8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of Earliest event Reported): July 9, 2010 (July 2, 2010)

CHINA UNITECH GROUP, INC.
(Exact name of registrant as specified in its charter)

Nevada	000-52832	98-0500738
(State or other jurisdiction of	(Commission File Number)	(IRS Employer Identification No.)
incorporation or organization)

1-D-1010, Yuanjing Park, Long Xiang Road,
Long Gang District, Shenzhen
Guangdong Province
P. R. China 518117
(Address of principal executive offices)

+86 755-2894-3820
(Registrant's telephone number, including area code)

No. 1 Xinxin Garden, No. 51 Fangjicun Xudong Road, Wuchang, Wuhan, Hubei, China 430062
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[   ]     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[   ]     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[   ]     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[   ]     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements. The forward-looking statements are contained principally in the sections entitled “Description of Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “would” and similar expressions intended to identify forward-looking statements. Forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties. These risks and uncertainties include, but are not limited to, the factors described in the section captioned “Risk Factors” below. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

Also, forward-looking statements represent our estimates and assumptions only as of the date of this report. You should read this report and the documents that we reference and filed as exhibits to this report completely and with the understanding that our actual future results may be materially different from what we expect. Except as required by law, we assume no obligation to update any forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in any forward-looking statements, even if new information becomes available in the future.

USE OF CERTAIN DEFINED TERMS

Except as otherwise indicated by the context, in this report:

• “BVI” refers to the British Virgin Islands;

• “China,” “Chinese” and “PRC,” refer to the People’s Republic of China, excluding Hong Kong, Macao and Taiwan;

• “China Unitech,” “the Company,” “we,” “us,” or “our,” refer to the combined business of China Unitech Group, Inc., and its wholly-owned subsidiaries, Classic Bond and Zhonghefangda, and our controlled VIE Junlong, but do not include the stockholders of China Unitech Group, Inc.;

• “Classic Bond” refers to Classic Bond Development Limited, a BVI company;

• “Exchange Act” refers to the Securities Exchange Act of 1934, as amended;

• “Junlong” refers to Shenzhen Junlong Culture Communications Co., Ltd., a PRC company and our variable interest entity, or VIE;

• “RMB” refer to Renminbi, the legal currency of China;

• “SEC” refer to the Securities and Exchange Commission;

• “Securities Act” refer to the Securities Act of 1933, as amended;

• “U.S. dollar,” “$” and “US$” refer to the legal currency of the United States;

• “VIE” refer to Junlong, our variable interest entity, which is an affiliated company that we control through contractual arrangements; and

• “Zhonghefangda” refer to “Shenzhen Zhonghefangda Internet Technology Co., Limited, a PRC company and a wholly-owned subsidiary of Classic Bond.

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

On July 2, 2010, we entered into a share exchange agreement, or the Share Exchange Agreement, with Classic Bond and the shareholders of Classic Bond. Pursuant to the Share Exchange Agreement, on July 2, 2010, we acquired 100% of the issued and outstanding capital stock of Classic Bond in exchange for 19,000,000 newly issued shares of our common stock, par value $0.00001 per share, which constituted 94% of our issued and outstanding common stock on a fully-diluted basis as of and immediately after the consummation of the transactions contemplated by the Share Exchange Agreement.

As a condition precedent to the consummation of the Share Exchange Agreement, on July 2, 2010 we entered into a cancellation agreement, or the Cancellation Agreement, with certain shareholders, whereby such shareholders agreed to the cancellation of 5,173,600 shares of our common stock owned by them.

The foregoing description of the terms of the Share Exchange Agreement and the Cancellation Agreement is qualified in its entirety by reference to the provisions of the document filed as Exhibits 2.1 and 4.1 to this report, which is incorporated by reference herein.

ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS

On July 2, 2010, we completed an acquisition of Classic Bond pursuant to the Share Exchange Agreement. The acquisition was accounted for as a recapitalization effected by a share exchange, wherein Classic Bond is considered the acquirer for accounting and financial reporting purposes. The assets and liabilities of the acquired entity have been brought forward at their book value and no goodwill has been recognized.

FORM 10 DISCLOSURE

As disclosed elsewhere in this report, on July 2, 2010, we acquired Classic Bond in a reverse acquisition transaction. Item 2.01(f) of Form 8-K states that if the registrant was a shell company as we were immediately before the reverse acquisition transaction disclosed under Item 2.01, then the registrant must disclose the information that would be required if the registrant were filing a general form for registration of securities under the Exchange Act on Form 10.

Accordingly, we are providing below the information that would be included in a Form 10 registration statement. Please note that the information provided below relates to the combined enterprises after the acquisition of Classic Bond, except that information relating to periods prior to the date of the reverse acquisition only relate to Classic Bond and its subsidiaries unless otherwise specifically indicated.

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CORPORATE STRUCTURE AND HISTORY

Our Corporate Structure

We are a Nevada holding company for our direct and indirect subsidiaries in the BVI and China. We own all of the issued and outstanding capital stock of Classic Bond, a BVI corporation. Classic Bond is a holding company that owns 100% of the outstanding capital stock of Zhonghefangda, a PRC company.

Current PRC laws and regulations impose substantial restrictions on foreign ownership of the internet café business in China. Therefore, our principal operations and sales and marketing activities in China are conducted through Junlong, our VIE, which holds the licenses and approvals for conducting the internet café business in China. Junlong was incorporated in the PRC in December 2003. It obtained its license to operate internet cafés in 2005. We control the VIE through a series of contractual arrangements. These contracts include a Management and Consulting Services Agreement, an Option Agreement, an Equity Pledge Agreement, and a Voting Rights Proxy Agreement. The Management and Consulting Services Agreement, dated June 11, 2010, is between our indirect, wholly-owned subsidiary, Zhonghefangda, and our VIE. The rest of the agreements, also dated June 11, 2010, are among Zhonghefangda, our VIE and its shareholders. These contracts are summarized below. Please also refer to the full text of the contracts, which are filed as exhibits to this report.

• Management and Consulting Services Agreement. Under the Management and Consulting Services Agreement between Junlong and Zhonghefangda, Zhonghefangda provides management and consulting services to the VIE in exchange for service fees up to 100% of the VIE’s Aggregate Net Profits (as defined in the agreement). In consideration for its right to receive the VIE’s aggregate net profits, Zhonghefangda will reimburse to the VIE the full amount of Net Losses (as defined in the Agreement) incurred by the VIE. During the term of the agreement, the VIE may not contract with any other party to provide services that are the same or similar to the services to be provided by Zhonghefangda pursuant to the agreement. The term of this agreement is 20 years, renewable for succeeding periods of the same duration until terminated pursuant to terms of the agreement.

• Option Agreement. Under the Option Agreement, the shareholders of the VIE, Mr. Dishan Guo, Mr. Jinzhou Zeng and Ms. Xiaofen Wang, or the VIE Shareholders, who collectively own 100% of the equity interest in the VIE, granted Zhonghefangda an exclusive, irrevocable option to purchase all or part of their equity interests in the VIE, exercisable at any time and from time to time, to the extent permitted under PRC law. The purchase price of the equity interest will be equal to the original paid-in registered capital of the transferor, adjusted proportionally if less than all of the equity interest owned by the transferor is purchased.

• Equity Pledge Agreement. The VIE Shareholders have pledged their entire equity interest in the VIE to Zhonghefangda pursuant to the Equity Pledge Agreement. The equity interests are pledged as collateral to secure the obligations of the VIE under the Management and Consulting Services Agreement and the VIE Shareholders’ obligations under the Option Agreement and the Proxy Agreement.

• Voting Rights Proxy Agreement. Pursuant to the Voting Rights Proxy Agreement, each of the VIE Shareholders has irrevocably granted and entrusted Zhonghefangda with all of the voting rights as a shareholder of the VIE for the maximum period of time permitted by law. Each VIE Shareholder has also covenanted not to transfer his or her equity interest in the VIE to any party other than Zhonghefangda or a designee of Zhonghefangda.

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We believe that the terms of these agreements are no less favorable than the terms that we could obtain from disinterested third parties. According to our PRC counsel, China Commercial Law Firm, our conduct of business through these agreements complies with existing PRC laws, rules and regulations.

As a result of these contractual arrangements, Junlong became our controlled VIE. A variable interest represents a contractual or ownership interest in another entity that causes the holder to absorb the changes in fair value of the other entity’s net assets. Potential variable interests include: holding economic interests, voting rights, or obligations to an entity; issuing guarantees on behalf of an entity; transferring assets to an entity; managing the assets of an entity; leasing assets from an entity; and providing financing to an entity. In such cases consolidation of the VIE is required by the enterprise that controls the economic risks and rewards of the entity, regardless of ownership. We have consolidated Junlong’s historical financial results in our financial statements as a variable interest entity pursuant to U.S. GAAP.

The following chart reflects our organizational structure as of the date of this report.

*Contractual agreements consisting of a management and consulting service agreement, an equity pledge agreement, option agreement and proxy agreement.

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Our Corporate History and Background

We were incorporated in the State of Nevada on March 14, 2006. From our office in China, we planned to operate in the online travel business using the website www.chinabizhotel.com. The website was planned to offer viewers the ability to book hotel rooms in China and earn us booking fees from the respective hotels. However, we did not engage in any operations and were dormant from our inception until our reverse acquisition of Classic Bond on July 2, 2010.

Acquisition of Classic Bond

On July 2, 2010, we completed a reverse acquisition transaction through a share exchange with Classic Bond and its shareholders, whereby we acquired 100% of the issued and outstanding capital stock of Classic Bond, in exchange for 19,000,000 shares of our common stock, which shares constituted 94% of our issued and outstanding shares on a fully-diluted basis, as of and immediately after the consummation of the reverse acquisition. As a result of the reverse acquisition, Classic Bond became our wholly-owned subsidiary and the former shareholders of Classic Bond, became our controlling shareholders. The share exchange transaction with Classic Bond was treated as a reverse acquisition, with Classic Bond as the acquirer and China Unitech Group, Inc. as the acquired party. Unless the context suggests otherwise, when we refer in this report to business and financial information for periods prior to the consummation of the reverse acquisition, we are referring to the business and financial information of Classic Bond and its consolidated subsidiaries.

Upon the closing of the reverse acquisition, Xuezheng Yuan, our sole director and officer, submitted a resignation letter pursuant to which he resigned, with immediate effect, from all offices that he held and from his position as our sole director that will become effective on the tenth day following the mailing by us of an information statement, or the Information Statement, to our stockholders that complies with the requirements of Section 14f-1 of the Exchange Act, which will be mailed out on or about July 12, 2010. Also upon the closing of the reverse acquisition, our board of directors increased its size from one to five members and appointed Dishan Guo, Zhenquan Guo, Lei Li, Wenbin An and Lizong Wang to fill the vacancies created by the resignation of Xuezheng Yuan and such increase. Mr. Dishan Guo's appointment became effective upon closing of the reverse acquisition, while the remaining appointments will become effective on the tenth day following our mailing of the Information Statement to our stockholders. In addition, our executive officers were replaced by the Classic Bond executive officers upon the closing of the reverse acquisition as indicated in more detail below.

As a result of our acquisition of Classic Bond, we now own all of the issued and outstanding capital stock of Classic Bond. Classic Bond was incorporated in the British Virgin Islands on November 2, 2009 to serve as an investment holding company. Junlong was incorporated in the PRC in December 2003. It obtained its first licenses from the Ministry of Culture to operate an internet café chain in 2005 and opened its first internet café in April 2006.

We plan to amend our certificate of incorporation to change our name from “China Unitech Group, Inc.” to “China Internet Café Holdings Group, Inc.” to reflect the current business of our company, which changed as a result of our acquisition of Classic Bond.

DESCRIPTION OF BUSINESS

Overview

We operate a chain of 28 internet cafés that we own in Shenzhen, Guangdong, China. We provide top quality internet café facilities and we believe we are the largest internet café chain in Shenzhen. We provide internet access at reasonable prices to students and migrant workers. Although we sell snacks, drinks, and game access cards, over 99% of our revenue comes from selling access time to our computers. We sell internet café memberships to our customers. Members purchase prepaid IC cards (a pocket-sized card with embedded integrated circuits that can be used for identification, authentication, data storage and application processing), which include stored value that will be deducted based on time usage of computer at the internet café. The cards are only sold at our cafés. We deduct the amount that reflects the access time used by a customer when the customer’s IC card is inserted into the IC card slot on the computer.

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The internet cafés are generally open 24 hours, 7 days a week.

As of March 31, 2010, we had 312 employees.

Our Industry

Background on Internet Cafés in China

Internet cafés have been booming in China in the recent years. According to the "Survey of China Internet Café Industry" by the Ministry of Culture in 2005, China had 110,000 internet cafés, with more than 1,000,000 employees and contributing RMB 18,500,000,000 to China's GDP. According to an article entitled “China Surpasses U.S. in Number of Internet Users” written by David Barboza in the New York Times July 26, 2008 issue, the number of internet users in the China reached about 253 million in June 2008, thereby, putting China ahead of the United States as the world’s biggest internet market. Within the Chinese internet market, internet cafés have been a fast growing segment.

The internet café market in China, like most places worldwide, originally started out as simply a location to access the internet. However, China’s cafés have changed into full service entertainment centers where people can relax outside work and home. These cafés provide services that are vastly different from the internet cafés initially established in China. They provide decent facilities at a reasonable fee, with specific configuration for online games and audio visual entertainment. They are a source of cost effective entertainment for low-income earners who cannot afford computers, game consoles or an internet connection, such as migrant workers and students. In internet cafés, customers have access to popular online games and can either socialize or entertain themselves. Players gather together in internet cafés for games such as World of Warcraft (WOW), and Call to Arms played either with their friends in the café or with users across the globe.

After tightened regulations on the operations of internet cafés, there are currently around 81,000 internet cafés in China. (Source: “Internet cafe ban call draws Chinese hacker wrath”. AFP 3 Mar 2010. http://www.google.com/hostednews/afp/article/ALeqM5gJus4tWVAaeWI8IoS-n238PYpFjw) The largest chain has over 1,000 locations. There are currently 10 chains which have licenses to operate nationally.

Computer Gaming Industry in China

According to Pearl Research, a business intelligence and consulting firm, China’s online game market rose 63% in 2008 to $2.8 billion. Given the relatively low rate of computer ownership in China as compared to Western countries, internet cafés have become the primary distribution point for games in China. A substantial number of game players access online games through internet cafés and these players are crucial for survival of internet cafés. The chart below shows the robust revenue growth of online game companies from 2003 to 2009.

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The following diagram prepared by Morgan Stanley depicts the interdependent relations between online game developers and internet cafés. (Source: Ji, Richard and Meeker, Mary. "Creating Consumer Value in Digital China" Morgan Stanley Equity Research Global. September 12, 2005.)

Given the pivotal position of internet cafés, many online game companies have been making great efforts to support internet cafés to expand their customer base.

Partnerships between Internet Cafés and Other Online Information Providers

Besides games, internet cafés are able to develop partnerships with other online information providers. These companies provide games as well as other information services. As can seen by the chart below, these providers have significant revenues and profits.

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Table 1 Major Internet Internet Company Revenues

		% of Revenue
Company	2009 Q1 Revenue Million US$	Mobile Value-Added Service (MVAS)	Gaming / Internet Value-Added Service (IVAS)	Advertising	Operating Margin
Sohu	$84.4	10%	49%	41%	40%
Baidu	$81.9	–	–	100%	27%
Sina	$71.3	33%	–	67%	19%
Shanda	$111	–	97%	3%	40%
NetEase	$93	–	86%	14%	63%
Tencent	$204.1	20%	70%	10%	51%
Total	$646	11%	58%	31%	40%

(Source: I2I Group. “Social Media Opportunities.” October 2009. Online PowerPoint. http://www.i2i-m.com/downloads/Handbook%20of%20Social%20Media%20in%20China%202.ppt.)

Our Competitive Strengths

We believe that the following strengths enable us to compete effectively in and to capitalize on growth in the internet café market in China:

• Company-owned Cafés. Unlike most of our competitors who franchise their internet cafés, all of our cafés are direct outlets. This model makes it easier to carry out management decisions at each of our cafés. It also allows us to maximize operating profit and create a consistent name brand.

• Good Scale of Operation. We have registered capital of RMB 10 million (approximately $1.47 million) with 28 cafés. The scale of operations allows us to control cost and standardize store management.

• Proprietary Software. We developed the software “SAFLASH” that provides fast and stable internet connections. Its automatic flow control prevents users from being disconnected when there is a disruption of internet traffic. Stability is a key requirement for online gamers. Our R&D team is working constantly to improve the software.

• Government and Industry Relations. We have developed excellent working relationship with the government that has assisted us to better comply with internet café related laws and regulations and to understand regulatory trends in our industry. Our CEO Dishan Guo is the executive president of Shenzhen Longgang District Internet Industry Association. This association is an associated department of the Ministry of Culture and sets the internet café industry standards. As a result of his involvement, Mr. Guo gains valuable insight into new standards and may also have the opportunity to influence industry standards.

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• Centralized Oversight. All of our cafe managers are trained by, and under the supervision of, our centralized operations manager, who is based at our headquarters. As a result, our local managers are able to effectively handle operational issues at the cafés. The local managers are trained to provide a service level that meets Junlong’s service standards, and our operations manager is able to effectively enforce policies and procedures implemented by us.

Our Growth Strategy

We are committed to enhancing our sales, profitability and cash flows through the following strategies:

• We will seek to grow by business expansion. We plan to expand in the southwest and mid-east regions of China through acquisitions of local small chains, in order to meet the requirements of applying for a national chain license. The national chain license requires 30 internet cafes in 3 provinces.  We plan to accomplish acquisitions of internet cafes in Guizhou in the third quarter, and Sichuan in quarter 4 in order to help us satisfy the requirements of obtaining a national chain license.   We also want to fully develop our wholly-owned branches through effective integration of resources. Most of our current competitors that offer franchising simply provide a franchise license to entrepreneurs to get started in exchange for a yearly fee.  Junlong, on the other hand,  is deeply involved in the operational management of its company-owned cafes. After we obtain a national chain license, we will focus on developing high-end internet cafes in the more developed cities to create new concepts of internet café operation.  We expect to spread to the less developed cities in three years in order to gain competitive market shares. We plan to put 20% of our resources to the less developed cities for market integration after we are granted a national license, which will effectively lay the foundation for us in those cities.

• We will seek to grow by improving our company structure. To optimize our resources and operations, we plan to improve our company structure so that 20% of our internet cafés will be large stores each with 300 or more computers mainly focusing on movies, high-end games and entertainment; 50% of cafés will be medium stores with 150 to 300 computers and a few movie suites focusing on high-end games; 10% of cafés will be small stores in the developed cities to spread our reputation with 100 to 150 computers. In order to penetrate the less developed cities, we want to open 20% of our stores in those cities. Our mission is to set up internet cafés all over China to become a real national chain and the industry leader.

• We will seek to grow by location selection. Internet café is a retail business. Internet cafes are located in highly populated areas so as to attract customers. Junlong’s internet cafes are located at busy and well attended areas such as industrial zones and business quarters. We have conducted market research in Sichuan, Guizhou, Yunan provinces and Chonqing municipalities in March. As a result of this market research, we have identified the university areas in Sichuan and Chongqing, the residential areas and business quarters in Yunan and Guizhou as prime areas for the establishment of internet cafes. Our future expansion in the south-western region will built on the basis of these locations.

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Use of Prepaid IC Cards

Internet café members purchase prepaid IC cards which include stored value that will be deducted based on time usage of computer at the internet café. The cards are only sold at our cafés. We deduct from the stored value amount to reflect customer usage when the customers’ IC cards are inserted into the IC card slot on the computer. Revenues derived from the prepaid IC cards at the internet café are recognized when services are provided. Below is our IC card sample.

Outstanding customer balances on the IC cards are included in deferred revenue on the balance sheets. The Company does not charge any service fees that cause a decrease in customer balances.

The basic membership comes with the IC card and costs RMB 10 (approximately $1.47) on top of the initial credits deposited. Members receive a discount (e.g. RMB 50 (approximately $7.35) deposit  gets RMB 60 (approximately $8.82) credit in the IC card). There is no expiration date for IC cards, but money deposited into the IC cards is not refundable.

Revenues from computer usage for the fiscal years ended December 31, 2009 and 2008 were $14,038,931 and $10,107,823, respectively.

Software on the Computers

We have on average 250 computers in each location and a total of 6,339 computers for the 28 cafés. We install more than 100 online games on each of our computers. We also provide movies, music and online chatting software. We use Microsoft Word compatible software called “WPS” which is a freeware provided by Kingsoft, a Chinese software company, so that we do not pay for the much higher priced Microsoft Office license

Third Party Gaming Cards, Snacks and Drinks

We also sell third party on-line gaming cards, snacks and drinks. The commission for the sale of gaming cards is generally 20% of the value of the cards. Concessions (snacks and drinks) are also sold to customers. Revenue from concession sales amounted to less than 1% of our total revenue in fiscal years 2008 and 2009.

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New products or services

We are considering opening more “luxury” cafes in the future to meet the needs of high income groups. This strategy is only in the planning stage. Further, although this is potentially a very interesting marketing and branding tool, we do not expect these locations to significantly increase our overall revenues.

Franchising

We own all of our cafes.  However, beginning in 2012 we expect to utilize a modified franchise model in addition to owning our own cafes.  We expect that our franchisees will pay the start up costs for a new internet café.   After the initial investment, we will select the location and provide intensive training and staff to run the café.   Once the café becomes operational, our employees will run the café and provide management support.  We expect the franchisee to be more akin to an investor than an owner/operator.  We will pay the franchisee a percentage of the café’s profit for providing the funds necessary to open the  café and operate it.

Our Customers

Our customers are individuals who come into the location to surf the internet and/or play online games with their friends locally and remotely with individuals around the world.

Internet café users are mainly young males with low incomes, mainly migrant workers. At our cafés migrant workers are provided a convenient channel at low cost to communicate with their families and friends. For example, VOIP (Voice over IP) service at the café is much cheaper than any other telecommunications method. Low income earners can arrange a time to chat online with their friends and families in their home cities.

We estimate that at our internet café approximately 50% of computer time is spent on gaming, 30% for other entertainment (e.g. online chatting, online movies, or online music); and 20% for other purpose (e.g work).

In the last few years there has been a decrease in the number of internet café users as a result of increased availability of internet connections at home. However, we believe that we will be able to maintain organic growth by providing quality services to our core customers. Even if someone has internet access in their home or dormitory, these locations do not provide the atmosphere and services provided by internet cafés at a reasonable cost. For example, if a computer is set up in the limited space of a dormitory, an additional internet connection would need to be purchased. A computer suitable for online gaming costs RMB 5,000 (approximately $735.29) or more. The monthly rent for an ADSL connection costs an additional RMB 100 (approximately $14.71) and even this may not be good enough for some online games such as WOW. In these types of games, there is a very important play mode called RAID, where, for example, 40 people are needed on a team to kill some monster in the dungeon. This requires all players to have very stable internet connections. A typical low-end computer and ADSL connection would suffer significant lags and cause performance issues. Internet cafés, on the other hand, can provide high speed computers and internet connections at much lower cost to the players.

Our future plans are to open internet cafés around university areas in the south-western provinces. Students spend more time in internet cafés because their time is very flexible. We believe that major users of internet cafés in the future will be young game players.

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Competition

There are approximately 168,000 Internet cafés in China in 2009. (Source: http://www.ai-media.cn/chinastats.htm (accessed March 23, 2010) The market is extremely fragmented. One of the largest national chains which has around 1,000 locations only has less than 2% of the national market. The following describes some of the local, regional and national competitors.

Local Competitors in Shenzhen

• Shenzhen Weiwo internet café Chain Company. Weiwo was founded in 1997. Currently, Weiwo has 14 cafés. The company mainly operates a franchise model, with only 3 company owned cafés. The cafés are mainly located in Futian district, Shenzhen City. The company concentrates on mid-range market. Each café is relatively small with 100 to150 computers (for a total of around 1,600 computers). Its franchised stores are charged a franchising fee per month of approximately RMB 5,000 (approximately $735.29). Weiwo is the smallest internet café chain company in Shenzhen.

• Shenzhen Bian Internet Co. Ltd. Although the company entered into the internet café industry in 2003, its current structure was founded on February 22, 2007 and obtained its regional internet café chain license in 2007. The company operates mostly as a franchise model with 26 registered café, only 3 of which are directly owned by the company. Each café has 80-150 computers. It also has a few large cafés with more than 200 computers. The estimated total number of computers owned by the company is 4,000. There is a significant turnover in franchise ownership with around one third of the franchise cafés transferring their licenses to other internet café owners.

• Quansu Internet Café Chain Company. Quansu was founded in 1998 as a subsidiary investment project of the Shenzhen Commercial Bank Investment Co. Ltd. The company owns 36 cafés, 8 of which are directly owned and 28 of which are franchises. Each café has 80-150 computers. The total number of computers is approximately 6,000. The cafés are located in Baoan District, Futian District and Luohu District. In May 2009, Quansu switched its major business towards its internet cable connection business and public telephone business.

National Competitors

Currently there are ten national internet café chains:

• Zhongqing Network Home Co., Ltd.

• Beijing Cultural Development Co., Ltd.

• China Digital Library Co., Ltd.

• Yalian Telecommunication Network Co., Ltd.

• China Heritage Information Center

• Capital Networks Limited

• Great Wall Broadband Network Service Co., Ltd.

• China United Telecommunications Co., Ltd. (China Unicom)

• CLP Chinese Tong Communication Co., Ltd.

• Reid Investment Holding Company

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The 10 national chains generally have strong financial support. However, to our knowledge these chains have not been successful in expanding their operations.

Competitors in Potential Markets

As we plan to expand our operations in other major cities, we identify the following competitors in the potential new markets where we expect to operate in the future:

• Kunming – Yunnan Jin-Zhao Yuan Culture Communication Network Co., Ltd. The company was founded on May 1, 2003 by the Yunnan Provincial Department of Culture. It obtained its business license and registration to operate a chain of Internet cafés from the Industrial and Commercial Bureau of Yunnan Province on April 31, 2004. It has a registered capital of RMB 10 million. The company has opened approximately 15 cafés with an average of 200 computers in each café and a total of nearly 3,000 computers.

• Chengdu – Chengdu Shang Dynasty Networks Co., Ltd. The company was founded in 2002 with a registered capital of RMB 12 million. It would be most accurately described as a multifunctional entertainment facility with coffee bars and multi-function rooms. Its facilities have full range of digital entertainment including hardware and software products, and professional e-sport training. The company has four wholly owned cafés, and has more than 20,000 registered members.

Intellectual Property

Trademark

Junlong owns the trademark Junlong, as specified in the Registration Certificate No. 4723040 issued by the Trademark Office under the State Administration of Industry and Commerce of the PRC. The registration is valid from January 28, 2009 to January 27, 2019.

Domain Name

We own and currently utilize the domain name, www.cnculture.com.cn. We have recently also acquired the domain name www.chinainternetcafe.com, which we believe better reflects our business.  We will transition from our old domain name to our new one during the third quarter of 2010.

Software

The main piece of intellectual property for Junlong is the SAFLASH software. This software, developed on a Microsoft Windows platform, increases internet connection stability. Its automatic flow control prevents users from being disconnected when there is a disruption in internet traffic. The stability is a key requirement for online gamers.

Although there are no patents or copyrights for this software, it is only used internally on our computer systems and is not available for download. We also entered into a confidentiality agreement with the IT manager Zhenfan Li whose team developed this software. Our competitive advantage lies in continually updating SAFLASH to assure internet connection stability.

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Regulation

Because our controlled VIE is located in the PRC, we are regulated by the national and local laws of the PRC.

In 2001, the Chinese government imposed a minimum capital requirement of RMB 10 million (approximately $1.47 million) for regional café chains and RMB 50 million (approximately $7.35 million) for national café chains. On September 29, 2002, Ministry of Information Industry, Ministry of Public Security, Ministry of Culture and State Administration for Commerce and Industry issued “Regulations on the Administration of Business Sites of Internet Access Services.” The regulations require a license to operate internet cafés which may not be assigned or leased to any third parties. The regulations also have detailed provisions regarding internet cafés’ business operations and security control.

We have been in compliance of these regulations. In August 2004, we increased our registered capital to RMB 10 million (approximately $1.46 million). In 2005, Junlong obtained internet café licenses of operating internet café chain in Shenzhen from the local counterpart of Ministry of Culture.

The Ministry of Cultural of China is in charge of regulating national internet café chains. To obtain a license to operate a national internet café chain, an applicant must, among other things, (i) a minimum registered capital of RMB 50 million, (ii) own or control at least 30 internet cafés, which shall cover at least three provinces or municipalities under direct administration of the State Council, and (iii) have been in full compliance with administrative regulations with respect to internet cafés for at least one year before submitting the application. Other requirements include having appropriate computer and ancillary facilities, necessary and qualified personnel and sound internal policy. Application for a national internet café chain shall be first made to the provincial counterpart of the Ministry of Cultural. After preliminary approval, the provincial authority will submit the application to the Ministry of Culture for final approval. In rendering its approval, the authorities consider such factors as the then existing number of the internet café chains.

We are subject to China's foreign currency regulations. The PRC government has controlled Renminbi reserves primarily through direct regulation of the conversion of Renminbi into other foreign currencies. Although foreign currencies, which are required for “current account” transactions, can be bought at authorized PRC banks, the proper procedural requirements prescribed by PRC law must be met. At the same time, PRC companies are also required to sell their foreign exchange earnings to authorized PRC banks, and the purchase of foreign currencies for capital account transactions still requires prior approval of the PRC government.

Under current PRC laws and regulations, Foreign Invested Entities, or FIEs, may pay dividends only out of their accumulated after-tax profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, FIEs in China are required to set aside at least 10.0% of their after-tax profit based on PRC accounting standards each year to their general reserves until the cumulative amount of such reserves reaches 50.0% of their registered capital. These reserves are not distributable as cash dividends. The board of directors of an FIE has the discretion to allocate a portion of the FIEs’ after-tax profits to staff welfare and bonus funds, which may not be distributed to equity owners except in the event of liquidation.

Our Employees

As of March 31, 2010, we employed a total of 312 full-time employees. The following table sets forth the number of employees by function:

Function	Number of
	Employees
Senior Management	35
Accounting	5
Staff employees	272
Total	312

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As required by applicable PRC law, we have entered into employment contracts with most of our officers, managers and employees. We are working towards entering employment contracts with those employees who do not currently have employment contracts with us. We believe that we maintain a satisfactory working relationship with our employees, and we have not experienced any significant disputes or any difficulty in recruiting staff for our operations.

Litigation

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. We are currently not a party to any legal proceeding and are not aware of any legal claims that we believe will have a material adverse affect on our business, financial condition or operating results.

RISK FACTORS

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below, together with all of the other information included in this report, before making an investment decision. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment.

RISKS RELATED TO OUR BUSINESS

Our limited operating history makes evaluating our business and prospects difficult.

Our VIE Junlong was established in December 2003 and obtained the license to operate internet cafés in Shenzhen in 2005. Our limited operating history may not provide a meaningful basis for you to evaluate our business and prospects. Our business strategy has not been proven over time and we cannot be certain that we will be able to successfully expand our business.

You should also consider additional risks and uncertainties that may be experienced by early stage companies operating in a rapidly developing and evolving industry.

We are dependent on our management team and the loss of any key member of that team could have a material adverse effect on our operations and financial condition.

We attribute our success to the leadership and contributions of our managing team comprising executive directors and key executives, in particular, to our Chief Executive Officer, Dishan Guo and our Chief Technology Officer Zhenfan Li.

Our continued success is therefore dependent to a large extent on our ability to retain the services of these key management personnel. The loss of their services without timely and qualified replacement, will adversely affect our operations and hence, our revenue and profits. The loss of the services of Dishan Guo and Zhenfan Li in particular, will have an adverse impact on our performance.

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We have not obtained social insurance benefits for all of our employees and could incur administrative fines and penalties that could materially affect our financial condition and reputation.

We have obtained social benefits coverage for employees who work at the headquarters of Junlong. For other employees, because of the high mobility of their work, they usually work on a probationary basis and will not enter into a long employment relationship with us. We are subject to administrative fines and penalties as a result of our failure to obtain social insurance for these employees. The amount of these fines and penalties, in the aggregate, may adversely affect our financial condition and our public image.

Tightened regulations on internet cafés may adversely affect our operations and revenues.

The Chinese government has been tough on internet café regulations. In 2003, the Chinese government imposed a minimum capital requirement of RMB 10 million (approximately $1.47 million) for regional café chains and RMB 50 million (approximately $7.32 million) for national café chains. On September 29, 2002, the State Council issued “Regulations on the Administration of Business Sites of Internet Access Services.” The regulations require a license to operate internet cafés which may not be assigned or leased to any third parties. The regulations also have detailed provisions regarding internet cafés’ business operations and security control. These regulations reduced the number of internet cafés.

If the Chinese government decided to impose more stringent regulations on internet cafés and their operations, our business may be adversely affected and our revenues may decrease as a result.

There may be reduced use of internet cafés with the increase in computer ownership and internet connections at home and any such reduction would negatively affect our financial performance.

With the rapid economic development and growing disposable income, computer ownership and internet connections at home will gradually increase. Although internet cafés provide easy access to the latest games, movies and music, fast and stable internet connections and a sense of community, there is no guarantee that individuals will continue to use internet cafés when they can have internet access at home.

Negative media coverage of internet cafés may reduce the number of customers that visit our internet cafes and result in lower revenues.

In the last few years there have been several negative stories in the media about internet cafes. A fatal fire in Beijing's Lanjisu Internet café in June 2002 raised nationwide concern about the country’s burgeoning internet café business. In 2006, a report from the China National Children's Center, a government think-tank, said that 13 percent of China's 18 million internet users under 18 were internet addicts. Responding to the problems associated with internet cafés, China imposed more stringent laws and regulations on internet cafés. In 2007, fearful of soaring internet addiction and juvenile crime, China banned the opening of new internet cafes for a year. Such negative media coverage may result in stricter government regulations and reduced number of customers.

We may be unable to adequately safeguard our intellectual property or we may face claims that may be costly to resolve or that limit our ability to use such intellectual property in the future.

Our business is reliant on our intellectual property. Our software SAFLASH is the result of our research and development efforts, which we believe to be proprietary and unique. However, we are unable to assure you that third parties will not assert infringement claims against us in respect of our intellectual property or that such claims will not be successful. It may be difficult for us to establish or protect our intellectual property against such third parties and we could incur substantial costs and diversion of management resources in defending any claims relating to proprietary rights. If any party succeeds in asserting a claim against us relating to the disputed intellectual property, we may need to obtain licenses to continue to use the same. We cannot assure you that we will be able to obtain these licenses on commercially reasonable terms, if at all. The failure to obtain the necessary licenses or other rights could cause our business results to suffer.

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Further, we rely upon a combination of trade secrets, non-disclosure and other contractual agreements with our employees as well as limitation of access to and distribution of our intellectual property in our efforts to protect intellectual property. However, our efforts in this regard may be inadequate to deter misappropriation of our proprietary information or we may be unable to detect unauthorized use and take appropriate steps to enforce our rights. Policing unauthorized use of our intellectual property is difficult and there can be no assurance that the steps taken by us will prevent misappropriation of our intellectual property.

Where litigation is necessary to safeguard our intellectual property, or to determine the validity and scope of the proprietary rights of others, this could result in substantial costs and diversion of our resources and could have a material adverse effect on our business, financial condition, operating results or future prospects.

We may not have sufficient insurance coverage and an interruption of our business or loss of a significant amount of property could have a material adverse effect on our financial condition and operations.

We currently do not maintain any insurance policies against loss of key personnel and business interruption as well as product liability claims. If such events were to occur, our business, financial performance and financial position may be materially and adversely affected.

Inability to maintain our competitiveness would adversely affect our financial performance.

We operate in a competitive environment and face competition from existing competitors and new market entrants. Some of these existing competitors, especially the national chains of internet cafés have more resources than us and may provide better services to customers.

There is no assurance that we will be able to compete successfully in the future. Any failure by us to remain competitive would adversely affect our financial performance.

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We may be adversely affected by a significant or prolonged economic downturn in the level of consumer spending in the industries and markets served by our customers.

