Contract

EXHIBIT 10.17 CONSULTING AND SERVICES AGREEMENTThis Consulting and Services Agreement (hereinafter referred to as the”Agreement”) has been executed by and between the following parties on April 5,2005 in Guangzhou.Party A: Guangzhou 3G Information Technology Co., Ltd. (Chinese Company Name”________________”), a company incorporated in Guangzhou, China whose principalplace of business is 11 Caipin Road, Science City, High & New TechnologyIndustrial Development Zone, Guangzhou, 510730, China (Chinese Address”________________”Party B: An affiliated Chinese entity of Party A: Guangzhou Sunroom InformationIndustrial Co, Ltd., (Chinese Company Name “________________”) a companyincorporated in Guangzhou, China whose principal place of business is 15/F,Huajian Building. No. 233, Tianfu Road. Tianhe Guangzhou 510630, China (Chineseaddress “________________”)WHEREAS:(1) Party A is a wholly foreign owned enterprise established in the People’sRepublic of China (hereinafter referred to as “China”), and has the resources toprovide technical and consulting services;(2) Party B is a company with exclusively domestic capital registered in Chinaand may engage in the business of providing value-added telecom services (VAS),internet and mobile entertainment application development, mobile game softwaredesign and development, mobile customer relationship management (CRM) servicesfor China’s telecom operators, mobile marketing and promotion services,management and consulting services, mobile internet information technology,mobile payment and mobile point of sale (POS) solutions, mobile consumeranalytics, mobile data-mining, internet e-commerce and mobile commerce, mobileapplications based on WAP, KJava, IVR, MS, MFLASH, short messaging services(SMS), multimedia messaging services (MMS), outsourced game development, andother mobile value-added services (VAS) in the PRC, and operates the followinginternet and mobile gaming web sites: www.vs366.com.(3) Party A agrees to provide Party B with exclusive technical consulting andrelated services in telecommunications value-added business during the term ofthis Agreement utilizing its own advantages in human capital and information,and Party B agrees to accept the technical consultations and services providedby Party A.Wherefore, through mutual discussion, the parties have reached the followingagreements:1. Exclusive Consultations and Services: Exclusive Interest1.1 During the term of this Agreement, Party A agrees to provide Party B withrelevant technical consultations and services as Party B’s exclusive provider oftechnical and consultation services, in accordance with the conditions of thisAgreement (for specific contents, see Attachment 1).1.2 Party B agrees to accept the technical consultations and services providedby Party A. Party B further agrees that unless Party A consents in writing inadvance, during the term of this Agreement, Party B shall not accept technicalconsultations and services provided by any third party regarding theaforementioned business.1.3 Party A shall have exclusive interests in all rights, ownership, interestsand intellectual properties arising from the performance of this Agreement,including but not limited to copyrights, patents, technical secrets, tradesecrets and others, regardless of whether they have been developed by Party A orby Party B based on Party A’s intellectual properties.2. The Calculation and Payment of the Technical Consulting and Service Fee(hereinafter referred to as “Consulting Service Fee”)The parties agree that the Consulting Service Fee under this Agreement shall bedetermined and paid based on the methods set forth in Attachment 2.3. Representations and Warranties3.1 Party A hereby represents and warrants as follows:3.2.1 Party A is a wholly foreign owned enterprise legally registered and validly existing in accordance with Chinese laws.3.2.2 Party A’s execution and performance of this Agreement is within the scope of its business operations; Party A has taken necessary corporate actions and given appropriate authorization and has obtained the consent and approval from third parties and government agencies, and will not violate the restrictions of laws binding or having an impact thereon.3.2.3 This Agreement shall constitute Party A’s legitimate and valid obligations as soon as it is executed, and shall be enforceable against it.3.2 Party B hereby represents and warrants as follows:3.2.1 Party B is a company legally registered and validly existing in accordance with Chinese laws and may engage in VAS business as approved by the authority Chinese government departments;3.2.2 Party B’s execution and performance of this Agreement is within the scope of its business operations; Party B has taken necessary corporate actions and given appropriate authorization and has obtained the consent and approval from third parties and government agencies, and will not violate the restrictions of laws binding or having an impact thereon.3.2.3 This Agreement shall constitute Party B’s legitimate and valid obligations as soon as it is executed, and shall be enforceable against it.4. Confidentiality Clauses4.1 Party B agrees to maintain the confidentiality of confidential materials andinformation (hereinafter referred to as “Confidential Information”) of Party Athat Party B learns or has access to due to its acceptance of Party A’sexclusive consultations and services, and shall take various security measuresdesigned to maintain such confidentiality; without the prior written consent ofParty A, Party B shall not disclose, give or transfer such ConfidentialInformation to any third party. Upon the termination of this Agreement, Party Bshall return any document, material or software that contains such ConfidentialInformation to Party A at Party A’s request, or shall destroy same on his ownand shall delete any Confidential Information from the relevant memory devicesand shall not continue to use such Confidential Information.4.2 The parties agree that this section shall survive changes to, rescission ortermination of this Agreement.5. IndemnificationParty B shall indemnify Party A for and hold Party A harmless from any loss,injury, obligation or expenses caused by any lawsuit, claims or other demandsagainst Party A arising from or caused by contents of consultations and servicesrequested by Party B.6. Effectiveness and Term6.1 This Agreement shall be executed on the date first above written and shalltake effect as of the even date therewith. Unless terminated early in accordancewith the provisions of this Agreement or relevant agreements separately executedbetween the parties, the term of this Agreement shall be years.6.2 The term of this Agreement shall not be extended unless confirmed in writingby Party A prior to the expiration thereof. The extended term shall bedetermined by the parties to this Agreement through consensus.7. Termination7.1 Termination upon date of expiration. Unless renewed in accordance with therelevant terms of this Agreement, this Agreement shall be terminated upon thedate of expiration thereof.7.2 Early termination. During the term of this Agreement, unless Party A commitsa gross fault, fraudulent act, other illegal acts or becomes bankrupt, Party Bshall not terminate this Agreement early. Notwithstanding the aforementionedcovenant, Party A shall have the right to terminate this Agreement upon 30 daysof written notice to Party B at any time.7.3 Terms that survive termination. The rights and obligations of the partiesunder Article 4 and Article 5 shall survive the termination of this Agreement.8. Resolution of DisputesIn the event of any dispute with respect to the construction and performance ofthe provisions of this Agreement, the parties shall hold consultations in goodfaith to resolve same. Upon failure of such consultations, either party maysubmit the relevant dispute to the China International Economics and ForeignTrade Arbitration Commission for resolution by arbitration, in accordance withits current arbitration