate another
                  domestic bank to substitute:

              

      

      

      
        	
              	(A)	
                The
                  reference bank merges with other bank, is merged into other bank,
                  is
                  extinguished, suspends the business, closes the business, is re-organized;
                  or any event under Article 62 of the Banking Law, which includes:
                  being
                  ordered to suspend the business, being put under custody, being
                  effected a
                  mandatory takeover, etc. occurs to the reference
                  bank.

              

      

      

      
        
           

        

        
          36

          
            

          

        

        
           

        

      

      
        	
              	(B)	
                The
                  short-term credit rating of the reference bank is lower than Taiwan
                  ratings. 

              

      

      

      
        	
              	(C)	
                The
                  reference bank ceases selling one-year-term time deposit
                  products.

              

      

      

      (4) The
        interests are collected based on a flexible rate calculated according to
        the
        following formula: The index of the time deposit of the Bank õ
        7.29û
        (i.e.
        the annual interest rate of 5û). 

       

      ARTICLE
        4:

      

      If
        the
        Borrower fails to repay the principal and the interests according to the
        I.O.U.,
        the Borrower agrees to pay for the delay interest rate calculated according
        to
        the interest rate applicable to this Loan for the delayed principal amount.
        The
        Borrower further agrees to pay for penalties calculated according to the
        following formula for the delayed payment for the principal and the interests:
        The penalty for the delayed payment for the principal shall be calculated
        from
        the maturity date and that for the delayed payment of the interests shall
        be
        calculated from the interests payment day at the, at the rate of 10 % of
        the
        interest rate for this Loan for the delay period within six months and at
        the
        rate of 20% of the interest rate for this Loan for the delay period above
        six
        months.

      

      ARTICLE
        5:

      

      The
        purpose of use of this Loan shall be limited to .

      

      ARTICLE
        6:

      

      In
        order
        to perform the obligations owed to the Bank, the Borrower and the joint and
        several guarantor(s) agree to authorize the Bank from time to time and at
        the
        Bank’s sole discretion to deduct from the demand accounts opened by the Borrower
        and/or the joint and several guarantor(s) in their names (account number:
        ) any
        amount at the time of maturity or the time of advancement to pay for the
        principal, interests, default interests, penalty advances and other expenses
        (including the insurance premium for the collaterals), without the necessary
        to
        present the passbook and the withdrawal slip.

      

      
        
           

        

        
          37

          
            

          

        

        
           

        

      

      ARTICLE
        7:

      

      The
        term
“obligation” or “all obligations” referred to hereunder shall mean the loan,
        instruments, advances, guarantee, overdraft and other obligations, including
        but
        not limited to interests, default interests, penalty, compensation of damages,
        the insurance premium, expenses for executing mortgages, expenses to obtain
        an
        enforcement title and other related expenses. 

      

      ARTICLE
        8:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        agree that the Joint Credit Information Center and its member financial
        institutions, Clearing Houses, Small and Medium Business Credit Guarantee
        Fund,
        National Credit Card Center, Financial Information Service Co., Ltd., the
        assignees/transferees of the Bank’s obligations/rights hereunder and the
        participants (or the entity which plans to be assigned/transferred) in the
        Loan,
        the person auditing the appraisal of the value of the debts or any agent
        appointed by the Bank to handle the outsourced work, or other domestic or
        overseas institutions handling financial affairs (including SWIFT) and other
        relevant institutions corresponding with the Bank, may collect, proceed with
        computer processing on, conduct international transmission of, use and provide
        to each other the following information and data of the Borrower, joint and
        several guarantor(s) and provider of the collaterals:

      

      Credit
        reports, credit extension data (including overdue, collection and bad debts
        records), deposits data, financial data, collaterals and other movables or
        real
        property information, credit information regarding the instruments, credit
        cards
        (including IC Cards and magnetic cards)credit card information, credit
        information in the credit card merchants and other personal information relating
        to the credit extension or transactions.