We rely on the spending of our customers in our cafés for our revenues, which may in turn depend on the customers’ level of disposable income, perceived future earning capabilities and willingness to spend. Any significant or prolonged decline of the PRC economy or economy of such markets served by our customers will affect consumers’ disposable income and consumer spending in these markets, and lead to a decrease in demand for consumer products.

To the extent that such decrease in demand for consumer products translates into a decline in the demand for internet café services, our performance will be adversely affected.

Revocation or failure to renew the license for operating internet café chain will adversely affect our business.

We hold a license for operating a regional internet café chain in Shenzhen and each of our internet cafés obtains a license for the internet access services. These licenses are currently valid and are renewable at the end of its term by application to the relevant authorities.

If any license is revoked or suspended or we are unable to renew the licenses for any reason, our business operations and correspondingly, our financial performance, would be adversely affected.

We may be unable to effectively manage our expansion.

We have identified several growth plans. These expansion plans may strain our financial resources. They may also overstretch our management personnel and require us to restructure our management structure.

If we are unable to successfully manage our expansion, we may encounter operational and financial difficulties which would in turn adversely affect our business and financial results.

We may require additional funding for our growth plans, and such funding may result in a dilution of your investment.

We attempted to estimate our funding requirements in order to implement our growth plans.

If the costs of implementing such plans should exceed these estimates significantly or if we come across opportunities to grow through expansion plans which cannot be predicted at this time, and our funds generated from our operations prove insufficient for such purposes, we may need to raise additional funds to meet these funding requirements.

These additional funds may be raised by issuing equity or debt securities or by borrowing from banks or other resources. We cannot assure you that we will be able to obtain any additional financing on terms that are acceptable to us, or at all. If we fail to obtain additional financing on terms that are acceptable to us, we will not be able to implement such plans fully. Such financing even if obtained, may be accompanied by conditions that limit our ability to pay dividends or require us to seek lenders’ consent for payment of dividends, or restrict our freedom to operate our business by requiring lender’s consent for certain corporate actions.

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Further, if we raise additional funds by way of a rights offering or through the issuance of new shares, any shareholders who are unable or unwilling to participate in such an additional round of fund raising may suffer dilution in their investment.

We may be exposed to potential risks relating to our internal controls over financial reporting and our ability to have those controls attested to by our independent auditors.

As directed by Section 404 of the Sarbanes-Oxley Act of 2002, or SOX 404, the SEC adopted rules requiring public companies to include a report of management on the company’s internal controls over financial reporting in their annual reports, including Form 10-K. In addition, the independent registered public accounting firm auditing a company's financial statements must also attest to and report on the operating effectiveness of the company’s internal controls. We were not subject to these requirements for the fiscal year ended December 31, 2009; accordingly, we have not evaluated our internal control systems in order to allow our management to report on, and our independent auditors to attest to, our internal controls as required by these requirements of SOX 404. Under current law, we will be subject to these requirements beginning with our annual report for the fiscal year ending December 31, 2010. We can provide no assurance that we will comply with all of the requirements imposed thereby. There can be no assurance that we will receive a positive attestation from our independent auditors. In the event we identify significant deficiencies or material weaknesses in our internal controls that we cannot remediate in a timely manner or we are unable to receive a positive attestation from our independent auditors with respect to our internal controls, investors and others may lose confidence in the reliability of our financial statements.

Our holding company structure may limit the payment of dividends.

We have no direct business operations, other than our ownership of our subsidiaries and contractual relationship with Junlong. While we have no current intention of paying dividends, should we decide in the future to do so, as a holding company, our ability to pay dividends and meet other obligations depends upon the receipt of dividends or other payments from our operating subsidiaries and other holdings and investments. In addition, our operating subsidiaries, from time to time, may be subject to restrictions on their ability to make distributions to us, including as a result of restrictive covenants in loan agreements, restrictions on the conversion of local currency into U.S. dollars or other hard currency and other regulatory restrictions as discussed below. If future dividends are paid in RMB, fluctuations in the exchange rate for the conversion of RMB into U.S. dollars may reduce the amount received by U.S. stockholders upon conversion of the dividend payment into U.S. dollars. Further, dividends paid to non-PRC stockholders may be subject to a 10% withholding, as further discussed under “Risk Factors – Under the EIT Law, we may be classified as a ‘resident enterprise’ of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.”

Chinese regulations currently permit the payment of dividends only out of accumulated profits as determined in accordance with Chinese accounting standards and regulations. Our subsidiaries in China are also required to set aside a portion of their after tax profits according to Chinese accounting standards and regulations to fund certain reserve funds. Currently, our subsidiaries in China are the only sources of revenues or investment holdings for the payment of dividends. If they do not accumulate sufficient profits under Chinese accounting standards and regulations to first fund certain reserve funds as required by Chinese accounting standards, we will be unable to pay any dividends.

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RISKS RELATING TO OUR COMMERCIAL RELATIONSHIP WITH JUNLONG

Our contractual arrangements with Junlong and its shareholders may not be as effective in providing control over them as direct ownership.

We rely on contractual arrangements with our VIE and its shareholders to operate our business. For a description of these contractual arrangements, see “Corporate structure”. In the opinion of our PRC legal counsel, China Commercial Law Firm, these contractual arrangements are valid, binding and enforceable, and will not result in any violation of PRC laws or regulations currently in effect. These contractual arrangements may not be as effective in providing us with control over these entities as direct ownership. If we had direct ownership of these entities, we would be able to exercise our rights as a shareholder to effect changes in the boards of directors of these entities, which in turn could effect changes, subject to any applicable fiduciary obligations, at the management level. However, if Junlong or any of its shareholders fails to perform its or his respective obligations under these contractual arrangements, we may not be able to enforce the relevant agreements. If the agreements are ruled in violation of the PRC laws, even if the contracts are otherwise legal and valid, we may not be able to enforce our rights under these contracts. We may have to incur substantial costs and resources to enforce them, and seek legal remedies under PRC law, including specific performance or injunctive relief, and claiming damages, which may not be effective. Accordingly, it may be difficult for us to change our corporate structure or to bring claims against any of these entities if they do not perform their obligations under their contracts with us.

All of our revenues are generated through our VIE, and we rely on payments made by our VIE to Zhonghefangda, our subsidiary, pursuant to contractual arrangements to transfer any such revenues to Zhonghefangda. Any restriction on such payments and any increase in the amount of PRC taxes applicable to such payments may materially and adversely affect our business and our ability to pay dividends to our shareholders.

We conduct substantially all of our operations through Junlong, our VIE, which generates all of our revenues. As Junlong is not owned by our subsidiary, it is not able to make dividend payments to our subsidiary. Instead, Zhonghefangda, our subsidiary in China, entered into a number of contracts with Junlong, including Management and Consulting Services Agreement, Equity Pledge Agreement, Option Agreement and Voting Rights Proxy Agreement, pursuant to which Junlong pays Zhonghefangda for certain services that Zhonghefangda provides to Junlong. However, depending on the nature of services provided, certain of these payments are subject to PRC taxes at different rates, including business taxes and VATs, which effectively reduce the amount that Zhonghefangda receives from Junlong. We cannot assure you that the PRC government will not impose restrictions on such payments or change the tax rates applicable to such payments. Any such restrictions on such payment or increases in the applicable tax rates may materially and adversely affect our ability to receive payments from Junlong or the amount of such payments, and may in turn materially and adversely affect our business, our net income and our ability to pay dividends to our shareholders.

Dishan Guo’s association with Junlong could pose a conflict of interest which may result in Junlong decisions that are adverse to our business.

Dishan Guo, Jinzhou Zeng and Xiaofen Wang, who hold controlling interest in Classic Bond are also controlling shareholders of our VIE. Conflicts of interests between their dual roles as owners of both Junlong and our company may arise. We cannot assure you that when conflicts of interest arise, any or all of these individuals will act in the best interests of our company or that any conflict of interest will be resolved in our favor. In addition, these individuals may breach or cause Junlong to breach or refuse to renew the existing contractual arrangements, which will have a material adverse effect on our ability to effectively control Junlong and receive economic benefits from it. If we cannot resolve any conflicts of interest or disputes between us and the beneficial owners of Junlong, we would have to rely on legal proceedings, the outcome of which is uncertain and which could be disruptive to our business.

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If Junlong or the VIE Shareholders violate our contractual arrangements with it, our business could be disrupted and we may have to resort to litigation to enforce our rights which may be time consuming and expensive.

Our operations are currently dependent upon our commercial relationship with Junlong. If Junlong or their shareholders are unwilling or unable to perform their obligations under our commercial arrangements with them, including payment of revenues under the Management and Consulting Service Agreement, we will not be able to conduct our operations in the manner currently planned.

If the PRC government determines that the agreements establishing the structure for operating our China business do not comply with applicable PRC laws, rules and regulations, we could be subject to severe penalties including being prohibited from continuing our operations in the PRC.

On August 9, 2006, six PRC regulatory agencies, including the CSRC, promulgated the Regulation on Mergers and Acquisitions of Domestic Companies by Foreign Investors, which became effective on September 8, 2006 (the “2006 M&A Rules”). This new regulation, among other things, governs the approval process by which a PRC company may participate in an acquisition of assets or equity interests. In the opinion of our PRC counsel, China Commercial Law Firm, this approval process was not required in our case because we have not acquired either the equity or assets of a company located in the PRC, and that the VIE agreements do not constitute such an acquisition. If the PRC government were to take a contrary view, we might be subject to fines or other enforcement action, and might be forced to amend or terminate our contractual arrangements with Junlong, which could have an adverse effect on our business.

The 2006 M&A Rules also contain provisions requiring offshore special purpose vehicles, or SPVs, formed for the purpose of acquiring PRC domestic companies and controlled by PRC individuals, to obtain the approval of the CSRC prior to listing their securities on an overseas stock exchange. In the opinion of our PRC counsel, China Commercial Law Firm, CSRC’s approval was not required for our offering of securities since we are not an SPV as defined in the Rules, nor have we acquired a PRC domestic company. However, there remains some uncertainty as to how this regulation will be interpreted or implemented. If the CSRC or another PRC regulatory agency subsequently determines that its approval was required, we may face sanctions by the CSRC or another PRC regulatory agency or other actions which could have an adverse effect on our business.

Uncertainties in the PRC legal system may impede our ability to enforce the commercial agreements that we have entered into with Junlong or any arbitral award thereunder and any inability to enforce these agreements could materially and adversely affect our business and operation.

While disputes under the Consulting Agreement with Junlong is subject to binding arbitration before the China International Economic and Trade Arbitration Commission, or CIETAC, in accordance with CIETAC Arbitration Rules, the agreements are governed by PRC law and an arbitration award may be challenged in accordance with PRC law. For example, a claim that the enforcement of an award in our favor will be detrimental to the public interest, or that an issue does not fall within the scope of the arbitration would require us to engage in administrative and judicial proceedings to defend an award. China’s legal system is a civil law system based on written statutes and unlike common law systems, it is a system in which decided legal cases have little value as precedent. As a result, China’s administrative and judicial authorities have significant discretion in interpreting and implementing statutory and contractual terms, and it may be more difficult to evaluate the outcome of administrative and judicial proceedings and the level of legal protection available than in more developed legal systems. These uncertainties may impede our ability to enforce the terms of the Consulting Agreement and the other contracts that we may enter into with Junlong. Any inability to enforce the Consulting Agreement or an award thereunder could materially and adversely affect our business and operation.

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Our arrangements with Junlong and the VIE Shareholders may be subject to a transfer pricing adjustment by the PRC tax authorities which could have an adverse effect on our income and expenses.

We could face material and adverse tax consequences if the PRC tax authorities determine that our contracts with Junlong and the VIE Shareholders were not entered into based on arm’s length negotiations. Although our contractual arrangements are similar to other companies conducting similar operations in China, if the PRC tax authorities determine that these contracts were not entered into on an arm’s length basis, they may adjust our income and expenses for PRC tax purposes in the form of a transfer pricing adjustment. Such an adjustment may require that we pay additional PRC taxes plus applicable penalties and interest, if any.

RISKS RELATED TO DOING BUSINESS IN CHINA

We may be exposed to liabilities under the Foreign Corrupt Practices Act and Chinese anti-corruption law, and any determination that we violated such laws could hurt our business.

We are subject to the Foreign Corrupt Practice Act, or FCPA, and other laws that prohibit improper payments or offers of payments to foreign governments and their officials and political parties by U.S. persons and issuers as defined by the statute for the purpose of obtaining or retaining business. We are also subject to Chinese anti-corrpution laws, which strictly prohibits bribery. We have operations, agreements with third parties and make sales in China, which may experience corruption. Our activities in China create the risk of unauthorized payments or offers of payments by one of the employees, consultants, sales agents or distributors of our Company, even though these parties are not always subject to our control. It is our policy to implement safeguards to discourage these practices by our employees. However, our existing safeguards and any future improvements may prove to be less than effective, and the employees, consultants, sales agents or distributors of our Company may engage in conduct for which we might be held responsible. Violations of the FCPA or Chinese anti-corruption law may result in severe criminal or civil sanctions, and we may be subject to other liabilities, which could negatively affect our business, operating results and financial condition. In addition, the United States government may seek to hold our Company liable for successor liability FCPA violations committed by companies in which we invest or that we acquire.

Changes in China’s political or economic situation could harm us and our operating results.

Economic reforms adopted by the Chinese government have had a positive effect on the economic development of the country, but the government could change these economic reforms or any of the legal systems at any time. This could either benefit or damage our operations and profitability. Some of the things that could have this effect are:

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• Level of government involvement in the economy;

• Control of foreign exchange;

• Methods of allocating resources;

• Balance of payments position;

• International trade restrictions; and

• International conflict.

The Chinese economy differs from the economies of most countries belonging to the Organization for Economic Cooperation and Development, or OECD, in many ways. For example, state-owned enterprises still constitute a large portion of the Chinese economy and weak corporate governance and a lack of flexible currency exchange policy still prevail in China. As a result of these differences, we may not develop in the same way or at the same rate as might be expected if the Chinese economy was similar to those of the OECD member countries.

Our business is largely subject to the uncertain legal environment in China and your legal protection could be limited.

The Chinese legal system is a civil law system based on written statutes. Unlike common law systems, it is a system in which precedents set in earlier legal cases are not generally used. The overall effect of legislation enacted over the past 20 years has been to enhance the legal protections afforded to foreign invested enterprises in China. However, these laws, regulations and legal requirements are relatively recent and are evolving rapidly, and their interpretation and enforcement involve uncertainties. These uncertainties could limit the legal protections available to foreign investors, such as the right of foreign invested enterprises to hold licenses and permits such as requisite business licenses. In addition, all of our executive officers and our directors are residents of China and not of the U.S., and substantially all the assets of these persons are located outside the U.S. As a result, it could be difficult for investors to effect service of process in the U.S., or to enforce a judgment obtained in the U.S. against our Chinese operations and our controlled VIE.

The Chinese government exerts substantial influence over the manner in which we must conduct our business activities.

China only recently has permitted provincial and local economic autonomy and private economic activities. The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, import and export tariffs, environmental regulations, land use rights, property and other matters. We believe that our operations in China are in material compliance with all applicable legal and regulatory requirements. However, the central or local governments of the jurisdictions in which we operate may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations.

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Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties or joint ventures.

Future inflation in China may inhibit our ability to conduct business in China.

In recent years, the Chinese economy has experienced periods of rapid expansion and highly fluctuating rates of inflation. During the past ten years, the rate of inflation in China has been as high as 20.7% and as low as - -2.2% . These factors have led to the adoption by the Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. High inflation may in the future cause the Chinese government to impose controls on credit and/or prices, or to take other action, which could inhibit economic activity in China, and thereby harm the market for our products and our company.

Restrictions on currency exchange may limit our ability to receive and use our revenues effectively.

The majority of our revenues will be settled in Renminbi and U.S. dollars, and any future restrictions on currency exchanges may limit our ability to use revenue generated in Renminbi to fund any future business activities outside China or to make dividend or other payments in U.S. dollars. Although the Chinese government introduced regulations in 1996 to allow greater convertibility of the Renminbi for current account transactions, significant restrictions still remain, including primarily the restriction that foreign-invested enterprises may only buy, sell or remit foreign currencies after providing valid commercial documents, at those banks in China authorized to conduct foreign exchange business. In addition, conversion of Renminbi for capital account items, including direct investment and loans, is subject to governmental approval in China, and companies are required to open and maintain separate foreign exchange accounts for capital account items. We cannot be certain that the Chinese regulatory authorities will not impose more stringent restrictions on the convertibility of the Renminbi.

Failure to comply with PRC regulations relating to the establishment of offshore special purpose companies by PRC residents may subject our PRC resident stockholders to personal liability, limit our ability to acquire PRC companies or to inject capital into our PRC controlled VIEs, limit our PRC controlled VIEs’ ability to distribute profits to us or otherwise materially adversely affect us.

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In October 2005, the PRC State Administration of Foreign Exchange, or SAFE, issued the Notice on Relevant Issues in the Foreign Exchange Control over Financing and Return Investment Through Special Purpose Companies by Residents Inside China, generally referred to as Circular 75, which required PRC residents to register with the competent local SAFE branch before establishing or acquiring control over an offshore special purpose company, or SPV, for the purpose of engaging in an equity financing outside of China on the strength of domestic PRC assets originally held by those residents. Internal implementing guidelines issued by SAFE, which became public in June 2007 (known as Notice 106), expanded the reach of Circular 75 by (i) purporting to cover the establishment or acquisition of control by PRC residents of offshore entities which merely acquire “control” over domestic companies or assets, even in the absence of legal ownership; (ii) adding requirements relating to the source of the PRC resident’s funds used to establish or acquire the offshore entity; (iii) covering the use of existing offshore entities for offshore financings; (iv) purporting to cover situations in which an offshore SPV establishes a new subsidiary in China or acquires an unrelated company or unrelated assets in China; and (v) making the domestic affiliate of the SPV responsible for the accuracy of certain documents which must be filed in connection with any such registration, notably, the business plan which describes the overseas financing and the use of proceeds. Amendments to registrations made under Circular 75 are required in connection with any increase or decrease of capital, transfer of shares, mergers and acquisitions, equity investment or creation of any security interest in any assets located in China to guarantee offshore obligations, and Notice 106 makes the offshore SPV jointly responsible for these filings. In the case of an SPV which was established, and which acquired a related domestic company or assets, before the implementation date of Circular 75, a retroactive SAFE registration was required to have been completed before March 31, 2006; this date was subsequently extended indefinitely by Notice 106, which also required that the Registrant establish that all foreign exchange transactions undertaken by the SPV and its affiliates were in compliance with applicable laws and regulations. Failure to comply with the requirements of Circular 75, as applied by SAFE in accordance with Notice 106, may result in fines and other penalties under PRC laws for evasion of applicable foreign exchange restrictions. Any such failure could also result in the SPV’s affiliates being impeded or prevented from distributing their profits and the proceeds from any reduction in capital, share transfer or liquidation to the SPV, or from engaging in other transfers of funds into or out of China.

We have asked our stockholders, who are PRC residents as defined in Circular 75, to register with the relevant branch of SAFE, as currently required, in connection with their equity interests in us and our acquisitions of equity interests in our PRC subsidiaries. However, we cannot provide any assurances that they can obtain the above SAFE registrations required by Circular 75 and Notice 106. Moreover, because of uncertainty over how Circular 75 will be interpreted and implemented, and how or whether SAFE will apply it to us, we cannot predict how it will affect our business operations or future strategies. For example, our present and prospective PRC subsidiaries' ability to conduct foreign exchange activities, such as the remittance of dividends and foreign currency-denominated borrowings, may be subject to compliance with Circular 75 and Notice 106 by our PRC resident beneficial holders. In addition, such PRC residents may not always be able to complete the necessary registration procedures required by Circular 75 and Notice 106. We also have little control over either our present or prospective direct or indirect stockholders or the outcome of such registration procedures. A failure by our PRC resident beneficial holders or future PRC resident stockholders to comply with Circular 75 and Notice 106, if SAFE requires it, could subject these PRC resident beneficial holders to fines or legal sanctions, restrict our overseas or cross-border investment activities, limit our subsidiaries' ability to make distributions or pay dividends or affect our ownership structure, which could adversely affect our business and prospects.

We may be unable to complete a business combination transaction efficiently or on favorable terms due to complicated merger and acquisition regulations which became effective on September 8, 2006.

On August 9, 2006, six PRC regulatory agencies, including the CSRC, promulgated the Regulation on Mergers and Acquisitions of Domestic Companies by Foreign Investors, which became effective on September 8, 2006. This new regulation, among other things, governs the approval process by which a PRC company may participate in an acquisition of assets or equity interests. Depending on the structure of the transaction, the new regulation will require the PRC parties to make a series of applications and supplemental applications to the government agencies. In some instances, the application process may require the presentation of economic data concerning a transaction, including appraisals of the target business and evaluations of the acquirer, which are designed to allow the government to assess the transaction. Government approvals will have expiration dates by which a transaction must be completed and reported to the government agencies. Compliance with the new regulations is likely to be more time consuming and expensive than in the past and the government can now exert more control over the combination of two businesses. Accordingly, due to the new regulation, our ability to engage in business combination transactions has become significantly more complicated, time consuming and expensive, and we may not be able to negotiate a transaction that is acceptable to our stockholders or sufficiently protect their interests in a transaction.

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The new regulation allows PRC government agencies to assess the economic terms of a business combination transaction. Parties to a business combination transaction may have to submit to the Ministry of Commerce and other relevant government agencies an appraisal report, an evaluation report and the acquisition agreement, all of which form part of the application for approval, depending on the structure of the transaction. The regulations also prohibit a transaction at an acquisition price obviously lower than the appraised value of the PRC business or assets and in certain transaction structures, require that consideration must be paid within defined periods, generally not in excess of a year. The regulation also limits our ability to negotiate various terms of the acquisition, including aspects of the initial consideration, contingent consideration, holdback provisions, indemnification provisions and provisions relating to the assumption and allocation of assets and liabilities. Transaction structures involving trusts, nominees and similar entities are prohibited. Therefore, such regulation may impede our ability to negotiate and complete a business combination transaction on financial terms that satisfy our investors and protect our stockholders’ economic interests.

Under the EIT Law, we may be classified as a “resident enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.

Under China’s new Enterprise Income Tax Law, or the EIT Law, and its implementing rules, both of which became effective on January 1, 2008, an enterprise established outside of China with “de facto management bodies” within China is considered a “resident enterprise,” meaning that it can be treated in a manner similar to a Chinese enterprise for enterprise income tax purposes. The implementing rules of the EIT Law define de facto management as “substantial and overall management and control over the production and operations, personnel, accounting, and properties” of the enterprise.

On April 22, 2009, the State Administration of Taxation issued the Notice Concerning Relevant Issues Regarding Cognizance of Chinese Investment Controlled Enterprises Incorporated Offshore as Resident Enterprises pursuant to Criteria of de facto Management Bodies, or the Notice, further interpreting the application of the EIT Law and its implementation non-Chinese enterprise or group controlled offshore entities. Pursuant to the Notice, an enterprise incorporated in an offshore jurisdiction and controlled by a Chinese enterprise or group will be classified as a “non-domestically incorporated resident enterprise” if (i) its senior management in charge of daily operation reside or perform their duties mainly in China; (ii) its financial or personnel decisions are made or approved by bodies or persons in China; (iii) its substantial properties, accounting books, corporate chops, board and shareholder minutes are kept in China; and (iv) ½ directors with voting rights or senior management often resident in China. Such resident enterprise would be subject to an enterprise income tax rate of 25% on its worldwide income and must pay a withholding tax at a rate of 10% when paying dividends to its non-PRC shareholders. However, it remains unclear as to whether the Notice is applicable to an offshore enterprise incorporated by a Chinese natural person. Nor are detailed measures on imposition of tax from non-domestically incorporated resident enterprises are available. Therefore, it is unclear how tax authorities will determine tax residency based on the facts of each case.

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However, as our case substantially meets the foregoing criteria, there is a likelihood that we are deemed to be a resident enterprise by Chinese tax authorities. If the PRC tax authorities determine that we are a “resident enterprise” for PRC enterprise income tax purposes, a number of unfavorable PRC tax consequences could follow. First, we may be subject to the enterprise income tax at a rate of 25% on our worldwide taxable income as well as PRC enterprise income tax reporting obligations. In our case, this would mean that income such as interest on financing proceeds and non-China source income would be subject to PRC enterprise income tax at a rate of 25%. Second, although under the EIT Law and its implementing rules dividends paid to us from our PRC subsidiaries would qualify as “tax-exempt income,” we cannot guarantee that such dividends will not be subject to a 10% withholding tax, as the PRC foreign exchange control authorities, which enforce the withholding tax, have not yet issued guidance with respect to the processing of outbound remittances to entities that are treated as resident enterprises for PRC enterprise income tax purposes. Finally, it is possible that future guidance issued with respect to the new “resident enterprise” classification could result in a situation in which a 10% withholding tax is imposed on dividends we pay to our non-PRC shareholders and with respect to gains derived by our non-PRC shareholders from transferring our shares. We are actively monitoring the possibility of “resident enterprise” treatment for the 2008 tax year and are evaluating appropriate organizational changes to avoid this treatment, to the extent possible.

If we were treated as a “resident enterprise” by PRC tax authorities, we would be subject to taxation in both the U.S. and China, and our PRC tax may not be creditable against our U.S. tax.

The value of our securities will be affected by the currency exchange rate between U.S. dollars and RMB.

The value of our common stock will be affected by the foreign exchange rate between U.S. dollars and RMB, and between those currencies and other currencies in which our sales may be denominated. For example, if we need to convert U.S. dollars into RMB for our operational needs and the RMB appreciates against the U.S. dollar at that time, our financial position, our business, and the price of our common stock may be harmed. Conversely, if we decide to convert our RMB into U.S. dollars for the purpose of declaring dividends on our common stock or for other business purposes and the U.S. dollar appreciates against the RMB, the U.S. dollar equivalent of our earnings from our subsidiaries in China would be reduced.

RISKS RELATED TO THE MARKET FOR OUR STOCK

Our common stock is quoted on the OTC Bulletin Board which may have an unfavorable impact on our stock price and liquidity.

Our common stock is quoted on the OTC Bulletin Board. The OTC Bulletin Board is a significantly more limited market than the New York Stock Exchange or NASDAQ stock markets. The quotation of our shares on the OTC Bulletin Board means there is a less liquid market available for existing and potential stockholders to trade shares of our common stock. The limited liquidity could depress the trading price of our common stock and could have a long-term adverse impact on our ability to raise capital in the future.

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We are subject to penny stock regulations and restrictions.

The SEC has adopted regulations which generally define so-called “penny stocks” to be an equity security that has a market price less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions. If our common stock becomes a “penny stock,” we may become subject to Rule 15g-9 under the Exchange Act, or the Penny Stock Rule. This rule imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and “accredited investors” (generally, individuals with a net worth in excess of $1,000,000 or annual incomes exceeding $200,000, or $300,000 together with their spouses). For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. As a result, this rule may affect the ability of broker-dealers to sell our securities and may affect the ability of purchasers to sell any of our securities in the secondary market.

For any transaction involving a penny stock, unless exempt, the rules require delivery, prior to any transaction in a penny stock, of a disclosure schedule prepared by the SEC relating to the penny stock market. Disclosure is also required to be made about sales commissions payable to both the broker-dealer and the registered representative and current quotations for the securities. Finally, monthly statements are required to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stock.

There can be no assurance that our common stock will qualify for exemption from the Penny Stock Rule. In any event, even if our common stock were exempt from the Penny Stock Rule, we would remain subject to Section 15(b)(6) of the Exchange Act, which gives the SEC the authority to restrict any person from participating in a distribution of penny stock, if the SEC finds that such a restriction would be in the public interest.

Certain provisions of our Certificate of Incorporation may make it more difficult for a third party to effect a change-in-control.

Our Certificate of Incorporation authorizes the Board of Directors to issue up to 50 million shares of preferred stock. The preferred stock may be issued in one or more series, the terms of which may be determined at the time of issuance by the board of directors without further action by the stockholders. These terms may include voting rights including the right to vote as a series on particular matters, preferences as to dividends and liquidation, conversion rights and redemption rights provisions. The issuance of any preferred stock could diminish the rights of holders of our common stock, and therefore could reduce the value of such common stock. In addition, specific rights granted to future holders of preferred stock could be used to restrict our ability to merge with, or sell assets to, a third party. The ability of the board of directors to issue preferred stock could make it more difficult, delay, discourage, prevent or make it more costly to acquire or effect a change-in-control, which in turn could prevent the stockholders from recognizing a gain in the event that a favorable offer is extended and could materially and negatively affect the market price of our common stock.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We operate a chain of 28 Internet Cafés in Shenzhen, Guangdong, China. We provide top quality internet café facilities and are the largest internet café chain in Shenzhen.

We provide internet access at reasonable prices to students and migrant workers. Although we sell snacks, drinks, and game access cards, over 95% of our revenue comes from selling access time to our computers.

For the fiscal year ended December 31, 2009, our revenue was $14,038,931 and our net profit was $4,388,449, representing an increase of 38.89% and 45.62%, respectively, from the previous fiscal year. For the three months ended March 31, 2010, our revenue was $3,721,105 and our net profit was $1,163,259, an increase of 16.11% and 17.06%, respectively, from the corresponding period of 2009. As of March 31, 2010, we have 312 employees.

Because our recent operations have been limited to the operations of Junlong, the discussion below of our performance is based upon the unaudited financial statements of Junlong for the three-month periods ended March 31, 2010 and 2009 and the audited financial statements of Junlong for the years ended December 31, 2009 and 2008, which are included in this report.

Principal Factors Affecting our Financial Performance

We believe that the following factors will continue to affect our financial performance:

• Improved Disposable Income. As Shenzhen Government is increasing the minimum wage, migrant workers who are our major customers will have more disposable income. We are expecting the inflow of migrant workers to contribute to our revenue growth.

• Continued Internet Café Use. Our business may be adversely affected with increased home computer and home console ownership. However, the home computer and console penetration rate is relatively low in China as compared to that of America and Europe. In addition, young people in China prefer internet cafes to home computers. We expect the preference will continue and provide us sustainable business.

Recent Developments

On July 2, 2010, we completed a reverse acquisition transaction through a share exchange with Classic Bond and its shareholders, whereby we acquired 100% of the issued and outstanding capital stock of Classic Bond, in exchange for 19,000,000 shares of our common stock, which shares constituted 94% of our issued and outstanding shares on a fully-diluted basis, as of and immediately after the consummation of the reverse acquisition. As a result of the reverse acquisition, Classic Bond became our wholly-owned subsidiary and the former shareholders of Classic Bond, became our controlling stockholder. See “Corporate Structure and History – Our Corporate History and Background – Acquisition of Classic Bond” above for more information regarding Classic Bond, its subsidiary and controlled VIE.

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Upon the closing of the reverse acquisition, Xuezheng Yuan, our sole director and officer, submitted a resignation letter pursuant to which he resigned from all offices that he held with immediate effect and from his position as our sole director effective 10 days after mailing of the Information Statement. Also upon the closing of the reverse acquisition, our board of directors increased its size from one to five members and appointed Dishan Guo, Zhenquan Guo, Lei Li, Wenbin An and Lizong Wang to fill the vacancies created by the resignation of Xuezheng Yuan and such increase. Mr. Dishan Guo's appointment became effective upon closing of the reverse acquisition, while the remaining appointments will become effective on the tenth day following our mailing of the Information Statement to our stockholders. In addition, our executive officers were replaced by the Classic Bond executive officers upon the closing of the reverse acquisition as indicated in more detail below.

For accounting purposes, the share exchange transaction was treated as a reverse acquisition, with Classic Bond as the acquirer and China Unitech as the acquired party.

In April, 2010, we acquired two new cafes in Longgang district. Lanman internet cafe opened On 6^th April, which has 231 computers with 10 employees; Chaosu internet cafe opened on 16^th April , which has 240 computers with 14 employees.

Taxation

United States

China Unitech is subject to United States tax at a tax rate of 34%. No provision for income taxes in the United States has been made as we had no taxable income for 2009 and 2008.

British Virgin Islands

Classic Bond was incorporated in the BVI and under the current laws of the BVI, is not subject to income taxes.

China

Zhonghefangda is subject to payment of a 5% business tax on its revenue.

Junlong was subject to a 18% Enterprise Income Tax, or EIT in 2008 20% in 2009, and 20% local tax for the fiscal years 2008 and 2009.

China passed a new Enterprise Income Tax Law, or the EIT Law, and its implementing rules, both of which became effective on January 1, 2008. The EIT Law and its implementing rules generally provide that a 10% withholding tax applies to China-sourced income derived by non-resident enterprises for PRC enterprise income tax purposes unless the jurisdiction of incorporation of such enterprises’ shareholder has a tax treaty with China that provides for a different withholding arrangement. In addition, under the EIT Law, we may be deemed to be a “resident enterprise,” as discussed in “Risk Factors – Under the EIT Law, we may be classified as a “resident enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.”

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We incurred income taxes of $333,864 for the period ended March 31, 2010, which is $117,286 or 54.15% more than the taxes we incurred in the same period in 2009. It was due to revenue increase because the internet cafes that were opened in the first quarter of 2009 became operative in the first quarter of 2010. The increase was also caused by the increase of income tax rate from 20% in 2009 to 22% in 2010. We incurred income taxes of $1,068,262 for the year ended December 31, 2009, an increase of $461,210 or 63.83% from the taxes we incurred in the same 2008 period, which were $652,052. This increase in taxes was due to new internet cafes opened and income tax rate rise from 18% in 2008 to 20% in 2009.

Our future effective income tax rate depends on various factors, such as tax legislation, the geographic composition of our pre-tax income and non-tax deductible expenses incurred. Our management carefully monitors these legal developments and will timely adjust our effective income tax rate when necessary.

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Results of Operations

The following tables set forth key components of our results of operations for the periods indicated, in dollars and as a percentage of revenue.

		Year ended						Three months ended
		December 31,						March 31,
		2009		2008	Comparison			2010		2009	Comparison
Revenue, net	$	14,038,931	$	10,107,823	3,931,108	38.89%	$	3,721,105	$	3,204,703	516,402	16.11%
Cost of revenue					2009/2008 gross						2010/2009 gross
Depreciation expenses		1,276,415		986,165	290,250	29.43%		331,630		285,000	46,630	16.36%
Direct labor		830,944		699,917	131,027	18.72%		228,523		185,381	43,142	23.27%
Rental payments for cafes		814,954		688,499	126,455	18.37%		206,699		195,134	11,565	5.93%
Utility expenses		1,367,545		989,448	378,097	38.21%		344,049		312,102	31,947	10.24%
Business tax and surcharge		3,319,554		2,389,324	930,230	38.93%		880,168		757,836	122,332	16.14%
Other overhead associated with the internet cafes		800,115		582,810	217,305	37.29%		169,070		223,839	-54,769	-24.47%
		8,409,527		6,336,163	2,073,364	32.72%		2,160,139		1,959,292	200,847	10.25%
Gross profit		5,629,404		3,771,660	1,857,744	49.26%		1,560,966		1,245,411	315,555	25.34%
Operating Expenses
General and administrative expenses		166,141		106,681	59,460	55.74%		62,673		37,653	25,020	66.45%
Total operating expenses		166,141		106,681	59,460	55.74%		62,673		37,653	25,020	66.45%
Income from operations		5,463,263		3,664,979	1,798,284	49.07%		1,498,293		1,207,758	290,535	24.06%
Non-operating income (expenses)
Interest income		-		859	-859			-		99	-99
Other income		-		-221	221					-95	95
								-
Interest expenses		-819		-	-819			-1,141			-1,141

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		Year ended						Three months ended
		December 31,						March 31,
		2009		2008	Comparison			2010		2009	Comparison
Other expenses		-5,733		-	-5,733			-29		-	-29
Total other income (expenses)		-6,552		637	-7,189	-1128.57%		-1,170		4	-1,174	-293.50%
Net income before income taxes		5,456,711		3,665,617	1,791,094	48.86%		1,497,123		1,207,762	289,361	23.96%
Income taxes		1,068,262		652,052	416,210	63.83%		333,864		216,578	117,286	54.15%
Net income	$	4,388,449	$	3,013,565	1,374,884	45.62%	$	1,163,259	$	991,184	172,075	17.36%
Other comprehensive income
Foreign currency translation		8,958		160,001	-151,043	-94.40%		1,122		3,477	-2,355	-67.73%
Comprehensive income	$	4,397,407	$	3,173,566	1,223,841	38.56%	$	1,164,381	$	994,661	169,720	17.06%
As a Percentage of Sales Revenue
Revenue, net		100.00%		100.00%				100.00%		100.00%
Cost of revenue
Depreciation expenses		9.09%		9.76%				8.91%		8.89%
Direct labor		5.92%		6.92%				6.14%		5.78%
Rental payments for cafes		5.80%		6.81%				5.55%		6.09%
Utility expenses		9.74%		9.79%				9.25%		9.74%
Business tax and surcharge		23.65%		23.64%				23.65%		23.65%
Other overhead associated with the internet cafes		5.70%		5.77%				4.54%		6.98%
		59.90%		62.69%				58.05%		61.14%
Gross profit		40.10%		37.31%				41.95%		38.86%

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Operating Expenses

	Year ended			Three months ended
	December 31,			March 31,
	2009	2008	Comparison	2010	2009	Comparison
General and administrative expenses	1.18%	1.06%		1.68%	1.17%
Total operating expenses	1.18%	1.06%		1.68%	1.17%
Income from operations	38.92%	36.26%		40.26%	37.69%
Non-operating income (expenses)
Interest income	-	0.01%		-	0.00%
Other income	-	0.00%		-	0.00%
Interest expenses	-0.01%	-		-0.03%	-
Other expenses	-0.04%	-		0.00%	-
Total other income (expenses)	-0.05%	0.01%		-0.03%	0.00%
Net income before income taxes	38.87%	36.27%		40.23%	37.69%
Income taxes	7.61%	6.45%		8.97%	6.76%
Net income	31.26%	29.81%		31.26%	30.93%
Other comprehensive income
Foreign currency translation	0.06%	1.58%		0.03%	0.11%
Comprehensive income	31.32%	31.40%		31.29%	31.04%

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Comparison of Three Months Ended March 31, 2010 and 2009

Revenue. Our revenue is generated from sales of prepaid IC cards. Sales revenue increased $516,402, or 16.11%, to $3,721,105 for the three months ended March 31, 2010 from $3,204,703 for the same period in 2009. The increase was mainly because of the revenue generated by the cafes opened in 2009 which became operative in the first quarter of 2010.