rules. The arbitration shall be performed in Shanghai,and the language used during arbitration shall be Chinese. The arbitrationruling shall be final and binding on both parties.9. Force Majeure9.1 “Force majeure” shall refer to any event beyond the reasonable control ofeither party and that still cannot be avoided even if the party affected hasexercised reasonable care, including but not limited government actions, acts ofGod, fire, explosions, storms, flood, earthquakes, tides, lightning or war. Buta lack of credit, funds or financing shall not be deemed a circumstances beyondthe reasonable control of either party. The party affected by a “force majeureevent” shall notify the other party of such relief from liability as soon aspossible.9.2 In the event that the performance of this Agreement is delayed or impeded bythe aforementioned “force majeure,” the party affected by such force majeureshall not be liable in any way under this Agreement to the extent of such delayor impedance. The party affected shall take appropriate measures to mitigate oreliminate the impact of such “force majeure” and shall attempt to resume theperformance of obligations delayed or impeded by such “force majeure.” As soonas the force majeure event is eliminated, the parties agree to use their bestefforts to resume the performance of this Agreement.10. NoticesNotices or other communications sent by either party as required by thisAgreement shall be written in Chinese, and a notice shall be deemed served whenit is delivered to the address of either party or the addresses of both partiesbelow by personal delivery, registered mail, mail with prepaid postage orrecognized express mail or facsimile. To Party A : Attn: Mr. Liao Mengjiang AIAI1/2-, General Manager Guangzhou 3G Information Technology Co., Ltd (“________________”) 11 Caipin Road, Science City, High & New Technology Industrial Development Zone, Guangzhou, 510730, China (Chinese Address “________________”) To Party B Attn: Mr. Wang, Yongchao IoOA(3), General Manager Guangzhou Sunroom Informaiton Industrial Co., Ltd (“________________”) 15/F, Huajian Building. No. 233, Tianfu Road. Tianhe Guangzhou 510630, China (Chinese Address (“________________”)11. ASSIGNMENTUnless Party A’s prior written consent is obtained, Party B shall not assign therights enjoyed to thereby and obligations undertaken thereby under thisAgreement to any third party.12. SEVERABILITYIn the event that any provisions of this Agreement are invalid or unenforceabledue to inconsistency with law, then such provisions shall only be invalid orunenforceable to the extent of the jurisdiction of such law, and shall notaffect the legal validity of the remaining provisions of this Agreement.13. AMENDMENTS AND SUPPLEMENTSAny amendments and supplements to this Agreement shall be in writing. Theamendment agreements and supplementary agreements that have been signed by theparties and that relate to this Agreement shall be an integral part of thisAgreement and shall have the same legal validity as this Agreement.14. GOVERNING LAWSThis Agreement shall be governed by laws of China and shall be construed inaccordance therewith.IN WITNESS WHEREOF, the parties have caused their authorized representatives toexecute this Agreement as of the date first above written.Party A: Guangzhou 3G Information Technology Co., Ltd (Chinese Company Name”________________”) By: /s/ Liao, Mengjiang ———————————– Name: Liao, Mengjiang Title: General ManagerParty B: An affiliated Chinese entity of Party A: Guangzhou Sunroom InformationIndustrial Co, Ltd., (Chinese Company Name “________________”) By: /s/ Wang Yongchao ———————————– Name: Wang Yongchao Title: General ManagerATTACHMENT 1: Table of Contents of Technical Consultations and ServicesIncluding furnishing of training of personnel, network platforms appurtenant tomanagement and information services required for Party B’s business, makingrecommendations to Party B regarding the telecommunications value-added andother forms of services accepted by the parties.ATTACHMENT 2: The Calculation and Payment of the Technical Consulting andService FeeFor each Value-added Service sold by Party B, Party B shall pay Party A 100% ofeach income in technical consulting and service fee. Party B shall settle andpay the aforementioned technical consulting and service fee by the 15th of eachmonth.The aforementioned method of calculation may be adjusted quarterly by Party Aand Party B depending on the current actual circumstances. SHARE PLEDGE AGREEMENTThis Share Pledge Agreement (hereinafter referred to as this “Agreement”) hasbeen executed by and between the following parties on April 5, 2005 inGuangzhou, PRC.PLEDGEE: Guangzhou 3G Information & Technology Limited.PLEDGOR: Sun,Zhengquan (PRC ID: 420111196801105655), Liao, Mengjiang (PRC ID:432503197202144812), and Wang, Yongchao (PRC ID: 440823197306096917),shareholders of an Affiliated Chinese Entity of Pledgee, located at Room 201,No. 56 Tianhedong Road, Tianhe, Guangdong, China; at Suntek New TechnologyResearch & Design Co, Ltd., Nanda Road, Shipai Tianhe, Guangzhou, Guangdong,China(pound)>>and Suntek New Technology Research & Design Co, Ltd., Nanda Road,Shipai Tianhe, Guangzhou, Guangdong, China respectively (hereinafter jointlyreferred to as the “PLEDGORS”);WHEREAS:1. Pledgors are citizens of the People’s Republic of China (hereinafter referredto as “China”), and hold 100% of the shares in Guangzhou Sunroom InformationIndustrial Co., Ltd. (“Guangzhou Sunroom”). Guangzhou Sunroom is a limitedliability company registered in Guangzhou, China.2. Pledgee is a wholly foreign owned entity registered in Guangzhou, China, andis engaged in the business of providing technical and consulting services.3. Pledgee and Guangzhou Sunroom executed a Consulting Services Agreement(hereinafter referred to as the “Service Agreement”) on April 5, 2005;3. To ensure that Pledgee collects consulting and service fees regularly fromGuangzhou Sunroom owned by Pledgors, Pledgors hereby pledge all of the shares inGuangzhou Sunroom held by him as security for the consulting and service feesunder the Service Agreement.To perform the provisions of the Service Agreement, Pledgors and Pledgee havemutually agreed to execute this Agreement upon the following terms.1. Unless otherwise provided herein, the terms below shall have the followingmeanings:1.1 Pledge: shall refer to the entire content set forth in Article 2 of thisAgreement.1.2 Shares: shall refer to all of the shares lawfully held by Pledgors inGuangzhou Sunroom.1.3 Pledge Ratio: shall refer to the ratio between value of the pledge underthis Agreement and the service fees payable by Guangzhou Sunroom to Pledgee.1.4 Term of Pledge: shall refer to the term set forth in Section 3.2 of thisAgreement.1.5 Service Agreement: shall refer to the Consulting Services Agreement executedby and between Guangzhou Sunroom owned by Pledgors and Pledgee on April 5, 2005.1.6 Event of Default: shall refer to any circumstances set forth in Article 7 ofthis Agreement.1.7 Notice of Default: shall refer to the notice issued by Pledgee in accordancewith this Agreement declaring an Event of Default.2. THE PLEDGE2.1 Pledgors hereby pledge to Pledgee all of his shares in Guangzhou Sunroom.”Pledge” shall refer to the right of Pledgee to be compensated on a preferentialbasis with the conversion, auction or sales price of the shares held byPledgors.3. THE PLEDGE RATIO AND TERM OF PLEDGE3.1 The Pledge Ratio3.1.1 The Pledge Ratio of the Pledge shall be approximately 100%.3.2 Term of Pledge3.2.1 The Pledge in accordance with this Agreement shall take effect as of thedate of recording on the shareholders list of Guangzhou Sunroom, and theeffective term of the Pledge shall be the same as the effective term of theService Agreement. The parties agree to complete the filing procedures of thePledge with the industry and commerce administration government authorities withwhich Guangzhou Sunroom was registered after this Agreement takes effect.3.2.2 DURING THE TERM OF