      

      The
        computer processing of such data and information and the period of the use
        in
        relevant institutions shall be the approved period of preservation for such
        files and data which relevant institutions applied with the competent
        authorities for registration.

      

      
        
           

        

        
          38

          
            

          

        

        
           

        

      

      The
        Borrower agrees that the Bank may from time to time monitor the Borrower’s use
        of the Loan extended to the Borrower and the business and financial status
        of
        the Borrower, examine/custody the collaterals, examine relevant accounts
        and
        books, statements (including the consolidated financial statements of the
        affiliates), check and review certificates, slips and documents. When the
        Bank
        deems necessary, the Bank may request the Borrower to fill out the requested
        information and deliver the requested data and information to the bank on
        a
        regular basis, or provide to the Bank the financial statements audited by
        the
        CPA approved by the Bank and request such CPA to provide relevant drafts
        of
        his/her work. If the Bank considers that the financial statements or other
        documents delivered by the Borrower are false, as soon as receiving the notice
        from the Bank, such will be deemed as a default by the Borrower; provided,
        however, the Bank does not have the obligation to monitor, audit, examine,
        custody and check such statements and documents. If the Bank considers that
        the
        Borrower’s financial structure should be improved, the Bank may demand the
        Borrower to take actions to improve its financial structure. The Borrower
        shall
        comply with such demand to improve.

      

      ARTICLE
        9:

      

      Any
        individual/entity holding the receipt or custody certificate issued by the
        Bank
        or the Borrower’s chop or the receipt documents signed by the Borrower goes to
        the Bank to request for returning or replacing the collaterals and the documents
        related thereto shall be deemed as the agent of the Borrower. The Bank may
        approve to return or replace.

      

      ARTICLE
        10:

      

      If
        the
        obligations hereunder are covered by the collaterals obtained from the extension
        of this Loan or from other credit extensions, except for complying with the
        terms and conditions set forth in the respective collaterals agreements,
        the
        Borrower shall comply with the following provisions:

      

      
        	1.	
                For
                  the collaterals which are insurable, the Borrower and the provider
                  of such
                  collaterals shall in each year procure appropriate fire insurance
                  (including earthquake insurance) or other insurance coverage required
                  by
                  the Bank for the collaterals form the insurance company for the
                  period
                  starting from the commencement of the term of the Loan and ending
                  on the
                  day that the Loan is repaid. In such insurances, the Borrower shall
                  include the Bank as the mortgagee to apply with the insurance company
                  to
                  add special terms and conditions for the mortgage. The insured
                  amount and
                  the terms and conditions of the insurance policies shall be approved
                  by
                  the Bank. The Borrower and the collaterals provider shall be jointly
                  and
                  severally responsible for paying the insurance premium and other
                  related
                  costs. The original copy of the insurance policy and the photocopy
                  of the
                  receipt for the insurance premium shall be kept by the Bank. If
                  the
                  Borrower and the collaterals provider forget to procure the insurance
                  or
                  renew the insurance, the Bank may use this I.O.U. as an authorization
                  letter to procure/renew the insurance on their behalf. If the Bank
                  has
                  advanced the insurance premium, the Borrower and the collaterals
                  provider
                  shall repay the advanced fund immediately. If the Borrower and
                  the
                  collaterals provider fail to repay the advanced fund immediately,
                  the Bank
                  may add such advanced fund into the mount owed by the Borrower
                  and collect
                  interests incurred thereon according to the interest rate provided
                  hereunder. However, the Bank does not have the obligation to procure
                  or
                  renew he insurance policy or pay for the insurance premium. If
                  unfortunately the insured collaterals are damages, lost or destroyed
                  and
                  the insurance company refuses or delays to pay for the compensation
                  for
                  the damages which the insurance company is required to pay for
                  whatever
                  reasons, the Bank may set a certain period of time to request the
                  Borrower
                  to provide a security approved by the Bank having the value equal
                  to the
                  reduced value of such collaterals within such time period. If the
                  Borrower
                  fails to provide such a security within the set time period, the
                  Bank is
                  entitled to request the Borrower to repay the debts
                  immediately.