Cost of Revenue. Our cost of sales is primarily comprised of the costs of our facilities, computers, accessories, utilities, labor and overhead. Our cost of sales increased $200,847, or 10.25%, to $2,160,139 for the three months ended March 31, 2010 from $1,959,292 during the same period in 2009. The increase was mainly attributable to increase of labor cost and utility expenses in the first quarter of 2010 as compared to the same period in 2009.

Gross Profit. Our gross profit is equal to the difference between our sales revenue and our cost of sales. Our gross profit increased $315,555, or 25.34%, to $1,560,966 for the three months ended March 31, 2010 from $1,245,411 for the same period in 2009. Gross profit as a percentage of sales revenue was 41.95% for the three months ended March 31, 2010, as compared to 38.86% during the same period in 2009. The improvement of our gross profit margin was mainly attributable to computer usage increase in the first quarter of 2010 as compared to the same period in 2009.

Operating Expenses. Our administrative expenses consist of the costs associated with staff and support personnel who manage our business activities. Our administrative expenses increased $25,020, or 66.45%, to $62,673 for the three months ended March 31, 2010 from $37,653 for the same period in 2009. The increase was mainly attributable to salary increase.

Non-operating Expenses. Our Non-operating expenses increased $1,174, to $1,170 for the three months ended March 31, 2010 from $4 operating income for the same period in 2009  In the 2010 period, we incurred interest expenses of $1,170 on the RMB 1 million (approximately $147,058) loan from China Construction Bank Shenzhen Branch, while in the 2009 period we received interest income of $4 from bank balances.

Income before Income Taxes. Income before income taxes increased $289,361, or 23.96%, to $1,497,123 for the three months ended March 31, 2010 from $1,207,762 for the same period in 2009. The increase of income before income tax was mainly attributable to computer usage increase in the first quarter. Income before income taxes as a percentage of sales revenue increased to 40.26% for the three months ended March 31, 2010, as compared to 37.69% for the same period in 2009 due to the factors described above.

Income Taxes. Our income taxes increased to $333,864 during the three months ended March 31, 2010 from $216,578 during the same period in 2009.

Net Income. Our net income increased $172,075, or 17.36%, to $1,163,259 during the three months ended March 31, 2010 from $991,184 during the same period in 2009, as a result of the factors described above.

Comparison of Fiscal Years Ended December 31, 2009 and 2008

Revenue. Revenue increased $3,931,108, or 38.89%, to $14,038,931 in 2009 from $10,107,823 in 2008. The increase was mainly attributable to the revenue generated by the cafes opened in 2009 which became operative in the first quarter of 2010.

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Cost of Revenue. Our cost of revenue increased $2,073,364, or 32.72%, to $8,409,527 in 2009 from $6,336,163 in 2008. This increase was mainly due to depreciation and utility expenses accounted in the first quarter of 2010.

Gross Profit. Our gross profit increased $1,857,744, or 49.26%, to $5,629,404 during 2009 from $3,771,660 in 2008. Gross profit as a percentage of sales revenue was 40.10% during 2009 as compared to 37.31% during 2008. Such percentage increase was mainly attributable to our efforts to increase computer usage time in the first quarter of 2010.

Operating Expenses. Our general and administrative expenses increased $59,460, or 55.74%, to $166,141 during 2009 from $106,681 in 2008. As a percentage of sales revenue, administrative expenses in 2009 increased to 1.18%, as compared to 1.06% for 2008. The increase was primarily attributable to business expansion and increased number of employees.

Non-operating Expenses. Our non-operating expenses increased $7,189, to $6,552 during 2009 from $637 non-operating income in 2008. This increase was mainly due to the interest payment on the RMB 1 million loan to China Construction Bank Shenzhen Branch.

Income Before Income Taxes. Income before income taxes increased $1,791,094, or 48.86%, to $5,456,711 in 2009 from $3,665,617 in 2008. Income before income taxes as a percentage of sales revenue increased to 38.87% in 2009, as compared to 36.27% in 2008 due to the factors described above.

Income Taxes. Our income taxes increased to $1,068,262 from $652,052 during 2009 as compared to 2008.

Net Income. Our net income increased $1,374,884, or 45.62%, to $4,388,449 in 2009 from $3,013,565 in 2008 as a result of the factors described above.

Liquidity and Capital Resources

As of March 31, 2010, we had cash and cash equivalents of $4,641,622 and restricted cash of $1,645,675. The following table provides detailed information about our net cash flow for all financial statements periods presented in this report.

Cash Flow
(All amounts in thousands of U.S. dollars)

		Three Months Ended						Fiscal Year Ended
		March 31,						December 31,
		2010			2009			2009			2008
Net cash provided by (used in) operating activities	$	1,586,135		$	931,904		$	4,781,464		$	4,945,741
Net cash used in investing activities		(395	)		(1,096,807	)		(2,988,697	)		(1,518,823	)
Net cash provided by (used in) financing activities		0			0			146,180			(2,872,635	)
Effect of Foreign currency translation on cash and cash equivalents		478			1,374			3,811			42,865
Net cash flows		1,586,218			(163,529	)		1,942,758			606,148

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Operating Activities

Net cash used in operating activities was $1,586,135 million for the three months ended March 31, 2010, as compared to $931,904 net cash used in operating activities for the same period in 2009.

Net cash provided by operating activities was $4,781,464 in 2009, as compared to $4,945,741 net cash provided by operating activities in 2008. The change was mainly attributable to increase in income tax payable and amount due to a director for advances made by the director

Investing Activities

Net cash used in investing activities was $395 for the three months ended March 31, 2010, as compared to $1,096,807 net cash used in investing activities for the same period in 2009.

Net cash used in investing activities was $2,988,697 in 2009, as compared to $1,518,823 net cash used in investing activities in 2008. The change was mainly attributable to two new subsidiaries to be established in Yiwu city, Zhejiang province and Anshun city, Guizhou province.

Financing Activities

Net cash provided by financing activities was $146,180 in 2009, as compared to $2,872,635 net cash used in financing activities in 2008. The change was mainly due to an approximately $2.9 million dividend paid to the owners of Zhonghefangda in 2008, while no dividend was paid in 2009. 

As of March 31, 2010, we only had a one-year loan, extended by China Construction Bank Shenzhen Branch, in the principal amount of $146,282 outstanding. This loan will mature on October 25, 2010.

We believe that we maintain good relationships with the various banks we deal with and our current available working capital, after receiving the aggregate proceeds from our planned capital raising activities and bank loans referenced above, should be adequate to sustain our operations at our current levels through at least the next twelve months.

Obligations Under Material Contracts

We are party to a Loan Agreement with China Construction Bank Shenzhen Branch entered into in October 2009 for a loan of RMB 1 million (approximately $146,282).

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Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for an understanding of our financial condition and results of operation. Critical accounting policies are those that are most important to the portrayal of our financial conditions and results of operations and require management’s difficult, subjective, or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s current judgments. We believe the following critical accounting policies involve the most significant estimates and judgments used in the preparation of our financial statements.

Revenue recognition

Internet café members purchase prepaid IC cards which include stored value that will be deducted based on time usage of computer at the internet cafe. Revenues derived from the prepaid IC cards at the internet café are recognized when services are provided. This is based upon usage of computer time at the internet cafe. Outstanding customer balances in the IC cards are included in deferred revenue on the balance sheets. The Company does not charge any service fees that cause a decrement to customer balances. There is no expiration date for IC cards.

The Company also records revenue from commission received from the sale of third parties on-line gaming cards, snacks and drinks. Commission revenue amounting to 20% of the value of the on-line gaming cards, snacks and drinks is recognized at the time the gaming cards, etc. are sold to customers. During the years ended December 31, 2009 and 2008, the commission income was $ 116,651 and $88,082, less than 1% of total revenue.

Cost of goods sold

Cost of goods sold consists primarily of depreciation of Café computer equipment and hardware, overhead associated with the internet cafes, including rental payments, utilities, business tax and surcharge. Companies in China are generally subject to business tax and related surcharges by various local tax authorities at rates ranging from 5% to 6% on gross revenue generated from internet cafés.

Credit risk

The Company may be exposed to credit risk from its cash at bank and fixed deposits. An allowance has been made for estimated irrecoverable amounts determined by reference to past default experience and the current economic environment.

Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash accounts, interest bearing savings accounts and time certificates of deposit with a maturity of three months or less when purchased.

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Restricted cash

At December 31, 2009, restricted cash of $1,645,411 represented cash held by two escrow agents on behalf of the company for registered capital and operating cash flow purposes of two new subsidiary companies to be established in Yiwu city, Zhejiang province and Anshun city, Guizhou province.

Inventory

Inventory represented the IC cards we purchased from IC cards manufacturer. Inventories are stated at the lower of cost or market value. Cost is determined using the first-in, first-out (FIFO) method.

Fair Value of Financial Instruments

FASB accounting standard requires disclosing fair value to the extent practicable for financial instruments that are recognized or unrecognized in the balance sheet. The fair value of the financial instruments disclosed herein is not necessarily representative of the amount that could be realized or settled, nor does the fair value amount consider the tax consequences of realization or settlement.

For certain financial instruments, including cash, accounts payable, short-term loans, accruals and other payables, it was assumed that the carrying amounts approximate fair value because of the near term maturities of such obligations.

Equipment Deposits

The Company prepaid the equipments deposits to the computer suppliers for purchase of computer and equipments for the two new internet cafes which were expected to be opened in Spring, 2010.

Property, plant and equipment

Fixed assets, comprising computer equipment and hardware, leasehold improvements, office furniture and vehicles and are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives listed below.

	Estimated Useful Lives
Leasehold improvement	Lesser of term of the lease or the estimated useful lives of the assets
Café computer equipment and hardware	5 years
Café furniture and fixtures	5 years
Office furniture, fixtures and equipments	5 years
Motor vehicles	5 years

Deferred Revenue

Deferred revenue represents amounts from the IC cards that are unused balance. The Outstanding customer balances are $775,985 and $800,474 as at December 31, 2009 and 2008 and are included in deferred revenue on the balance sheets.

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Comprehensive income

The Company follows the FASB’s accounting standard. Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investments from owners and distributions to owners. For the Company, comprehensive income for the periods presented includes net income and foreign currency translation adjustments.

Income taxes

Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred income tax liabilities or assets are recorded to reflect the tax consequences in future differences between the tax basis of assets and liabilities and the financial reporting amounts at each year end. A valuation allowance is recognized if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized.

Foreign currency translation

Assets and liabilities of the Company with a functional currency other than US$ are translated into US$ using period end exchange rates. Income and expense items are translated at the average exchange rates in effect during the period. Foreign currency translation differences are included as a component of Accumulated Other Comprehensive Income in Stockholders’ Equity.

The exchange rates used to translate amounts in RMB into USD for the purposes of preparing the consolidated financial statements were as follows:

	2009	2008
Year end RMB : USD exchange rate	6.8372	6.8542
Average yearly RMB : USD exchange rate	6.8409	6.9623

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

Post-retirement and post-employment benefits

The Company contributes to a state pension plan in respect of its PRC employees. Other than the above, neither the Company nor its subsidiary provides any other post-retirement or post-employment benefits.

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Earnings per Common Share

No basic income/loss per common share has been calculated based on the weighted average number of shares outstanding during the period since the Company is a Chinese company with stated capital, without number of shares.

Retained earnings-appropriated

In accordance with the relevant PRC regulations and the Company’s PRC articles of association, Junlong is required to allocate their respective net income to statutory surplus reserve.

Statutory surplus reserve

In accordance with the relevant laws and regulations of the PRC and the articles of associations of the Company, Junlong is required to allocate 10% of their net income reported in the PRC statutory accounts, after offsetting any prior years’ losses, to the statutory surplus reserve, on an annual basis. When the balance of such reserve reaches 50% of the respective registered capital of the subsidiaries, any further allocation is optional.

The statutory surplus reserves can be used to offset prior years’ losses, if any, and may be converted into registered capital, provided that the remaining balances of the reserve after such conversion is not less than 25% of registered capital. The statutory surplus reserve is non-distributable.

Recently issued accounting pronouncements

Accounting Standards Codification

In June 2009, the Financial Accounting Standards Board (“FASB”) issued a standard that established the FASB Accounting Standards Codification (the “ASC”), which effectively amended the hierarchy of U.S. generally accepted accounting principles (“GAAP”) and established only two levels of GAAP, authoritative and non-authoritative. All previously existing accounting standard documents were superseded, and the ASC became the single source of authoritative, nongovernmental GAAP, except for rules and interpretive releases of the Securities and Exchange Commission (“SEC”), which are sources of authoritative GAAP for SEC registrants. All other non-grandfathered, non-SEC accounting literature not included in the ASC became non-authoritative. The ASC was intended to provide access to the authoritative guidance related to a particular topic in one place. New guidance issued subsequent to June 30, 2009 will be communicated by the FASB through Accounting Standards Updates. The ASC was effective for financial statements for interim or annual reporting periods ending after September 15, 2009. We adopted and applied the provisions of the ASC for the Company’s fiscal year ended December 31, 2009, and have eliminated references to pre-ASC accounting standards throughout the financial statements. The adoption of the ASC did not have a material impact on the Company’s financial statements.

Subsequent Events

In May 2009, the FASB issued new guidance on the treatment of subsequent events which is intended to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. Specifically, management of a reporting entity is required to evaluate subsequent events through the date that financial statements are issued and disclose the date through which subsequent events have been evaluated, as well as the date the financial statements were issued. This new guidance was effective for fiscal years and interim periods ended after June 15, 2009, and must be applied prospectively. The Company adopted this guidance in the year ended December 31, 2009.

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Fair Value and Other-Than-Temporary Impairments

In April 2009, the FASB issued new guidance intended to provide additional application guidance and enhanced disclosures regarding fair value measurements and impairments of securities. New guidance related to determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly provides additional guidelines for estimating fair value in accordance with pre-existing guidance on fair value measurements. New guidance on recognition and presentation of other-than-temporary impairments provides additional guidance related to the disclosure of impairment losses on securities and the accounting for impairment losses on debt securities, but does not amend existing guidance related to other-than-temporary impairments of equity securities. The new guidance was effective for fiscal years and interim periods ended after June 15, 2009. As such, the Company adopted this guidance for the quarter ended June 30, 2009. Adoption of the new guidance did not have a material impact on the Company’s financial statements.

Hierarchy of Generally Accepted Accounting Principles

In June 2009, the FASB issued FASB ASC 105-10 (Prior authoritative literature: FASB Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles”). FASB ASC 105-10 replaces SFAS No. 162 and establishes the FASB Accounting Standards Codification as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. FASB ASC 105-10 is effective for financial statements issued for interim and annual periods ending after September 15, 2009. As such, the Company is required to adopt this standard in the current period. Adoption of FASB ASC 105-10 did not have a significant effect on the Company’s financial statements.

Financial Instruments

In February 2007, the FASB issued a new accounting standard which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This accounting standard also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. This accounting standard is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company adopted this accounting standard on November 1, 2008. It has not elected to measure any financial assets and financial liabilities at fair value which were not previously required to be measured at fair value. Therefore, the adoption of this accounting standard has had no impact on its financial statements and footnote disclosure.

In April 2009, the FASB issued additional guidance to require disclosures about the fair value of financial instruments on an interim basis. Previously, this has been disclosed on an annual basis only.

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The Company adopted this guidance for the quarter ended June 30, 2009. This guidance has not impacted the Company’s balance sheets or income statements, as its requirements are disclosure-only in nature.

Fair Value Measurement

In September 2006, the FASB issued a new accounting standard related to fair value measurements. The new standard defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. In February 2008, the FASB issued a new provision which delayed the effective date of the fair value measurements and disclosures for all nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). In August 2009, the FASB issued ASU No. 2009-05, "Measuring Liabilities at Fair Value" in relation to the fair value measurement of liabilities. The Company adopted the applicable portions of the provisions of the new standards as of November 1, 2008, and will adopt the provision related to the nonfinancial assets and nonfinancial liabilities on November 1, 2009. The adoption of this accounting standard for financial assets and financial liabilities did not have a material impact on its financial statements. Although the Company will continue to evaluate the application of the provision for the nonfinancial assets and nonfinancial liabilities, the Company does not expect the adoption to have a material impact on the financial statements.

Measuring Liabilities at Fair Value

In August 2009, the FASB issued an accounting standard update that amended the accounting standard for fair value measurements. Specifically, the accounting standard update provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following methods: 1) a valuation technique that uses a) the quoted price of the identical liability when traded as an asset or b) quoted prices for similar liabilities or similar liabilities when traded as assets and/or 2) a valuation technique that is consistent with the principles of the accounting standard on fair value measurements (e.g. an income approach or market approach). This accounting standard update also clarifies that when estimating the fair value of a liability, a reporting entity is not required to adjust to include inputs relating to the existence of transfer restrictions on that liability. This guidance will be effective for the first interim period beginning November 1, 2009. The Company does not anticipate that the adoption of this statement will have a material impact on its financial statements.

Useful Life of Intangible Asset

In April 2008, the FASB issued a new accounting standard which amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset. This guidance is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. Application of this accounting standard is not currently applicable to the Company.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

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Seasonality

Our operating results and operating cash flows historically have not been subject to seasonal variations. There are moderate impact on our business during major national holidays such as the Spring Festival and National Day. This pattern may change, however, as a result of new market opportunities or new product introductions.

DESCRIPTION OF PROPERTY

There is no private land ownership in China. Individuals and companies are permitted to acquire land use rights for specific purposes. We currently do not have any land use rights. Instead we lease most of the property that we need to operate our business from third parties.

Junlong currently leases from an individual Changsheng Hao the office space for its headquarters located at Room 1010, Unit D, Block 1, Yuanjing Garden, Longxiang Road, Zhongxin Cheng, Longgang District, Shenzhen. The lease is from December 1, 2009 to December 31, 2010. The lease has been filed with the House Leasing Management Office of Longgang District, Shenzhen.

Junlong also leases spaces from different entities or individuals for its 28 internet cafés.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information regarding beneficial ownership of our common stock as of July 2, 2010 immediately after the consummation of the share exchange (i) by each person who is known by us to beneficially own more than 5% of our common stock; (ii) by each of our officers and directors; and (iii) by all of our officers and directors as a group. Unless otherwise specified, the address of each of the persons set forth below is in care of Junlong, 1-D-1010, Yuanjing Park, Long Xiang Road, Long Gang District, Shenzhen, Guangdong Province, People’s Republic of China.

Name and Address of Beneficial Owner	Office, If Any	Title of Class	Amount and Nature of Beneficial Ownership(1)	Percent of Class(2)
Officers and Directors
Dishan Guo	Chairman and Chief Executive Officer	Common stock, $0.001 par value	12,008,750	59.45%
Xuezheng Yuan	Director	Common stock, $0.001 par value		*
All officers and directors as a group (2 persons named above)		Common stock, $0.001 par value	12,008,750	59.45%
5% Security Holders
Dishan Guo		Common stock, $0.001 par value	12,008,750	59.45%

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* Less than 1%

(1)	Beneficial Ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Each of the beneficial owners listed above has direct ownership of and sole voting power and investment power with respect to the shares of our common stock.
(2)	A total of 20,200,000 shares of our common stock are considered to be outstanding pursuant to SEC Rule 13d-3(d)(1) as of July 2, 2010.

Changes in Control

We do not currently have any arrangements which if consummated may result in a change of control of our Company.

DIRECTORS AND EXECUTIVE OFFICERS

Directors and Executive Officers

The following table sets forth the name and position of each of our current executive officers and directors.

NAME	AGE	POSITION
Dishan Guo	46	Chairman and Chief Executive Officer

Zhenquan Guo (1)	33	Director
Lei Li (1)	45	Director
Wenbin An (1)	70	Director
Lizong Wang (1)	45	Director
Xuezheng Yuan (2)	41	Director

(1)	Will become a director on the 10th day following the mailing by us of the Information Statement to our stockholders
(2)	Former President, Chief Executive Officer, Chief Financial Officer and Secretary prior to July 2, 2010 and current director until the 10th day following the mailing by us of the Information Statement to our stockholders.

Dishan Guo. Mr. Guo became our Chairman and CEO on July 2, 2010, the day that we consummated our reverse acquisition of Classic Bond. As the founder of Junlong, Mr. Guo has served as the Managing Director and CEO of Junlong for over 7 years since 2003, responsible for strategic planning of the company’s business and growth and overseeing the operations of the Comapny. He has extensive experience and contact in the industry; he is the executive president of Shenzhen Longgang District Internet Industry Association which is the associate department of the ministry of culture and sets the internet café industry standards, and a director of Guangdong High-Tech Inudstry Association. Mr. Guo graduated from Administrative Management Institute in Guangdong province in 1996, holding a college degree in business management. Mr. Guo's foregoing experience, qualifications, attributes and skills led us to the conclusion that he should serve as a director of our company, in light of our business and structure.

Zhenquan Guo. Zhenquan Guo will join our board on the 10th day following the mailing of the Information Statement to our Shareholders. Mr. Guo joined the company in 2003; he has worked in a variety of roles in Junlong. Since 2006, Zhenquan Guo has been the Operation Director in Junlong Culture Communication Co. Ltd; he is in charge of the daily operations in the wholly owned internet cafés of Junlong. Over the past five years, he has taken part in all the internet cafe set up and license application task and gained extensive experience in internet cafe industry. Zhenquan Guo graduated in Gannan Normal University in 2000, major in Mathematics and Applied Mathematics; he gained is master degree from Shenzhen University in 2008 as a on-job postgraduate student major in Marketing. Mr Guo's foregoing experience, qualifications, attributes and skills led us to the conclusion that he should serve as a director of our company, in light of our business and structure.

Lei Li. Lei Li will join our board on the 10th day following the mailing of the Information Statement to our Shareholders. Mr. Li is the founder and managing director of the Boardroom Advisors Company Limited, a Beijing-based financial advisory firm. He is currently also a Director of Universal Travel Group, a NYSE-listed company. He served as chief financial officer of Synutra International, Inc., a NASDAQ-listed company, from October 2007 to November 2009. From August 2004 to September 2007, Mr. Li was vice president and chief financial officer of Kasen International Holdings Limited, a public company listed on the Hong Kong Stock Exchange. Prior to that, Mr. Lee served as chief financial officer at Eagle Brand Holdings Limited, a company listed on the Singapore Stock Exchange. Mr. Li’s experience also includes serving as a financial controller at the Korean division of Exel Plc, and serving as a senior auditor at Waste Management Inc.’s international department in London. Mr. Li is a fellow member of the Association of Chartered Certified Accountants (ACCA) in the UK. He received a bachelor’s degree in management and engineering from Beijing Institute of Technology, a master’s degree in economics from Renmin University of China, and a master’s degree in accounting and finance from the London School of Economics. Mr. Li's foregoing experience, qualifications, attributes and skills led us to the conclusion that he should serve as a director of our company, in light of our business and structure.

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Wenbin An. Wenbin An will join our board on the 10th day following the mailing of the Information Statement to our Shareholders. Mr. An was a diplomatic before retiring in 2002. He was deputy consul general in the PRC Consulate in Los Angeles from 1987 to 1994. In 1995, after returning to Beijing, he served as the Ministry of Foreign Affairs’ Chief of Protocol for sever years, during which time he organized many high profile events, including the Fourth World Conference on Women in Beijing in 2005 and the celebration of the handover of Hong Kong in 1997, and he accompanied PRC leaders in visits to more than 30 foreign countries. Mr. An graduated from Zhongshan University in Guangzhou, where he major in English language. Since retirement, Mr. An has been serving as business consultants to PRC companies. Mr. An's foregoing experience, qualifications, attributes and skills led us to the conclusion that he should serve as a director of our company, in light of our business and structure.

Lizong Wang. Mr. Wang will join the board on the 10th day following the mailing of the Information Statement to our Shareholders. Mr. Wang currently serves as deputy secretary of China Society for Promotion of The Guangcai Program, a program initiated and implemented by PRC private enterprises to alleviate poverty. He also serves as strategic advisors and independent directors of Universal Travel Group, Shenzhen 3nod Electronics Co., Ltd, and Shenzhen Ruidefeng Pesticide. In addition, he acts as economic consultant to a number of municipalities in the PRC as well as Asan in Korea. Mr. Wang is a frequent lecturer at high education institutions in the Greater China Region. Mr. Wang's foregoing experience, qualifications, attributes and skills led us to the conclusion that he should serve as a director of our company, in light of our business and structure.

Xuezheng Yuan. Mr. Yuan became our Chairman, President, Chief Executive Officer, Chief Financial Officer and Secretary on March 14, 2006. On July 2, 2010, Mr. Yuan resigned from all offices he held with us. On the same date, Mr. Yuan submitted his resignation as a member of our board of directors, which will become effective on the 10th day following the mailing of the Information Statement to our stockholders, which Information Statement will be mailed on or about July 20, 2010. Since March 14, 2006, Mr. Yuan has been our president, chief executive officer, secretary/treasurer, chief financial officer, principal accounting officer and the sole member of the board of directors. Since April 1997, Mr. Yuan has been the president of Hubei Dilong Industry Group located in Wuhan, China. Hubei Dilong Industry Group is engaged in the business of tourist and travel theme park. From April 1992 to April 1997, Mr. Yuan was a founder and president of Hubei Province Real Estate Development Ltd. located in Wuhan, China. Hebei Province Real Estate Development Ltd. is engage in the business of real estate development. From July 1990 to April 1992, Mr. Yuan was employed by a trading company located in Shenzhen, China. He was mainly engaged in the business of acting as an import and export agent of textiles. In 1990, Mr. Yuan was awarded a degree in sociology from China Wuhan Irrigation Water and Electric Power University. Mr. Yuan devotes 15 hours a week to our operations.

Except as noted above, there are no agreements or understandings for any of our executive officers or directors to resign at the request of another person and no officer or director is acting on behalf of nor will any of them act at the direction of any other person.

Directors are elected until their successors are duly elected and qualified.

The company is conducting a search for candidates to serve as Chief Financial Officer.

Family Relationships

Zhenquan Guo, one of our directors, is the nephew of our CEO Dishan Guo. There are no other family relationships between any of our directors or executive officers.

Involvement in Certain Legal Proceedings

To the best of our knowledge, none of our directors or executive officers has been convicted in a criminal proceeding, excluding traffic violations or similar misdemeanors, or has been a party to any judicial or administrative proceeding during the past ten years that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws, except for matters that were dismissed without sanction or settlement. Except as set forth in our discussion below in “Transactions with Related Persons, and Director Independence,” none of our directors, director nominees or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.

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EXECUTIVE COMPENSATION

Summary Compensation Table— Fiscal Years Ended December 31, 2009 and 2008

The following table sets forth information concerning all cash and non-cash compensation awarded to, earned by or paid to the named persons for services rendered in all capacities during the noted periods. No executive officer received total annual salary and bonus compensation in excess of $100,000.

Name and Principal Position	Year	Salary ($)	Total ($)
Dishan Guo, Chief Executive Officer (1)	2009	6,272	6,272
	2008	5,856	5,856
Xuezheng Yuan, Former Chief Executive Officer (2)	2009	-	-
	2008	-	-

(1)

On July 2, 2010, we acquired Classic Bond in a reverse acquisition transaction that was structured as a share exchange and in connection with that transaction, Mr. Guo became our Chief Executive Officer and President. Prior to the effective date of the reverse acquisition, Mr. Guo served at Classic Bond’s VIE Junlong as its CEO. The annual, long term and other compensation shown in this table include the amount Mr. Guo received from Junlong prior to the consummation of the reverse acquisition.

(2)

Xuezhoneg Yuan resigned as our sole officer upon the closing of the reverse acquisition of Classic Bond on July 2, 2010.

Employment Agreements

All of our employees, including Mr. Dishan Guo, our Chief Executive Officer, have executed our standard employment agreement. Our employment agreements with our executives provide the amount of each executive officer’s salary and establish their eligibility to receive a bonus. Mr. Guo’s employment agreement provides for an annual salary of RMB 300,000 (approximately $44,118).

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Other than the salary and necessary social benefits required by the government, which are defined in the employment agreement, we currently do not provide other benefits to our officers at this time. Our executive officers are not entitled to severance payments upon the termination of their employment agreements or following a change in control.

Outstanding Equity Awards at Fiscal Year End

None of our executive officers received any equity awards, including, options, restricted stock or other equity incentives during the fiscal year ended December 31, 2009.

Compensation of Directors

During the 2009 fiscal year, no member of our board of directors received any compensation for his services as a director.

TRANSACTIONS WITH RELATED PERSONS,
AND DIRECTOR INDEPENDENCE

Transactions with Related Persons

The following includes a summary of transactions since the beginning of our 2009 fiscal year, or any currently proposed transaction, in which we were or are to be a participant and the amount involved exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at year end for the last two completed fiscal years, and in which any related person had or will have a direct or indirect material interest (other than compensation described under “Executive Compensation”). We believe the terms obtained or consideration that we paid or received, as applicable, in connection with the transactions described below were comparable to terms available or the amounts that would be paid or received, as applicable, in arm’s-length transactions.

• On June 11, 2010, Zhonghefangda entered into the Management and Consulting Services Agreement with Junlong, pursuant to which Zhonghefangda agreed to provide management and consulting services to the VIE in exchange for service fees up to 100% of the VIE’s aggregate net profits during the term of the agreement.

• On June 11, 2010, Zhonghefangda entered into the Option Agreement with Junlong and the VIE Shareholders, whereby the VIE and the VIE Shareholders granted Zhonghefangda an exclusive, irrevocable option to purchase all or part of their equity interests in Junlong.

• On June 11, 2010, Zhonghefangda entered into the Equity Pledge Agreement with Junlong and the VIE Shareholders, whereby the VIE Shareholders have pledged their entire equity interest in the VIE to Zhonghefangda. The equity interests are pledged as collateral to secure the respective obligations of the VIE and the VIE Shareholders under the Management and Consulting Services Agreement, the Option Agreement and the Voting Rights Proxy Agreement.

• On June 11, 2010, Zhonghefangda entered into the Voting Rights Proxy Agreement with the VIE and the VIE Shareholders. The agreement requires the VIE Shareholders to grant and entrust Zhonghefangda with all of the voting rights as shareholders of the VIE for the maximum period of time permitted by law.

• On July 2, 2010, we entered into a cancellation agreement with certain shareholders, namely, Xuezheng Yuan, First Prestige, Inc., Shuihua Cheng, Catalfa Holdings, Inc. and JD Infinity Holdings, Inc., whereby these shareholders agreed to the cancellation of 4,973,600 shares of our common stock owned by him. At the time he entered into the Cancellation Agreement, Mr. Yuan was our sole director and officer.

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None of our directors, director nominees or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.

Promoters and Certain Control Persons

We did not have any promoters at any time during the past five fiscal years.

Director Independence

We currently do not have any independent directors, as the term “independent” is defined by the rules of the Nasdaq Stock Market.

LEGAL PROCEEDINGS

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse affect on our business, financial condition or operating results.

MARKET PRICE OF AND DIVIDENDS ON OUR COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Our common stock is quoted on the OTC Bulletin Board trades under the symbol “CUIG.OB,” however there is not currently, and historically there has never been, an active trading market for our common stock, and no information is available for the prices of our common stock.

Approximate Number of Holders of Our Common Stock

As of July 2, 2010, immediately after consummation of the share exchange, there were approximately 111 stockholders of record of our common stock, as reported by our transfer agent. In computing the number of holders of record, each broker-dealer and clearing corporation holding shares on behalf of its customers is counted as a single stockholder.

Dividends

Junlong declared a dividend distribution to Dishan Guo, Jinzhou Zeng, Xiaojiang Yang and Xiaofen Wang on December 31, 2008, totaling RMB 20 million (approximately US$2.9 million). Our board of directors will make any future decisions regarding dividends. We currently intend to retain and use any future earnings for the development and expansion of our business and do not anticipate paying any cash dividends within one year. Our board of directors has complete discretion on whether to pay dividends, subject to the approval of our stockholders. Even if our board of directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the board of directors may deem relevant.

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Securities Authorized for Issuance Under Equity Compensation Plans

We do not have in effect any compensation plans under which our equity securities are authorized for issuance and we do not have any outstanding stock options.

RECENT SALES OF UNREGISTERED SECURITIES

Reference is made to the disclosure set forth under Item 3.02 of this report, which disclosure is incorporated herein by reference.

DESCRIPTION OF SECURITIES

Common Stock

We are authorized to issue up to 100,000,000 shares of common stock, par value $0.00001 per share. Each outstanding share of common stock entitles the holder thereof to one vote per share on all matters. Our bylaws provide that elections for directors shall be by a plurality of votes. Stockholders do not have preemptive rights to purchase shares in any future issuance of our common stock. Upon our liquidation, dissolution or winding up, and after payment of creditors and preferred stockholders, if any, our assets will be divided pro-rata on a share-for-share basis among the holders of the shares of common stock.

The holders of shares of our common stock are entitled to dividends out of funds legally available when and as declared by our board of directors. Our board of directors has never declared a dividend and does not anticipate declaring a dividend in the foreseeable future. Should we decide in the future to pay dividends, as a holding company, our ability to do so and meet other obligations depends upon the receipt of dividends or other payments from our operating subsidiary, our VIE and other holdings and investments. In addition, our operating subsidiary and our VIE, from time to time, may be subject to restrictions on its ability to make distributions to us, including as a result of restrictive covenants in loan agreements, restrictions on the conversion of local currency into U.S. dollars or other hard currency and other regulatory restrictions. In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to receive, ratably, the net assets available to stockholders after payment of all creditors.

All of the issued /and outstanding shares of our common stock are duly authorized, validly issued, fully paid and non-assessable. To the extent that additional shares of our common stock are issued, the relative interests of existing stockholders will be diluted.

Preferred Stock

We are authorized to issue up to 100,000,000 shares of preferred stock, par value $0.00001 per share, in one or more classes or series within a class as may be determined by our board of directors, who may establish, from time to time, the number of shares to be included in each class or series, may fix the designation, powers, preferences and rights of the shares of each such class or series and any qualifications, limitations or restrictions thereof. Any preferred stock so issued by the board of directors may rank senior to the common stock with respect to the payment of dividends or amounts upon liquidation, dissolution or winding up of us, or both. Moreover, under certain circumstances, the issuance of preferred stock or the existence of the unissued preferred stock might tend to discourage or render more difficult a merger or other change of control.