THE PLEDGE, IN THE EVENT THAT PLEDGORS FAIL TO PAY THEEXCLUSIVE TECHNICAL CONSULTING SERVICE FEES IN ACCORDANCE WITH THE SERVICEAGREEMENT, PLEDGEE SHALL HAVE THE RIGHT TO DISPOSE OF THE PLEDGE IN ACCORDANCEWITH THE PROVISIONS OF THIS AGREEMENT.4. CUSTODY OF RECORDS FOR SHARES SUBJECT TO PLEDGE4.1 During the Term of Pledge set forth in this Agreement, Pledgors shall submitto Pledgee’s custody the capital contribution certificate for the Shares and theshareholder’s list within one week from the execution of this Agreement.4.2 Pledgee shall have the right to collect dividends generated by the Shares.5. REPRESENTATIONS AND WARRANTIES OF PLEDGORS5.1 Pledgors are the lawful owners of the Shares.5.2 Whenever Pledgee exercises its right with respect to the Pledge inaccordance with this Agreement, there shall not be any intervention from anyother parties.5.3 Pledgee shall have the right to dispose of and transfer the Pledge inaccordance with the provisions set forth in this Agreement.5.4 Except the Pledgee, the Pledgors have not placed any other pledge rights onthe Shares.6. COVENANTS OF THE PLEDGORS6.1 Pledgors hereby promise to the Pledge for the interest of the Pledgee, thatduring the term of this Agreement, Pledgors shall:6.1.1 Not transfer the Shares, place or permit the existence of any pledge thatmay affect the Pledgee’s rights and interests in the Shares, without the priorwritten consent of Pledgee;6.1.2 Comply with the provisions of all laws and regulations applicable to thepledge of rights, and within 5 days of receipt of any notice, order orrecommendation issued or prepared by relevant competent authorities regardingthe Pledge, shall present the aforementioned notice, order or recommendation toPledgee, and shall comply with the aforementioned notice, order orrecommendation or submit objections and representations with respect to theaforementioned matters upon Pledgee’s reasonable request or upon consent ofPledgee;6.1.3 Promptly notify Pledgee of any event or notice received by Pledgee thatmay have an impact on Pledgee’s rights to the Shares or any portion thereof, aswell as promptly notify Pledgee of any event or notice received by Pledgee thatmay have an impact on any guarantees and other obligations of Pledgor arising inconnection with this Agreement.6.2 Pledgors agree that the rights acquired by Pledgee in accordance with thisPledge Agreement with respect to Pledge shall not be interrupted or harmed byPledgors or any heirs or representatives of Pledgors or any other personsthrough operation of law.6.3 Pledgors hereby warrant to Pledgee that to protect or perfect the guaranteeprovided by this Agreement for payment of the consulting service fees under theService Agreement, Pledgors hereby execute in good faith and shall cause otherparties who have a stake in the Pledge to execute all rights certificates,agreements, deeds and/or covenants required by Pledgee and / or shall performand shall cause other parties who have a stake in the Pledge to perform actionsrequired by Pledgee, and facilitate the exercise by Pledgee of its rights andauthority granted thereto by this Agreement, execute all relevant documents thatmodify stock certificates with Pledgee or designee(s) of Pledgee (naturalpersons / legal persons), and shall provide to Pledgee within a reasonable timeall notices, orders and decisions regarding the Pledge that are required byPledgee.6.4 Pledgors hereby warrant to Pledgee that for Pledgee’s interest, Pledgorsshall comply with representations and conditions under this Agreement. In theevent of failure or partial performance of its guarantees, promises, agreements,representations and conditions, Pledgors shall indemnify Pledgee for all of itslosses resulting therefrom.7. EVENT OF DEFAULT7.1 The following circumstances shall be deemed Events of Default:7.1.1 Guangzhou Sunroom fails to pay in full the exclusive technical servicefees payable under the Service Agreement;7.1.2 Any representation or warranty by Pledgors in Article 5 of this Agreementcontains material misrepresentations or errors, and/or Pledgors violate any ofthe warranties in Article 5 of this Agreement;7.1.3 Pledgors breach any of the covenants in Article 6 of this Agreement;7.1.4 Pledgors breach any provisions of this Agreement;7.1.5 Pledgors give up the Shares pledged or assign the Shares pledged withoutthe written consent of Pledgee;7.1.6 Any of Pledgors’ own loans, guarantees, indemnification, promises or otherdebt liabilities to any third party or parties (1) have been subject to a demandof early repayment or performance; or (2) have become due but are not capable ofbeing repaid or performed in a timely manner, thus leading Pledgee to believethat Pledgors’ ability to perform its obligations under this Agreement has beenaffected;7.1.7 Pledgors are unable to repay general debts and other debts;7.1.8 The promulgation of applicable laws have rendered this Agreement illegalor have rendered it impossible for Pledgors to continue to perform itsobligations under this Agreement;7.1.9 All approvals, licenses, permits or authorizations of government agenciesthat make this Agreement enforceable, legal and effective have been withdrawn,terminated, invalidated or substantively changed;7.1.10 Adverse changes in properties owned by Pledgors, which lead Pledgee tobelieve that that Pledgors’ ability to perform its obligations under thisAgreement has been affected;7.1.11 The successor or custodian of Guangzhou Sunroom is capable of onlypartially perform or refuses to perform the payment obligations under theService Agreement;7.1.12 Breach of this Agreement resulting from breach of other provisions ofthis Agreement by Pledgors’ action or omission; and7.1.13 Other circumstances where Pledgee is unable to exercise its right withrespect to the Pledge.7.2 Upon information or discovery of the occurrence of any circumstances orevent that may lead to the aforementioned circumstances described in Section7.1, Pledgors shall immediately notify Pledgee in writing. Unless an Event ofDefault set forth in this Section 7.1 has been successfully resolved toPledgee’s satisfaction, Pledgee may issue a Notice of Default to Pledgors inwriting upon the occurrence of the Event of Default or at any time thereafterand demand that Pledgors immediately pay all outstanding payments due under theService Agreement and all other payments due to Pledgee, or dispose of thePledge in accordance with the provisions of Article 8 of this Agreement.8. EXERCISE OF PLEDGE8.1 Prior to the full payment of the consulting service fee described in theService Agreement, without the Pledgee’s written consent, Pledgors shall notassign the Pledge.8.2 Pledgee shall issue a Notice of Default to Pledgors when exercising thePledge.8.3 Subject to the provisions of Section 7.3, Pledgee may exercise the right todispose of the Pledge concurrently with the issuance of the Notice of Default inaccordance with Section 7.2 or at any time after the issuance of the Notice ofDefault.8.4 Pledgee shall have the right to be compensated with the conversion price ofthe Shares under this Agreement in part or in whole, in accordance with legallymandated procedures, or with the auction or sale price of such Shares on apreferential basis, until all outstanding consulting service fees and all otheroutstanding payments under the Service Agreement have been paid off.8.5 When Pledgee disposes of the Pledge in accordance with this Agreement,Pledgors shall not erect any impediment, and shall provide necessary assistanceto enable Pledgee to realize its Pledge.9. ASSIGNMENT9.1 Unless Pledgee consents in advance, Pledgors shall not have the right toassign or delegate its rights and obligations under this Agreement.9.2 This Agreement shall be binding on Pledgors and the successors thereof, andshall be valid with respect to Pledgee and each of the successors and assignsthereof.9.3 At any time, Pledgee may assign any and all of its rights and obligationsunder the Service Agreement to its designee(s) (natural / legal persons), inwhich