              

      

      

      
        
           

        

        
          39

          
            

          

        

        
           

        

      

      
        	2.	
                If
                  the payment made by the Borrower or the payment made though automatic
                  transfer from the Borrower’s account according to the agreement is
                  insufficient to repay all of the overdue loan owed by the Borrower,
                  the
                  collaterals shall be used to set off against the various expenses
                  (including the insurance premium for the collaterals advanced by
                  the
                  Bank), penalty, interests, delay interests and the principal in
                  the same
                  order.

              

      

      

      
        	3.	
                The
                  Bank’s headquarter and all of its branches may share and exercise the
                  rights over the collaterals provided by the Borrower and/or the
                  collaterals provider hereunder, irrespective of whether their rights
                  are
                  created earlier or later, to obtain guarantee from such collaterals
                  to
                  secure the present debts (including those already occurred but
                  not being
                  repaid and not limited to the total amount of credit extension
                  agreed
                  hereunder) and future debts owed by the Borrower in the form of
                  instruments, loans, advances, insurances and all other debts, together
                  with the incurred interests, delay interests, penalties, damages
                  and all
                  of the expenses required for performing the obligations of the
                  above
                  debts.

              

      

      

      
        
           

        

        
          40

          
            

          

        

        
           

        

      

      ARTICLE
        11:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), the Bank may from time to time reduce the extended
        credit
        amount or shorten the period of the credit extension without the necessity
        to
        send any prior notice or demand for a correction or remedial action in the
        first
        place:

      

      
        	1.	
                Failing
                  to repay the principal for any indebtedness according to the
                  agreement.

              

      

      

      
        	2.	
                The
                  Borrower and/or the joint and several guarantor(s) file for reconciliation
                  or is declared bankruptcy according to the Bankruptcy Act, apply
                  for
                  reorganization according to eh Company Law, are declared by the
                  clearing
                  houses to be a company/individual with which the transactions are
                  rejected, suspend the business operation or proceed a debt
                  arrangement..

              

      

      

      
        	3.	
                The
                  Borrower and/or the joint and several guarantor(s) have the obligation
                  to
                  provide guarantees according to the original agreement, but fail
                  to
                  provide such guarantees.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) die and their
                  heirs
                  declare a limited inheritance or waive their rights to
                  inherit.

              

      

      

      
        	5.	
                The
                  Borrower and/or the joint and several guarantor(s) are declared
                  a
                  confiscation of their major properties in criminal
                  cases.

              

      

      

      ARTICLE
        12:

      

      In
        case
        that any of the following events occurred to the Borrower or the joint and
        several guarantor(s), after the Bank has given a notice or demand within
        a
        reasonable period, the Bank may reduce the extended credit amount or shorten
        the
        period of the credit extension or treat all of the loan as matured:

      

      
        	1.	
                The
                  interests incurred on any debt are not
                  paid.

              

      

      

      
        	2.	
                The
                  collateral is foreclosed or the collateral is lost, or the value
                  of which
                  is reduced or is insufficient to secure the
                  obligations.

              

      

      

      
        
           

        

        
          41

          
            

          

        

        
           

        

      

      
        	3.	
                The
                  actual use of the fund obtained from the loan extended by the Bank
                  does
                  not conform to the purpose of use selected by the
                  Bank.

              

      

      

      
        	4.	
                The
                  Borrower and/or the joint and several guarantor(s) are subject
                  to
                  compulsory execution, provisional attachment, provisional measures
                  or
                  other protecting measures, which has made the Bank to face a threat
                  that
                  the debt may not be repaid. 