49

No other shares of our preferred stock are currently outstanding. The issuance of additional shares of preferred stock, while providing desirable flexibility in connection with possible acquisitions and other corporate purposes, could have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from acquiring, a majority of our outstanding voting stock.

Anti-takeover Effects of Our Articles of Incorporation and By-laws

Our amended and restated articles of incorporation and bylaws contain certain provisions that may have anti-takeover effects, making it more difficult for or preventing a third party from acquiring control of the Company or changing its board of directors and management. According to our bylaws and articles of incorporation, neither the holders of the Company’s common stock nor the holders of the Company’s preferred stock have cumulative voting rights in the election of our directors. The combination of the present ownership by a few stockholders of a significant portion of the Company’s issued and outstanding common stock and lack of cumulative voting makes it more difficult for other stockholders to replace the Company’s board of directors or for a third party to obtain control of the Company by replacing its board of directors.

Anti-takeover Effects of Nevada Law

Business Combinations

The “business combination” provisions of Sections 78.411 to 78.444, inclusive, of the Nevada Revised Statutes, or NRS, prohibit a Nevada corporation with at least 200 stockholders from engaging in various “combination” transactions with any interested stockholder: for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the transaction is approved by the board of directors prior to the date the interested stockholder obtained such status; or after the expiration of the three-year period, unless:

• the transaction is approved by the board of directors or a majority of the voting power held by disinterested stockholders, or

• if the consideration to be paid by the interested stockholder is at least equal to the highest of: (a) the highest price per share paid by the interested stockholder within the three years immediately preceding the date of the announcement of the combination or in the transaction in which it became an interested stockholder, whichever is higher, (b) the market value per share of common stock on the date of announcement of the combination and the date the interested stockholder acquired the shares, whichever is higher, or (c) for holders of preferred stock, the highest liquidation value of the preferred stock, if it is higher.

A “combination” is defined to include mergers or consolidations or any sale, lease exchange, mortgage, pledge, transfer or other disposition, in one transaction or a series of transactions, with an "interested stockholder" having: (a) an aggregate market value equal to 5% or more of the aggregate market value of the assets of the corporation, (b) an aggregate market value equal to 5% or more of the aggregate market value of all outstanding shares of the corporation, or (c) 10% or more of the earning power or net income of the corporation.

50

In general, an “interested stockholder” is a person who, together with affiliates and associates, owns (or within three years, did own) 10% or more of a corporation's voting stock. The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire our company even though such a transaction may offer our stockholders the opportunity to sell their stock at a price above the prevailing market price.

Our amended and restated articles of incorporation state that we have elected not to be governed by the “business combination” provisions, therefore such provisions currently do not apply to us.

Control Share Acquisitions

The “control share” provisions of Sections 78.378 to 78.3793, inclusive, of the NRS, which apply only to Nevada corporations with at least 200 stockholders, including at least 100 stockholders of record who are Nevada residents, and which conduct business directly or indirectly in Nevada, prohibit an acquirer, under certain circumstances, from voting its shares of a target corporation's stock after crossing certain ownership threshold percentages, unless the acquirer obtains approval of the target corporation's disinterested stockholders. The statute specifies three thresholds: one-fifth or more but less than one-third, one-third but less than a majority, and a majority or more, of the outstanding voting power. Once an acquirer crosses one of the above thresholds, those shares in an offer or acquisition and acquired within 90 days thereof become “control shares” and such control shares are deprived of the right to vote until disinterested stockholders restore the right. These provisions also provide that if control shares are accorded full voting rights and the acquiring person has acquired a majority or more of all voting power, all other stockholders who do not vote in favor of authorizing voting rights to the control shares are entitled to demand payment for the fair value of their shares in accordance with statutory procedures established for dissenters’ rights.

Our amended and restated articles of incorporation state that we have elected not to be governed by the “control share” provisions, therefore, they currently do not apply to us.

Transfer Agent and Registrar

Our independent stock transfer agent is Pacific Stock Transfer Company. Its mailing address is 4045 South Spencer Street, Suite 403, Las Vegas, NV 89119. Its phone number is (702) 361-3033.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 78.138 of the NRS provides that a director or officer will not be individually liable unless it is proven that (i) the director’s or officer’s acts or omissions constituted a breach of his or her fiduciary duties, and (ii) such breach involved intentional misconduct, fraud or a knowing violation of the law.

Section 78.7502 of NRS permits a company to indemnify its directors and officers against expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with a threatened, pending or completed action, suit or proceeding if the officer or director (i) is not liable pursuant to NRS 78.138 or (ii) acted in good faith and in a manner the officer or director reasonably believed to be in or not opposed to the best interests of the corporation and, if a criminal action or proceeding, had no reasonable cause to believe the conduct of the officer or director was unlawful.

51

Section 78.751 of NRS permits a Nevada company to indemnify its officers and directors against expenses incurred by them in defending a civil or criminal action, suit or proceeding as they are incurred and in advance of final disposition thereof, upon receipt of an undertaking by or on behalf of the officer or director to repay the amount if it is ultimately determined by a court of competent jurisdiction that such officer or director is not entitled to be indemnified by the company. Section 78.751 of NRS further permits the company to grant its directors and officers additional rights of indemnification under its articles of incorporation or bylaws or otherwise.

Section 78.752 of NRS provides that a Nevada company may purchase and maintain insurance or make other financial arrangements on behalf of any person who is or was a director, officer, employee or agent of the company, or is or was serving at the request of the company as a director, officer, employee or agent of another company, partnership, joint venture, trust or other enterprise, for any liability asserted against him and liability and expenses incurred by him in his capacity as a director, officer, employee or agent, or arising out of his status as such, whether or not the company has the authority to indemnify him against such liability and expenses.

Our amended and restated articles of incorporation provide that no director or officer of the Company will be personally liable to the Company or any of its stockholders for damages for breach of fiduciary duty as a director or officer; provided, however, that the foregoing provision shall not eliminate or limit the liability of a director or officer (i) for acts or omissions which involve intentional misconduct, fraud or knowing violation of law, or (ii) the payment of dividends in violation of Section 78.300 of NRS. In addition, our amended and restated articles of incorporation and bylaws implement the indemnification and insurance provisions permitted by Chapter 78 of the NRS by providing that:

• The Company shall indemnify its directors and officers, or any person serving at the request of the Company, to the fullest extent permitted by the NRS.

• The Company may at the discretion of the Board of Directors purchase and maintain insurance on behalf of any person who holds or who has held any position identified in the paragraph above against any and all liability incurred by such person in any such position or arising out of his status as such.

Insofar as indemnification by us for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling the company pursuant to provisions of our articles of incorporation and bylaws, or otherwise, we have been advised that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. In the event that a claim for indemnification by such director, officer or controlling person of us in the successful defense of any action, suit or proceeding is asserted by such director, officer or controlling person in connection with the securities being offered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

52

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE

None

ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES

On July 2, 2010, we issued 19,000,000 shares of our common stock to the shareholders of Classic Bond. The total consideration for the 19,000,000 shares was 50,000 ordinary shares of Classic Bond, which is all the issued and outstanding capital stock of Classic Bond. The number of our shares issued to the shareholders of Classic Bond was determined based on an arms-length negotiation. The issuance these shares was made in reliance on the exemption provided by Section 4(2) of the Securities Act for the offer and sale of securities not involving a public offering and Regulation D promulgated thereunder.

In instances described above where we issued securities in reliance upon Regulation D, we relied upon Rule 506 of Regulation D of the Securities Act. These stockholders who received the securities in such instances made representations that (a) the stockholder is acquiring the securities for his, her or its own account for investment and not for the account of any other person and not with a view to or for distribution, assignment or resale in connection with any distribution within the meaning of the Securities Act, (b) the stockholder agrees not to sell or otherwise transfer the purchased shares unless they are registered under the Securities Act and any applicable state securities laws, or an exemption or exemptions from such registration are available, (c) the stockholder has knowledge and experience in financial and business matters such that he, she or it is capable of evaluating the merits and risks of an investment in us, (d) the stockholder had access to all of our documents, records, and books pertaining to the investment and was provided the opportunity to ask questions and receive answers regarding the terms and conditions of the offering and to obtain any additional information which we possessed or were able to acquire without unreasonable effort and expense, and (e) the stockholder has no need for the liquidity in its investment in us and could afford the complete loss of such investment. Management made the determination that the investors in instances where we relied on Regulation D are accredited investors (as defined in Regulation D) based upon management’s inquiry into their sophistication and net worth. In addition, there was no general solicitation or advertising for securities issued in reliance upon Regulation D.

In instances described above where we indicate that we relied upon Section 4(2) of the Securities Act in issuing securities, our reliance was based upon the following factors: (a) the issuance of the securities was an isolated private transaction by us which did not involve a public offering; (b) there were only a limited number of offerees; (c) there were no subsequent or contemporaneous public offerings of the securities by us; (d) the securities were not broken down into smaller denominations; and (e) the negotiations for the sale of the stock took place directly between the offeree and us.

53

ITEM 5.01 CHANGES IN CONTROL OF REGISTRANT

Reference is made to the disclosure set forth under Item 2.01 of this report, which disclosure is incorporated herein by reference.

As a result of the closing of the reverse acquisition with Classic Bond, the former shareholders of Classic Bond own an aggregate of 94% of the total outstanding shares of our capital stock and 94% total voting power of all our outstanding voting securities.

ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS

Upon the closing of the reverse acquisition of Classic Bond pursuant to the Share Exchange Agreement on July 2, 2010, Xuezheng Yuan, our sole director and officer, submitted a resignation letter pursuant to which he resigned immediately from all offices that he held and from his position as our sole director effective 10 days after mailing of the Information Statement. The resignation of Mr. Yuan was not in connection with any known disagreement with us on any matter.

A copy of this report has been provided to Mr. Yuan, who has been provided with the opportunity to furnish us as promptly as possible with a letter addressed to us stating whether she agrees with the statements made by us in this report, and if not, stating the respects in which she does not agree. No such letter has been received by us.

On the same day, our board of directors increased its size from one to five members and appointed Dishan Guo, Zhenquan Guo, Lei Li, Wenbin An and Lizong Wang to fill the vacancies created by the resignation of Mr. Yuan and such increase. Mr. Guo joined the board on July 2, 2010, and the other four new directors will join board when Yuan’s resignation as director takes effect 10 days after mailing of the Information Statement.

ITEM 5.03 AMENDMENT TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR

On July 2, 2010, our board of directors approved a change in our fiscal year end from June 30 to December 31. This change is being effectuated in connection with the reverse acquisition transaction described in Item 2.01 above.

ITEM 5.06 CHANGE IN SHELL COMPANY STATUS

Reference is made to the disclosures set forth under Item 2.01 and 5.01 of this report, which disclosure is incorporated herein by reference.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements of Business Acquired

1. Unaudited condensed combined financial statements of Junlong for the three months ended March 31, 2010 and 2009.

2. Audited combined financial statements of Junlong for the fiscal years ended December 31, 2009 and 2008.

54

(b) Pro Forma Financial Information

Filed herewith is unaudited pro forma combined financial information of China Unitech and its subsidiaries.

(d) Exhibits

Exhibit No.	Description
2.1*	Form of Share Exchange Agreement, dated July 2, 2010, among the Company, Classic Bond Development Limited and its shareholders.
3.1	Articles of Incorporation of the Company [Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form SB-2 filed on August 30, 2006].
3.2	Bylaws of the Company [Incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form SB-2 filed on August 30, 2006].
4.1*	Form of Cancellation Agreement, dated July 2, 2010, among the Company and certain shareholders.
10.1*	Management Consulting Service Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.2*	Equity Pledge Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.3*	Option Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.4*	Proxy Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.5*	English Translation of Employment Agreement, dated April 1, 2009, between Junlong and Tu Fan.
10.6*	English Translation of Form of Non-disclosure and Non-competition Agreement, dated March 11, 2010, between Junlong and its employees.
10.7*	English Summary of Loan Agreement, dated October 23, 2009, between Junlong and Shenzhen Branch of China Construction Bank.
10.8*	English Summary of Guaranty Contract of Maximum Amount, dated October 23, 2009, between Dishan Guo and Shenzhen Branch of China Construction Bank.
10.9*	English Summary of Purchase Agreement, dated June 7, 2010, between Junlong and Shenzhen SEG Industrial Investment Co., Ltd.
10.10*	English Summary of Lease Contract, dated September 1, 2006, between Junlong and Zou Zhiwei.
10.11*	English Summary of Lease Contract, dated December 15, 2009, between Junlong and Hao Changsheng
21*	Subsidiaries of the Company.

* Filed herewith

55

SIGNATURES

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: July 9, 2010

CHINA UNITECH GROUP, INC.

By:/s/ Dishan Guo                               
      Dishan Guo
      Chief Executive Officer

56

SHENZHEN JUN LONG CULTURE COMMUNICATION CO., LTD.

FINANCIAL STATEMENTS

FOR THE YEARS ENDED

DECEMBER 31, 2009 AND 2008

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

INDEX TO FINANCIAL STATEMENTS

	Page
Report of Independent Registered Public Accounting Firm	F-1
Balance Sheets	F-2
Statements of Income and Comprehensive Income	F-3
Statements of Stockholders’ Equity	F-4
Statements of Cash Flows	F-5
Notes to Financial Statements	F-6 - F-18

Certified Public Accountants | 1870 Winston Road S., Suite 200 | Rochester, New York 14618 | 585.295.2400 | EFPRotenberg.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Shenzhen Jun Long Culture Communication Co., Ltd.
1-D-1010, Yuan Jing Park, Long Xiang Road
City Centre, Long Gang District
Shenzhen City, Guangdong Province, China

We have audited the accompanying balance sheets of Shenzhen Jun Long Culture Communication Co., Ltd. as of December 31, 2009 and 2008, and the related statements of income, stockholders’ equity and comprehensive income, and cash flows for each of the years in the two-year period ended December 31, 2009. Shenzhen Jun Long Culture Communication Co., Ltd.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Shenzhen Jun Long Culture Communication Co., Ltd. as of December 31, 2009 and 2008, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2009 in conformity with accounting principles generally accepted in the United States of America.

/s/ EFP Rotenberg, LLP

EFP Rotenberg, LLP
Rochester, New York
February 26, 2010

F-1

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

BALANCE SHEETS

		December 31,		December 31,
		2009		2008
ASSETS
Current assets:
Cash and cash equivalents	$	3,055,404	$	1,112,646
Restricted cash		1,645,411		-
Rental deposit		144,504		130,723
Equipment deposit		81,217		29,004
Inventory		204,971		74,096
Total current assets		5,131,507		1,346,469
Plant and equipment, net		3,572,696		3,574,931
Total assets	$	8,704,203	$	4,921,400
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short term loan	$	146,259	$	-
Accounts payable		33,979		22,418
Deferred revenue		775,985		800,474
Payroll and payroll related liabilities		124,390		119,633
Income and other taxes payable		525,470		943,473
Accrued expenses		43,126		32,407
Amount due to a director		5,162		350,570
Total current liabilities		1,654,371		2,268,975
Stockholders' Equity
Capital - at stated value, no authorized shares		1,367,222		1,367,222
Statutory reserves		718,744		399,802
Retained earnings		4,752,871		683,364
Accumulated other comprehensive income		210,995		202,037
Total stockholders’ equity		7,049,832		2,652,425
Total liabilities and stockholders’ equity	$	8,704,203	$	4,921,400

The accompanying notes are an integral part of the financial statements

F-2

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

		For The Years Ended
		December 31
		2009			2008
Revenue, net	$	14,038,931		$	10,107,823
Cost of revenue
Depreciation expenses		1,276,415			986,165
Direct labor		830,944			699,917
Rental payments for cafes		814,954			688,499
Utility expenses		1,367,545			989,448
Business tax and surcharge		3,319,554			2,389,324
Other overhead associated with the internet cafes		800,115			582,810
		8,409,527			6,336,163
Gross profit		5,629,404			3,771,660
Operating Expenses
General and administrative expenses		166,141			106,681
Total operating expenses		166,141			106,681
Income from operations		5,463,263			3,664,979
Non-operating income (expenses)
Interest income		-			859
Other income		-			(221	)
Interest expenses		(819	)		-
Other expenses		(5,733	)		-
Total other income (expenses)		(6,552	)		637
Net income before income taxes		5,456,711			3,665,617
Income taxes		1,068,262			652,052
Net income	$	4,388,449		$	3,013,565
Other comprehensive income
Foreign currency translation		8,958			160,001
Comprehensive income	$	4,397,407		$	3,173,566

The accompanying notes are an integral part of the financial statements

F-3

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF STOCKHOLDERS’ EQUITY FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

								Accumulated
		Stated						other		Total
		Capital		Statutory	Retained			comprehensive		Stockholders’
		Amount		reserves	Earnings			income		Equity
Balance at December 31, 2007	$	1,367,222	$	98,427 $	843,809		$	42,036	$	2,351,494
Dividend paid		-			(2,872,635	)		-		(2,872,635	)
Transfers to statutory reserves				301,375	(301,375	)				-
Net income for the year		-			3,013,565			-		3,013,565
Foreign currency translation difference		-						160,001		160,001
Balance at December 31, 2008		1,367,222		399,802	683,364			202,037		2,652,425
Transfers to statutory reserves		-		318,942	(318,942	)		-		-
Net income for the year		-			4,388,449			-		4,388,449
Foreign currency translation difference		-		-	-			8,958		8,958
Balance at December 31, 2009		1,367,222		718,744	4,752,871			210,995		7,049,832

The accompanying notes are an integral part of the financial statements

F-4

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF CASH FLOWS

		For The Years Ended
		December 31
		2009			2008
Cash flows from operating activities:
Net income	$	4,388,449		$	3,013,565
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		1,303,177			997,921
Changes in operating assets and liabilities:
Rental deposit		(13,449	)		(16,087	)
Inventory		(130,619	)		(54,229	)
Accounts payable		11,499			4,599
Amount due to director		(346,093	)		10,772
Payroll and payroll related liabilities		4,457			50,486
Accrued expenses		10,632			15,752
Deferred revenue		(26,466	)		151,206
Income and other tax payable		(420,123	)		780,756
Net cash provided by operating activities		4,781,464			4,954,741
Cash flows from investing activities:
Acquisition of property, plant and equipment		(1,324,220	)		(1,512,446	)
Deposit paid for equipment and construction in progress		(19,952	)		(6,377	)
Restricted cash		(1,644,525	)		-
Net cash used in investing activities		(2,988,697	)		(1,518,823	)
Cash flows from financing activities:
Proceeds from bank loan		146,180			-
Dividend paid		-			(2,872,635	)
Net cash flows provided by (used in) financing activities:		146,180			(2,872,635	)
Effect of foreign currency translation on cash and cash equivalents		3,811			42,865
Net increase in cash		1,942,758			606,148
Cash- beginning of year		1,112,646			506,498
Cash- end of year	$	3,055,404		$	1,112,646
Cash paid during the year for:
Interest paid	$	1,423		$	-
Income taxes paid	$	962,623		$	535,364

The accompanying notes are an integral part of the financial statements

F-5

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

1. Organization and Nature of Business

Shenzhen Junlong Culture Communication Co., Ltd. (“Junlong’) is a Chinese enterprise organized in the People’s Republic of China (“PRC”) on December 26, 2003 in accordance with the Laws of the People’s Republic of China with the registered capital of $0.136 million (equivalent to Rmb 1 million).

In 2001, the Chinese government imposed higher capital (Rmb10 million for regional internet café chain and Rmb50 million for national internet café chain) and facility requirements for the establishment of internet cafes. On August 19, 2004, Junlong was granted approval from Shenzhen Municipal People’s Government to increase its registered capital by $1,230,500 from $136,722 to $1,367,222 million (increased by RMB 9 million, from RMB 1 million to RMB 10 million) The capital verification process has been completed.

In 2005, Junlong obtained internet cafe licenses of operating internet café chain from the Ministry of Culture, and opened the internet first cafe in April, 2006 and our member can access internet at our venues. As of December 31, 2009, the company operated 28 internet cafes, including 10 internet cafes opened in 2006, 3 internet cafes opened in 2007, 10 internet cafes opened in 2008, and 5 internet cafes opened in 2009. Junlong currently mainly engages in the operation of internet café chain stores in the Shenzhen region of PRC.

On December 25, 2008, the company declared a dividend of $2.9 million (equivalent to RMB20 million).

2. Summary of Significant Accounting Policies

(a) Basis of presentation

The Company’s accounting policies used in the preparation of the accompanying financial statements conform to accounting principles generally accepted in the United States of America ("US GAAP") and have been consistently applied.

(b) Use of estimates

In preparing financial statements in conformity with US GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported periods. Actual results could differ from those estimates

Significant Estimates
These financial statements include some amounts that are based on management's best estimates and judgments. The most significant estimates relate to depreciation of property, plant and equipment, the valuation allowance for deferred taxes, impairment testing of long-lived assets and various contingent liabilities. It is reasonably possible that the above-mentioned estimates and others may be adjusted as more current information becomes available, and any adjustment could be significant in future reporting periods.

F-6

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

2. Summary of Significant Accounting Policies - Continued

(c) Revenue recognition

Internet café members purchase prepaid IC cards which include stored value that will be deducted based on time usage of computer at the internet cafe. Revenues derived from the prepaid IC cards at the internet café are recognized when services are provided. This is based upon usage of computer time at the internet cafe. Outstanding customer balances in the IC cards are included in deferred revenue on the balance sheets. The Company does not charge any service fees that cause a decrement to customer balances. There is no expiration date for IC cards.

The Company also records revenue from commission received from the sale of third parties on-line gaming cards, snacks and drinks. Commission revenue amounted to 20% of the value of the on-line gaming cards, snacks and drinks is recognized at the time the gaming cards, etc. are sold to customers. During the years ended December 31, 2009 and 2008, the commission income was $ 116,651 and $88,082, less than 1% of total revenue.

(d) Cost of goods sold

Cost of goods sold consists primarily of depreciation of Café computer equipment and hardware, overhead associated with the internet cafes, including rental payments, utilities, business tax and surcharge. Companies in China are generally subject to business tax and related surcharges by various local tax authorities at rates ranging from 5% to 6% on gross revenue generated from internet cafés.

(e) Credit risk

The Company may be exposed to credit risk from its cash at bank, fixed deposits. An allowance has been made for estimated irrecoverable amounts determined by reference to past default experience and the current economic environment.

(f) Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash accounts, interest bearing savings accounts and time certificates of deposit with a maturity of three months or less when purchased.

(g) Restricted cash

At December 31, 2009, restricted cash of $1,645,411 represented cash held by two escrow agents on behalf of the company for registered capital and operating cash flow purposes of two new subsidiary companies to be established in Yiwu city, Zhejiang province and Anshun city, Guizhou province.

(h) Inventory

Inventory represented the IC cards we purchased from IC cards manufacturer. Inventories are stated at the lower of cost or market value. Cost is determined using the first-in, first-out (FIFO) method.

F-7

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

2. Summary of Significant Accounting Policies - Continued

(i) Fair Value of Financial Instruments

FASB accounting standard requires disclosing fair value to the extent practicable for financial instruments that are recognized or unrecognized in the balance sheet. The fair value of the financial instruments disclosed herein is not necessarily representative of the amount that could be realized or settled, nor does the fair value amount consider the tax consequences of realization or settlement.

For certain financial instruments, including cash, accounts payable, short-term loans, accruals and other payables, it was assumed that the carrying amounts approximate fair value because of the near term maturities of such obligations.

(j) Equipment Deposits

The Company prepaid the equipments deposits to the computer suppliers for purchase of computer and equipments for the two new internet cafes which were expected to be opened in Spring, 2010.

(k) Property, plant and equipment

Fixed assets, comprising computer equipment and hardware, leasehold improvements, office furniture and vehicles and are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives listed below.

	Estimated Useful Lives
Leasehold improvement	Lesser of term of the lease or the estimated useful lives of the assets
Café computer equipment and hardware	5 years
Café furniture and fixtures	5 years
Office furniture, fixtures and equipments	5 years
Motor vehicles	5 years

(l) Deferred Revenue

Deferred revenue represents amounts from the IC cards that are unused balance. The Outstanding customer balances are $775,985 and $800,474 as at December 31, 2009 and 2008 and are included in deferred revenue on the balance sheets.

(m) Comprehensive income

The Company follows the FASB’s accounting standard. Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investments from owners and distributions to owners. For the Company, comprehensive income for the periods presented includes net income and foreign currency translation adjustments.

F-8

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

2. Summary of Significant Accounting Policies - Continued

(n) Income taxes

Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred income tax liabilities or assets are recorded to reflect the tax consequences in future differences between the tax basis of assets and liabilities and the financial reporting amounts at each year end. A valuation allowance is recognized if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized.

(o) Foreign currency translation

Assets and liabilities of the Company with a functional currency other than US$ are translated into US$ using period end exchange rates. Income and expense items are translated at the average exchange rates in effect during the period. Foreign currency translation differences are included as a component of Accumulated Other Comprehensive Income in Stockholders’ Equity.

The exchange rates used to translate amounts in RMB into USD for the purposes of preparing the consolidated financial statements were as follows:

	2009	2008
Year end RMB : USD exchange rate	6.8372	6.8542
Average yearly RMB : USD exchange rate	6.8409	6.9623

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

(p) Post-retirement and post-employment benefits

The Company contributes to a state pension plan in respect of its PRC employees. Other than the above, neither the Company nor its subsidiary provides any other post-retirement or post-employment benefits.

(q) Earnings Per Common Share

No basic income/loss per common share has been calculated based on the weighted average number of shares outstanding during the period since the Company is a Chinese company with stated capital, without number of shares.

(r) Retained earnings-appropriated

In accordance with the relevant PRC regulations and the Company’s PRC articles of association, Junlong is required to allocate their respective net income to statutory surplus reserve.

(s) Statutory surplus reserve

In accordance with the relevant laws and regulations of the PRC and the articles of associations of the Company, Junlong is required to allocate 10% of their net income reported in the PRC statutory accounts, after offsetting any prior years’ losses, to the statutory surplus reserve, on an annual basis. When the balance of such reserve reaches 50% of the respective registered capital of the subsidiaries, any further allocation is optional.

F-9

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

2. Summary of Significant Accounting Policies - Continued

The statutory surplus reserves can be used to offset prior years’ losses, if any, and may be converted into registered capital, provided that the remaining balances of the reserve after such conversion is not less than 25% of registered capital. The statutory surplus reserve is non-distributable.

Recently Adopted Accounting Pronouncements

Accounting Standards Codification

In June 2009, the Financial Accounting Standards Board (“FASB”) issued a standard that established the FASB Accounting Standards Codification (the “ASC”), which effectively amended the hierarchy of U.S. generally accepted accounting principles (“GAAP”) and established only two levels of GAAP, authoritative and non-authoritative. All previously existing accounting standard documents were superseded, and the ASC became the single source of authoritative, nongovernmental GAAP, except for rules and interpretive releases of the Securities and Exchange Commission (“SEC”), which are sources of authoritative GAAP for SEC registrants. All other non-grandfathered, non-SEC accounting literature not included in the ASC became non-authoritative. The ASC was intended to provide access to the authoritative guidance related to a particular topic in one place. New guidance issued subsequent to June 30, 2009 will be communicated by the FASB through Accounting Standards Updates. The ASC was effective for financial statements for interim or annual reporting periods ending after September 15, 2009. We adopted and applied the provisions of the ASC for the Company’s fiscal year ended December 31, 2009, and have eliminated references to pre-ASC accounting standards throughout the financial statements. The adoption of the ASC did not have a material impact on the Company’s financial statements.

Subsequent Events

In May 2009, the FASB issued new guidance on the treatment of subsequent events which is intended to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. Specifically, management of a reporting entity is required to evaluate subsequent events through the date that financial statements are issued and disclose the date through which subsequent events have been evaluated, as well as the date the financial statements were issued. This new guidance was effective for fiscal years and interim periods ended after June 15, 2009, and must be applied prospectively. The Company adopted this guidance in the year ended December 31, 2009.

Fair Value and Other-Than-Temporary Impairments

In April 2009, the FASB issued new guidance intended to provide additional application guidance and enhanced disclosures regarding fair value measurements and impairments of securities. New guidance related to determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly provides additional guidelines for estimating fair value in accordance with pre-existing guidance on fair value measurements. New guidance on recognition and presentation of other-than-temporary impairments provides additional guidance related to the disclosure of impairment losses on securities and the accounting for impairment losses on debt securities, but does not amend existing guidance related to other-than-temporary impairments of equity securities. The new guidance was effective for fiscal years and interim periods ended after June 15, 2009. As such, the Company adopted this guidance for the quarter ended July 31, 2009. Adoption of the new guidance did not have a material impact on the Company’s financial statements.

Hierarchy of Generally Accepted Accounting Principles

In June 2009, the FASB issued FASB ASC 105-10 (Prior authoritative literature: FASB Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles”). FASB ASC 105-10 replaces SFAS No. 162 and establishes the FASB Accounting Standards Codification as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. FASB ASC 105-10 is effective for financial statements issued for interim and annual periods ending after September 15, 2009. As such, the Company is required to adopt this standard in the current period. Adoption of FASB ASC 105-10 did not have a significant effect on the Company’s financial statements.

F-10

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

2. Summary of Significant Accounting Policies - Continued

Financial Instruments
In February 2007, the FASB issued a new accounting standard which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This accounting standard also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. This accounting standard is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company adopted this accounting standard on November 1, 2008. It has not elected to measure any financial assets and financial liabilities at fair value which were not previously required to be measured at fair value. Therefore, the adoption of this accounting standard has had no impact on its financial statements and footnote disclosure.

In April 2009, the FASB issued additional guidance to require disclosures about the fair value of financial instruments on an interim basis. Previously, this has been disclosed on an annual basis only. The Company adopted this guidance for the quarter ended July 31, 2009. This guidance has not impacted the Company’s balance sheets or income statements, as its requirements are disclosure-only in nature.

Fair Value Measurement
In September 2006, the FASB issued a new accounting standard related to fair value measurements. The new standard defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. In February 2008, the FASB issued a new provision which delayed the effective date of the fair value measurements and disclosures for all nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). In August 2009, the FASB issued ASU No. 2009-05, "Measuring Liabilities at Fair Value" in relation to the fair value measurement of liabilities. The Company adopted the applicable portions of the provisions of the new standards as of November 1, 2008, and will adopt the provision related to the nonfinancial assets and nonfinancial liabilities on November 1, 2009. The adoption of this accounting standard for financial assets and financial liabilities did not have a material impact on its financial statements. Although the Company will continue to evaluate the application of the provision for the nonfinancial assets and nonfinancial liabilities, the Company does not expect the adoption to have a material impact on the financial statements.

Measuring Liabilities at Fair Value
In August 2009, the FASB issued an accounting standard update that amended the accounting standard for fair value measurements. Specifically, the accounting standard update provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following methods: 1) a valuation technique that uses a) the quoted price of the identical liability when traded as an asset or b) quoted prices for similar liabilities or similar liabilities when traded as assets and/or 2) a valuation technique that is consistent with the principles of the accounting standard on fair value measurements (e.g. an income approach or market approach). This accounting standard update also clarifies that when estimating the fair value of a liability, a reporting entity is not required to adjust to include inputs relating to the existence of transfer restrictions on that liability. This guidance will be effective for the first interim period beginning November 1, 2009. The Company does not anticipate that the adoption of this statement will have a material impact on its financial statements.

Useful Life of Intangible Asset
In April 2008, the FASB issued a new accounting standard which amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset. This guidance is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. Application of this accounting standard is not currently applicable to the Company.

F-11

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

3. Cash and Cash Equivalents

Cash and cash equivalents are summarized as follows:

		2009		2008
Cash at bank	$	2,969,539	$	1,040,596
Cash in hand		85,865		72,050
	$	3,055,404	$	1,112,646

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents (Note 2). As of December 31, 2009 and December 31, 2008, substantially all of the Company’s cash and cash equivalents were held by major banks located in the PRC, which management believes are of high credit quality.

4. Restricted Cash

Bank deposits held by:		2009		2008
Mr. Fang Zheng-rong	$	914,117	$	-
Mr. Tsang Kam-ping		731,294		-
	$	1,645,411	$	-

At December 31, 2009, restricted cash of $1,645,411 represented cash held by two escrow agents on behalf of the company for registered capital and operating cash flow purposes of two new subsidiary companies to be established in Yiwu city, Zhejiang province and Anshun city, Guizhou province.

5. Equipment deposit

Equipment deposit consists of:

		2009		2008
Equipment deposit for purchase computers	$	81,217	$	29,004

F-12

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

6. Inventory

Inventory consists of:

		2009		2008
Purchased IC cards	$	204,971	$	74,096

There was no allowance made for obsolete or slow moving inventory as of December 31, 2009 and 2008.

7. Property, Plant and Equipment

Property, plant and equipment consist of the following:

		December 31,			December 31,
		2009			2008
Leasehold improvement	$	2,388,937		$	1,921,211
Café computers equipments and hardware		3,333,037			2,705,098
Café furniture and fixtures		858,846			699,662
Office furniture, fixtures and equipments		21,117			16,574
Motor vehicle		94,073			15,211
	$	6,696,010		$	5,357,756
Less: Accumulated depreciation		(3,169,385	)		(1,860,880	)
Property and equipment in service, net		3,526,625			3,496,877
Construction in progress		46,071			78,054
Property and equipment, net	$	3,572,696		$	3,574,931

During the year ended December 31, 2009, depreciation expenses amounted to $1,303,181, of which $ 1,276,415 and $ 26,766 was recorded as cost of sales and general and administrative expense, respectively.

During the year ended December 31, 2008, depreciation expenses amounted to $997,922, of which $986,165 and $11,757 was recorded as cost of sales and general and administrative expense, respectively.

F-13

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

8. Short Term Loan

The short term loan due within one year as of December 31, 2009 and 2008 consist of the following:

				2009		2008
Bank	Loan Period	Interest rate
China Construction Bank	October 27, 2009 to October 25, 2010	6.372%	$	146,259	$	-

On October 27, 2009, the Company entered into a loan agreement with China Construction Bank for $146,259 (RMB1,000,000) which was secured by director’s guarantee. The annual interest rate is 6.372% and is due on October 25, 2010.

9. Due To A Director

		2009		2008
Mr. Guo Di Shan, a director of the Company	$	5,162	$	350,570

The amount due to Mr. Guo Di Shan is unsecured with no stated interest or repayment terms.

10.  Income and Other Tax Payables

Income and other tax payables consist of the following:

		2009		2008
Business tax payable	$	240,015	$	180,374
Income tax		280,027		173,898
Withhold Individual income tax payable		2,907		587,306
Other tax payables		2,521		1,895
Total	$	525,470	$	943,473

F-14

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

11. Income Tax

The Company incorporated in PRC are subject to PRC enterprises income tax at the applicable tax rates on the taxable income as reported in their Chinese statutory accounts in accordance with the relevant enterprises income tax laws. Junlong was charged a tax rate of 18% of its taxable income in 2008 and 20% in 2009.

The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. There are no material timing differences and therefore no deferred tax asset or liability at December 31, 2009. As approved by the relevant tax authority in the PRC, Junlong’s income tax rates will be 22% and 24% for 2010 and 2011 respectively and 24% for 2012 and thereafter.

The income tax provision consists of the following:

		2009		2008
Current	$	1,068,262	$	652,052
Deferred		-		-
	$	1,068,262	$	652,052

The Company applied the provisions of ASC 740.10.50, “Accounting For Uncertainty In Income Taxes”, which provides clarification related to the process associated with accounting for uncertain tax positions recognized in our consolidated financial statements. ASC 740.10.50 prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return. ASC 740.10.50 also provides guidance related to, among other things, classification, accounting for interest and penalties associated with tax positions, and disclosure requirements. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the consolidated statements of operation. The Company’s policy for recording interest and penalties associated with audits is to record such items as a component of income tax expense.

As of December 31, 2009, the Company is subject to potential audit by the PRC tax bureau for three yeas afterwards. As of December 31, 2009 and 2008, the Company did not accrue any interest and penalties in connection with ASC 740.10.50.

12. Employee Benefits

The Company contributes to a state pension scheme organized by municipal and provincial governments in respect of its employees in PRC. The compensation expense related to this plan, which is calculated at a range of  8% of the average monthly salary, was $6,671 and $4,357 for the years ended December 31, 2009 and 2008, respectively.