case the assigns shall have the rights and obligations of Pledgee underthis Agreement, as if it were a party to this Agreement. When the Pledgeeassigns the rights and obligations under the Service Agreement, upon Pledgee’srequest, Pledgors shall execute relevant agreements and / or documents relatingto such an assignment.9.4 In the event of a change in Pledgee due to an assignment, the new parties tothe Pledge shall execute a new pledge agreement.10. TERMINATION10.1Upon the payoff of the consulting service fees under the Service Agreementand Pledgors no longer undertakes any obligations under the Service Agreement,this Pledge Agreement shall be terminated, and Pledgors shall then cancel orterminate this Agreement as soon as reasonably practicable.11. HANDLING FEES AND OTHER EXPENSES11.1 All fees and out of pocket expenses relating to this Agreement, includingbut not limited legal costs, cost of production, stamp tax and any other taxesand fees shall be borne by Pledgors. In the event that the law requires Pledgeeto pay relevant taxes, Pledgors shall provide full reimbursement for all taxesalready paid by Pledgee.11.2 IN THE EVENT THAT PLEDGORS FAIL TO PAY ANY TAXES AND FEES IN ACCORDANCEWITH THE PROVISIONS OF THIS AGREEMENT OR IN THE EVENT THAT DUE TO OTHER REASONS,PLEDGEE ATTEMPTS TO RECOVER TAXES AND FEES PAYABLE BY PLEDGORS THROUGH ANYMEANS, ALL EXPENSES (INCLUDING BUT NOT LIMITED TO VARIOUS TAXES, HANDLING FEES,MANAGEMENT FEES, COST OF LITIGATION, ATTORNEY’S FEES AND VARIOUS INSURANCEPREMIUMS, ETC.) RESULTING THEREFROM SHALL BE BORNE BY PLEDGORS.12. FORCE MAJEURE12.1 “Force majeure” shall refer to any event beyond the reasonable control ofeither party and that still cannot be avoided even if the party affected hasexercised reasonable care, including but not limited government actions, acts ofGod, fire, explosions, storms, flood, earthquakes, tides, lightning or war. Buta lack of credit, funds or financing shall not be deemed a circumstances beyondthe reasonable control of either party. The party affected by a “force majeureevent” shall notify the other party of such relief from liability as soon aspossible.12.2 In the event that the performance of this Agreement is delayed or impededby the aforementioned “force majeure,” the party affected by such force majeureshall not be liable in any way under this Agreement to the extent of such delayor impedance. The party affected shall take appropriate measures to mitigate oreliminate the impact of such “force majeure” and shall attempt to resume theperformance of obligations delayed or impeded by such “force majeure.” As soonas the force majeure event is eliminated, the parties agree to use their bestefforts to resume the performance of this Agreement.13. RESOLUTION OF DISPUTES13.1 This Agreement shall be governed by laws of China and shall be construed inaccordance therewith.13.2 In the event of any dispute with respect to the construction andperformance of the provisions of this Agreement, the parties shall negotiate ingood faith to resolve same. Upon failure of such negotiations, any party maysubmit the relevant disputes to the China International Economics and ForeignTrade Arbitration Commission for resolution by arbitration, in accordance withits current arbitration rules., and the language used during arbitration shallbe Chinese. The arbitration ruling shall be final and binding on both parties.14. NOTICES14.1 Notices sent by the parties to perform the rights and obligations underthis Agreement shall be in writing. If sent by personal delivery, such a noticeshall be deemed served upon actual delivery; if sent by telex or facsimile, sucha notice shall be deemed served at the time of transmission. If the date oftransmission is not a business day or if transmission is after hours, then thenext consecutive business day shall be the date of service. The address ofservice shall be the addresses of the two parties on the first page of thisAgreement or addresses notified in writing at any time subsequently. In writingshall include facsimiles and telexes.15. ATTACHMENTSThe attachments set forth in this Agreement shall be an integral part hereof.16. EFFECTIVENESSAny amendments, changes and supplements to this Agreement shall be in writingand shall take effect upon affixation of the signatures and seals of theparties.16.2 This Agreement is written in English in triplicate copies. (Signature Page to Follow)PLEDGEE: Guangzhou 3G Information Technology Co., Ltd.Authorized representative: /s/ Liao Mengjiang ———————— Liao MengjiangTitle: General ManagerPLEDGORS:/s/ Sun ZhengquanSun Zhengquan: —————————–/s/ Wang YongchaoWang Yongchao: —————————–/s/ Liao MengjiangLiao Mengjiang: —————————– POWER OF ATTORNEYWe SUN ZHENGQUAN (PRC ID: 420111196801105655), LIAO MENGJIANG (PRC ID:432503197202144812), and WANG, YONGCHAO – (PRC ID: 440823197306096917), herebyirrevocably authorize Mr. Victor Tongto exercise the following rights during theterm of this Power of Attorney:Mr. Victor Tong is hereby authorized to exercise on my behalf at shareholdersmeetings of GUANGZHOU SUNROOM INFORMATION INDUSTRIAL CO., LTD. (the “Company”),all the shareholder’s voting rights I am entitled to under Chinese laws and theCompany’s bylaws, including but not limited to the sale or transfer of theshares I hold in the Company in part or in whole, and designate and appoint onmy behalf at the shareholders meetings of the Company, the chief executiveofficer of the Company.The aforementioned authorization shall be subject to Mr. Victor Tong being anemployee of PACIFICNET STRATEGIC INVESTMENT HOLDINGS LIMITED. (“PacificNetStrategic”). As soon as Mr. Victor Tong no longer holds any position withPacificNet Strategic, I shall withdraw the authorization granted thereto herein,and shall designate / authorize another employee of PacificNet Strategic toexercise all of my shareholders voting rights at shareholders meetings of theCompany.During the valid existence of the Company, unless the Operating Agreementjointly executed by and between Guangzhou 3G Information Technology Co., Ltd.and the Company is terminated early due to any reason, the term of this Power ofAttorney shall be 5 years from the date of execution of this Power of Attorney.SIGNATURE:Sun Zhengquan: /s/ Sun ZhengquanLiao Mengjiang: /s/ Liao MengjiangWang Yongchao: /s/ Wang YongchaoDate: March 28, 2005 CONSULTING AND SERVICES AGREEMENTThis Consulting and Services Agreement (hereinafter referred to as the”Agreement”) has been executed by and between the following parties on October10, 2004 in Guangzhou.Party A: Guangzhou Dianxun Digital Network Technology Co., Ltd (Chinese CompanyName “________________”), a company incorporated in Guangzhou, China whoseprincipal place of business is Room 803, GuangRi Building, Si You Nan Road,Wuyang XinCheng, Guangzhou 510613, China (Chinese Address “________________”)Party B: An affiliated Chinese entity of Party A: GuangZhou DianXun CompanyLimited (Chinese Company Name “________________”), a company incorporated inGuangzhou, China whose principal place of business is Room 803, GuangRiBuilding, Si You Nan Road, Wuyang XinCheng, Guangzhou 510613, China (ChineseAddress “________________”) .WHEREAS:(1) Party A is a wholly foreign owned enterprise established in the People’sRepublic of China (hereinafter referred to as “China”), and has the resources toprovide technical and consulting services;(2) Party B is a company with exclusively domestic capital registered in Chinaand may engage in the business of providing value-added telecom services (VAS),internet and mobile entertainment application development, mobile game softwaredesign and development, mobile customer relationship management (CRM) servicesfor China’s telecom operators, mobile marketing and promotion services,management and consulting services, mobile internet information technology,mobile payment and mobile point of sale (POS) solutions, mobile consumeranalytics, mobile data-mining, internet e-commerce and mobile commerce, mobileapplications based on WAP, KJava, BREW, EMS, short messaging services (SMS),multimedia messaging services (MMS), outsourced game development, and othermobile value-added services (VAS) in the PRC, and operates the followinginternet and mobile gaming web sites:www.Mo168.com;(3) Party A agrees to provide Party B with exclusive technical consulting andrelated services in VAS service business during the term of this Agreementutilizing its own advantages in human capital and information, and Party Bagrees to accept the technical consultations and services provided by Party A.