              

      

      

      ARTICLE
        13:

      

      If
        the
        Bank transfers/assigns all or part of the rights claimable by the Bank according
        to the I.O.U. (including the rights to claim against the Borrower and the
        joint
        and several guarantor(s) to pay for the interests and the repay the loan),
        together with the mortgages and insurance benefits the Bank obtained according
        to the agreement, to a third party, it is the Bank or the transferee/assignee’s
        obligation to notify the Borrower. After the Borrower, the joint and several
        guarantor(s) and collaterals provider agreed to such transfer/assignment
        and the
        Bank or the transferee/assignee has notified the Borrower, if any changes
        of the
        mortgages registration or the beneficiary under the insurance contract are
        required due to such transfer/assignment, they shall cooperate to change
        the
        mortgages registration and/or the beneficiary without any objection.

      

      If
        such
        transfer/assignment is for securitizing the Bank’s financial assets or the
        transferee/assignee is an asset management company, the notice stated in
        the
        preceding paragraph can be replaced by public announcement.

      

      ARTICLE
        14:

      

      The
        Bank
        may exercise the rights of set-off against the various funds deposited by
        the
        Borrower and the joint and several guarantor(s) in the Bank (including the
        deposits in the checking accounts which have been suspended according to
        the
        agreement) and all the rights claimable against the Bank, whether or not
        such
        funds and/or rights have matured.

      

      The
        expression of intention to exercise the right of set-off as provided in the
        preceding paragraph shall become effective as soon as the Bank records such
        set-off and deduction on its books and accounts. In the meantime, the deposit
        slips, the passbook and other certificates shall, within the set-off amount,
        loose their effect.

      

      
        
           

        

        
          42

          
            

          

        

        
           

        

      

      ARTICLE
        15:

      

      If
        the
        debt certificates evidencing the various debts owed by the Borrower and the
        joint and several guarantor(s) are lost, destroyed or damaged, unless the
        amounts stated on the Bank’s accounts and books, vouchers, computer generated
        certificates/slips, debt certificates and micro-copies of the correspondences
        are proved by the Borrower and the joint and several guarantor(s) to be
        erroneous and the Bank shall immediately correct such errors, the Borrower
        and
        the joint and several guarantor(s) shall admit the full amounts stated thereon
        and, when such amounts mature, immediately pay for various expenses incurred
        for
        such amounts, penalties and the principal and interests, or at the Bank’s
        request issue another debt certificates before the maturity to the Bank for
        the
        Bank’s safe-keeping.

      

      ARTICLE
        16:

      

      In
        the
        event that the Borrower changes its name, organization, contents of its articles
        of association, seal/chop, representative, scope of authority delegated to
        the
        representative, or the occurrence of any event which may affect the rights
        and
        interests of the Bank, the Borrower shall immediately notify the Bank in
        writing
        of such events and complete the procedures of change or cancel the seal/chop
        specimen kept in the Bank. 

      

      The
        Borrower and the joint and several guarantor(s) shall be responsible for
        the
        transactions conducted before sending the notice and completing the procedures
        as provided in the preceding paragraph and compensate the Bank for any damages
        it has suffered which were resulted thereof.

      

      ARTICLE
        17:

      

      In
        the
        event that the Borrower and the joint and several guarantor(s) change their
        addresses, Borrower and the joint and several guarantor(s) shall immediately
        notify the Bank. If Borrower and the joint and several guarantor(s) fail
        to send
        the above notice and the Bank sends relevant documents to the addresses provided
        hereunder or to the last addresses notified by the Borrower and the joint
        and
        several guarantor(s), such documents shall be deemed to have been served
        upon
        the Borrower and the joint and several guarantor(s) at the expiry of the
        traveling period normally required by the post office. 

      

      
        
           

        

        
          43

          
            

          

        

        
           

        

      

      ARTICLE
        18:

      

      The
        requirements, effects and the formalities of the legal action for the creation
        of the debts incurred to the Borrower and the joint and several guarantor(s)
        based upon this I.O.U. shall be governed by the laws of the Republic of
        China.