F-15

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

13. Commitments and Contingencies

Operating Leases
In the normal course of business, the Company leases office space and internet cafes under operating leases agreements, which expire through 2014. The Company rents internet cafes venues and office space, primarily for regional sales administration offices that are conducive to administrative operations. The operating leases agreements generally contain renewal options that may be exercised in the Company's discretion after the completion of the base rental terms. In addition, many of the leases provide for regular increases to the base rental rate at specified intervals, which usually occur on an annual basis.

As of December 31, 2009, the Company was obligated under operating leases requiring minimum rentals as follows:

Fiscal year
2010	$	866,555
2011		709,850
2012		474,062
2013		188,865
2014 and thereafter		97,648
	$	2,336,980

During the year ended December 31, 2009, rent expenses amounted to $823,730, of which $814,954 and $8,776 was recorded as cost of sales and general and administrative expense, respectively.

During the year ended December 31, 2008, rent expenses amounted to $697,117, of which $688,499 and $8.618 was recorded as cost of sales and general and administrative expense, respectively.

Incorporation of Two New Subsidiary Companies

The Company is committed to establish two new subsidiary companies, which located in Yiwu city, Zhejiang province and Anshun city, Guizhou province with the investment of approximately $2.195 million (equivalent to Rmb15 million) each, with total of $4.39 million as registered capital and operating cash flow purposes. The registered capital of each subsidiary company will be $0.439 million (Rmb3,000,000). As of December 31, 2009, the company paid approximately $1.6 million (Rmb11.25 million) in total to two escrow agents and the amounts were recorded under restricted cash.

Upon the establishment of the two subsidiary companies, the two escrow agents will be appointed as the General Manager of the two subsidiary companies. The Company is committed to pay a monthly salary of approximately $1,100 (Rmb7,500) plus 3% of the net income of the respective subsidiary companies as bonus.

F-16

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

14. Concentrations, Risks, and Uncertainties

The Company did not have any customer constituting greater than 10% of net sales for the year ended December 31, 2009.

At December 31, 2009 and 2008, there was one supplier of consignment snacks and drinks accounted for 100% of the Company’s account payable, with a total amount of $33,979 and $22,418 respectively.

15. Operating Risk

 Interest rate risk

The interest rates and terms of repayment of bank and other borrowings are disclosed in Note 8. Other financial assets and liabilities do not have material interest rate risk.

Foreign currency risk

Most of the transactions of the Company were settled in Renminbi. In the opinion of the directors, the Company does not have significant foreign currency risk exposure.

Company’s operations are substantially in foreign countries

Substantially all of the Company’s products are processed in China. The Company’s operations are subject to various political, economic, and other risks and uncertainties inherent in China. Among other risks, the Company’s operations are subject to the risks of restrictions on transfer of funds; export duties, quotas, and embargoes; domestic and international customs and tariffs; changing taxation policies; foreign exchange restrictions; and political conditions and governmental regulations.

The Chinese government began tightening its regulation of internet cafes since 2001,. In particular, a large number of unlicensed internet cafes have been closed. In addition, the Chinese government has imposed higher capital (Rmb10,000,000 for regional internet café chain is required and Rmb50,000,000 for national internet café chain) and facility requirements for the establishment of internet cafes. Furthermore, the Chinese government’s policy, which encourages the development of a limited number of national and regional internet cafe chains and discourages the establishment of independent internet cafes, may slow down the growth of internet cafes. Recently, the Ministry of Culture, together with other government authorities, issued a joint notice suspending the issuance of new internet cafe chain licenses. Any intensified government regulation of internet cafes could restrict our ability to maintain and expand our internet cafes.

Currently, the Company uses only one internet service provider. However, there are other internet service providers available to the Company. The management of the Company believes that the risk of loss of internet services is not that high because of other service providers available to the Company.

16. Shareholders’ Equity

On December 26, 2003, the inception date of the company, Junlong was formed with 3 shareholders, Mr. Guo Di Shan, Mr. Ceng Jin Zhou and Ms. Wang Xiao Fen. The initial capital was $136,722 (Rmb1,000,000), Mr. Guo Di Shan, Mr. Ceng Jin Zhou and Ms. Wang Xiao Fen contributed $68,362, $34,180 and $34,180 respectively.

On August 26, 2004, the Company increased its registered share capital from $136,722 (Rmb1,000,000) to $1,367,222 (Rmb10,000,000) by the creation of additional $1,230,500(Rmb9,000,000) registered capital. Mr. Guo Di Shan and Mr. Ceng Jin Zhou contributed $ 1,162,139 and $68,361 respectively.

On May 27, 2008, Mr. Guo Di Shan sold his 10% to Mr. Yang Xiao Jiang, and on October 13, 2009, Mr. Yang Xiao Jiang sold his 10% shareholding back to Mr. Guo Di Shan. Since the registration process with the PRC registration department on such change of shareholding was not yet effective as of December 31, 2009, the current shareholding of the Company are: Mr. Guo Di Shan held 80%, Mr. Yang Xiao Jiang held 10%, Mr. ChenJin Zhou held 7.5% and Ms. Wang Xiao Fen held 2.5% of the shareholding of the Company.

F-17

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008

17.  Subsequent Event

The Company evaluated subsequent events through the time of issuance of the financial statements on February 26, 2010. Pursuant to the requirements of FASB ASC Topic 855, there were no events or transactions occurring during this subsequent event reporting period that require recognition or disclosure in the financial statements. There is no subsequent event from December 31, 2009 through February 26, 2010, the financial statements issue date.

18. Segment Information

The Company applies the provisions of Statement of Financial Accounting Standards No. 131, "Disclosures about Segments of an Enterprise and Related Information". The Company views its operations and manages its business as one segment: the operation of internet café chain. Factors used to identify the Company's single operating segment include the organizational structure of the Company and the financial information available for evaluation by the chief operating decision-maker in making decisions about how to allocate resources and assess performance. The Company operates predominantly in one geographical area, the PRC.

F-18

SHENZHEN JUN LONG CULTURE COMMUNICATION CO., LTD.

FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND DECEMBER 31, 2009

F-19

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

INDEX TO FINANCIAL STATEMENTS

	Page
Balance Sheets	F-21
Statements of Income and Comprehensive Income	F-22
Statements of Stockholders’ Equity	F-23
Statements of Cash Flows	F-24
Notes to Financial Statements	F-25 - F-35

 

F-20

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

BALANCE SHEETS

		March 31,		December 31,
		2010		2009
		Unaudited
ASSETS
Current assets:
Cash and cash equivalents	$	4,641,622	$	3,055,404
Restricted cash		1,645,675		1,645,411
Rental deposit		144,527		144,504
Equipment deposit		81,230		81,217
Inventory		190,988		204,971
Total current assets		6,704,042		5,131,507
Plant and equipment, net		3,234,866		3,572,696
Total assets	$	9,938,908	$	8,704,203
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short term loan	$	146,282	$	146,259
Accounts payable		51,475		33,979
Deferred revenue		768,081		775,985
Payroll and payroll related liabilities		103,312		124,390
Income and other taxes payable		603,250		525,470
Accrued expenses		47,621		43,126
Amount due to a director		4,674		5,162
Total current liabilities		1,724,695		1,654,371
Stockholders' Equity:
Capital - at stated value, no authorized shares		1,367,222		1,367,222
Statutory reserves		718,744		718,744
Retained earnings		5,916,130		4,752,871
Accumulated other comprehensive income		212,117		210,995
Total stockholders’ equity		8,214,213		7,049,832
Total liabilities and stockholders’ equity	$	9,938,908	$	8,704,203

The accompanying notes are an integral part of the financial statements

F-21

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
UNAUDITED

		For The Three Months Ended
		March 31
		2010			2009
Revenue, net	$	3,721,105		$	3,204,703
Cost of revenue
Depreciation expenses		331,630			285,000
Direct labor		228,523			185,381
Rental payments for cafes		206,699			195,134
Utility expenses		344,049			312,102
Business tax and surcharge		880,168			757,836
Other overhead associated with the internet cafes		169,070			223,839
		2,160,139			1,959,292
Gross profit		1,560,966			1,245,411
Operating Expenses
General and administrative expenses		62,673			37,653
Total operating expenses		62,673			37,653
Income from operations		1,498,293			1,207,758
Non-operating income (expenses)
Interest income		-			99
Other income		-			(95	)
Interest expenses		(1,141	)		-
Other expenses		(29	)		-
Total other income (expenses)		(1,170	)		4
Net income before income taxes		1,497,123			1,207,762
Income taxes		333,864			216,578
Net income	$	1,163,259		$	991,184
Other comprehensive income
Foreign currency translation		1,122			3,477
Comprehensive income	$	1,164,381		$	994,661

The accompanying notes are an integral part of the financial statements

F-22

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF STOCKHOLDERS’ EQUITY

									Accumulated
		Stated							other		Total
		Capital		Statutory		Retained			comprehensive		Stockholders’
		Amount		reserves		Earnings			income		Equity
Balance at December 31, 2008	$	1,367,222	$	399,802	$	683,364		$	202,037	$	2,652,425
Transfers to statutory reserves		-		318,942		(318,942	)		-		-
Net income for the year		-				4,388,449			-		4,388,449
Foreign currency translation difference		-		-		-			8,958		8,958
Balance at December 31, 2009		1,367,222		718,744		4,752,871			210,995		7,049,832
Net income for the period		-		-		1,163,259			-		1,163,259
Foreign currency translation difference		-				-			1,122		1,122
Balance at March 31, 2010 – unaudited	$	1,367,222	$	718,744	$	5,916,130		$	212,117	$	8,214,213

The accompanying notes are an integral part of the financial statements

F-23

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

STATEMENTS OF CASH FLOWS
UNAUDITED

		For The Three Months Ended
		March 31
		2010			2009
Cash flows from operating activities
Net income	$	1,163,259		$	991,184
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation		338,802			290,613
Changes in operating assets and liabilities:
Rental deposit		-			(6,719	)
Inventory		14,016			(128,118	)
Accounts payable		17,491			146,107
Deferred revenue		(8,029	)		170,891
Payroll and payroll related liabilities		(21,099	)		(41,147	)
Income and other taxes payable		77,696			(481,585	)
Accrued expenses		4,488			11,282
Amount due to director		(489	)		(20,604	)
Net cash provided by operating activities		1,586,135			931,904
Cash flows from investing activities
Acquisition of property, plant and equipment		(395	)		(1,131,151	)
Deposit paid for equipment and construction in progress		-			34,344
Net cash used in investing activities		(395	)		(1,096,807	)
Effect of foreign currency translation on cash and cash equivalents		478			1,374
Net increase in cash		1,586,218			(163,529	)
Cash- beginning of period		3,055,404			1,112,646
Cash- end of period	$	4,641,622		$	949,117
Cash paid during the period for:
Interest paid	$	2,330		$	-
Income taxes paid	$	280,075		$	174,091

The accompanying notes are an integral part of the financial statements

F-24

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

1. Basis of presentation

The interim financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein.

2. Organization and Nature of Business

Shenzhen Junlong Culture Communication Co., Ltd. (“Junlong’) is a Chinese enterprise organized in the People’s Republic of China (“PRC”) on December 26, 2003 in accordance with the Laws of the People’s Republic of China with the registered capital of $0.136 million (equivalent to RMB 1 million).

In 2001, the Chinese government imposed higher capital (RMB10 million for regional internet café chain and RMB50 million for national internet café chain) and facility requirements for the establishment of internet cafes. On August 19, 2004, Junlong was granted approval from Shenzhen Municipal People’s Government to increase its registered capital by $1,230,500 from $136,722 to $1,367,222 million (increased by RMB 9 million, from RMB 1 million to RMB 10 million) The capital verification process has been completed.

In 2005, Junlong obtained internet cafe licenses of operating internet café chain from the Ministry of Culture, and opened the internet first cafe in April, 2006 and our member can access internet at our venues. As of December 31, 2009, the company operated 28 internet cafes, including 10 internet cafes opened in 2006, 3 internet cafes opened in 2007, 10 internet cafes opened in 2008, and 5 internet cafes opened in 2009. Junlong currently mainly engages in the operation of internet café chain stores in the Shenzhen region of PRC.

On December 25, 2008, the company declared a dividend of $2.9 million (equivalent to RMB20 million).

3. Summary of Significant Accounting Policies

(a) Basis of presentation

The Company’s accounting policies used in the preparation of the accompanying financial statements conform to accounting principles generally accepted in the United States of America ("US GAAP") and have been consistently applied.

(b) Use of estimates

In preparing financial statements in conformity with US GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported periods. Actual results could differ from those estimates

Significant Estimates

These financial statements include some amounts that are based on management's best estimates and judgments. The most significant estimates relate to depreciation of property, plant and equipment, the valuation allowance for deferred taxes, impairment testing of long-lived assets and various contingent liabilities. It is reasonably possible that the above-mentioned estimates and others may be adjusted as more current information becomes available, and any adjustment could be significant in future reporting periods.

F-25

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

2. Summary of Significant Accounting Policies - Continued

(c) Revenue recognition

Internet café members purchase prepaid IC cards which include stored value that will be deducted based on time usage of computer at the internet cafe. Revenues derived from the prepaid IC cards at the internet café are recognized when services are provided. This is based upon the usage of computer time at the internet cafe. Outstanding customer balances in the IC cards are included in deferred revenue on the balance sheets. The Company does not charge any service fees that cause a decrement to customer balances. There is no expiration date for IC cards.

The Company also records revenue from commission received from the sale of third parties on-line gaming cards, snacks and drinks. Commission revenue amounted to 20% of the value of the on-line gaming cards, snacks and drinks is recognized at the time the gaming cards, etc. are sold to customers. During the three months ended March 31, 2010 and 2009, the commission income was $29,326 and $24,941, less than 1% of total revenue.

(d) Cost of goods sold

Cost of goods sold consists primarily of depreciation of Café computer equipment and hardware, overhead associated with the internet cafes, including rental payments, utilities, business tax and surcharge. Companies in China are generally subject to business tax and related surcharges by various local tax authorities at rates ranging from 5% to 6% on gross revenue generated from internet cafés.

(e) Credit risk

The Company may be exposed to credit risk from its cash at bank, fixed deposits. An allowance has been made for estimated irrecoverable amounts determined by reference to past default experience and the current economic environment.

(f) Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash accounts, interest bearing savings accounts and time certificates of deposit with a maturity of three months or less when purchased.

(g) Restricted cash

At March 31, 2010 and December 31, 2009, restricted cash of $1,645,675 (equivalent to RMB11,250,000) represented cash held by two escrow agents on behalf of the company for registered capital and operating cash flow purposes of two new subsidiary companies to be established in Yiwu city, Zhejiang province and Anshun city, Guizhou province.

(h) Inventory

Inventory represented the IC cards we purchased from IC cards manufacturer. Inventories are stated at the lower of cost or market value. Cost is determined using the first-in, first-out (FIFO) method.

F-26

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

2. Summary of Significant Accounting Policies - Continued

(i) Fair Value of Financial Instruments

FASB accounting standard requires disclosing fair value to the extent practicable for financial instruments that are recognized or unrecognized in the balance sheet. The fair value of the financial instruments disclosed herein is not necessarily representative of the amount that could be realized or settled, nor does the fair value amount consider the tax consequences of realization or settlement.

For certain financial instruments, including cash, accounts payable, short-term loans, accruals and other payables, it was assumed that the carrying amounts approximate fair value because of the near term maturities of such obligations.

(j) Equipment Deposits

The Company prepaid the equipments deposits to the computer suppliers for purchase of computer and equipments for the two new internet cafes which were expected to be opened in Spring, 2010.

(k) Property, plant and equipment

Property, plant and equipment, comprising computer equipment and hardware, leasehold improvements, office furniture and vehicles and are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives listed below.

	Estimated Useful Lives
Leasehold improvement	Lesser of term of the lease or the estimated useful lives of the assets
Café computer equipment and hardware	5 years
Café furniture and fixtures	5 years
Office furniture, fixtures and equipments	5 years
Motor vehicles	5 years

(l) Deferred Revenue

Deferred revenue represents amounts from the IC cards that are unused balance. The Outstanding customer balances are $768,081 and $775,985 as at March 31, 2010 and December 31, 2009 and are included in deferred revenue on the balance sheets.

(m) Comprehensive income

The Company follows the FASB’s accounting standard. Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investments from owners and distributions to owners. For the Company, comprehensive income for the periods presented includes net income and foreign currency translation adjustments.

F-27

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

2. Summary of Significant Accounting Policies - Continued

(n) Income taxes

Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred income tax liabilities or assets are recorded to reflect the tax consequences in future differences between the tax basis of assets and liabilities and the financial reporting amounts at each year end. A valuation allowance is recognized if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized.

(o) Foreign currency translation

Assets and liabilities of the Company with a functional currency other than US$ are translated into US$ using period end exchange rates. Income and expense items are translated at the average exchange rates in effect during the period. Foreign currency translation differences are included as a component of Accumulated Other Comprehensive Income in Stockholders’ Equity.

The exchange rates used to translate amounts in RMB into USD for the purposes of preparing the financial statements were as follows:

	3/31/2010	3/31/2009
Year end RMB : USD exchange rate	6.83610	6.84560
Average yearly RMB : USD exchange rate	6.83603	6.84659
	12/31/2009	12/31/2008
Year end RMB : USD exchange rate	6.8372	6.8542
Average yearly RMB : USD exchange rate	6.8409	6.9623

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

(p) Post-retirement and post-employment benefits

The Company contributes to a state pension plan in respect of its PRC employees. Other than the above, neither the Company nor its subsidiary provides any other post-retirement or post-employment benefits.

(q) Earnings Per Common Share

No basic income/loss per common share has been calculated based on the weighted average number of shares outstanding during the period since the Company is a Chinese company with stated capital, without number of shares.

(r) Retained earnings-appropriated

In accordance with the relevant PRC regulations and the Company’s PRC articles of association, Junlong is required to allocate their respective net income to statutory surplus reserve.

F-28

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

2. Summary of Significant Accounting Policies - Continued

(s) Statutory surplus reserve

In accordance with the relevant laws and regulations of the PRC and the articles of associations of the Company, Junlong is required to allocate 10% of their net income reported in the PRC statutory accounts, after offsetting any prior years’ losses, to the statutory surplus reserve, on an annual basis. When the balance of such reserve reaches 50% of the respective registered capital of the subsidiaries, any further allocation is optional.

The statutory surplus reserves can be used to offset prior years’ losses, if any, and may be converted into registered capital, provided that the remaining balances of the reserve after such conversion is not less than 25% of registered capital. The statutory surplus reserve is non-distributable.

Recently Adopted Accounting Pronouncements

Fair Value and Other-Than-Temporary Impairments

In April 2009, the FASB issued new guidance intended to provide additional application guidance and enhanced disclosures regarding fair value measurements and impairments of securities. New guidance related to determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly provides additional guidelines for estimating fair value in accordance with pre-existing guidance on fair value measurements. New guidance on recognition and presentation of other-than-temporary impairments provides additional guidance related to the disclosure of impairment losses on securities and the accounting for impairment losses on debt securities, but does not amend existing guidance related to other-than-temporary impairments of equity securities. The new guidance was effective for fiscal years and interim periods ended after June 15, 2009. As such, the Company adopted this guidance for the quarter ended June 30, 2009. Adoption of the new guidance did not have a material impact on the Company’s financial statements.

Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities

In June 2009, the FASB issued revised authoritative guidance related to variable interest entities, which requires entities to perform a qualitative analysis to determine whether a variable interest gives the entity a controlling financial interest in a variable interest entity. The guidance also requires an ongoing reassessment of variable interests and eliminates the quantitative approach previously required for determining whether an entity is the primary beneficiary. This guidance, which was reissued by the FASB in December 2009 as ASU No. 2009-17, “Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities,” amends ASC Topic 810, “Consolidation”, and will be effective as of the beginning of an entity’s first annual reporting period that begins after November 15, 2009 (January 1, 2010 for the Company). The adoption of this guidance has not had a significant impact on the Company’s financial statements.

Financial Instruments

In February 2007, the FASB issued a new accounting standard which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This accounting standard also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. This accounting standard is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company adopted this accounting standard on November 1, 2008. It has not elected to measure any financial assets and financial liabilities at fair value which were not previously required to be measured at fair value. Therefore, the adoption of this accounting standard has had no impact on its financial statements and footnote disclosure.

In April 2009, the FASB issued additional guidance to require disclosures about the fair value of financial instruments on an interim basis. Previously, this has been disclosed on an annual basis only. The Company adopted this guidance for the quarter ended June 30, 2009. This guidance has not impacted the Company’s balance sheets or income statements, as its requirements are disclosure-only in nature.

F-29

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

2. Summary of Significant Accounting Policies – Continued

Fair Value Measurement

In September 2006, the FASB issued a new accounting standard related to fair value measurements. The new standard defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. In February 2008, the FASB issued a new provision which delayed the effective date of the fair value measurements and disclosures for all nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). In August 2009, the FASB issued ASU No. 2009-05, "Measuring Liabilities at Fair Value" in relation to the fair value measurement of liabilities. The Company adopted the applicable portions of the provisions of the new standards as of November 1, 2008, and will adopt the provision related to the nonfinancial assets and nonfinancial liabilities on November 1, 2009. The adoption of this accounting standard for financial assets and financial liabilities did not have a material impact on its financial statements. Although the Company will continue to evaluate the application of the provision for the nonfinancial assets and nonfinancial liabilities, the Company does not expect the adoption to have a material impact on the financial statements.

Measuring Liabilities at Fair Value

In August 2009, the FASB issued an accounting standard update that amended the accounting standard for fair value measurements. Specifically, the accounting standard update provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following methods: 1) a valuation technique that uses a) the quoted price of the identical liability when traded as an asset or b) quoted prices for similar liabilities or similar liabilities when traded as assets and/or 2) a valuation technique that is consistent with the principles of the accounting standard on fair value measurements (e.g. an income approach or market approach). This accounting standard update also clarifies that when estimating the fair value of a liability, a reporting entity is not required to adjust to include inputs relating to the existence of transfer restrictions on that liability. This guidance will be effective for the first interim period beginning November 1, 2009. Adoption did not have an impact on our financial statements.

3. Cash and Cash Equivalents

Cash and cash equivalents are summarized as follows:

		March 31,		December 31,
		2010		2009
		(unaudited)
Cash at bank	$	4,560,650	$	2,969,539
Cash in hand		80,971		85,865
	$	4,641,622	$	3,055,404

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents (Note 2). As of March 31, 2010 and December 31, 2009, substantially all of the Company’s cash and cash equivalents were held by major banks located in the PRC, which management believes are of high credit quality.

4. Restricted Cash

		March 31,		December 31,
Bank deposits held by:		2010		2009
		(unaudited)
Mr. Fangrong, Zheng – Anshun city of Guizhou province	$	914,264	$	914,117
Mr. Jinping Zeng - Yiwu city of Zhejiang province		731,411		731,294
	$	1,645,675	$	1,645,411

F-30

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

4. Restricted Cash– Continued

At March 31, 2010 and December 31, 2009, the restricted cash represented bank deposits of RMB11,500,000 held by two escrow agents on behalf of the company for registered capital and operating cash flow purposes of two new subsidiary companies to be established in Anshun city, Guizhou province and Yiwu city, Zhejiang province.

5. Equipment deposit

Equipment deposit consists of:
		March 31,		December 31,
		2010		2009
		(unaudited)
Equipment deposit for purchase computers	$	81,230	$	81,217

6. Inventory

Inventory consists of:

		March 31,		December 31,
		2010		2009
		(unaudited)
Purchased IC cards	$	190,988	$	204,971

There was no allowance made for obsolete or slow moving inventory as of March 31, 2010 and December 31, 2009.

7. Property, Plant and Equipment

Property, plant and equipment consist of the following:

		March 31,			December 31,
		2010			2009
		(unaudited)
Leasehold improvement	$	2,389,322		$	2,388,938
Café computers equipments and hardware		3,333,573			3,333,037
Café furniture and fixtures		858,984			858,846
Office furniture, fixtures and equipments		21,515			21,117
Motor vehicle		94,089			94,072
	$	6,697,483		$	6,696,010
Less: Accumulated depreciation		(3,508,695	)		(3,169,385	)
Property and equipment in service, net		3,188,788			3,526,625
Construction in progress		46,079			46,071
Property and equipment, net	$	3,234,867		$	3,572,696

During the three months ended March 31, 2010, depreciation expenses amounted to $338,802, of which $ 331,630 and $ 7,172 were recorded as cost of sales and general and administrative expense, respectively.

During the three months ended March 31, 2009, depreciation expenses amounted to $290,613, of which $285,000 and $ 5,613 were recorded as cost of sales and general and administrative expense, respectively.

F-31

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

8. Short Term Loan

The short term loan due within one year as of March 31, 2010 and December 31, 2009 consist of the following:

				March 31,		December 31,
				2010		2009
				(unaudited)
Bank	Loan Period	Interest rate
China Construction Bank	October 27, 2009 to October 25, 2010	6.372%	$	146,282	$	146,259

On October 27, 2009, the Company entered into a loan agreement with China Construction Bank for $146,259 (RMB1,000,000) which was secured by director’s guarantee. The annual interest rate is 6.372% and is due on October 25, 2010.

9. Due To A Director

		March 31,		December 31,
		2010		2009
		(unaudited)
Mr. Guo Di Shan, a director of the Company	$	4,674	$	5,162

The amount due to Mr. Guo Di Shan is unsecured with no stated interest or repayment terms.

10. Income and Other Tax Payables

Income and other tax payables consist of the following:

		March 31,		December 31,
		2010		2009
		(unaudited)
Business tax payable	$	264,989	$	240,015
Income tax		333,861		280,027
Withhold Individual income tax payable		1,617		2,907
Other tax payables		2,783		2,521
Total	$	603,250	$	525,470

F-32

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

11. Income Tax

The Company incorporated in PRC is subject to PRC enterprises income tax at the applicable tax rates on the taxable income as reported in their Chinese statutory accounts in accordance with the relevant enterprises income tax laws. Junlong was charged a tax rate of 20% of its taxable income in 2009 and 22% in 2010.

The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. There are no material timing differences and therefore no deferred tax asset or liability at March 31, 2010. As approved by the relevant tax authority in the PRC, Junlong’s income tax rates will be 24% for 2011 and thereafter.

The income tax provision consists of the following:

		March 31, 2010		March 31, 2009
		(unaudited)		(unaudited)
Current	$	333,864	$	216,578
Deferred		-		-
	$	333,864	$	216,578

The Company applied the provisions of ASC 740.10.50, “Accounting For Uncertainty In Income Taxes”, which provides clarification related to the process associated with accounting for uncertain tax positions recognized in our financial statements. ASC 740.10.50 prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return. ASC 740.10.50 also provides guidance related to, among other things, classification, accounting for interest and penalties associated with tax positions, and disclosure requirements. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the statements of operation. The Company’s policy for recording interest and penalties associated with audits is to record such items as a component of income tax expense.

As of March 31, 2010, the Company is subject to potential audit by the PRC tax bureau for three years afterwards. As of March 31, 2010 and 2009, the Company did not accrue any interest and penalties in connection with ASC 740.10.50.

12. Employee Benefits

The Company contributes to a state pension scheme organized by municipal and provincial governments in respect of its employees in PRC. The compensation expense related to this plan, which is calculated at a range of 8% of the average monthly salary, was $ 734 and $1,298 for the periods ended March 31, 2010 and 2009, respectively.

F-33

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

13. Commitments and Contingencies

Operating Leases

In the normal course of business, the Company leases office space and internet cafes under operating leases agreements, which expire through 2014. The Company rents internet cafes venues and office space, primarily for regional sales administration offices that are conducive to administrative operations. The operating leases agreements generally contain renewal options that may be exercised in the Company's discretion after the completion of the base rental terms. In addition, many of the leases provide for regular increases to the base rental rate at specified intervals, which usually occur on an annual basis.

As of March 31, 2010, the Company was obligated under operating leases requiring minimum rentals as follows:

Fiscal year
Remainder of 2010	$	649,916
2011		709,850
2012		474,062
2013		188,865
2014 and thereafter		97,648
	$	2,120,341

During the three months ended March 31, 2010, rent expenses amounted to $ 208,893, of which $ 206,699 and $2,194 was recorded as cost of sales and general and administrative expense, respectively.

During the three months ended March 31, 2009, rent expenses amounted to $197,325, of which $195,134 and $2,191 was recorded as cost of sales and general and administrative expense, respectively.

Incorporation of Two New Subsidiary Companies

The Company is committed to establish two new subsidiary companies, which are located in Yiwu city, Zhejiang province and Anshun city, Guizhou province with the investment of approximately $2.195 million (equivalent to RMB15 million) each, with total of $4.39 million as registered capital and operating cash flow purposes. The registered capital of each subsidiary company will be $0.439 million (RMB3,000,000). As of December 31, 2009, the Company paid approximately $1.6 million (RMB11.25 million) in total to two escrow agents and the amounts were recorded under restricted cash.

Upon the establishment of the two subsidiary companies, the two escrow agents will be appointed as the General Manager of the two subsidiary companies. The Company is committed to pay a monthly salary of approximately $1,100 (RMB7,500) plus 3% of the net income of the respective subsidiary companies as bonus.

14. Concentrations, Risks, and Uncertainties

The Company did not have any customer constituting greater than 10% of net sales for the three months ended March 31, 2010 and 2009.

At March 31, 2010 and December 31, 2009, there was one supplier of consignment snacks and drinks accounted for 100% of the Company’s account payable, with a total amount of $51,475 and $33,979, respectively.

F-34

SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD.

NOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009

15. Operating Risk

Interest rate risk

The interest rates and terms of repayment of bank and other borrowings are disclosed in Note 8. Other financial assets and liabilities do not have material interest rate risk.

Foreign currency risk

Most of the transactions of the Company were settled in Renminbi. In the opinion of the directors, the Company does not have significant foreign currency risk exposure.

Company’s operations are substantially in foreign countries

Substantially all of the Company’s services are provided in China. The Company’s operations are subject to various political, economic, and other risks and uncertainties inherent in China. Among other risks, the Company’s operations are subject to the risks of restrictions on transfer of funds; export duties, quotas, and embargoes; domestic and international customs and tariffs; changing taxation policies; foreign exchange restrictions; and political conditions and governmental regulations.

The Chinese government began tightening its regulation of internet cafes since 2001. In particular, a large number of unlicensed internet cafes have been closed. In addition, the Chinese government has imposed higher capital (RMB10,000,000 for regional internet café chain is required and RMB50,000,000 for national internet café chain) and facility requirements for the establishment of internet cafes. Furthermore, the Chinese government’s policy, which encourages the development of a limited number of national and regional internet cafe chains and discourages the establishment of independent internet cafes, may slow down the growth of internet cafes. Recently, the Ministry of Culture, together with other government authorities, issued a joint notice suspending the issuance of new internet cafe chain licenses. Any intensified government regulation of internet cafes could restrict our ability to maintain and expand our internet cafes.

Currently, the Company uses only one internet service provider. However, there are other internet service providers available to the Company. The management of the Company believes that the risk of loss of internet services is not that high because of other service providers available to the Company.

16. Shareholders’ Equity

On December 26, 2003, the inception date of the company, Junlong was formed with 3 shareholders, Mr. Guo Di Shan, Mr. Ceng Jin Zhou and Ms. Wang Xiao Fen. The initial capital was $136,722 (RMB1,000,000), Mr. Guo Di Shan, Mr. Ceng Jin Zhou and Ms. Wang Xiao Fen contributed $68,362, $34,180 and $34,180 respectively.

On August 26, 2004, the Company increased its registered share capital from $136,722 (RMB1,000,000) to $1,367,222 (RMB10,000,000) by the creation of additional $1,230,500(RMB9,000,000) registered capital. Mr. Guo Di Shan and Mr. Ceng Jin Zhou contributed $ 1,162,139 and $68,361 respectively.

On May 27, 2008, Mr. Guo Di Shan sold his 10% to Mr. Yang Xiao Jiang, and on October 13, 2009, Mr. Yang Xiao Jiang sold his 10% shareholding back to Mr. Guo Di Shan.

The registration process with the PRC registration department on such change of shareholding was completed as of March 31, 2010. The current shareholding of the Company are: Mr. Guo Di Shan held 90%, Mr. Ceng Jin Zhou held 7.5% and Ms. Wang Xiao Fen held 2.5% of the shareholding of the Company.

17. Segment Information

The Company applies the provisions of FASB ASC 280-10 (Prior authoritative literature: Statement of Financial Accounting Standards No. 131, "Disclosures about Segments of an Enterprise and Related Information"). The Company views its operations and manages its business as one segment: the operation of internet café chain. Factors used to identify the Company's single operating segment include the organizational structure of the Company and the financial information available for evaluation by the chief operating decision-maker in making decisions about how to allocate resources and assess performance. The Company operates predominantly in one geographical area, the PRC.

F-35

UNAUDITED PRO FORMA COMBINED FINANCIAL DATA

The following pro forma balance sheet has been derived from the unaudited balance sheet of SHENZHEN JUNLONG CULTURE COMMUNICATION CO., LTD. (“Junlong”) at March 31, 2010, and adjusts such information to give the effect of the acquisition of CHINA UNITECH GROUP, INC. (“Unitech”)., as if the acquisition had occurred at March 31, 2010. The following pro forma EPS statement has been derived from the consolidated statements of income of Junlong and adjusts such information to give the effect for the acquisition of Junlong by Unitech for the three months ended March 31, 2010 and 2009 and for the years ended December 31, 2009 and 2008. The pro forma consolidated balance sheet and EPS statement is presented for informational purposes only and does not purport to be indicative of the financial condition that would have resulted if the acquisition had been consummated on those historical dates.

Unaudited Pro Forma Combined Earnings per Share - Three Months Ended March, 31
		2010		2009
Net income attributable to stockholders	$	1,163,259	$	991,184
Net income per Share
Basic and diluted	$	0.06	$	0.05
Weighted average shares outstanding
Basic and diluted		20,200,000		20,200,000
Unaudited Pro Forma Combined Earnings per Share - Year Ended December 31,
		2009		2008
Net income attributable to stockholders	$	4,388,449	$	3,013,565
Net income per Share
Basic and diluted	$	0.22	$	0.15
Weighted average shares outstanding
Basic and diluted		20,200,000		20,200,000
MARCH 31, 2010 PRO FORMA BALANCE SHEET

		A		B
		Junlong		Unitech
		March 31,		March 31,		Adjustments
		2010		2010		Debit		Credit	Pro Forma
		Unaudited		Unaudited
ASSETS
Current assets:
Cash and cash equivalents	$	4,641,622	$	4,564					4,646,186
Restricted cash		1,645,675							1,645,675
Rental deposit		144,527		5,833					150,360
Equipment deposit		81,230							81,230
Inventory		190,988							190,988
									0
Total current assets		6,704,042		10,397					6,714,439
									0
Plant and equipment, net		3,234,866		0					3,234,866
									0
Total assets	$	9,938,908	$	10,397		0		0	9,949,305
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short term loan	$	146,282	$						146,282
Accounts payable		51,475		3,000					54,475
Deferred revenue		768,081							768,081
Payroll and payroll related liabilities		103,312							103,312
Income and other taxes payable		603,250							603,250
Accrued expenses		47,621							47,621
Amount due to a director		4,674		42,000	C	42,000			4,674
Total current liabilities		1,724,695		45,000		42,000		0	1,727,695
Stockholders' Equity:
Preferred stock, $0.00001 par value; authorized 100,000,000 shares, issued and outstanding 0 shares		0		0					0
Common stock, $0.00001 par value; authorized 100,000,000 shares, issued and outstanding 20,200,000 and 20,200,000 shares, respectively		1,367,222		62	D	1,367,082			202
Additional Paid-In-Capital		0		112,479			C	42,000
							D	1,367,082
					E	147,144			1,374,417
Statutory reserves		718,744		0					718,744
Retained earnings		5,916,130		-147,144			E	147,144	5,916,130
Accumulated other comprehensive income		212,117		0					212,117
									0
Total stockholders’ equity		8,214,213		-34,603		1,514,226		1,556,226	8,221,610
									0
Total liabilities and stockholders’ equity	$	9,938,908	$	10,397		1,556,226		1,556,226	9,949,305

Notes to Unaudited Pro Forma Combined Financial Information:

On July 2, 2010, Unitech entered into a share exchange agreement, or the Share Exchange Agreement, with Classic Bond and its shareholders, a BVI company who was the sole shareholder of Junlong. Pursuant to the Share Exchange Agreement, on July 2, 2010, Unitech acquired 100% of the issued and outstanding capital stock of Classic Bond in exchange for 19,000,000 newly issued shares of our common stock, par value $0.00001 per share, which constituted 95% of the issued and outstanding common stock on a fully-diluted basis as of and immediately after the consummation of the transactions contemplated by the Share Exchange Agreement.