(4) Party A and Party B previously executed a Consulting Services Contract onDec 1, 2004, and the parties now desire to make amendments to the conditions ofsaid contract, and to execute this Agreement to replace said Consulting ServicesContract.Wherefore, through mutual discussion, the parties have reached the followingagreements:1. Exclusive Consultations and Services: Exclusive Interest1.1 During the term of this Agreement, Party A agrees to provide Party B withrelevant technical consultations and services as Party B’s exclusive provider oftechnical and consultation services, in accordance with the conditions of thisAgreement (for specific contents, see Attachment 1).1.2 Party B agrees to accept the technical consultations and services providedby Party A. Party B further agrees that unless Party A consents in writing inadvance, during the term of this Agreement, Party B shall not accept technicalconsultations and services provided by any third party regarding theaforementioned business.1.3 Party A shall have exclusive interests in all rights, ownership, interestsand intellectual properties arising from the performance of this Agreement,including but not limited to copyrights, patents, technical secrets, tradesecrets and others, regardless of whether they have been developed by Party A orby Party B based on Party A’s intellectual properties.2. The Calculation and Payment of the Technical Consulting and Service Fee(hereinafter referred to as “Consulting Service Fee”)The parties agree that the Consulting Service Fee under this Agreement shall bedetermined and paid based on the methods set forth in Attachment 2.Representations and Warranties3.1 Party A hereby represents and warrants as follows:3.2.1 Party A is a wholly foreign owned enterprise legally registered andvalidly existing in accordance with Chinese laws.3.2.2 Party A’s execution and performance of this Agreement is within the scopeof its business operations; Party A has taken necessary corporate actions andgiven appropriate authorization and has obtained the consent and approval fromthird parties and government agencies, and will not violate the restrictions oflaws binding or having an impact thereon.3.2.3 This Agreement shall constitute Party A’s legitimate and valid obligationsas soon as it is executed, and shall be enforceable against it.3.2 Party B hereby represents and warrants as follows:3.2.1 Party B is a company legally registered and validly existing in accordancewith Chinese laws and may engage in VAS business as approved by authorityChinese government departments;3.2.2 Party B’s execution and performance of this Agreement is within the scopeof its business operations; Party B has taken necessary corporate actions andgiven appropriate authorization and has obtained the consent and approval fromthird parties and government agencies, and will not violate the restrictions oflaws binding or having an impact thereon.3.2.3 This Agreement shall constitute Party B’s legitimate and valid obligationsas soon as it is executed, and shall be enforceable against it.4. Confidentiality Clauses4.1 Party B agrees to maintain the confidentiality of confidential materials andinformation (hereinafter referred to as “Confidential Information”) of Party Athat Party B learns or has access to due to its acceptance of Party A’sexclusive consultations and services, and shall take various security measuresdesigned to maintain such confidentiality; without the prior written consent ofParty A, Party B shall not disclose, give or transfer such ConfidentialInformation to any third party. Upon the termination of this Agreement, Party Bshall return any document, material or software that contains such ConfidentialInformation to Party A at Party A’s request, or shall destroy same on his ownand shall delete any Confidential Information from the relevant memory devicesand shall not continue to use such Confidential Information.4.2 The parties agree that this section shall survive changes to, rescission ortermination of this Agreement.5. IndemnificationParty B shall indemnify Party A for and hold Party A harmless from any loss,injury, obligation or expenses caused by any lawsuit, claims or other demandsagainst Party A arising from or caused by contents of consultations and servicesrequested by Party B.6. Effectiveness and Term6.1 This Agreement shall be executed on the date first above written and shalltake effect as of the even date therewith. Unless terminated early in accordancewith the provisions of this Agreement or relevant agreements separately executedbetween the parties, the term of this Agreement shall be ten years.6.2 The term of this Agreement shall not be extended unless confirmed in writingby Party A prior to the expiration thereof. The extended term shall bedetermined by the parties to this Agreement through consensus.7. Termination7.1 Termination upon date of expiration. Unless renewed in accordance with therelevant terms of this Agreement, this Agreement shall be terminated upon thedate of expiration thereof.7.2 Early termination. During the term of this Agreement, unless Party A commitsa gross fault, fraudulent act, other illegal acts or becomes bankrupt, Party Bshall not terminate this Agreement early. Notwithstanding the aforementionedcovenant, Party A shall have the right to terminate this Agreement upon 30 daysof written notice to Party B at any time.7.3 Terms that survive termination. The rights and obligations of the partiesunder Article 4 and Article 5 shall survive the termination of this Agreement.8. Resolution of DisputesIn the event of any dispute with respect to the construction and performance ofthe provisions of this Agreement, the parties shall hold consultations in goodfaith to resolve same. Upon failure of such consultations, either party maysubmit the relevant dispute to the China International Economics and ForeignTrade Arbitration Commission Guangzhou Chapter for resolution by arbitration, inaccordance with its current arbitration rules. The arbitration shall beperformed in Guangzhou, and the language used during arbitration shall beChinese. The arbitration ruling shall be final and binding on both parties.9. Force Majeure9.1 “Force majeure” shall refer to any event beyond the reasonable control ofeither party and that still cannot be avoided even if the party affected hasexercised reasonable care, including but not limited government actions, acts ofGod, fire, explosions, storms, flood, earthquakes, tides, lightning or war. Buta lack of credit, funds or financing shall not be deemed a circumstances beyondthe reasonable control of either party. The party affected by a “force majeureevent” shall notify the other party of such relief from liability as soon aspossible.9.2 In the event that the performance of this Agreement is delayed or impeded bythe aforementioned “force majeure,” the party affected by such force majeureshall not be liable in any way under this Agreement to the extent of such delayor impedance. The party affected shall take appropriate measures to mitigate oreliminate the impact of such “force majeure” and shall attempt to resume theperformance of obligations delayed or impeded by such “force majeure.” As soonas the force majeure event is eliminated, the parties agree to use their bestefforts to resume the performance of this Agreement.10. NoticesNotices or other communications sent by either party as required by thisAgreement shall be written in Chinese, and a notice shall