      

      ARTICLE
        19:

      

      The
        place
        for performing the obligation hereunder shall be the business place of the
        Bank.
        Any disputes arising out of or in connection with this I.O.U. shall be subject
        to the Taipei District Of Taiwan for the first instance; provided, however,
        if
        the law mandates a court to have exclusive jurisdiction over such dispute,
        such
        mandated exclusive jurisdiction shall prevail.

      

      ARTICLE
        20:

       

      Any
        matters not provided for in this I.O.U. shall be negotiated by the Borrower
        and
        the joint and several guarantor(s) with the Bank separately.

      

      【SPECIAL
        TERMS AND CONDITIONS】

      

      ARTICLE
        1:

      

      In
        the
        event that any amount deposited by the Borrower and the joint and several
        guarantor(s) in the Bank is attached or frozen by other person according
        to the
        law, the Bank may from time to time reduce the extended credit amount or
        shorten
        the period of the credit extension or deem all of the debts as matured, without
        the necessity to send any prior notice or demand for a correction or remedial
        action in the first place:

      

      
        	1.	
                The
                  checks issued by the Borrower and the joint and several guarantor(s)
                  are
                  bounced due to insufficient fund deposit; or the checks prepared
                  for
                  making the payment as provided by them are rejected after being
                  presented
                  for payment.

              

      

      

      
        	2.	
                The
                  debts owed by the Borrower and the joint and several guarantor(s)
                  to other
                  financial institutions are overdue and not
                  paid.

              

      

      

      
        
           

        

        
          44

          
            

          

        

        
           

        

      

      
        	3.	
                The
                  occurrence of matters that are against the principles of good faith,
                  such
                  as there exist false statements or omission of statements in the
                  financial
                  statements or other data/documents delivered by the Borrower and
                  the joint
                  and several guarantor(s) to the
                  Bank.

              

      

      

      
        	4.	
                The
                  Borrower and the joint and several guarantor(s) fail to perform
                  or violate
                  the written agreements reached with the Bank or the
                  promises.

              

      

      

      
        	5.	
                The
                  certificates, licenses or approvals required by relevant programs
                  under
                  the I.O.U. are suspended, canceled or revoked for certain
                  reasons.

              

      

      

      
        	6.	
                The
                  chattels over which the mortgages are created in favor of the Bank
                  have
                  been removed, sold, transferred or subject to other disposal
                  measures.

              

      

      

      
        	7.	
                Failing
                  to honor the promise made when entering into the contract to build
                  the
                  factory according to the promised speed.

              

      

      

      ARTICLE
        2:

      

      Unless
        the Bank agrees in writing, the Borrower and the collaterals provider shall
        not
        sell (or transfer, lease out or lend) the collaterals, or create any
        encumbrances over such collaterals or, if the collateral is an empty land),
        build any illegal buildings on the unoccupied land where the mortgage is
        created. In case of any violation of the above provisions, the Bank may set
        a
        certain time period to request the Borrower or the collaterals provider to
        provide another collateral of the same value approved by the Bank or request
        the
        Borrower to settle the debts within the set time period and compensate all
        of
        the damages suffered by the Bank as a result.

      

      ARTICLE
        3:

      

      Before
        the Borrower repays all of the debts incurred hereon, if the Bank based upon
        the
        Borrower’s request considers there is a need to extend the repayment schedule or
        allow the debts to be repaid by installments, the Bank shall immediately
        notify
        the joint and several guarantor(s) in writing. The joint and several
        guarantor(s) agree to continue to bear the joint and several guarantee liability
        when the written notice from the Bank has arrived or is deemed to have been
        served upon such joint and several guarantor(s). 

      

      
        
           

        

        
          45

          
            

          

        

        
           

        

      

      ARTICLE
        4:

      

      The
        Bank
        is authorized to apply with the tax offices to check the tax information
        and
        properties of the Borrower and the joint and several guarantor(s), if any
        events
        provided in Article hereof has occurred to them.

      

      ARTICLE
        5:

      

      The
        Bank
        and the joint and several guarantor(s) agree that the Bank may outsource
        the
        work to collect the debts owed by them to the bank to a third
        party.