Assumptions and Adjustments:

Historical consolidated balance sheet as of March 31, 2010 of Junlong - A

Value of assets and liabilities of Unitech as of March 31, 2010 acquired in transaction - B

On July 2, 2010, principal shareholder and director of Unitech forgives debt due to him - C

On July 2, 2010, the Classic Bond shareholders delivered to Unitech its Classic Bond common stock free and clear of all liens, in exchange for 19,000,000 newly issued shares of Unitech's common stock, par value $0.00001 per share. There are 20,200,000 shares outstanding after the merger - D

Adjustment to Retained earnings to reflect the reverse acquisition - E

F-36

EXHIBIT INDEX

Exhibit No.	Description
2.1*	Form of Share Exchange Agreement, dated July 2, 2010, among the Company, Classic Bond Development Limited and its shareholders.
3.1	Articles of Incorporation of the Company [Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form SB-2 filed on August 30, 2006].
3.2	Bylaws of the Company [Incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form SB-2 filed on August 30, 2006].
4.1*	Form of Cancellation Agreement, dated July 2, 2010, among the Company and certain shareholders.
10.1*	Management Consulting Service Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.2*	Equity Pledge Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.3*	Option Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.4*	Proxy Agreement, dated June 11, 2010, among Zhonghefangda, Junlong and Junlong’s shareholders.
10.5*	English Translation of Employment Agreement, dated April 1, 2009, between Junlong and Tu Fan.
10.6*	English Translation of Form of Non-disclosure and Non-competition Agreement, dated March 11, 2010, between Junlong and its employees.
10.7*	English Summary of Loan Agreement, dated October 23, 2009, between Junlong and Shenzhen Branch of China Construction Bank.
10.8*	English Summary of Guaranty Contract of Maximum Amount, dated October 23, 2009, between Dishan Guo and Shenzhen Branch of China Construction Bank.
10.9*	English Summary of Purchase Agreement, dated June 7, 2010, between Junlong and Shenzhen SEG Industrial Investment Co., Ltd.
10.10*	English Summary of Lease Contract, dated September 1, 2006, between Junlong and Zou Zhiwei.
10.11*	English Summary of Lease Contract, dated December 15, 2009, between Junlong and Hao Changsheng
21*	Subsidiaries of the Company.

* Filed herewith

EX-2.1

Exhibit 2.1

SHARE EXCHANGE AGREEMENT

          This SHARE EXCHANGE AGREEMENT (this “Agreement”), dated as of July 2, 2010, is by and among China Unitech Group, Inc., a Nevada corporation (the “Parent”), The Classic Bond Development Limited, a British Virgin Islands company (the “Company”), and the Shareholders of the Company identified on Annex A hereto (each, a “Shareholder”, and together, the “Shareholders”). Each of the parties to this Agreement is individually referred to herein as a “Party” and collectively, as the “Parties.”

BACKGROUND

          The Company has 2,000,000 shares of capital stock (the “Company Stock”) outstanding, all of which are held by the Shareholders. Each Shareholder is the record and beneficial owner of the number of shares of Company Stock set forth opposite such Shareholder’s name on Annex A hereto. Each Shareholder has agreed to transfer all of his, her or its (hereinafter “its”) shares of Company Stock in exchange for a number of newly issued and existing shares of the Common Stock, par value $0.00001 per share, of the Parent (the “Parent Stock”) that will, in the aggregate, constitute 94% of the issued and outstanding capital stock of the Parent on a fully-diluted basis as of and immediately after the Closing. The number of shares of Parent Stock to be received by each Shareholder is listed opposite each such Shareholder’s name on Annex A. The aggregate number of shares of Parent Stock that is reflected on Annex A is referred to herein as the “Shares”.

          The exchange of Company Stock for Parent Stock is intended to constitute a reorganization within the meaning of Section 368(a)(1)(B) of the Internal Revenue Code of 1986 (the “Code”), as amended or such other tax free reorganization exemptions that may be available under the Code.

          The Board of Directors of the Parent and the Company have determined that it is desirable to effect this plan of reorganization and share exchange.

AGREEMENT

          NOW THEREFORE, the parties agree as follows:

ARTICLE I

Exchange of Shares

          SECTION 1.01.      Exchange by Shareholders. At the Closing (as defined in Section 1.02), each of the Shareholders shall sell, transfer, convey, assign and deliver to the Parent its Company Stock free and clear of all Liens (as defined below) in exchange for the Parent Stock listed on Annex A opposite such Shareholder’s name.

          SECTION 1.02.      Adjustment for Outstanding Liabilities. In the event that the Company shall have any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for taxes (“Liability”), as of the Closing, the portion of the Additional Consideration payable at the Closing shall be reduced on a dollar for dollar basis by the amount of such Liability.

          SECTION 1.03.      Closing. The closing (the “Closing”) of the transactions contemplated hereby (the “Transactions”) shall take place at the offices of Pillsbury Winthrop Shaw Pittman LLP in Washington, DC commencing at 9:00 a.m. local time on the second business day following the satisfaction or waiver of all conditions to the obligations of the parties to consummate the Transactions contemplated hereby (other than conditions with respect to actions the respective parties will take at the Closing itself), or such other date and time as the parties may mutually determine (the “Closing Date“).

ARTICLE II

Representations and Warranties of Shareholders

          Each of the Shareholders hereby severally (and not jointly) represents and warrants to the Parent with respect to itself, as follows:

          SECTION 2.01.      Good Title. The Shareholder is the record and beneficial owner, and has good title to its Company Stock, with the right and authority to sell and deliver such Company Stock. Upon delivery of any certificate or certificates duly assigned, representing the same as herein contemplated and/or upon registering of the Parent as the new owner of such Company Stock in the share register of the Company, the Parent will receive good title to such Company Stock, free and clear of all liens, security interests, pledges, equities and claims of any kind, voting trusts, stockholder agreements and other encumbrances (collectively, “Liens”).

          SECTION 2.02.      Organization. Each Shareholder that is an entity is duly organized and validly existing in its jurisdiction of organization.

          SECTION 2.03.      Power and Authority. Each Shareholder that is an entity has the legal power and authority to execute and deliver this Agreement and to perform its obligations hereunder. All acts required to be taken by the Shareholder to enter into this Agreement and to carry out the Transactions have been properly taken. This Agreement constitutes a legal, valid and binding obligation of the Shareholder, enforceable against such Shareholder in accordance with the terms hereof.

          SECTION 2.04.      No Conflicts. The execution and delivery of this Agreement by the Shareholder and the performance by the Shareholder of its obligations hereunder in accordance with the terms hereof: (i) will not require the consent of any third party or any federal, state, local or foreign government or any court of competent jurisdiction, administrative agency or commission or other governmental authority or instrumentality, domestic or foreign (“Governmental Entity”) under any statutes, laws, ordinances, rules, regulations, orders, writs, injunctions, judgments, or decrees (collectively, “Laws”); (ii) will not violate any Laws applicable to such Shareholder and (iii) will not violate or breach any contractual obligation to which such Shareholder is a party.

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          SECTION 2.05.      No Finder’s Fee. The Shareholder has not created any obligation for any finder’s, investment banker’s or broker’s fee in connection with the Transactions.

          SECTION 2.06.      Regulation S Compliance. The Shareholder (i) acknowledges that the certificate(s) representing or evidencing the Shares contain a customary restrictive legend restricting the offer, sale or transfer of the Shares except in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933, as amended (the “Securities Act”), or pursuant to an available exemption from registration, (ii) agrees that all offers and sales by the Shareholder of the Shares will be made pursuant to an effective registration statement under the Securities Act or pursuant to an exemption from, or a transaction not subject to the registration requirements of, the Securities Act, (iii) represents that the Shareholder is now and will be at the time of the exchange contemplated by this Agreement, outside the United States, (iv) has not engaged in or directed any unsolicited offers to acquire the Shares in the United States, (v) is neither a U.S. Person nor a Distributor (as such terms are defined in Section 902(a) and 902(c), respectively, of Regulation S of the Securities Act), (vi) is acquiring the Shares for its own account and not for the account or benefit of any U.S. Person, (vii) is the sole beneficial owner of the Shares and has not prearranged any sale with a purchaser in the United States, and (ix) is familiar with and understands the terms and conditions and requirements contained in Regulation S, specifically, without limitation, the Shareholder understands that the statutory basis for the exemption claimed for the exchange of the Shares would not be present if the exchange, although in technical compliance with Regulation S, is part of a plan or scheme to evade the registration provisions of the Securities Act.

          SECTION 2.07.      Investment. The Shareholder is acquiring the Shares to be issued to the Shareholder for investment for the Shareholder’s own account and not with the view to, or for resale in connection with, any distribution, assignment or resale within the meaning of the Securities Act or the securities law of any applicable state to others and no other person has a direct or indirect beneficial interest, in whole or in part, in such Shares. The Shareholder understands that the Shares to be issued to the Shareholder have not been and will not be registered under the Securities Act or qualified under the laws of any applicable state of the United States in reliance upon specific exemptions therefrom which depend upon, among other things, the bona fide nature of the investment intent as expressed herein and in any other representations, warranties or information provided by the Shareholder under this Agreement.

          SECTION 2.08.      Restrictions on Transfer. The Shareholder acknowledges that the Shares to be issued to the Shareholder must be held indefinitely unless subsequently registered and qualified under the Securities Act or unless an exemption from registration and qualification is otherwise available. In addition, the Shareholder understands that the certificate representing the Shares will be imprinted with a legend which prohibits the transfer of such Shares unless they are sold in a transaction in compliance with the Securities Act or are registered and qualified or such registration and qualification are not required in the opinion of counsel acceptable to the Parent.

          SECTION 2.09.      Experience. The Shareholder and/or the Shareholder’s personal representative(s) have such knowledge and experience in financial, tax and business matters to enable the Shareholder and/or them to utilize the information made available to the 3 Shareholder and/or them in connection with the acquisition of the Shares to evaluate the merits and risks of the prospective investment and to make an informed investment decision with respect thereto. The Shareholder is experienced in evaluating and investing companies such as the Parent.

          SECTION 2.10.      The Shareholder’s Liquidity. In reaching the decision to acquire the Shares, the Shareholder has carefully evaluated the Shareholder’s financial resources and investment position and the risks associated with this investment, and the Shareholder acknowledges that the Shareholder is able to bear the economic risks of the investment. The Shareholder (i) has adequate means of providing for the Shareholder’s current needs and possible personal contingencies, (ii) has no need for liquidity in the Shareholder’s investment, (iii) is able to bear the substantial economic risks of an investment in the Shares for an indefinite period and (iv) at the present time, can afford a complete loss of such investment. The Shareholder’s commitment to investments which are not readily marketable is not disproportionate to the Shareholder’s net worth and the Shareholder’s investment in the Shares will not cause the Shareholder’s overall commitment to become excessive.

          SECTION 2.11.      Offer and Sale. The Shareholder understands that the offer and sale of the Shares have not been registered under the Securities Act in reliance upon exemption therefrom. The Shareholder was not offered or sold the Shares, directly or indirectly, by means of any form of general solicitation or general advertisement, including the following: (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio; or (ii) any seminar or meeting whose attendees had been invited by general solicitation or general advertising.

          SECTION 2.12.      Access to Data. The Shareholder acknowledges that during the course of this transaction and before deciding to acquire the Shares, the Shareholder has been provided with financial and other written information about the Parent. The Shareholder has been given the opportunity by the Parent to obtain any information and ask questions concerning the Parent and the Shares that the Shareholder felt necessary; and to the extent the Shareholder availed itself of that opportunity, the Shareholder has received satisfactory information and answers.

          SECTION 2.13.      Risks. The Shareholder acknowledges and understands that (i) an acquisition of Shares of the Parent constitutes a high risk, (ii) the Shares are highly speculative, and (iii) there can be no assurance as to what investment return, if any, there may be. The Shareholder is aware that the Parent may issue additional securities in the future which could result in the dilution of the Shareholder’s ownership interest in the Parent.

          SECTION 2.14.      Valid Agreement. This Agreement when executed and delivered by the Shareholder will constitute a valid and legally binding obligation of the Shareholder which is enforceable in accordance with its terms.

          SECTION 2.15.      Residence. The address set forth on Annex A hereto is the Shareholder’s current address and accurately sets forth the Shareholder’s place of residence.

4

          SECTION 2.16.      Legends. It is understood that the Parent Stock will bear the following legend or one that it substantially similar to the following legend:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION STATEMENT IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.

ARTICLE III

Representations and Warranties of the Company

          The Company represents and warrants as follows to the Parent that, except as set forth in the letter delivered from the Company to the Parent concurrently herewith (the “Company Disclosure Letter”), regardless of whether or not the Company Disclosure Letter is referenced below with respect to any particular representation or warranty:

          SECTION 3.01.      Organization, Standing and Power. Each of the Company and its subsidiaries (the “Company Subsidiaries”) is duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized and has the corporate power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to conduct its businesses as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, has not had and would not reasonably be expected to have a material adverse effect on the Company, a material adverse effect on the ability of the Company to perform its obligations under this Agreement or on the ability of the Company to consummate the Transactions (a “Company Material Adverse Effect”). The Company and each Company Subsidiary is duly qualified to do business in each jurisdiction where the nature of its business or its ownership or leasing of its properties make such qualification necessary except where the failure to so qualify would not reasonably be expected to have a Company Material Adverse Effect. The Company has delivered to the Parent true and complete copies of the memorandum and articles of association of the Company and such other constituent instruments of the Company as may exist, each as amended to the date of this Agreement (as so amended, the “Company Constituent Instruments”), and the comparable charter, organizational documents and other constituent instruments of each Company Subsidiary, in each case as amended through the date of this Agreement.

          SECTION 3.02.      Company Subsidiaries; Equity Interests.

                         (a)      The Company Disclosure Letter lists each Company Subsidiary and its jurisdiction of organization. All the outstanding shares of capital stock or equity investments of each Company Subsidiary have been validly issued and are fully paid and nonassessable and are as of the date of this Agreement owned by the Company, by another Company Subsidiary or by the Company and another Company Subsidiary, free and clear of all Liens.

5

                    (b)      Except for its interests in the Company Subsidiaries, the Company does not as of the date of this Agreement own, directly or indirectly, any capital stock, membership interest, partnership interest, joint venture interest or other equity interest in any person.

          SECTION 3.03.      Capital Structure. The authorized capital stock of the Company consists of 50,000 ordinary shares, of no par value each, of which 50,000 shares are issued and outstanding. Except as set forth above, no shares of capital stock or other voting securities of the Company are issued, reserved for issuance or outstanding. The Company is the sole record and beneficial owner of all of the issued and outstanding capital stock of each Company Subsidiary. All outstanding shares of the capital stock of the Company and each Company Subsidiary are duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the applicable corporate laws of the British Virgin Islands, the Company Constituent Instruments or any Contract (as defined in Section 3.05) to which the Company is a party or otherwise bound. There are not any bonds, debentures, notes or other indebtedness of Company or any Company Subsidiary having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which holders of Company Stock or the common stock of any Company Subsidiary may vote (“Voting Company Debt”). Except as set forth above, as of the date of this Agreement, there are not any options, warrants, rights, convertible or exchangeable securities, “phantom” stock rights, stock appreciation rights, stock-based performance units, commitments, Contracts, arrangements or undertakings of any kind to which the Company or any Company Subsidiary is a party or by which any of them is bound (i) obligating the Company or any Company Subsidiary to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity interests in, or any security convertible or exercisable for or exchangeable into any capital stock of or other equity interest in, the Company or any Company Subsidiary or any Voting Company Debt, (ii) obligating the Company or any Company Subsidiary to issue, grant, extend or enter into any such option, warrant, call, right, security, commitment, Contract, arrangement or undertaking or (iii) that give any person the right to receive any economic benefit or right similar to or derived from the economic benefits and rights occurring to holders of the capital stock of the Company or of any Company Subsidiary. As of the date of this Agreement, there are not any outstanding contractual obligations of the Company to repurchase, redeem or otherwise acquire any shares of capital stock of the Parent.

          SECTION 3.04.      Authority; Execution and Delivery; Enforceability. The Company has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the Transactions. The execution and delivery by the Company of this Agreement and the consummation by the Company of the Transactions have been duly authorized and approved by the Board of Directors of the Company and no other corporate proceedings on the part of the Company are necessary to authorize this Agreement and the Transactions. When executed and delivered, this Agreement will be enforceable against the Company in accordance with its terms.

6

          SECTION 3.05.      No Conflicts; Consents.

                         (a)      The execution and delivery by the Company of this Agreement does not, and the consummation of the Transactions and compliance with the terms hereof and thereof will not, conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or result in the creation of any Lien upon any of the properties or assets of the Company or any Company Subsidiary under, any provision of (i) the Company Constituent Instruments or the comparable charter or organizational documents of any Company Subsidiary, (ii) any material contract, lease, license, indenture, note, bond, agreement, permit, concession, franchise or other instrument (a “Contract”) to which the Company or any Company Subsidiary is a party or by which any of their respective properties or assets is bound or (iii) subject to the filings and other matters referred to in Section 3.05(b), any material judgment, order or decree (“Judgment”) or material Law applicable to the Company or any Company Subsidiary or their respective properties or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually or in the aggregate, have not had and would not reasonably be expected to have a Company Material Adverse Effect.

                         (b)      Except for required filings with the Securities and Exchange Commission (the “SEC”) and applicable “Blue Sky” or state securities commissions, no material consent, approval, license, permit, order or authorization (“Consent”) of, or registration, declaration or filing with, or permit from, any Governmental Entity is required to be obtained or made by or with respect to the Company or any Company Subsidiary in connection with the execution, delivery and performance of this Agreement or the consummation of the Transactions.

          SECTION 3.06.      Taxes.

                        (a)      Each of the Company and each Company Subsidiary has timely filed, or has caused to be timely filed on its behalf, all Tax Returns (as defined below) required to be filed by it, and all such Tax Returns are true, complete and accurate, except to the extent any failure to file or any inaccuracies in any filed Tax Returns, individually or in the aggregate, have not had and would not reasonably be expected to have a Company Material Adverse Effect. All Taxes (as defined below) shown to be due on such Tax Returns, or otherwise owed, have been timely paid, except to the extent that any failure to pay, individually or in the aggregate, has not had and would not reasonably be expected to have a Company Material Adverse Effect. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim.

                         (b)      The Company Financial Statements (as defined in Section 3.15) reflect an adequate reserve for all Taxes payable by the Company and the Company Subsidiaries (in addition to any reserve for deferred Taxes to reflect timing differences between book and Tax items) for all Taxable periods and portions thereof through the date of such financial statements. No deficiency with respect to any Taxes has been proposed, asserted or assessed against the Company or any Company Subsidiary, and no requests for waivers of the time to assess any such Taxes are pending, except to the extent any such deficiency or request for waiver, individually or in the aggregate, has not had and would not reasonably be expected to have a Company Material Adverse Effect.

7

                         (c)      For purposes of this Agreement:

                         “Taxes” includes all forms of taxation, whenever created or imposed, and whether of the United States or elsewhere, and whether imposed by a local, municipal, governmental, state, foreign, federal or other Governmental Entity, or in connection with any agreement with respect to Taxes, including all interest, penalties and additions imposed with respect to such amounts.

                         “Tax Return” means all federal, state, local, provincial and foreign Tax returns, declarations, statements, reports, schedules, forms and information returns and any amended Tax return relating to Taxes.

          SECTION 3.07.      Benefit Plans.

                         (a)      The Company does not have or maintain any collective bargaining agreement or any bonus, pension, profit sharing, deferred compensation, incentive compensation, stock ownership, stock purchase, stock option, phantom stock, retirement, vacation, severance, disability, death benefit, hospitalization, medical or other plan, arrangement or understanding (whether or not legally binding) providing benefits to any current or former employee, officer or director of the Company or any Company Subsidiary (collectively, “Company Benefit Plans”). As of the date of this Agreement there are not any severance or termination agreements or arrangements between the Company or any Company Subsidiary and any current or former employee, officer or director of the Company or any Company Subsidiary, nor does the Company or any Company Subsidiary have any general severance plan or policy.

                         (b)      Since March 31, 2010, there has not been any adoption or amendment in any material respect by the Company or any Company Subsidiary of any Company Benefit Plan.

          SECTION 3.08.      Litigation. There is no action, suit, inquiry, notice of violation, proceeding (including any partial proceeding such as a deposition) or investigation pending or threatened in writing against or affecting the Company, any subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency, regulatory authority (federal, state, county, local or foreign), stock market, stock exchange or trading facility (“Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of this Agreement or the Shares or (ii) could, if there were an unfavorable decision, individually or in the aggregate, have or reasonably be expected to result in a Company Material Adverse Effect. Neither the Company nor any subsidiary, nor any director or officer thereof (in his or her capacity as such), is or has been the subject of any Action involving a claim or violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty.

          SECTION 3.09.      Compliance with Applicable Laws. The Company and the Company Subsidiaries are in compliance with all applicable Laws, including those relating to occupational health and safety and the environment, except for instances of noncompliance that, individually and in the aggregate, have not had and would not reasonably be expected to have a Company Material Adverse Effect. The Company has not received any written communication during the past two years from a Governmental Entity that alleges that the Company is not in compliance in any material respect with any applicable Law. This Section 3.09 does not relate to matters with respect to Taxes, which are the subject of Section 3.06.

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          SECTION 3.10.      Brokers; Schedule of Fees and Expenses. Except for fees due to HFG International, Limited or its assigns, no broker, investment banker, financial advisor or other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the Transactions based upon arrangements made by or on behalf of the Company.

          SECTION 3.11.      Contracts. Except as disclosed in the Company Disclosure Letter, there are no Contracts that are material to the business, properties, assets, condition (financial or otherwise), results of operations or prospects of the Company and its subsidiaries taken as a whole. Neither the Company nor any Company Subsidiary is in violation of or in default under (nor does there exist any condition which upon the passage of time or the giving of notice would cause such a violation of or default under) any Contract to which it is a party or by which it or any of its properties or assets is bound, except for violations or defaults that would not, individually or in the aggregate, reasonably be expected to result in a Company Material Adverse Effect.

          SECTION 3.12.      Title to Properties. Except as set forth in the Disclosure Letter, the Company and the Company Subsidiaries do not own any real property. Each of the Company and the Company Subsidiaries has sufficient title to, or valid leasehold interests in, all of its properties and assets used in the conduct of its businesses. All such assets and properties, other than assets and properties in which the Company or any of the Company Subsidiaries has leasehold interests, are free and clear of all Liens, except for Liens that, in the aggregate, do not and will not materially interfere with the ability of the Company and the Company Subsidiaries to conduct business as currently conducted.

          SECTION 3.13.      Intellectual Property. The Company and the Company Subsidiaries own, or are validly licensed or otherwise have the right to use, all patents, patent rights, trademarks, trademark rights, trade names, trade name rights, service marks, service mark rights, copyrights and other proprietary intellectual property rights and computer programs (collectively, “Intellectual Property Rights”) which are material to the conduct of the business of the Company and the Company Subsidiaries taken as a whole. The Company Disclosure Letter sets forth a description of all Intellectual Property Rights which are material to the conduct of the business of the Company and the Company Subsidiaries taken as a whole. There are no claims pending or, to the knowledge of the Company, threatened that the Company or any of the Company Subsidiaries is infringing or otherwise adversely affecting the rights of any person with regard to any Intellectual Property Right. To the knowledge of the Company, no person is infringing the rights of the Company or any of the Company Subsidiaries with respect to any Intellectual Property Right.

          SECTION 3.14.      Labor Matters. There are no collective bargaining or other labor union agreements to which the Company or any of the Company Subsidiaries is a party or by which any of them is bound. No material labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company.

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          SECTION 3.15.      Financial Statements. The Company has delivered to the Parent its unaudited financial statements for the periods ended March 31, 2010 and 2009 and audited consolidated financial statements for the fiscal years ended December 31, 2009 and 2008 (collectively, the “Company Financial Statements”). The Company Financial Statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods indicated. The Company Financial Statements fairly present in all material respects the financial condition and operating results of the Company, as of the dates, and for the periods, indicated therein. The Company does not have any material liabilities or obligations, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to March 31, 2010, and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles to be reflected in the Company Financial Statements, which, in both cases, individually and in the aggregate would not be reasonably expected to result in a Company Material Adverse Effect.

          SECTION 3.16.      Insurance. Except as set forth in the Company Disclosure Letter, the Company and its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and its subsidiaries are engaged and in the geographic areas where they engage in such businesses. Except as set forth in the Company Disclosure Letter, the Company has no reason to believe that it will not be able to renew its and its subsidiaries’ existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business on terms consistent with market for the Company’s and such subsidiaries’ respective lines of business.

          SECTION 3.17.      Transactions With Affiliates and Employees. Except as set forth in the Company Disclosure Letter and Company Financial Statements, none of the officers or directors of the Company and, to the knowledge of the Company, none of the employees of the Company is presently a party to any transaction with the Company or any subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

          SECTION 3.18.      Internal Accounting Controls. The Company and its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management's general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management's general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company has established disclosure controls and procedures for the Company and designed such disclosure controls and procedures to ensure that material information relating to the Company, including its subsidiaries, is made known to the officers by others within those entities. The Company’s officers have evaluated the effectiveness of the Company’s controls and procedures. Since March 31, 2010, there have been no significant changes in the Company’s internal controls or, to the Company’s knowledge, in other factors that could significantly affect the Company’s internal controls.

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          SECTION 3.19.      Application of Takeover Protections. The Company has taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s charter documents or the laws of its jurisdiction of formation that is or could become applicable to the Shareholders as a result of the Shareholders and the Company fulfilling their obligations or exercising their rights under this Agreement, including, without limitation, the issuance of the Shares and the Shareholders’ ownership of the Shares.

          SECTION 3.20.      No Additional Agreements. The Company does not have any agreement or understanding with any Shareholders with respect to the transactions contemplated by this Agreement other than as specified in this Agreement.

          SECTION 3.21.      Investment Company. The Company is not, and is not an affiliate of, and immediately following the Closing will not have become, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

          SECTION 3.22.      Disclosure. The Company confirms that neither it nor any person acting on its behalf has provided any Shareholder or its respective agents or counsel with any information that the Company believes constitutes material, non-public information except insofar as the existence and terms of the proposed transactions hereunder may constitute such information and except for information that will be disclosed by the Parent under a current report on Form 8-K filed within four business days after the Closing. The Company understands and confirms that the Shareholders will rely on the foregoing representations and covenants in effecting transactions in securities of the Company. All disclosure provided to the Shareholders regarding the Company, its business and the transactions contemplated hereby, furnished by or on behalf of the Company (including the Company’s representations and warranties set forth in this Agreement) are true and correct and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

          SECTION 3.23.      Absence of Certain Changes or Events. Except as disclosed in the Company Financial Statements or in the Company Disclosure Letter, from March 31, 2010 to the date of this Agreement, the Company has conducted its business only in the ordinary course, and during such period there has not been:

                         (a)      any change in the assets, liabilities, financial condition or operating results of the Company or any Company Subsidiary, except changes in the ordinary course of business that have not caused, in the aggregate, a Company Material Adverse Effect;

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                         (b)      any damage, destruction or loss, whether or not covered by insurance, that would have a Company Material Adverse Effect;

                         (c)      any waiver or compromise by the Company or any Company Subsidiary of a valuable right or of a material debt owed to it;

                         (d)      any satisfaction or discharge of any lien, claim, or encumbrance or payment of any obligation by the Company or any Company Subsidiary, except in the ordinary course of business and the satisfaction or discharge of which would not have a Company Material Adverse Effect;

                         (e)      any material change to a material Contract by which the Company or any Company Subsidiary or any of its respective assets is bound or subject;

                         (f)      any mortgage, pledge, transfer of a security interest in, or lien, created by the Company or any Company Subsidiary, with respect to any of its material properties or assets, except liens for taxes not yet due or payable and liens that arise in the ordinary course of business and do not materially impair the Company’s or such Company Subsidiary’s ownership or use of such property or assets;

                         (g)      any loans or guarantees made by the Company or any Company Subsidiary to or for the benefit of its employees, officers or directors, or any members of their immediate families, other than travel advances and other advances made in the ordinary course of its business;

                         (h)      any alteration of the Company’s method of accounting or the identity of its auditors;

                         (i)      any declaration or payment of dividend or distribution of cash or other property to Shareholders or any purchase, redemption or agreements to purchase or redeem any shares of Company Stock;

                         (j)      any issuance of equity securities to any officer, director or affiliate, except pursuant to existing Company stock option plans; or

                         (k)      any arrangement or commitment by the Company or any Company Subsidiary to do any of the things described in this Section 3.23.

          SECTION 3.24.      No Undisclosed Events, Liabilities, Developments or Circumstances. No event, liability, development or circumstance has occurred or exists, or is contemplated to occur with respect to the Company, its subsidiaries or their respective business, properties, prospects, operations or financial condition, that would be required to be disclosed by the Company under applicable securities laws on a registration statement filed with the SEC relating to an issuance and sale by the Company of its Common Stock and which has not been publicly announced.

          SECTION 3.25.      Foreign Corrupt Practices. Neither the Company, nor any of its subsidiaries, nor, to the Company’s knowledge, any director, officer, agent, employee or other person acting on behalf of the Company or any of its subsidiaries has, in the course of its actions for, or on behalf of, the Company (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

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ARTICLE IV

Representations and Warranties of the Parent

          The Parent represents and warrants as follows to each Shareholder and the Company that, except as set forth in the reports, schedules, forms, statements and other documents filed by the Parent with the SEC and publicly available prior to the date of this Agreement (the “Parent SEC Documents”) or in the letter delivered by the Parent to the Company and the Shareholders concurrently herewith (the “Parent Disclosure Letter”):

          SECTION 4.01.      Organization, Standing and Power. The Parent is duly organized, validly existing and in good standing under the laws of the State of Nevada and has full corporate power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to conduct its businesses as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, has not had and would not reasonably be expected to have a material adverse effect on the Parent, a material adverse effect on the ability of the Parent to perform its obligations under this Agreement or on the ability of the Parent to consummate the Transactions (a “Parent Material Adverse Effect”). The Parent is duly qualified to do business in each jurisdiction where the nature of its business or their ownership or leasing of its properties make such qualification necessary and where the failure to so qualify would reasonably be expected to have a Parent Material Adverse Effect. The Parent has delivered to the Company true and complete copies of the certificate or articles of incorporation of the Parent, as amended to the date of this Agreement (as so amended, the “Parent Charter”), and the Bylaws of the Parent, as amended to the date of this Agreement (as so amended, the “Parent Bylaws”).

          SECTION 4.02.      Subsidiaries; Equity Interests. The Parent does not own, directly or indirectly, any capital stock, membership interest, partnership interest, joint venture interest or other equity interest in any person.

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          SECTION 4.03.      Capital Structure. The authorized capital stock of the Parent consists of 100,000,000 shares of Common Stock, par value $0.00001 per share (“Parent Common Stock”), and 100,000,000 shares of preferred stock, par value $0.00001 per share. As of the date hereof (i) 6,173,600 shares of Parent Common Stock are issued and outstanding, (ii) no shares of preferred stock are outstanding and (iii) no shares of Parent Common Stock or preferred stock are held by the Parent in its treasury. Except as set forth above, no shares of capital stock or other voting securities of the Parent were issued, reserved for issuance or outstanding. All outstanding shares of the capital stock of the Parent are, and all such shares that may be issued prior to the date hereof will be when issued, duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the General Corporation Law of the State of Nevada, the Parent Charter, the Parent Bylaws or any Contract to which the Parent is a party or otherwise bound. There are not any bonds, debentures, notes or other indebtedness of the Parent having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which holders of Parent Common Stock may vote (“Voting Parent Debt”). Except as set forth above, as of the date of this Agreement, there are not any options, warrants, rights, convertible or exchangeable securities, “phantom” stock rights, stock appreciation rights, stock-based performance units, commitments, Contracts, arrangements or undertakings of any kind to which the Parent is a party or by which it is bound (i) obligating the Parent to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity interests in, or any security convertible or exercisable for or exchangeable into any capital stock of or other equity interest in, the Parent or any Voting Parent Debt, (ii) obligating the Parent to issue, grant, extend or enter into any such option, warrant, call, right, security, commitment, Contract, arrangement or undertaking or (iii) that give any person the right to receive any economic benefit or right similar to or derived from the economic benefits and rights occurring to holders of the capital stock of the Parent. As of the date of this Agreement, there are not any outstanding contractual obligations of the Parent to repurchase, redeem or otherwise acquire any shares of capital stock of the Parent. Except as set forth in the Parent Disclosure Letter, the Parent is not a party to any agreement granting any securityholder of the Parent the right to cause the Parent to register shares of the capital stock or other securities of the Parent held by such securityholder under the Securities Act. The stockholder list provided to the Company is a current stockholder list generated by its stock transfer agent, and such list accurately reflects all of the issued and outstanding shares of the Parent’s Common Stock.

          SECTION 4.04.      Authority; Execution and Delivery; Enforceability. The execution and delivery by the Parent of this Agreement and the consummation by the Parent of the Transactions have been duly authorized and approved by the Board of Directors of the Parent and no other corporate proceedings on the part of the Parent are necessary to authorize this Agreement and the Transactions. This Agreement constitutes a legal, valid and binding obligation of the Parent, enforceable against the Parent in accordance with the terms hereof.

          SECTION 4.05.      No Conflicts; Consents.

                         (a)      Except as set forth in the Parent Disclosure Letter, the execution and delivery by the Parent of this Agreement, does not, and the consummation of Transactions and compliance with the terms hereof and thereof will not, conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlements of any person under, or result in the creation of any Lien upon any of the properties or assets of the Parent under, any provision of (i) the Parent Charter or Parent Bylaws, (ii) any material Contract to which the Parent is a party or by which any of its properties or assets is bound or (iii) subject to the filings and other matters referred to in Section 4.05(b), any material Judgment or material Law applicable to the Parent or its properties or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually or in the aggregate, have not had and would not reasonably be expected to have a Parent Material Adverse Effect.

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                         (b)      No Consent of, or registration, declaration or filing with, or permit from, any Governmental Entity is required to be obtained or made by or with respect to the Parent in connection with the execution, delivery and performance of this Agreement or the consummation of the Transactions, other than filings under state “blue sky” laws, as may be required in connection with this Agreement and the Transactions.

          SECTION 4.06.      SEC Documents; Undisclosed Liabilities.

                         (a)      The Parent has filed all reports, schedules, forms, statements and other documents required to be filed by the Parent with the SEC since January 5, 2009, pursuant to Sections 13(a), 14(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act,” and such documents, the “Parent SEC Documents”).

                         (b)      As of its respective filing date, each Parent SEC Document complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such Parent SEC Document, and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Except to the extent that information contained in any Parent SEC Document has been revised or superseded by a later Parent SEC Document, none of the Parent SEC Documents contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The consolidated financial statements of the Parent included in the Parent SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with the U.S. generally accepted accounting principles (“GAAP”) (except, in the case of unaudited statements, as permitted by the rules and regulations of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of the Parent and its consolidated subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods shown (subject, in the case of unaudited statements, to normal year-end audit adjustments).

                         (c)      Except as set forth in the Parent SEC Documents, the Parent has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) required by GAAP to be set forth on a balance sheet of the Parent or in the notes thereto. The Parent Disclosure Letter sets forth all financial and contractual obligations and liabilities (including any obligations to issue capital stock or other securities of the parent) due after the date hereof. All liabilities of the Parent shall have been paid off and shall in no event remain liabilities of the Parent, the Company or the Shareholders following the Closing.