be deemed served whenit is delivered to the address of either party or the addresses of both partiesbelow by personal delivery, registered mail, mail with prepaid postage orrecognized express mail or facsimile. To Party A (Licensor): Attn: Mr. Zhang, MingOAA/, General Manager Guangzhou Dianxun Digital Network Technology Co., Ltd (“________________”) Room 803, GuangRi Building, Shi You Nan Road, Wuyang XinCheng, Guangzhou 510613, China (Chinese Address “________________”) To Party B: Attn: Mr. Zhang, MingOAA/, General Manager GuangZhou DianXun Company Limited (“________________”) Room 803, GuangRi Building, Shi You Nan Road, Wuyang XinCheng, Guangzhou 510613, China (Chinese Address “________________”)11. AssignmentUnless Party A’s prior written consent is obtained, Party B shall not assign therights enjoyed to thereby and obligations undertaken thereby under thisAgreement to any third party.12. SeverabilityIn the event that any provisions of this Agreement are invalid or unenforceabledue to inconsistency with law, then such provisions shall only be invalid orunenforceable to the extent of the jurisdiction of such law, and shall notaffect the legal validity of the remaining provisions of this Agreement.13. Amendments and SupplementsAny amendments and supplements to this Agreement shall be in writing. Theamendment agreements and supplementary agreements that have been signed by theparties and that relate to this Agreement shall be an integral part of thisAgreement and shall have the same legal validity as this Agreement.14. Governing LawsThis Agreement shall be governed by laws of China and shall be construed inaccordance therewith.IN WITNESS WHEREOF, the parties have caused their authorized representatives toexecute this Agreement as of the date first above written. (Signature Page to Follow)Party A: Guangzhou Dianxun Digital Network Technology Co., Ltd(Chinese Company Name “________________”) By: /s/ Mr. Zhang, Ming —————————————— Name: Mr. Zhang, Ming Title: Legal Representative and General ManagerParty B: An affiliated Chinese entity of Party A:GuangZhou DianXun Company Limited (Chinese Company Name “________________”) By: /s/ Mr. Zhang, Ming —————————————— Name: Mr. Zhang, Ming Title: Legal Representative and General ManagerATTACHMENT 1: Table of Contents of Technical Consultations and ServicesIncluding furnishing of training of personnel, network platforms appurtenant tomanagement and information services required for Party B’s business, makingrecommendations to Party B regarding the telecommunications value-added andother forms of services accepted by the parties.ATTACHMENT 2: The Calculation and Payment of the Technical Consulting andService FeeFor each Value-adder Service sold by Party B, Party B shall pay Party A 100% ofeach income in technical consulting and service fee. Party B shall settle andpay the aforementioned technical consulting and service fee by the 15th of eachmonth.The aforementioned method of calculation may be adjusted quarterly by Party Aand Party B depending on the current actual circumstances. SHARE PLEDGE AGREEMENTThis Share Pledge Agreement (hereinafter referred to as this “Agreement”) hasbeen executed by and between the following parties on Dec 1, 2004 in Guangzhou.Pledgee: Guangzhou Dianxun Digital Network Technology Co., Ltd (Chinese CompanyName “________________”), a company incorporated in Guangzhou, China whoseprincipal place of business is Room 803, GuangRi Building, Si You Nan Road,Wuyang XinCheng, Guangzhou 510613, China (Chinese Address “________________”)Pledgor: Zhang, Ming, Lai, Jinnan, and Liu, Dong residents of PRC, located atNo.8, No.8 Street, Luyiju, Clifford Estates, Panyu Borough, Guangzhou,Guangdong, China (“________________”); at 901, No 3 Door, No3 Building, 388JinNin Road, XiangZhou Borough, Zhuhai, Guangdong, China (“________________”);and at 803 GuangRi Building, WuYangXinCheng, SiYou South Road, Guangzhou,Guangdong, China (“________________”).WHEREAS:1. Pledgors are citizens of the People’s Republic of China (hereinafter referredto as “China”), and holds 100% of the shares in Guangzhou DianXun TechnologyCo., Ltd. (“Guangzhou Dianxun”). Guangzhou Dianxun is a limited liabilitycompany registered in Guangzhou, China.2. Pledgee is a wholly foreign owned entity registered in Guangzhou, China, andis engaged in the business of developing computer software and hardwaretechnologies and systems integration and information services (including onlinetravel information consulting services). Pledgee and Guangzhou Dianxun executeda Consulting Services Agreement (hereinafter referred to as the “ServiceAgreement”) on Oct 10, 2004;3. To ensure that Pledgee collects consulting and service fees regularly fromGuangzhou Dianxun partially owned by Pledgor, Pledgor hereby pledges all of theshares in Guangzhou Dianxun held by him as security for the consulting andservice fees under the Service Agreement.To perform the provisions of the Service Agreement, Pledgors and Pledgee havemutually agreed to execute this Agreement upon the following terms.1. Unless otherwise provided herein, the terms below shall have the followingmeanings:1.1 Pledge: shall refer to the entire content set forth in Article 2 of thisAgreement.1.2 Shares: shall refer to all of the shares lawfully held by Pledgors inGuangzhou Dianxun.1.3 Pledge Ratio: shall refer to the ratio between value of the pledge underthis Agreement and the service fees payable by Guangzhou Dianxun to Pledgee.1.4 Term of Pledge: shall refer to the term set forth in Section 3.2 of thisAgreement.1.5 Service Agreement: shall refer to the Consulting Services Agreement executedby and between Guangzhou Dianxun owned by Pledgors and Pledgee on October 10,2004.1.6 Event of Default: shall refer to any circumstances set forth in Article 7 ofthis Agreement.1.7 Notice of Default: shall refer to the notice issued by Pledgee in accordancewith this Agreement declaring an Event of Default.2. THE PLEDGE2.1 Pledgors hereby pledge to Pledgee all of his shares in Guangzhou Dianxun.”Pledge” shall refer to the right of Pledgee to be compensated on a preferentialbasis with the conversion, auction or sales price of the shares held byPledgors.3. THE PLEDGE RATIO AND TERM OF PLEDGE3.1 The Pledge Ratio3.1.1 The Pledge Ratio of the Pledge shall be approximately 100%.3.2 Term of Pledge3.2.1 The Pledge in accordance with this Agreement shall take effect as of thedate of recording on the shareholders list of Guangzhou Dianxun, and theeffective term of the Pledge shall be the same as the effective term of theService Agreement. The parties agree to complete the filing procedures of thePledge with the industry and commerce administration government authorities withwhich Guangzhou Dianxun was registered after this Agreement takes effect.3.2.2 DURING THE TERM OF THE PLEDGE, IN THE EVENT THAT PLEDGORS FAIL TO PAY THEEXCLUSIVE TECHNICAL CONSULTING SERVICE FEES IN ACCORDANCE WITH THE SERVICEAGREEMENT, PLEDGEE SHALL HAVE THE RIGHT TO DISPOSE OF THE PLEDGE IN ACCORDANCEWITH THE PROVISIONS OF THIS AGREEMENT.4. CUSTODY OF RECORDS FOR SHARES SUBJECT TO PLEDGE4.1 During the Term of Pledge set forth in this Agreement, Pledgors shall submitto Pledgee’s custody the capital contribution certificate for the Shares and theshareholder’s list within one week from the execution of this Agreement.4.2 Pledgee shall have the right to collect dividends generated by the Shares.5. REPRESENTATIONS AND WARRANTIES OF PLEDGORS5.1 Pledgors are the lawful owners of the Shares.5.2 Whenever Pledgee exercises its right with respect to the Pledge inaccordance with this Agreement, there shall not be any intervention from anyother parties.5.3 Pledgee shall have the right to dispose of and transfer the Pledge inaccordance with the provisions set forth in this Agreement.5.4 Except the Pledgee, the Pledgors have not placed any other pledge rights onthe Shares.6. COVENANTS OF THE PLEDGORS6.1 Pledgors hereby promise to the Pledge for the interest of the Pledgee, thatduring the term of this Agreement, Pledgors