      

      ARTICLE
        6:

      

      If
        the
        Bank and/or the joint and several guarantor(s) fails to provide sufficient
        collaterals for the credit extension for this Loan, the property the information
        of which had been provided by the Bank and/or the joint and several guarantor(s)
        to the Bank for documentary review before applying for the credit extension
        shall not be used to create a trust.

      

      ARTICLE
        7:

      

      The
        scope
        and amounts of the debts guaranteed by the collaterals which are provided
        by the
        collaterals provider to the Bank to create mortgages, together with the period
        of the mortgages, shall not be affected by the transfer of the collaterals
        pursuant to a trust.

      

      ARTICLE
        8:

      

      The
        joint
        and several guarantor(s) shall be responsible for repaying all the debts
        owed by
        the Borrower hereunder jointly and severally with the Borrower. Each joint
        and
        several guarantor(s) shall also be individually repaying all the debts owed
        by
        the Borrower hereunder. The joint and several guarantor(s) further agree
        to the
        following:

      

      
        	1.	
                The
                  Bank is entitled to claim against the joint and several guarantor(s)
                  for
                  repayment of the debts before seeking to be paid from the
                  collaterals.

              

      

      

      
        
           

        

        
          46

          
            

          

        

        
           

        

      

      
        	2.	
                After
                  the joint and several guarantor(s) repaid the debts for the Borrower
                  and
                  request the Bank to transfer the collaterals according to applicable
                  laws,
                  the joint and several guarantor(s) shall not raise any objection
                  to
                  contend that the rights to the collaterals are
                  defective.

              

      

      

      
        	3.	
                The
                  guarantor(s) shall be jointly and severally responsible for repaying
                  all
                  of the debts owed by the Borrower hereunder. Such responsibility
                  shall not
                  be affected by the fact that the Bank releases any or several joint
                  and
                  several guarantor(s)’ liabilities or agree to replace any or several joint
                  and several guarantor(s) with others. Also, such responsibility
                  shall not
                  be discharged by the fact that the instruments, notes or other
                  relevant
                  documents and certificates issued by the Borrower hereunder have
                  not been
                  signed by the guarantor(s).

              

      

      

      The
        Borrower, the joint and several guarantor(s)s and the provider of the
        collaterals hereby declare that the Article of the above SPECIAL TERMS AND
        CONDITIONS have been reviewed article by article and stamp their chops as
        below:

      

      Borrower:

      

      Kidcastle
        Internet Technology Co. Ltd.

      Responsible
        Person: Wang, Kuo An

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Joint
        and
        several guarantor(s):

      Provider
        of the collaterals: Wang, Kuo An

      

      TO:
        FUHWA
        BANK:

      

      The
        Borrower, the joint and several guarantor(s) and the provider of the collaterals
        hereby represent that they have reviewed all of the terms and conditions
        contained in this I.O.U. within a reasonable period of time, have fully
        understood its contents and agree to execute this I.O.U. as below.

      

      Borrower:
        Kidcastle Internet Technology Co. Ltd.

      Responsible
        person: Wang, Kuo An

      Address:
        1st Fl., 148, Chien Kuo Rd., Hsin Dian City

      

      
        
           

        

        
          47

          
            

          

        

        
           

        

      

      Joint
        and
        several guarantor(s): Wang, Kuo An

      Address:
        2nd
        Fl.,
        299, Si Yuan Rd., 10 Lin, Chung Shan Borough, Hsin Dian City, Taipei County
        

      

      Joint
        and
        several guarantor(s): Chiu, Yu En

      Address:
        No. 71, Nan Chang Rd., Section 1, Long Fu Borough, Chung Shan District,
        Taipei

      

      Joint
        and
        several guarantor(s):

      Address:

      

      Joint
        and
        several guarantor(s):

      Address:

      

      
        	Date:	
                August
                  5, 2005

              

      

    

     

    
      
         

      

      
        48

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]