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          SECTION 4.07.      Absence of Certain Changes or Events. Except as disclosed in the Parent SEC Documents or in the Parent Disclosure Letter, from the date of the most recent audited financial statements included in the Parent SEC Documents to the date of this Agreement, the Parent has conducted its business only in the ordinary course, and during such period there has not been:

                         (a)      any change in the assets, liabilities, financial condition or operating results of the Parent from that reflected in the Parent SEC Documents, except changes in the ordinary course of business that have not caused, in the aggregate, a Parent Material Adverse Effect;

                         (b)      any damage, destruction or loss, whether or not covered by insurance, that would have a Parent Material Adverse Effect;

                         (c)      any waiver or compromise by the Parent of a valuable right or of a material debt owed to it;

                         (d)      any satisfaction or discharge of any lien, claim, or encumbrance or payment of any obligation by the Parent, except in the ordinary course of business and the satisfaction or discharge of which would not have a Parent Material Adverse Effect;

                         (e)      any material change to a material Contract by which the Parent or any of its assets is bound or subject;

                         (f)      any material change in any compensation arrangement or agreement with any employee, officer, director or stockholder;

                         (g)      any resignation or termination of employment of any officer of the Parent;

                         (h)      any mortgage, pledge, transfer of a security interest in, or lien, created by the Parent, with respect to any of its material properties or assets, except liens for taxes not yet due or payable and liens that arise in the ordinary course of business and do not materially impair the Parent’s ownership or use of such property or assets;

                         (i)      any loans or guarantees made by the Parent to or for the benefit of its employees, officers or directors, or any members of their immediate families, other than travel advances and other advances made in the ordinary course of its business;

                         (j)      any declaration, setting aside or payment or other distribution in respect of any of the Parent’s capital stock, or any direct or indirect redemption, purchase, or other acquisition of any of such stock by the Parent;

                         (k)      any alteration of the Parent’s method of accounting or the identity of its auditors;

                         (l)      any issuance of equity securities to any officer, director or affiliate, except pursuant to existing Parent stock option plans; or

                         (m)      any arrangement or commitment by the Parent to do any of the things described in this Section 4.07.

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          SECTION 4.08.      Taxes.

                         (a)      The Parent has timely filed, or has caused to be timely filed on its behalf, all Tax Returns required to be filed by it, and all such Tax Returns are true, complete and accurate, except to the extent any failure to file or any inaccuracies in any filed Tax Returns, individually or in the aggregate, have not had and would not reasonably be expected to have a Parent Material Adverse Effect. All Taxes shown to be due on such Tax Returns, or otherwise owed, has been timely paid, except to the extent that any failure to pay, individually or in the aggregate, has not had and would not reasonably be expected to have a Parent Material Adverse Effect.

                         (b)      The most recent financial statements contained in the Parent SEC Documents reflect an adequate reserve for all Taxes payable by the Parent (in addition to any reserve for deferred Taxes to reflect timing differences between book and Tax items) for all Taxable periods and portions thereof through the date of such financial statements. No deficiency with respect to any Taxes has been proposed, asserted or assessed against the Parent, and no requests for waivers of the time to assess any such Taxes are pending, except to the extent any such deficiency or request for waiver, individually or in the aggregate, has not had and would not reasonably be expected to have a Parent Material Adverse Effect.

                         (c)      There are no Liens for Taxes (other than for current Taxes not yet due and payable) on the assets of the Parent. The Parent is not bound by any agreement with respect to Taxes.

          SECTION 4.09.      Absence of Changes in Benefit Plans. From the date of the most recent audited financial statements included in the Parent SEC Documents to the date of this Agreement, there has not been any adoption or amendment in any material respect by the Parent of any collective bargaining agreement or any bonus, pension, profit sharing, deferred compensation, incentive compensation, stock ownership, stock purchase, stock option, phantom stock, retirement, vacation, severance, disability, death benefit, hospitalization, medical or other plan, arrangement or understanding (whether or not legally binding) providing benefits to any current or former employee, officer or director of the Parent (collectively, “Parent Benefit Plans”). As of the date of this Agreement there are not any employment, consulting, indemnification, severance or termination agreements or arrangements between the Parent and any current or former employee, officer or director of the Parent, nor does the Parent have any general severance plan or policy.

          SECTION 4.10.      ERISA Compliance; Excess Parachute Payments. The Parent does not, and since its inception never has, maintained, or contributed to any “employee pension benefit plans” (as defined in Section 3(2) of ERISA), “employee welfare benefit plans” (as defined in Section 3(1) of ERISA) or any other Parent Benefit Plan for the benefit of any current or former employees, consultants, officers or directors of the Parent.

          SECTION 4.11.      Litigation. Except as disclosed in the Parent SEC Documents, there is no Action which (i) adversely affects or challenges the legality, validity or enforceability of any of this Agreement or the Shares or (ii) could, if there were an unfavorable decision, individually or in the aggregate, have or reasonably be expected to result in a Parent Material Adverse Effect. Neither the Parent nor any subsidiary, nor any director or officer thereof (in his or her capacity as such), is or has been the subject of any Action involving a claim or violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty.

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          SECTION 4.12.      Compliance with Applicable Laws. Except as disclosed in the Parent SEC Documents, the Parent is in compliance with all applicable Laws, including those relating to occupational health and safety, the environment, export controls, trade sanctions and embargos, except for instances of noncompliance that, individually and in the aggregate, have not had and would not reasonably be expected to have a Parent Material Adverse Effect. Except as set forth in the Parent SEC Documents, the Parent has not received any written communication during the past two years from a Governmental Entity that alleges that the Parent is not in compliance in any material respect with any applicable Law. The Parent is in compliance with all effective requirements of the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations thereunder, that are applicable to it, except where such noncompliance could not have or reasonably be expected to result in a Parent Material Adverse Effect. This Section 4.12 does not relate to matters with respect to Taxes, which are the subject of Section 4.08.

          SECTION 4.13.      Contracts. Except as disclosed in the Parent Filed SEC Documents, there are no Contracts that are material to the business, properties, assets, condition (financial or otherwise), results of operations or prospects of the Parent taken as a whole. The Parent is not in violation of or in default under (nor does there exist any condition which upon the passage of time or the giving of notice would cause such a violation of or default under) any Contract to which it is a party or by which it or any of its properties or assets is bound, except for violations or defaults that would not, individually or in the aggregate, reasonably be expected to result in a Parent Material Adverse Effect.

          SECTION 4.14.      Title to Properties. The Parent has good title to, or valid leasehold interests in, all of its properties and assets used in the conduct of its businesses. All such assets and properties, other than assets and properties in which the Parent has leasehold interests, are free and clear of all Liens, except for Liens that, in the aggregate, do not and will not materially interfere with the ability of the Parent to conduct business as currently conducted. The Parent has complied in all material respects with the terms of all material leases to which it is a party and under which it is in occupancy, and all such leases are in full force and effect. The Parent enjoys peaceful and undisturbed possession under all such material leases.

          SECTION 4.15.      Intellectual Property. The Parent owns, or is validly licensed or otherwise has the right to use, all Intellectual Property Rights which are material to the conduct of the business of the Parent taken as a whole. The Parent Disclosure Letter sets forth a description of all Intellectual Property Rights which are material to the conduct of the business of the Parent taken as a whole. No claims are pending or, to the knowledge of the Parent, threatened that the Parent is infringing or otherwise adversely affecting the rights of any person with regard to any Intellectual Property Right. To the knowledge of the Parent, no person is infringing the rights of the Parent with respect to any Intellectual Property Right.

          SECTION 4.16.      Labor Matters. There are no collective bargaining or other labor union agreements to which the Parent is a party or by which it is bound. No material labor dispute exists or, to the knowledge of the Parent, is imminent with respect to any of the employees of the Parent.

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          SECTION 4.17.      Market Makers. The Parent has at least two market makers for its common shares and such market makers have obtained all permits and made all filings necessary in order for such market makers to continue as market makers of the Parent.

          SECTION 4.18.      Transactions With Affiliates and Employees. Except as set forth in the Parent SEC Documents, none of the officers or directors of the Parent and, to the knowledge of the Parent, none of the employees of the Parent is presently a party to any transaction with the Parent or any subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Parent, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

          SECTION 4.19.      Internal Accounting Controls. The Parent maintains a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Parent has established disclosure controls and procedures for the Parent and designed such disclosure controls and procedures to ensure that material information relating to the Parent is made known to the officers by others within those entities. The Parent’s officers have evaluated the effectiveness of the Parent's controls and procedures. Since December 31, 2006, there have been no significant changes in the Parent’s internal controls or, to the Parent’s knowledge, in other factors that could significantly affect the Parent’s internal controls.

          SECTION 4.20.      Solvency. Based on the financial condition of the Parent as of the Closing Date (and assuming that the closing shall have occurred), (i) the Parent’s fair saleable value of its assets exceeds the amount that will be required to be paid on or in respect of the Parent's existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Parent’s assets do not constitute unreasonably small capital to carry on its business for the current fiscal year as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Parent, and projected capital requirements and capital availability thereof, and (iii) the current cash flow of the Parent, together with the proceeds the Parent would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its debt when such amounts are required to be paid. The Parent does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).

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          SECTION 4.21.      Application of Takeover Protections. The Parent has taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Parent’s charter documents or the laws of its state of incorporation that is or could become applicable to the Shareholders as a result of the Shareholders and the Parent fulfilling their obligations or exercising their rights under this Agreement, including, without limitation, the issuance of the Shares and the Shareholders’ ownership of the Shares.

          SECTION 4.22.      No Additional Agreements. The Parent does not have any agreement or understanding with the Shareholders with respect to the transactions contemplated by this Agreement other than as specified in this Agreement.

          SECTION 4.23.      Investment Company. The Parent is not, and is not an affiliate of, and immediately following the Closing will not have become, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

          SECTION 4.24.      Disclosure. The Parent confirms that neither it nor any person acting on its behalf has provided any Shareholder or its respective agents or counsel with any information that the Parent believes constitutes material, non-public information except insofar as the existence and terms of the proposed transactions hereunder may constitute such information and except for information that will be disclosed by the Parent under a current report on Form 8-K filed within four business days after the Closing. The Parent understands and confirms that the Shareholders will rely on the foregoing representations and covenants in effecting transactions in securities of the Parent. All disclosure provided to the Shareholders regarding the Parent, its business and the transactions contemplated hereby, furnished by or on behalf of the Parent (including the Parent’s representations and warranties set forth in this Agreement) are true and correct and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

          SECTION 4.25.      Certain Registration Matters. Except as specified in the Parent Disclosure Letter and except for registration rights granted to Halter Financial Investments, L.P., the Parent has not granted or agreed to grant to any person any rights (including “piggy-back” registration rights) to have any securities of the Parent registered with the SEC or any other governmental authority that have not been satisfied.

          SECTION 4.26.      Listing and Maintenance Requirements. The Parent is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with the listing and maintenance requirements for continued listing of the Parent Stock on the trading market on which the Parent Stock are currently listed or quoted. The issuance and sale of the Shares under this Agreement does not contravene the rules and regulations of the trading market on which the Parent Stock are currently listed or quoted, and no approval of the stockholders of the Parent is required for the Parent to issue and deliver to the Shareholders the Shares contemplated by this Agreement.

          SECTION 4.27.      No Undisclosed Events, Liabilities, Developments or Circumstances. No event, liability, development or circumstance has occurred or exists, or is contemplated to occur with respect to the Parent, its subsidiaries or their respective business, properties, prospects, operations or financial condition, that would be required to be disclosed by the Parent under applicable securities laws on a registration statement filed with the SEC relating to an issuance and sale by the Parent of its Common Stock and which has not been publicly announced.

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          SECTION 4.28.      Foreign Corrupt Practices. Neither the Parent, nor any of its subsidiaries, nor, to the Parent’s knowledge, any director, officer, agent, employee or other person acting on behalf of the Parent or any of its subsidiaries has, in the course of its actions for, or on behalf of, the Parent (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

ARTICLE V

Deliveries

          SECTION 5.01.      Deliveries of the Shareholders.

                         (a)      Concurrently herewith each Shareholder is delivering to the Parent this Agreement executed by the Shareholder.

                         (b)      At or prior to the Closing, each Shareholder shall deliver to the Parent a copy of an executed instrument of transfer and bought and sold note for transfer by the Shareholder of its Company Stock.

                         (c)      At or within 30 business days following the Closing, or on such other date as the Parent shall agree, each Shareholder shall deliver to the Parent:

               (i)      a certificate or certificates representing its Company Stock; and

               (ii)      the original duly executed instrument of transfer and bought and sold note for transfer by the Shareholder of its Company Stock to the Parent.

          SECTION 5.02.      Deliveries of the Parent.

                         (a)      Concurrently herewith, the Parent is delivering to each Shareholder and to the Company a copy of this Agreement executed by the Parent.

                         (b)      At or prior to the Closing, the Parent shall deliver to the Company:

               (i)      a certificate from the Parent, signed by its Secretary or Assistant Secretary, certifying that the attached copies of the Parent Charter, Parent Bylaws and resolutions of the Board of Directors of the Parent approving this Agreement and the Transactions, are all true, complete and correct and remain in full force and effect;

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               (ii)      a letter of resignation of Xuezheng Yuan from his position as a director of the Parent and from all offices he holds with the Parent effective upon the Closing;

               (iii)      evidence of the election of Dishan Guo, Zhenquan Guo, Lei Li, Wenbin An and Lizong Wang as directors of the Parent effective upon the Closing;

               (iv)      evidence of the election of Dishan Guo as the Chief Executive Officer of the Parent, Lawrence Lee as the Chief Financial Officer of the Parent, and such other executive officers designated by the Company, effective as of the Closing;

               (v)      the results of UCC, judgment lien and tax lien searches with respect to the Parent, the results of which indicate no liens on the assets of the Parent; and

               (vi)      a duly executed release by the current directors and officers of the Parent in favor of the Parent, the Company and the Shareholders.

                         (c)      At or within 5 business days following the Closing, the Parent shall deliver to each Shareholder, a certificate representing the new shares of Parent Common Stock issued to such Shareholder as set forth on Annex A.

          SECTION 5.03.      Deliveries of the Company.

                         (a)      Concurrently herewith, the Company is delivering to the Parent this Agreement executed by the Company.

                         (b)      At or prior to the Closing, the Company shall deliver to the Parent a certificate from the Company, signed by its authorized officer certifying that the attached copies of the Company Constituent Instruments and resolutions of the Board of Directors of the Company approving this Agreement and the Transactions are all true, complete and correct and remain in full force and effect.

ARTICLE VI

Conditions to Closing

          SECTION 6.01.      Shareholder and Company Conditions Precedent. The obligations of the Shareholders and the Company to enter into and complete the Closing is subject, at the option of the Shareholders and the Company, to the fulfillment on or prior to the Closing Date of the following conditions.

                         (a)      Representations and Covenants. The representations and warranties of the Parent contained in this Agreement shall be true in all material respects on and as of the Closing Date with the same force and effect as though made on and as of the Closing Date. The Parent shall have performed and complied in all material respects with all covenants and agreements required by this Agreement to be performed or complied with by the Parent on or prior to the Closing Date. The Parent shall have delivered to the Shareholders and the Company, a certificate, dated the Closing Date, to the foregoing effect.

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                         (b)      Litigation. No action, suit or proceeding shall have been instituted before any court or governmental or regulatory body or instituted or threatened by any governmental or regulatory body to restrain, modify or prevent the carrying out of the Transactions or to seek damages or a discovery order in connection with such Transactions, or which has or may have, in the reasonable opinion of the Company or any Shareholders, a materially adverse effect on the assets, properties, business, operations or condition (financial or otherwise) of the Parent or the Company.

                         (c)      No Material Adverse Change. There shall not have been any occurrence, event, incident, action, failure to act, or transaction since December 31, 2006 which has had or is reasonably likely to cause a Parent Material Adverse Effect.

                         (d)      Post-Closing Capitalization. At, and immediately after, the Closing, the authorized capitalization, and the number of issued and outstanding shares of the capital stock of the Company and the Parent, on a fully-diluted basis, as indicated on a schedule to be delivered by the Parties at or prior to the Closing, shall be acceptable to the Shareholders in their sole and absolute discretion.

                         (e)      SEC Reports. The Parent shall have filed all reports and other documents required to be filed by the Parent under the U.S. federal securities laws through the Closing Date.

                         (f)      OTCBB Quotation. The Parent shall have maintained its status as a Company whose common stock is quoted on the Over-the-Counter Bulletin Board and no reason shall exist as to why such status shall not continue immediately following the Closing.

                         (g)      Deliveries. The deliveries specified in Section 5.02 shall have been made by the Parent.

                         (h)      No Suspensions of Trading in Parent Stock; Listing. Trading in the Parent Stock shall not have been suspended by the SEC or any trading market (except for any suspensions of trading of not more than one trading day solely to permit dissemination of material information regarding the Parent) at any time since the date of execution of this Agreement, and the Parent Stock shall have been at all times since such date listed for trading on a trading market.

                         (i)      Satisfactory Completion of Due Diligence. The Company and the Shareholders shall have completed their legal, accounting and business due diligence of the Parent and the results thereof shall be satisfactory to the Company and the Shareholders in their sole and absolute discretion.

                         (j)      Delivery of Audit Report and Financial Statements. The Company shall have completed the Company Financial Statements and shall have received an audit report from an independent audit firm that is registered with the Public Company Accounting Oversight Board relating to the periods ended March 31, 2010 and 2009 and the fiscal years ended December 31, 2009 and 2008.

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                         (k)      Termination of Lease Contract. The Parent shall terminate the lease contract with Xuezheng Yuan for the office space at No. 1 Xinxin Garden, No.51 Fangjicun Xudong Road, Wuchang, Wuhan, Hubei, China 430062 without subject the Company to any future obligations.

                         (l)      Payment of Consulting Services. The Company shall have paid $250,000 to Beijing Allstar Business Consulting, Inc. for its consulting services in connection with the share exchange transaction. Of such amount, $25,000 has previously been forwarded to Beijing Allstar Business Consulting, Inc. as an escrow deposit. Upon execution of this Agreement, the Company shall pay the remainder to Beijing Allstar Business Consulting, Inc. on the Closing Date.

                         (m)      Cancellation Agreement. A total of 4,973,600 shares of the Parent’s Stock held by certain shareholders shall have been cancelled and such shareholders and the Parent shall have delivered to the Company a Cancellation Agreement (the “Cancellation Agreement”), in form and substance satisfactory to the Company.

          SECTION 6.02.      Parent Conditions Precedent. The obligations of the Parent to enter into and complete the Closing is subject, at the option of the Parent, to the fulfillment on or prior to the Closing Date of the following conditions, any one or more of which may be waived by the Parent in writing.

                         (a)      Representations and Covenants. The representations and warranties of the Shareholders and the Company contained in this Agreement shall be true in all material respects on and as of the Closing Date with the same force and effect as though made on and as of the Closing Date. The Shareholders and the Company shall have performed and complied in all material respects with all covenants and agreements required by this Agreement to be performed or complied with by the Shareholders and the Company on or prior to the Closing Date. The Company shall have delivered to the Parent, if requested, a certificate, dated the Closing Date, to the foregoing effect.

                         (b)      Litigation. No action, suit or proceeding shall have been instituted before any court or governmental or regulatory body or instituted or threatened by any governmental or regulatory body to restrain, modify or prevent the carrying out of the Transactions or to seek damages or a discovery order in connection with such Transactions, or which has or may have, in the reasonable opinion of the Parent, a materially adverse effect on the assets, properties, business, operations or condition (financial or otherwise) of the Parent.

                         (c)      No Material Adverse Change. There shall not have been any occurrence, event, incident, action, failure to act, or transaction since March 31, 2010 which has had or is reasonably likely to cause a Company Material Adverse Effect.

                         (d)      Deliveries. The deliveries specified in Section 5.01 and Section 5.03 shall have been made by the Shareholders and the Company, respectively.

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                         (e)      Audited Financial Statements and Form 10-SB Disclosure. The Company shall have provided the Parent and the Shareholders with reasonable assurances that the Parent will be able to comply with its obligation to file a current report on Form 8-K within four (4) business days following the Closing containing the requisite audited consolidated financial statements of the Company and the requisite Form 10-type disclosure regarding the Company.

                         (f)      Post-Closing Capitalization. At, and immediately after, the Closing, the authorized capitalization, and the number of issued and outstanding shares of the capital stock of the Company and the Parent, on a fully-diluted basis, as indicated on a schedule to be delivered by the Parties at or prior to the Closing, shall be acceptable to the Parent in its sole and absolute discretion.

                         (g)      Satisfactory Completion of Due Diligence. The Parent shall have completed its legal, accounting and business due diligence of the Company and the Shareholders and the results thereof shall be satisfactory to the Parent in its sole and absolute discretion.

                         (h)      Delivery of Audit Report and Financial Statements. The Company shall have completed the Company Financial Statements and shall have received an audit report from an independent audit firm that is registered with the Public Company Accounting Oversight Board relating to the periods ended March 31, 2010 and 2009 and the fiscal years ended December 321, 2009 and 2008. The form and substance of the Financial Statements shall be satisfactory to the Parent in its sole and absolute discretion.

ARTICLE VII

Covenants

          SECTION 7.01.      Blue Sky Laws. The Parent shall take any action (other than qualifying to do business in any jurisdiction in which it is not now so qualified) required to be taken under any applicable state securities laws in connection with the issuance of Parent Stock in connection with this Agreement.

          SECTION 7.02.      Public Announcements. The Parent and the Company will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to this Agreement and the Transactions and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable Law, court process or by obligations pursuant to any listing agreement with any national securities exchange.

          SECTION 7.03.      Fees and Expenses. All fees and expenses incurred in connection with this Agreement shall be paid by the Party incurring such fees or expenses, whether or not this Agreement is consummated.

          SECTION 7.04.      Continued Efforts. Each Party shall use commercially reasonable efforts to (a) take all action reasonably necessary to consummate the Transactions, and (b) take such steps and do such acts as may be necessary to keep all of its representations and warranties true and correct as of the Closing Date with the same effect as if the same had been made, and this Agreement had been dated, as of the Closing Date.

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     SECTION 7.05.      Exclusivity. The Parent shall not (i) solicit, initiate, or encourage the submission of any proposal or offer from any person relating to the acquisition of any capital stock or other voting securities of the Parent, or any assets of the Parent (including any acquisition structured as a merger, consolidation, share exchange or other business combination), (ii) participate in any discussions or negotiations regarding, furnish any information with respect to, assist or participate in, or facilitate in any other manner any effort or attempt by any person to do or seek any of the foregoing, or (iii) take any other action that is inconsistent with the Transactions and that has the effect of avoiding the Closing contemplated hereby. The Parent shall notify the Company immediately if any person makes any proposal, offer, inquiry, or contact with respect to any of the foregoing.

     SECTION 7.06.      Filing of 8-K and Press Release. The Parent shall file, within four (4) business days of the Closing Date, a current report on Form 8-K and attach as exhibits all relevant agreements with the SEC disclosing the terms of this Agreement and other requisite disclosure regarding the Transactions and including the requisite audited consolidated financial statements of the Company and the requisite Form 10-SB disclosure regarding the Company. In addition, the Parent shall issue a press release prior to 9:30 a.m. (New York Time) on the business day following the Closing Date, announcing the closing of the transaction.

     SECTION 7.07.      Furnishing of Information. As long as any Shareholder owns the Shares, the Parent covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Parent after the date hereof pursuant to the Exchange Act. As long as any Shareholder owns Shares, if the Parent is not required to file reports pursuant to such laws, it will prepare and furnish to the Shareholders and make publicly available in accordance with Rule 144(c) promulgated by the SEC pursuant to the Securities Act, such information as is required for the Shareholder to sell the Shares under Rule 144. The Parent further covenants that it will take such further action as any holder of Shares may reasonably request, all to the extent required from time to time to enable such person to sell the Shares without registration under the Securities Act within the limitation of the exemptions provided by Rule 144.

     SECTION 7.08.      Access. Each Party shall permit representatives of each other Party to have full access to all premises, properties, personnel, books, records (including Tax records), contracts, and documents of or pertaining to such Party.

     SECTION 7.09.      Preservation of Business. From the date of this Agreement until the Closing Date, each of the Company and the Parent shall operate only in the ordinary and usual course of business consistent with past practice (provided, however, that Parent shall not issue any securities without the prior written consent of the Company), and shall use reasonable commercial efforts to (a) preserve intact its respective business organization, (b) preserve the good will and advantageous relationships with customers, suppliers, independent contractors, employees and other Persons material to the operation of its respective business, and (c) not permit any action or omission which would cause any of its respective representations or warranties contained herein to become inaccurate or any of its respective covenants to be breached in any material respect.

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ARTICLE VIII

Miscellaneous

          SECTION 8.01.      Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed given upon receipt by the Parties at the following addresses (or at such other address for a Party as shall be specified by like notice):

If to the Parent, to:

China Unitech, Inc.
No. 1 Xinxin Garden
No. 51 Fangjicun Xudong Road
Wuchang, Wuhan
Hubei, China 430062
Attention: Xuezheng Yuan

If to the Company, to:

Rm. 1010, Unit D, Block 1
Yuanjing Garden, Longxiang Road
Zhongxin Cheng, Longgang District, Shenzhen
China 518117
Attention: Chief Executive Officer
Facsimile: 86- 755-28943610

If to Shareholders at the addresses set forth in Annex A hereto.

with a copy to:

Pillsbury Winthrop Shaw Pittman LLP
2300 N Street, N.W.
Washington, DC 20037-11228
Attention: Louis A. Bevilacqua, Esq.
Facsimile: +1 202-663-8007

          SECTION 8.02.      Amendments; Waivers; No Additional Consideration. No provision of this Agreement may be waived or amended except in a written instrument signed by the Company, the Parent and the Shareholders holding a majority of the Shares. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of either Party to exercise any right hereunder in any manner impair the exercise of any such right. No consideration shall be offered or paid to any Shareholder to amend or consent to a waiver or modification of any provision of any transaction document unless the same consideration is also offered to all Shareholders who then hold Shares.

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          SECTION 8.03.      Replacement of Securities. If any certificate or instrument evidencing any Shares is mutilated, lost, stolen or destroyed, the Parent shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof, or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Parent of such loss, theft or destruction and customary and reasonable indemnity, if requested. The applicants for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs associated with the issuance of such replacement Shares. If a replacement certificate or instrument evidencing any Shares is requested due to a mutilation thereof, the Parent may require delivery of such mutilated certificate or instrument as a condition precedent to any issuance of a replacement.

          SECTION 8.04.      Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Shareholders, the Parent and the Company will be entitled to specific performance under this Agreement. The Parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations described in the foregoing sentence and hereby agrees to waive in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.

          SECTION 8.05.      Independent Nature of Shareholders' Obligations and Rights. The obligations of each Shareholder under this Agreement are several and not joint with the obligations of any other Shareholder, and no Shareholder shall be responsible in any way for the performance of the obligations of any other Shareholder under this Agreement. The decision of each Shareholder to acquire Shares pursuant to this Agreement has been made by such Shareholder independently of any other Shareholder. Nothing contained herein, and no action taken by any Shareholder pursuant hereto, shall be deemed to constitute the Shareholders as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Shareholders are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated herein. Each Shareholder shall be entitled to independently protect and enforce its rights, including without limitation the rights arising out of this Agreement, and it shall not be necessary for any other Shareholder to be joined as an additional party in any proceeding for such purpose. Each of the Company and the Parent acknowledge that each of the Shareholders has been provided with this same Agreement for the purpose of closing a transaction with multiple Shareholders and not because it was required or requested to do so by any Shareholder.

          SECTION 8.06.      Limitation of Liability. Notwithstanding anything herein to the contrary, each of the Parent and the Company acknowledge and agree that the liability of a Shareholder arising directly or indirectly, under any transaction document of any and every nature whatsoever shall be satisfied solely out of the assets of such Shareholder, and that no trustee, officer, other investment vehicle or any other affiliate of such Shareholder or any investor, shareholder or holder of shares of beneficial interest of such Shareholder shall be personally liable for any liabilities of such Shareholder.

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          SECTION 8.07.      Interpretation. When a reference is made in this Agreement to a Section, such reference shall be to a Section of this Agreement unless otherwise indicated. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”.

          SECTION 8.08.      Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule or Law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the Transactions contemplated hereby is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that Transactions contemplated hereby are fulfilled to the extent possible.

          SECTION 8.09.      Counterparts; Facsimile Execution. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties. Facsimile execution and delivery of this Agreement is legal, valid and binding for all purposes.

          SECTION 8.10.      Entire Agreement; Third Party Beneficiaries. This Agreement, taken together with the Company Disclosure Letter and the Parent Disclosure Letter, (a) constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the Parties with respect to the Transactions and (b) are not intended to confer upon any person other than the Parties any rights or remedies.

          SECTION 8.11.      Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof, except to the extent the laws of Nevada are mandatorily applicable to the Transactions.

          SECTION 8.12.      Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the Parties without the prior written consent of the other Parties. Any purported assignment without such consent shall be void. Subject to the preceding sentences, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the Parties and their respective successors and assigns.

[Signature Page Follows]

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          The Parties hereto have executed and delivered this Share Exchange Agreement as of the date first above written.

The Parent:	CHINA UNITECH GROUP, INC.
	By: ________________________________
	Name: Xuezheng Yuan
	Title: President
The Company:	CLASSIC BOND DEVELOPMENT LIMITED
	By: ________________________________
	Name: Dishan Guo
	Title: Director
The Shareholders:
	By:________________________________
	Name:

ANNEX A

Shareholders of Classic Bond Development Limited

No.	Name and Address of Shareholder	Tax ID (if applicable)	Number of Shares of Company Stock Being Exchanged	Percentage of Total Company Shares Represented By Shares Being Exchanged	Number of Shares of Parent Stock to be Received by Shareholder
1	GUO Dishan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,264,079	63.204%	12,008,750
2	TANG Liangyu 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
3	LIU Fangfang 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000
4	SUN Songtao 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	21,053	1.053%	200,000
5	LIU Yunbo 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
6	GE Ming 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	3,158	0.158%	30,000
7	XIE Shuixiang 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
8	WANG Lingli 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
9	YUAN Yuan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
10	CHEN Bingchang 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
11	LIN Guiseng 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
12	DENG Jian 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	737	0.037%	7,000
13	YE Chunqiu 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
14	ZHANG Lin 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000

No.	Name and Address of Shareholder	Tax ID (if applicable)	Number of Shares of Company Stock Being Exchanged	Percentage of Total Company Shares Represented By Shares Being Exchanged	Number of Shares of Parent Stock to be Received by Shareholder
15	DU Xiaojun 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000
16	LI Binhe 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000
17	Li Jinhui 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	105	0.005%	1,000
18	XU Ruihong 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
19	DONG Lingyun 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	737	0.037%	7,000
20	LIN Xiaohong 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	526	0.026%	5,000
21	ZHONG Hongjuan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	631	0.032%	6,000
22	HU Dongyang 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	631	0.032%	6,000
23	LI Xiaoyan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	631	0.032%	6,000
24	ZHANG Na 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	105	0.005%	1,000
25	CHEN Yefeng 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000
26	WANG Hongshu 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	4,211	0.211%	40,000
27	SUN Qian 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
28	ZHU Bizhi 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	526	0.026%	5,000
29	LIU Liyun 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	4211	0.211%	40,000

No.	Name and Address of Shareholder	Tax ID (if applicable)	Number of Shares of Company Stock Being Exchanged	Percentage of Total Company Shares Represented By Shares Being Exchanged	Number of Shares of Parent Stock to be Received by Shareholder
30	LIU Yumiao 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	526	0.026%	5,000
31	LONG Hongmei 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,579	0.079%	15,000
32	GU Dongqing 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	211	0.011%	2,000
33	LI Wei 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	2,105	0.105%	20,000
34	YANG Yizhou 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	7,368	0.368%	70,000
35	HU Yixue 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	526	0.026%	5,000
36	WANG Lizong 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	10,526	0.526%	100,000
37	ZHU Zhenping 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	631	0.032%	6,000
38	WANG Qiaoyun 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	1,053	0.053%	10,000
39	XIE Jing 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	94,737	4.737%	900,000
40	WEN Liuping 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	94,737	4.737%	900,000
41	XU Yanting 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	63,158	3.158%	600,000
42	WU Fan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	73,684	3.684%	700,000
43	JIANG Jiangping 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	94,737	4.737%	900,000
44	LIU Desheng 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	526	0.026%	5,000
45	CHEN Hanguang 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	15,040	0.752%	142,880

No.	Name and Address of Shareholder	Tax ID (if applicable)	Number of Shares of Company Stock Being Exchanged	Percentage of Total Company Shares Represented By Shares Being Exchanged	Number of Shares of Parent Stock to be Received by Shareholder
46	GUO Songqing 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	42,100	2.105%	399,950
47	GUO Zhenquan 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	63,160	3.158%	600,020
48	WANG Xiaofen 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	42,100	2.105%	399,950
49	ZENG Jinzhou 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	42,100	2.105%	399,950
50	WU Huiming 1-D-1010 Yuanjing Park, Longxiang Road, Center City, Longgang District, Shenzhen	N/A	27,000	1.350%	256,500
		Totals:	2,000,000	100.00%	19,000,000

EX-4.1

Exhibit 4.1

CANCELLATION AGREEMENT

          CANCELLATION AGREEMENT, dated July 2, 2010 (this “Agreement”), by and among, China Unitech Group, Inc., a Nevada corporation (the “Company”), and the shareholder identified on the signature page (the “Cancelling Party”).

BACKGROUND

          On or about the date hereof, the Company has entered into a Share Exchange Agreement with Classic Bond Development Limited, a British Virgin Islands company (“Classic Bond”), and its shareholders (the “Shareholders”), pursuant to which the Company will acquire from the Shareholders all of the issued and outstanding capital stock of Classic Bond in exchange for 18,800,000 shares of the Company’s common stock (the “Share Exchange Transaction”).

          It is a condition precedent to the consummation of the Share Exchange Transaction that the Cancelling Party enter into this Agreement, and that certain other shareholders of the Company (the “Other Cancelling Parties”) who are also cancelling shares enter into similar cancellation agreements, which will effectuate the cancellation of an aggregate of 4,973,600 shares of the common stock, par value $.00001 per share, of the Company held by the Cancelling Party and the Other Cancelling Parties (the “Subject Shares”). The Cancelling Party is entering into this Agreement to, among other things, induce Classic Bond and the Shareholders to enter into the Share Exchange Transaction and the Cancelling Party acknowledges that Classic Bond and the Shareholders would not consummate the transactions contemplated by the Share Exchange Transaction unless the transactions contemplated hereby are effectuated in accordance herewith.

AGREEMENT

          NOW, THEREFORE, in consideration of the mutual promises herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

          1.           Cancellation of Subject Shares. The Cancelling Party has delivered to the Company for cancellation stock certificates representing the number of shares of the Company’s Common Stock specified on the signature page hereto under the caption “Subject Shares” (the “Subject Shares”) along with duly executed medallion guaranteed stock powers covering the Subject Shares (or such other documents acceptable to the Company’s transfer agent) and hereby irrevocably instructs the Company and the Company’s transfer agent to cancel the Subject Shares such that the Subject Shares will no longer be outstanding on the stock ledger of the Company and such that the Cancelling Party shall no longer have any interest in the Subject Shares whatsoever. The Company shall immediately deliver to the Company’s transfer agent irrevocable instructions providing for the cancellation of the Subject Shares.

          2.           Representations by the Cancelling Party.

                         (a)           The Cancelling Party owns the Subject Shares, of record and beneficially, free and clear of all liens, claims, charges, security interests, and encumbrances of any kind whatsoever. The Cancelling Party has sole control over the Subject Shares or sole discretionary authority over any account in which they are held. Except for this Agreement, no person has any option or right to purchase or otherwise acquire the Subject Shares, whether by contract of sale or otherwise, nor is there a “short position” as to the Subject Shares.

                         (b)           The Cancelling Party has full right, power and authority to execute, deliver and perform this Agreement and to carry out the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Cancelling Party and constitutes a valid, binding obligation of the Cancelling Party, enforceable against it in accordance with its terms (except as such enforceability may be limited by laws affecting creditor's rights generally).

          3.           Further Assurances. Each party to this Agreement will use his or its best efforts to take all action and to do all things necessary, proper, or advisable in order to consummate and make effective the transactions contemplated by this Agreement (including the execution and delivery of such other documents and agreements as may be necessary to effectuate the cancellation of the Subject Shares).