shall:6.1.1 Not transfer the Shares, place or permit the existence of any pledge thatmay affect the Pledgee’s rights and interests in the Shares, without the priorwritten consent of Pledgee;6.1.2 Comply with the provisions of all laws and regulations applicable to thepledge of rights, and within 5 days of receipt of any notice, order orrecommendation issued or prepared by relevant competent authorities regardingthe Pledge, shall present the aforementioned notice, order or recommendation toPledgee, and shall comply with the aforementioned notice, order orrecommendation or submit objections and representations with respect to theaforementioned matters upon Pledgee’s reasonable request or upon consent ofPledgee;6.1.3 Promptly notify Pledgee of any event or notice received by Pledgee thatmay have an impact on Pledgee’s rights to the Shares or any portion thereof, aswell as promptly notify Pledgee of any event or notice received by Pledgee thatmay have an impact on any guarantees and other obligations of Pledgor arising inconnection with this Agreement.6.2 Pledgors agree that the rights acquired by Pledgee in accordance with thisPledge Agreement with respect to Pledge shall not be interrupted or harmed byPledgors or any heirs or representatives of Pledgors or any other personsthrough operation of law.6.3 Pledgors hereby warrant to Pledgee that to protect or perfect the guaranteeprovided by this Agreement for payment of the consulting service fees under theService Agreement, Pledgors hereby execute in good faith and shall cause otherparties who have a stake in the Pledge to execute all rights certificates,agreements, deeds and/or covenants required by Pledgee and / or shall performand shall cause other parties who have a stake in the Pledge to perform actionsrequired by Pledgee, and facilitate the exercise by Pledgee of its rights andauthority granted thereto by this Agreement, execute all relevant documents thatmodify stock certificates with Pledgee or designee(s) of Pledgee (naturalpersons / legal persons), and shall provide to Pledgee within a reasonable timeall notices, orders and decisions regarding the Pledge that are required byPledgee.6.4 Pledgors hereby warrant to Pledgee that for Pledgee’s interest, Pledgorsshall comply with representations and conditions under this Agreement. In theevent of failure or partial performance of its guarantees, promises, agreements,representations and conditions, Pledgors shall indemnify Pledgee for all of itslosses resulting therefrom.7. EVENT OF DEFAULT7.1 The following circumstances shall be deemed Events of Default:7.1.1 Guangzhou Dianxun fails to pay in full the exclusive technical servicefees payable under the Service Agreement;7.1.2 Any representation or warranty by Pledgors in Article 5 of this Agreementcontains material misrepresentations or errors, and/or Pledgors violate any ofthe warranties in Article 5 of this Agreement;7.1.3 Pledgors breach any of the covenants in Article 6 of this Agreement;7.1.4 Pledgors breach any provisions of this Agreement;7.1.5 Pledgors give up the Shares pledged or assign the Shares pledged withoutthe written consent of Pledgee;7.1.6 Any of Pledgors’ own loans, guarantees, indemnification, promises or otherdebt liabilities to any third party or parties (1) have been subject to a demandof early repayment or performance; or (2) have become due but are not capable ofbeing repaid or performed in a timely manner, thus leading Pledgee to believethat Pledgors’ ability to perform its obligations under this Agreement has beenaffected;7.1.7 Pledgors are unable to repay general debts and other debts;7.1.8 The promulgation of applicable laws have rendered this Agreement illegalor have rendered it impossible for Pledgors to continue to perform itsobligations under this Agreement;7.1.9 All approvals, licenses, permits or authorizations of government agenciesthat make this Agreement enforceable, legal and effective have been withdrawn,terminated, invalidated or substantively changed;7.1.10 Adverse changes in properties owned by Pledgors, which lead Pledgee tobelieve that that Pledgors’ ability to perform its obligations under thisAgreement has been affected;7.1.11 The successor or custodian of Guangzhou Dianxun is capable of onlypartially perform or refuses to perform the payment obligations under theService Agreement;7.1.12 Breach of this Agreement resulting from breach of other provisions ofthis Agreement by Pledgors’ action or omission; and7.1.13 Other circumstances where Pledgee is unable to exercise its right withrespect to the Pledge.7.2 Upon information or discovery of the occurrence of any circumstances orevent that may lead to the aforementioned circumstances described in Section7.1, Pledgors shall immediately notify Pledgee in writing. Unless an Event ofDefault set forth in this Section 7.1 has been successfully resolved toPledgee’s satisfaction, Pledgee may issue a Notice of Default to Pledgors inwriting upon the occurrence of the Event of Default or at any time thereafterand demand that Pledgors immediately pay all outstanding payments due under theService Agreement and all other payments due to Pledgee, or dispose of thePledge in accordance with the provisions of Article 8 of this Agreement.8. EXERCISE OF PLEDGE8.1 Prior to the full payment of the consulting service fee described in theService Agreement, without the Pledgee’s written consent, Pledgors shall notassign the Pledge.8.2 Pledgee shall issue a Notice of Default to Pledgors when exercising thePledge.8.3 Subject to the provisions of Section 7.3, Pledgee may exercise the right todispose of the Pledge concurrently with the issuance of the Notice of Default inaccordance with Section 7.2 or at any time after the issuance of the Notice ofDefault.8.4 Pledgee shall have the right to be compensated with the conversion price ofthe Shares under this Agreement in part or in whole, in accordance with legallymandated procedures, or with the auction or sale price of such Shares on apreferential basis, until all outstanding consulting service fees and all otheroutstanding payments under the Service Agreement have been paid off.8.5 When Pledgee disposes of the Pledge in accordance with this Agreement,Pledgors shall not erect any impediment, and shall provide necessary assistanceto enable Pledgee to realize its Pledge.9. ASSIGNMENT9.1 Unless Pledgee consents in advance, Pledgors shall not have the right toassign or delegate its rights and obligations under this Agreement.9.2 This Agreement shall be binding on Pledgors and the successors thereof, andshall be valid with respect to Pledgee and each of the successors and assignsthereof.9.3 At any time, Pledgee may assign any and all of its rights and obligationsunder the Service Agreement to its designee(s) (natural / legal persons), inwhich case the assigns shall have the rights and obligations of Pledgee underthis Agreement, as if it were a party to this Agreement. When the Pledgeeassigns the rights and obligations under the Service Agreement, upon Pledgee’srequest, Pledgors shall execute relevant agreements and / or documents relatingto such an assignment.9.4 In the event of a change in Pledgee due to an assignment, the new parties tothe Pledge shall execute a new pledge agreement.10. TERMINATION10.1Upon the payoff of the consulting service fees under the Service Agreementand Pledgors no longer undertakes any obligations under the Service Agreement,this Pledge Agreement shall be terminated, and Pledgors shall then cancel orterminate this Agreement as soon as reasonably practicable.11. HANDLING FEES AND OTHER EXPENSES11.1 All fees and out of pocket expenses relating to this Agreement, includingbut not limited legal costs, cost of production, stamp tax and any other taxesand fees shall be borne by Pledgors. In the event that the law requires Pledgeeto pay relevant taxes, Pledgors shall provide full reimbursement for all taxesalready paid by Pledgee.11.2 IN THE EVENT THAT PLEDGORS FAIL TO PAY ANY TAXES AND FEES IN ACCORDANCEWITH THE PROVISIONS OF THIS AGREEMENT OR IN THE EVENT THAT DUE TO OTHER REASONS,PLEDGEE ATTEMPTS TO RECOVER TAXES AND FEES PAYABLE BY PLEDGORS THROUGH ANYMEANS, ALL EXPENSES (INCLUDING BUT NOT LIMITED TO VARIOUS TAXES, HANDLING FEES,MANAGEMENT FEES, COST OF LITIGATION, ATTORNEY’S FEES AND VARIOUS INSURANCEPREMIUMS, ETC.) RESULTING THEREFROM SHALL BE BORNE BY PLEDGORS.12. FORCE MAJEURE12.1 “Force majeure” shall refer to any event beyond the reasonable control ofeither party and that still cannot be avoided even if the party affected hasexercised reasonable care, including but not limited government actions, acts ofGod, fire, explosions, storms, flood, earthquakes, tides, lightning or war. Buta lack of credit, funds or financing shall not be deemed a circumstances beyondthe reasonable control of either party. The party affected by a “force majeureevent” shall notify the other party of such relief from liability as soon aspossible.12.2 In the event that the performance of this Agreement is delayed or impededby the aforementioned “force majeure,” the party affected by such force majeureshall not be liable in any way under this Agreement to the extent of such delayor impedance. The party affected shall take appropriate measures to mitigate oreliminate the impact of such “force majeure” and shall attempt to resume theperformance of obligations delayed or impeded by such “force majeure.” As soonas the force majeure event is eliminated, the parties agree to use their bestefforts to resume the performance of this Agreement.13. RESOLUTION OF DISPUTES13.1This Agreement shall be governed by laws of China and shall be construed inaccordance therewith.13.2 In the event of any dispute with respect to the construction andperformance of the provisions of this Agreement, the parties shall negotiate ingood faith to resolve same. Upon failure of such negotiations, any party maysubmit the relevant disputes to the China International Economics and ForeignTrade Arbitration Commission for resolution by arbitration, in accordance withits current arbitration rules., and the language used during arbitration shallbe Chinese. The arbitration ruling shall be final and binding on both parties.14. NOTICES14.1 Notices sent by the parties to perform the rights and obligations underthis Agreement shall be in writing. If sent by personal delivery, such a noticeshall be deemed served upon actual delivery; if sent by telex or facsimile, sucha notice shall be deemed served at the time of transmission. If the date oftransmission is not a business day or if transmission is after hours, then thenext consecutive business day shall be the date of service. The address ofservice shall be the addresses of the two parties on the first page of thisAgreement or addresses notified in writing at any time subsequently. In writingshall include facsimiles and telexes.15. ATTACHMENTSThe attachments set forth in this Agreement shall be an integral part hereof.16. EFFECTIVENESSAny amendments, changes and supplements to this Agreement shall be in writingand shall take effect upon affixation of the signatures and seals of theparties.16.2 This Agreement is written in English in triplicate copies. (Signature Page to Follow)Pledgee: Guangzhou Dianxun Digital Network Technology Co., LtdAuthorized representative: ___________Pledgor: Zhang, MingNo.8, No.8 Street, Luyiju, Clifford Estates, Panyu Borough, Guangzhou,Guangdong, China (“________________”)Signed: /s/ Zhang, MingLai, Jinnan901, No 3 Door, No3 Building, 388 JinNin Road, XiangZhou Borough, Zhuhai,Guangdong, China (“________________”)Signed: /s/ Lai, JinnanLiu, Dong803 GuangRi Building, WuYangXinCheng, SiYou South Road, Guangzhou, Guangdong,China (“________________”)Signed: /s/ Liu, Dong POWER OF ATTORNEYI, Zhang, Ming OAA/ (“WenChu”), a Chinese citizen with Chinese PASSPORT #G09161800, hereby irrevocably authorize Mr. Victor Tong to exercise thefollowing rights during the term of this Power of Attorney:Mr. Victor Tong is hereby authorized to exercise on my behalf at shareholdersmeetings of Guangzhou DianXun Technology Co., Ltd. (the “Company”), 51% of allthe shareholder’s voting rights I am entitled to under Chinese laws and theCompany’s bylaws, including but not limited to the sale or transfer of theshares I hold in the Company in part or in whole, and designate and appoint onmy behalf at the shareholders meetings of the Company, the chief executiveofficer of the Company.The aforementioned authorization shall be subject to Mr. Victor Tong being anemployee of PacificNet Inc (“PacificNet”). As soon as Mr. Victor Tong no longerholds any position with PacificNet, I shall withdraw the authorization grantedthereto herein, and shall designate / authorize another employee of PacificNetto exercise all of my shareholders voting rights at shareholders meetings of theCompany.During the valid existence of the Company, unless the Operating Agreementjointly executed by and between PacificNet and the Company is terminated earlydue to any reason, the term of this Power of Attorney shall be 5 years from thedate of execution of this Power of Attorney. /s/ Zhang, Ming Zhang, Ming (“WenChu”) DECEMBER 1, 2004 POWER OF ATTORNEYI, Lai, Jinnan Au1/2oAI (“Marco”), a Chinese citizen with Chinese PASSPORT #G10920356, hereby irrevocably authorize Mr. Victor Tong to exercise thefollowing rights during the term of this Power of Attorney:Mr. Victor Tong is hereby authorized to exercise on my behalf at shareholdersmeetings of Guangzhou DianXun Technology Co., Ltd. (the “Company”), 51% of allthe shareholder’s voting rights I am entitled to under Chinese laws and theCompany’s bylaws, including but not limited to the sale or transfer of theshares I hold in the Company in part or in whole, and designate and appoint onmy behalf at the shareholders meetings of the Company, the chief executiveofficer of the Company.The aforementioned authorization shall be subject to Mr. Victor Tong being anemployee of PacificNet Inc (“PacificNet”). As soon as Mr. Victor Tong no longerholds any position with PacificNet, I shall withdraw the authorization grantedthereto herein, and shall designate / authorize another employee of PacificNetto exercise all of my shareholders voting rights at shareholders meetings of theCompany.During the valid existence of the Company, unless the Operating Agreementjointly executed by and between PacificNet and the Company is terminated earlydue to any reason, the term of this Power of Attorney shall be 5 years from thedate of execution of this Power of Attorney. /s/ Lai, Jinnan Lai, Jinnan (“Marco”) DECEMBER 1, 2004 POWER OF ATTORNEYI, Liu Dong (“_____”), a Chinese citizen with Chinese ID number:350500197806092530, hereby irrevocably authorize Mr. Victor Tong to exercise thefollowing rights during the term of this Power of Attorney:Mr. Victor Tong is hereby authorized to exercise on my behalf at shareholdersmeetings of Guangzhou DianXun Technology Co., Ltd. (the “Company”), 51% of allthe shareholder’s voting rights I am entitled to under Chinese laws and theCompany’s bylaws, including but not limited to the sale or transfer of theshares I hold in the Company in part or in whole, and designate and appoint onmy behalf at the shareholders meetings of the Company, the chief executiveofficer of the Company.The aforementioned authorization shall be subject to Mr. Victor Tong being anemployee of PacificNet Inc (“PacificNet”). As soon as Mr. Victor Tong no longerholds any position with PacificNet, I shall withdraw the authorization grantedthereto herein, and shall designate / authorize another employee of PacificNetto exercise all of my shareholders voting rights at shareholders meetings of theCompany.During the valid existence of the Company, unless the Operating Agreementjointly executed by and between PacificNet and the Company is terminated earlydue to any reason, the term of this Power of Attorney shall be 5 years from thedate of execution of this Power of Attorney. /s/ Liu Dong Liu Dong (“______”) DECEMBER 1, 2004- ——————————————————————————–