          4.           Amendment and Waiver. Any term, covenant, agreement or condition of this Agreement may be amended, with the written consent of the Company and the Cancelling Party, or compliance therewith may be waived (either generally or in a particular instance and either retroactively or prospectively), by one or more substantially concurrent written instruments signed by the Company and the Cancelling Party.

          5.           Survival of Agreements, Representations and Warranties, etc. All representations and warranties contained herein shall survive the execution and delivery of this Agreement.

          6.           Successors and Assigns. This Agreement shall bind and inure to the benefit of and be enforceable by the Company and the Cancelling Party, and their respective successors and assigns.

          7.           Governing Law. This Agreement (including the validity thereof and the rights and obligations of the parties hereunder and thereunder) and all amendments and supplements hereof and thereof and all waivers and consents hereunder and thereunder shall be construed in accordance with and governed by the internal laws of the State of New York without regard to its conflict of laws rules, except to the extent the laws of Nevada are mandatorily applicable.

          8.           Indemnification. The Cancelling Party shall indemnify, defend and hold the Company harmless from and against all claims, losses, costs, penalties, fees, liabilities and damages, and expenses arising out of or otherwise related to (a) any breach of any representation or warranty contained herein, or (b) any assertion by the Cancelling Party or any third party to any right in the Subject Shares.

          9.           Miscellaneous. This Agreement embodies the entire agreement and understanding between the parties hereto and supersedes all prior agreements and understandings relating to the subject matter hereof. In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. This Agreement may be executed in any number of counterparts and by the parties hereto on separate counterparts but all such counterparts shall together constitute but one and the same instrument. This Agreement may be reproduced by any electronic, photographic, photostatic, magnetic, microfilm, microfiche, microcard, miniature photographic, facsimile or other similar process and the original thereof may be destroyed. The parties agree that any such reproduction shall, to the extent permitted by law, be as admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not the reproduction was made in the regular course of business) and that any enlargement, facsimile or further reproduction shall likewise be admissible in evidence. Facsimile execution and delivery of this Agreement is legal, valid and binding execution and delivery for all purposes.

[Signature Page Follows]

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          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

CHINA UNITECH GROUP, INC.

By: _________________________________________
Name: Xuezhang Yuan
Title: President

Shareholder

By: _________________________________________
Name:

Subject Shares: ________________________________

(representing _____________ shares of China Unitech Group, Inc. owned by the shareholder)

[Signature Page to Cancellation Agreement]

EX-10.1

Exhibit 10.1

MANAGEMENT AND CONSULTING
SERVICES AGREEMENT

          This MANAGEMENT AND CONSULTING SERVICES AGREEMENT (“Agreement”) is entered into as of June 11, 2010 (the “Effective Date”), by and between the following (each a “Party” and together the “Parties”):

(i) Party A: Shenzhen Jun Long Culture Communication Co., Ltd. (Party A), a limited liability company with its legal address at 1-D-1010 Yuanjing Garden, Longxiang Avenue, Longgang District, Shenzhen City, Guangdong, People’s Republic of China; and

(ii) Party B: Shenzhen Zhonghefangda Network Technology Co., Ltd., a wholly foreign-owned enterprise organized under the laws of the People’s Republic of China, with its legal address at 1-D-1008 Yuanjing Garden, Longxiang Avenue, Longgang District, Shenzhen City, Guangdong, People’s Republic of China.

          Capitalized terms not otherwise defined have the meanings assigned to them in Appendix A to this Agreement, which is incorporated and made a part hereof by reference.

RECITALS

          This Agreement is entered into with reference to the following facts:

          A.      Party A is a limited liability company organized under the laws of the People’s Republic of China. Party A is 100% owned by GUO Dishan, ZENG Jinzhou and WANG Xiaofen (the “Shareholders”). Party A is engaged in internet café chain store service; development of computer network hardware; distribution of cultural items; calligraphy and painting artwork exhibition planning, art and cultural activities planning, cultural and courtesy planning, starting businesses; domestic commerce; advertising etc. in the People’s Republic of China (together with any expansion, contraction or other change to the scope of that business as contemplated by this Agreement, the “Business”).

          B.      Party B is a wholly foreign-owned enterprise organized under the laws of the People’s Republic of China. Party B is 100% owned by Classic Bond Development Limited, a company organized under the laws of the British Virgin Islands. Party B has executive and financial management experience and capability relevant to the Business.

          D.      Effective as of June 11, 2010, Party B agreed to provide management and consulting services to Party A, upon request, in connection with the operation of the Business. The Parties now desire to memorialize the terms and conditions pursuant to which those services have been and/or will be provided by Party B to Party A, and pursuant to which Party A will compensate Party B therefor.

          NOW, THEREFORE, in consideration for the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is acknowledged by the Parties, and through friendly consultation under the principle of equality and mutual benefits, in accordance with the relevant laws and regulations of the People’s Republic of China, the Parties agree as follows:

Execution Version

AGREEMENT

          1.      Management and Consulting Services; Work Orders.

                         (a)      During the Term of this Agreement, Party A may deliver one or more written work orders (each a “Work Order”) to Party B requesting Party B to provide management and/or consulting services (the “Services”) to Party A. Unless otherwise agreed between the Parties, the Services described in each Work Order must be within the scope of services described in Appendix B.

                         (b)      Party B will provide the Services described in each Work Order directly and/or through providing to Party A executive, technical, administrative and financial management personnel in sufficient numbers and with expertise and experience appropriate to provide the Services.

                         (c)      Party A will take all commercially reasonable actions to permit and facilitate the provision of the Services by Party B and accept those Services. Party B is required to provide only those Services which are the subject of a Work Order.

          2.      Services Fee.

                         (a)      Aggregate Services Fee. As compensation for providing the Services, Party B will be entitled to receive an aggregate fee (the “Services Fee”), upon demand but only upon demand, equal to up to one hundred percent (100%) of the Aggregate Net Profit of Party A during the Term of this Agreement.

                         (b)      Calculation and Payment of Services Fee. Promptly after receipt of each Work Order, Party B will notify Party A in writing of the amount of the fee for such Services, which amount will be due and payable within sixty (60) days after written demand therefor. The aggregate fees charged by Party B for Services performed pursuant to Work Orders may not exceed the Aggregate Net Profit of Party A.

                         (c)      Excess Capacity Payment. The Parties acknowledge that Party B must retain capacity at all times sufficient to provide Services in response to Work Orders received from Party A. Such resources may or may not be otherwise employed during the Term of this Agreement. The Parties therefore agree that periodically, upon written demand from Party B, Party A will pay to Party B up to the entire amount of Party A’s Aggregate Net Profit not previously earned pursuant to a Work Order, in consideration for Party B’s maintenance of resources adequate to respond to requests for Services from Party A.

                         (d)      Disputes. Any dispute between the Parties concerning any calculation or payment under this Section 2 will be resolved pursuant to the dispute resolution provisions of Section 19.

          3.      Ad Hoc Payment. The Parties acknowledge that in order to provide the Services under this Agreement, Party B may incur expenses and costs from time to time, and the Parties further agree that Party B from time to time may request an ad hoc payment from Party A, and such payment may be credited against Services Fees payable in the future.

          4.      Obligation to Reimburse Net Losses. In consideration for its right to receive the Aggregate Net Profit of Party A as provided in Section 2, Party B will reimburse to Party A the full amount of any Net Losses incurred by Party A during the Term of this Agreement. Net Losses will be calculated annually and paid by Party B to Party A no later than the last day of the first quarter following the end of each calendar year, commencing on September 30 for calendar year 2010. Any dispute between the Parties concerning any calculation or payment under this Section 4 will be resolved pursuant to the dispute resolution provisions of Section 19.

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Execution Version

          5.      Advances Against Net Losses . From time to time, in its sole discretion, Party B may advance to Party A amounts to be credited against Party B’s future obligations to reimburse Net Losses of Party A. Any such advances will be treated as prepayments and not as loans. Party A will have no obligation to repay any such advances except by crediting the amount thereof against Party B’s obligation to reimburse Net Losses, or by adding the amount thereof to Net Profit when and as requested by Party B.

          6.      Credit for Amounts Paid Under Other Agreements. Party B and Party A are or may be parties to certain other agreements (collectively, the “Business Cooperation Agreements”), some or all of which may require certain payments to be made by Party A to Party B in consideration for services, equipment or other items of value provided by Party B to Party A. The Parties agree that any and all such amounts may be (a) separately paid by Party A to Party B and accordingly counted as expenses of Party A, reducing Party A’s Net Profit; or (b) included in the aggregate Net Profit of Party A and not separately paid to Party B.

          7.      Interest Penalty. If any amounts due and payable under this Agreement are not paid when due, interest will accumulate on such amounts at the rate of four percent (4%) per annum until paid. This interest penalty may be reduced or waived by the Party entitled to receive it in light of actual circumstances, including the reason for any delay in payment.

          8.      Guarantees. To the extent and only to the extent permitted by applicable law, each Party agrees to act as a guarantor of the indebtedness of the other, as and only as follows:

                         (a)      Party A will not incur any indebtedness to any Person not a party to this Agreement without the advance written consent of Party B. If Party A incurs any indebtedness as contemplated by this Section 8(a), Party B will act as a guarantor of that indebtedness.

                         (b)      Party B may, in the exercise of its reasonable business judgment, incur indebtedness to any Person not a party to this Agreement, provided that any such indebtedness may only be in connection with the Business. If Party B incurs any indebtedness as contemplated by this Section 8(b), Party A will act as a guarantor of that indebtedness.

          9.      Exclusivity. During the Term of this Agreement, (a) Party A will not contract with any other Person to provide services which are the same or similar to the Services, and (b) Party B will not provide services which are the same or similar to the Services to any other Person. For purposes of this Section 9 only, “Person” does not include any Affiliate of either Party, including other entities that may become affiliated with either Party.

          10.      Operation of Business. During the Term of this Agreement:

                         (a)     Party A will ensure that:

(i)	the business of Party A, together with all business opportunities presented to or which become available to Party A, will be treated as part of the Business covered by the Services and this Agreement;
(ii)	all cash of Party A will be maintained in Company Bank Accounts or disposed of in accordance with this Agreement;
(iii)	all business income, working capital, recovered accounts receivable, and any other funds which come into the possession of Party A or are derived from or related to the operation of the business of Party A, are deposited into a Company Bank Account;

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Execution Version

(iv)	all accounts payable, employee compensation and other employment-related expenses, and any payments in connection with the acquisition of any assets for the benefit of Party A or the satisfaction of any liabilities of Party A, are paid from amounts maintained in Company Bank Accounts;
(v)	Party B or any third party designated by Party B will have full access to the financial records of Party A and from time to time, Party B may request, at its sole option, to conduct an auditing with regard to the financial status of Party A;
(vi)	ensure that a majority of the members of its board of directors are also members of the board of directors of Party B; and
(vii)	no action is taken without the prior written consent of Party B that that would have the effect of entrusting all or any part of the business of Party A to any other Person.

                         (b)      Party B will ensure that:

(i)	it exercises with respect to the conduct of the Business the same level of care it exercises with respect to the operation of its own business and will at all times act in accordance with its Reasonable Business Judgment, including taking no action which it knows, or in the exercise of its Reasonable Business Judgment should have known, would materially adversely affect the status of any of permits, licenses and approvals necessary for the conduct of the Business or constitute a violation of all Legal Requirements;
(ii)	neither it, nor any of its agents or representatives, takes any action that interferes with, or has the effect of interfering with, the operation of the Business in accordance with this Agreement, or which materially adversely affects its assets, operations, business or prospects;
(iii)	use its Best Efforts to cooperate and assist Party B and Party A to maintain in effect all permits, licenses and other authorizations and approvals necessary or appropriate to the conduct of the Business; and
(iv)	use its Best Efforts to assist Party B and Party A to maintain positive and productive relations with relevant Governmental Authorities and their representatives.
(v)	a majority of the members of its board of directors are also members of the board of directors of Party A; and
(vi)	subject to the provisions of Section 13 relating to the Transition period, it will preserve intact the business and operations of Party A and take no action which it knows, or in the exercise of its Reasonable Business Judgment should have known, would materially adversely affect the business, operations, or prospects of Party A.

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Execution Version

          11.      Material Actions. The Parties acknowledge and agree that the economic risk of the operation of the Business is being substantially assumed by Party B and that the continued business success of Party A is necessary to permit the Parties to realize the benefits of this Agreement and the other Business Cooperation Agreements, if any. During the Term of this Agreement, the Parties therefore will ensure that Party A does not take any Material Action without the advance written consent of Party B, which consent will not be unreasonably withheld or delayed.

          12.      Right of First Refusal. Party A will ensure as follows: if the Shareholder proposes to Transfer to any other Person other than Party B (the “Proposed Transferee”) all or any portion of the equity of Party A held by the Shareholder (the “Selling Shareholder”), the Selling Shareholder will first deliver to Party B a written notice (the “Notice”) offering to Party B or its designee(s) all of the equity proposed to be Transferred by the Shareholder, on terms and conditions no less favorable to Party B than those offered to the Proposed Transferee. The Notice will include all relevant terms of the Proposed Transfer, and will be irrevocable for a period of thirty (30) calendar days after its receipt by Party B. Party B will have the right and option, by written notice delivered within thirty (30) calendar days after receipt of the Notice, to notify the Shareholder in writing of its acceptance of all or any part of the equity so offered in the Notice, at the purchase price and on the terms stated in the Notice. If Party B accepts the offer contained in the Notice, then the equity of Party A proposed to be Transferred will be Transferred to Party B at the purchase price and on the terms stated in the Notice. If Party B is not able to accept the transferred equity of Party A only due to the restrictions set forth by the then effective PRC regulations, Party A shall not make the Proposed Transfer to any third party without prior written approval from Party B.

          13.      Transition of Business to Party B; Future Expansion. At the sole discretion of Party B, during the Term of this Agreement, Party B may transfer or cause to be transferred from Party A to Party B or its designee (referred to collectively for purposes of this Section 13 as “Party B”) any part or all of the business, personnel, assets and operations of Party A which may be lawfully conducted, employed, owned or operated by Party B (the “Transition”), including any of the following:

                         (a)      business opportunities presented to, or available to Party A may be pursued and contracted for in the name of Party B rather than Party A, and at its discretion Party B may employ the resources of Party A to secure such opportunities;

                         (b)      any tangible or intangible property of Party A, any contractual rights, any personnel, and any other items or things of value held by Party A may be transferred to Party B at book value;

                         (c)      real property, personal or intangible property, personnel, services, equipment, supplies and any other items useful for the conduct of the Business may be obtained by Party B by acquisition, lease, license or otherwise, and made available to Party A on terms to be determined by agreement between Party B and Party A;

                         (d)      contracts entered into in the name of Party A may be transferred to Party B, or the work under such contracts may be subcontracted, in whole or in part, to Party B, on terms to be determined by agreement between Party B and Party A; and

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Execution Version

                         (e)      any changes to, or any expansion or contraction of, the Business may be carried out in the exercise of the sole discretion of Party B, and in the name of and at the expense of, Party B;

provided, however, that none of the foregoing, and no other part of the Transition may cause or have the effect of terminating (without being substantially replaced under the name of Party B) or adversely affecting any license, permit or regulatory status of Party A. Any of the activity contemplated by this Section 13 will be deemed part of the “Business.”

          14.      Ownership of Intellectual Property. All Intellectual Property created by Party B in the course of providing the Services will be the sole property of Party B and Party A will have no right to any ownership or use of such Intellectual Property except under separate written agreement with Party B.

          15.      Representations and Warranties of Party A. Party A hereby makes the following representations and warranties for the benefit of Party B:

                         (a)      Corporate Existence and Power. Party A is a limited liability company duly organized and validly existing under the laws of the PRC, and has all legal or corporate power and all governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and as currently contemplated to be conducted. Party A has never approved, or commenced any proceeding or made any election contemplating, the dissolution or liquidation of Party A or the winding up or cessation of the business or affairs of Party A.

                         (b)      Authorization; No Consent. Party A (i) has taken all necessary corporate and other actions to authorize its execution, delivery and performance of this Agreement and all related documents and has the corporate and other power and authorization to execute, deliver and perform this Agreement and the other related documents; (ii) has the absolute and unrestricted right, power, authority, and capacity to execute and deliver this Agreement and the other related documents and to perform its obligations under this Agreement and the other related documents; (iii) is not required to give any notice to or obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the transactions or actions contemplated by any of the Business Cooperation Agreements, except for any notices that have been duly given or Consents that have been duly obtained; and (iv) holds all the governmental authorizations necessary to permit it to lawfully conduct and operate its business in the manner it currently conducts and operates such business and to permit Party A to own and use its assets in the manner in which it currently owns and uses such assets. To the best knowledge of Party A, there is no basis for any governmental authority to withdraw, cancel or cease in any manner any of such governmental authorizations.

                         (c)      No Conflicts. The execution and perform of this Agreement by Party A will not contravene, conflict with, or result in violation of (i) any provision of the organizational documents of Party A; (ii) resolution adopted by the board of directors or the equity holders of Party A; and (iii) any laws and regulations to which Party A or the transactions and relationships contemplated in this Agreement and the Business Cooperation Agreements are subject.

          16.      Representations and Warranties of Party B. Party B hereby makes the following representations and warranties for the benefit of Party A:

                         (a)      Corporate Existence and Power. Party B (i) is a limited liability company duly organized and validly existing under the laws of PRC, and has all corporate power and all governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and as currently contemplated to be conducted; and (ii) has not ever approved, or commenced any proceeding or made any election contemplating, the dissolution or liquidation of Party B or the winding up or cessation of the business or affairs of Party B.

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                         (b)      Authorization; No Consent. Party B (i) has taken all necessary corporate actions to authorize its execution, delivery and performance of this Agreement and all related documents and has the corporate power and authorization to execute, deliver and perform this Agreement and the other related documents; (ii) has the absolute and unrestricted right, power, authority, and capacity to execute and deliver this Agreement and the other related documents and to perform its obligations under this Agreement and the other related documents; (iii) is not required to give any notice to or obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the Business Cooperation Agreements, except for any notices that have been duly given or Consents that have been duly obtained; and (iv) has all the governmental authorizations necessary to permit Party B to lawfully conduct and operate its business in the manner it currently conducts and operates such business and to permit Party B to own and use its assets in the manner in which it currently owns and uses such assets. To the best knowledge of Party B, there is no basis for any governmental authority to withdraw, cancel or cease in any manner any of such governmental authorizations.

                         (c)      No Conflicts. The execution and perform of this Agreement by Party B will not contravene, conflict with, or result in violation of (i) any provision of the organizational documents of Party B; (ii) any resolution adopted by the board of directors or the equity holders of Party B; and (iii) any laws and regulations to which Party B or the transactions and relationships contemplated in this Agreement and the Business Cooperation Agreements are subject.

          17.      Liability for Breach; Indemnification and Hold Harmless. Each of the Parties will be liable to the other Party for any damage or loss caused by such Party’s breach of this Agreement. Party A will indemnify and hold harmless Party B from and against any claims, losses or damages unless caused by a breach by Party B of its obligations under this Agreement or by the willful, reckless or illegal conduct of Party B. Party B will indemnify and hold harmless Party A from and against any claims, losses or damages caused by any breach by Party A of its obligations under this Agreement or by the willful, reckless or illegal conduct of Party A.

          18.      Liquidated Damages. Party A acknowledges and agrees that Party B will be incurring significant expense in order to fulfill its obligations under this Agreement. Party A further acknowledges that breach of this Agreement by it would cause Party B and Party B’s stockholders significant damages and perhaps the complete cessation of Party B’s business. Since the exact amount of such damages would be extremely difficult, if not impossible to calculate, Party A agrees that in the event of the material breach by it of this Agreement, which breach has not been cured within sixty (60) days of receipt of notice from Party B of such material breach and a description of such breach, Party A will be obligated to pay to Party B liquidated damages in an amount equal to the greater of (a) eight (8) times the annualized revenues of Party B for the last completed fiscal quarter, or (b) US$50 million.

          19.      Dispute Resolution.

                         (a)      Friendly Consultations. Any and all disputes, controversies or claims arising out of or relating to the interpretation or implementation of this Agreement, or the breach hereof or relationships created hereby, will be settled through friendly consultations.

                         (b)      Arbitration. If any such dispute is not resolved through friendly consultations within sixty (60) days from the date a Party gives the other Parties written notice of a dispute, then it will be resolved exclusively by arbitration under the auspices of and in accordance with the Arbitration Rules of China International Economic and Trade Arbitration Commission (“CIETAC”) and will be submitted to CIETAC Shanghai Branch. Any arbitration will be heard before three (3) arbitrators, one (1) of whom will be appointed by Party B, one (1) of whom will be appointed by Party A, and the remaining one (1) arbitrator (chairman of the arbitration tribunal) will be appointed by the Director of CIETAC. Any arbitration will be conducted in both the English and Chinese languages. The arbitration award will be final and binding on both Parties and will not be subject to any appeal, and the Parties agree to be bound thereby and to act accordingly.

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                              (c)      Continuation of Agreement. It is not necessary for any Party to declare a breach of this Agreement in order to proceed with the dispute resolution process set out in this Section 19. Unless and until this Agreement is terminated pursuant to Section 20, this Agreement will continue in effect during the pendency of any discussions or arbitration under this Section 19.

          20.      Term. This Agreement is effective as of the date first set forth above, and will continue in effect for a period of twenty (20) years (the “Initial Term”), and for succeeding periods of the same duration (each, “Subsequent Term”), until terminated by one of the following means either during the Initial Term or thereafter. The period during which this Agreement is effective is referred to as the “Term.”

                         (a)      Mutual Consent. This Agreement may be terminated at any time by the mutual consent of the Parties, evidenced by an agreement in writing signed by both Parties.

                         (b)      Termination by Party B. This Agreement may be terminated by Party B ((i) upon written notice delivered to Party A no later than ten (10) calendar days before the expiration of the Initial Term or any Subsequent Term; or (ii) at any time by upon ninety (90) calendar days’ written notice delivered to Party A.

                         (c)      Breach or Insolvency. Either of Party A or Party B may terminate this Agreement immediately (a) upon the material breach by the other of its obligations hereunder and the failure of such Party to cure such breach within thirty (30) working days after written notice from the non-breaching Party; or (b) upon the filing of a voluntary or involuntary petition in bankruptcy by the other or of which the other is the subject, or the insolvency of the other, or the commencement of any proceedings placing the other in receivership, or of any assignment by the other for the benefit of creditors.

                         (d)      Consequences of Termination. Upon any effective date of any termination of this Agreement: (i) Party B will instruct all management personnel identified or provided by it to Party A to cease working for Party A; (ii) Party B will deliver to Party A all chops and seals of Party A; (iii) Party B will deliver to Party A, or grant to Party A unrestricted access to and control of, all of the financial and other books and records of Party A, including any and all permits, licenses, certificates and other proprietary and operational documents and instruments; (iv) Party B will cooperate fully in the replacement of any signatories or persons authorized to act on behalf of Party A with persons appointed by Party A; and (v) any licenses granted by Party B to Party A during the Term will terminate unless otherwise agreed by the Parties.

                         (e)      Survival. The provisions of Section 17 (Indemnification; Hold Harmless); Section 18 (Liquidated Damages), Section 19 (Dispute Resolution), Section 20(d) (Consequences of Termination), and Section 21 (Miscellaneous) will survive any termination of this Agreement. Any amounts owing from any Party to any other Party on the effective date of any termination under the terms of this Agreement will continue to be due and owing despite such termination.

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          21.      Miscellaneous.

                         (a)      Headings and Gender. The headings of Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. All references to “Section” or “Sections” refer to the corresponding Section or Sections of this Agreement. All words used in this Agreement will be construed to be of such gender or number as the circumstances require. Unless otherwise expressly provided, the word “including” does not limit the preceding words or terms.

                         (b)      Usage. The words “include” and “including” will be read to include “without limitation.”

                         (c)      Severability. Whenever possible each provision and term of this Agreement will be interpreted in a manner to be effective and valid but if any provision or term of this Agreement is held to be prohibited by or invalid, then such provision or term will be ineffective only to the extent of such prohibition or invalidity, without invalidating or affecting in any manner whatsoever the remainder of such provision or term or the remaining provisions or terms of this Agreement. If any of the covenants set forth in this Agreement are held to be unreasonable, arbitrary, or against public policy, such covenants will be considered divisible with respect to scope, time and geographic area, and in such lesser scope, time and geographic area, will be effective, binding and enforceable against the Parties.

                         (d)      Waiver. No failure or delay by any Party to exercise any right, power or remedy under this Agreement will operate as a waiver of any such right, power or remedy.

                         (e)      Integration. This Agreement and the other Business Cooperation Agreements supersede any and all prior discussions and agreements (written or oral) between the Parties with respect to the exclusive cooperation arrangement and other matters contained herein.

                         (f)      Assignments, Successors, and No Third-Party Rights. No Party may assign any of its rights under this Agreement without the prior consent of the other Parties, which will not be unreasonably withheld. Notwithstanding the foregoing, the Parties understand that Party B is intending to set up a wholly foreign owned enterprise (the “WFOE”) in China and it is the agreement between the Parties that all the rights and obligations of Party B under this Agreement and the Business Cooperation Agreement will be assigned to the WFOE at Party B’s discretion. Subject to the preceding sentence, this Agreement will apply to, be binding in all respects upon, and inure to the benefit of the successors and permitted assigns of the Parties. Nothing expressed or referred to in this Agreement will be construed to give any Person other than the Parties to this Agreement any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement. This Agreement and all of its provisions and conditions are for the sole and exclusive benefit of the Parties to this Agreement and their successors and assigns.

                         (g)      Notices. All notices, requests, demands, claims, and other communications under this Agreement will be in writing. Any Party may send any notice, request, demand, claim, or other communication under this Agreement to the intended recipient at the address set forth on the signature page of this Agreement by any means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail, or electronic mail), but no such notice, request, demand, claim, or other communication will be deemed to have been duly given unless and until it actually is received by the intended recipient. Refusal by a Party to accept notice that is validly given under this Agreement will be deemed to have been received by such Party upon receipt. Any Party may change the address to which notices, requests, demands, claims, and other communications under this Agreement are to be delivered by giving the other Parties notice in the manner herein set forth. Any notice, request, demand, claim, or other communication under this Agreement will be addressed to the intended recipient as set forth on the signature page hereto.

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                         (h)      Further Assurances. Each of the Parties will use its best efforts to take all action and to do all things necessary, proper, or advisable in order to consummate and make effective the transactions contemplated by this Agreement.

                         (i)      Governing Law. This Agreement will be construed, and the rights and obligations under this Agreement determined, in accordance with the laws of the PRC, without regard to the principles of conflict of laws thereunder.

                         (j)      Amendment. This Agreement may not be amended, altered or modified except by a subsequent written document signed by all Parties.

                         (k)      Language. This Agreement is written in both Chinese and English, and both versions are equally authentic.

                         (l)      Counterparts. This Agreement may be executed in any number of counterparts. When each Party has signed and delivered to the other Party at least one such counterpart, each of the counterparts will constitute one and the same instrument.

[Signature Page Follows]

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          IN WITNESS WHEREOF, the Parties hereto have executed this Services Agreement as of the date first above written.

Party A:	Party B:
Shenzhen Jun Long Culture Communication Co., Ltd.	Shenzhen Zhonghefangda Network Technology Co., Ltd.
By: /s/ Guo Dishan	By: /s/ Guo Dishan
Its: Legal Representative	Its: Legal Representative
Address:	Address:
1-D-1010 Yuanjing Garden, Longxiang Avenue,	1-D-1008 Yuanjing Garden, Longxiang Avenue,
Longgang District, Shenzhen City, Guangdong,	Longgang District, Shenzhen City, Guangdong,
People’s Republic of China	People’s Republic of China

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APPENDIX A
Definitions

For purposes of that certain Services Agreement to which this is Appendix A, the following terms have the meanings set forth below:

“Affiliate” means, with respect to any Person, any of (a) a director, officer or stockholder holding 5% or more of the equity or capital stock (on a fully diluted basis) of such Person, (b) a spouse, parent, sibling or descendant of such Person (or a spouse, parent, sibling or descendant of any director or officer of such Person) and (c) any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another such Person. The term “control” includes, without limitation, the possession, directly or indirectly, of the power to direct the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

“Aggregate Net Profit” means the aggregate Net Profit of Party A for the period commencing on the Effective Date and continuing through the date on which Aggregate Net Profit is calculated.

“Best Efforts” means the efforts that a prudent Person desiring to achieve a particular result would use in order to ensure that such result is achieved as expeditiously as possible.

“Business” is defined in the Recitals.

“Business Cooperation Agreements” means any other agreements entered into between the Parties with respect to the operation of the Business or the carrying out of the transactions contemplated by this Agreement.

“Company Bank Accounts” means all accounts maintained or held in the name of Party A at or with any bank or other financial institution, whether existing on the date of this Agreement or established in the future.

“Consent” means any approval, consent, ratification, permission, waiver or authorization, including any of the foregoing issued or granted by any Governmental Authority.

“Governmental Authority” means any nation or government or any province or state any other political subdivision thereof; any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any government authority, agency, department, board, commission or instrumentality of the People’s Republic of China or any political subdivision thereof; any court, tribunal or arbitrator; and any self-regulatory organization.

“Intellectual Property” means any patent, patent application, trademark (whether registered or unregistered and whether or not relating to a published work), trademark application, trade name, fictitious business name, service mark (whether registered or unregistered), service mark application, copyright (whether registered or unregistered), copyright application, maskwork, maskwork application, trade secret, know-how, franchise, system, computer software, invention, design, blueprint, proprietary product, technology, proprietary right, and improvement on or to any of the foregoing, or any other other intellectual property right or intangible asset.

“Law” means all applicable provisions of all (a) constitutions, treaties, statutes, laws (including the common law), codes, rules, regulations, ordinances or orders of any Governmental Authority, (b) governmental approvals and (c) orders, decisions, injunctions, judgments, awards and decrees of or agreements with any Governmental Authority.

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“Legal Requirement” “means any national (or federal), provincial, state, local, municipal, foreign or other constitution, law, statute, legislation, constitution, principle of common law, resolution, ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, ruling, directive, pronouncement, requirement, specification, determination, decision, opinion or interpretation issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into effect by or under the authority of any Governmental Authority.

“Lien” means any mortgage, pledge, deed of trust, hypothecation, right of others, claim, security interest, encumbrance, burden, title defect, title retention agreement, lease, sublease, license, occupancy agreement, easement, covenant, condition, encroachment, voting trust agreement, interest, option, right of first offer, negotiation or refusal, proxy, lien, charge or other restrictions or limitations of any nature whatsoever, including but not limited to such Liens as may arise under any contract.

“Services” is defined in Section 1.

“Services Fee” is defined in Section 2.

“Material Action” means any of the actions set forth in Appendix C.

“Net Losses” means the net losses of Party A, calculated as follows: if the result of the calculation of Net Profit is a negative number, that number will be the “Net Losses” of Party A.

“Net Profit” means the net profit of Party A for the period immediately preceding the date for calculation of Net Profit set out in this Agreement, calculated as follows: (a) Revenue, less (b) Costs, Accrued Expenses, Taxes accrued or paid, and Fixed Revenue. In addition, the following terms have the meanings set forth below, each with reference to the same period:

                         (a)      “Revenue” means all the revenue or income actually accrued by Party A arising out of or connected to the conduct of the Business;

                         (b)      “Costs” means all costs required for the conduct of the Business actually accrued by Party A;

                         (c)      “Accrued Expenses” means the amount which must be accrued by Party A according to applicable Legal Requirements in connection with employee health and welfare, mandatory development funds, and the like;

                         (d)      “Taxes” is defined in this Appendix A; and

                         (e)      “Fixed Revenue” means the amount which must be paid by Party A to Sichuan International Studies University.

“Person” means an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

“Reasonable Business Judgment” means a judgment reached in good faith and in the exercise of reasonable care.

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“Shareholder” is defined in the Recitals.

“Taxes” means with respect to any Person, (a) all income taxes (including any tax on or based upon net income, gross income, income as specially defined, earnings, profits or selected items of income, earnings or profits) and all gross receipts, sales, use, ad valorem, transfer, franchise, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property or windfall profits taxes, alternative or add-on minimum taxes, customs duties and other taxes, fees, assessments or charges of any kind whatsoever, together with all interest and penalties, additions to tax and other additional amounts imposed by any taxing authority (domestic or foreign) on such Person (if any) and (b) any liability for the payment of any amount of the type described in the clause (a) above as a result of being a “transferee” of another entity or a member of an affiliated or combined group, and “Tax” will have the correlative meaning.

“Tax Return” means any return (including any information return), report, statement, declaration, estimate, schedule, notice, notification, form, election, certificate or other document or information that is, has been or may in the future be filed with or submitted to, or required to be filed with or submitted to, any Governmental Body in connection with the determination, assessment, collection or payment of any Tax or in connection with the administration, implementation or enforcement of or compliance with any Legal Requirement relating to any Tax.

“Term” is defined in Section 20.

“Transfer” means directly or indirectly, to sell, assign, transfer, pledge, bequeath, hypothecate, mortgage, grant any proxy with respect to, or in any other way encumber or otherwise dispose of.

“Transition” is defined in Section 13.

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APPENDIX B
Services

For purposes of that certain Services Agreement to which this is Appendix B, “Services” means the following:

General Services

“Services” includes the following general Services relating to the operation of the Business except for those compulsively limited or prohibited by PRC laws and regulations otherwise:

                         (a)      All aspects of the day-to-day operations of Party A, including its relationships with its customers, its performance under agreements or other arrangements with any other parties, its compliance with applicable laws and regulations;

                         (b)      The appointment, hiring, compensation (including any bonuses, non-monetary compensation, fringe and other benefits, and equity-based compensation), firing and discipline of all employees, consultants, agents and other representatives of Party A, including the Executive Director or the Board of Directors of Party A and all other executive officers or employees of Party A;

                         (c)      Establishment, maintenance, termination or elimination of any plan or other arrangement for the benefit of any employees, consultants, agents, representatives or other personnel of Party A;

                         (d)      Management, control and authority over all accounts receivable, accounts payable and all funds and investments of Party A;

                         (e)      Management, control and authority over Party A Bank Accounts, in connection with which all seals and signatures will be those of personnel appointed and confirmed by Party B;

                         (f)      Any expenditure, including any capital expenditure, of Party A;

                         (g)      The entry into, amendment or modification, or termination of any contract, agreement and/or other arrangement to which Party A is, was, or would become a party;

                         (h)      The acquisition, lease or license by Party A of any assets, supplies, real or personal property, or intellectual or other intangible property;

                         (i)      The acquisition of or entry into any joint venture or other arrangement by Party A with any other Person;

                         (j)      Any borrowing or assumption by Party A of any liability or obligation of any nature, or the subjection of any asset of Party A to any Lien;

                         (k)      Any sale, lease, license or other disposition of any asset owned, beneficially owned or controlled by Party A;

                         (l)      Applying for, renewing, and taking any action to maintain in effect, any permits, licenses or other authorizations and approvals necessary for the operation of Party A’s business;

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                         (m)      The commencement, prosecution or settlement by Party A of any litigation or other dispute with any other Person, through mediation, arbitration, lawsuit or appeal;

                         (n)      The declaration or payment of any dividend or other distribution of profits of Party A;

                         (o)      The preparation and filing of all Tax Returns, the payment or settlement of any and all Taxes, and the conduct of any proceedings with any Governmental Authority with respect to any Taxes; and

                         (p)      The carrying out of the Transition, as defined in Section 13.

Specific Services

“Services” also includes the following specific services relating to the operation of the Business:

(a)	Marketing and Public Relationship
	Service Content: Party B will be in charge of, including but not limited to, engaging in publicizing Party A’s brand so as to broaden Party A’s influence; dealing the cooperation issues with the qualified third party for Party A’s interests.
(b)	Establishment, Maintenance and Property Management of Fixed Assets and Equipments
	Service Content: Party B provides the services of establishment, maintenance and management for buildings owned and/or used by Party A; establishment, repair, maintenance, operation and management for the public equipments, devices owned and/or used by Party A; Party A’s public environment sanitation, including buildings and public sites; management for traffic and order of vehicles stop; maintenance for the public order, including security monitor, patrol, guard, guard at gate; energy services (use of power, water and gas); maintenance for telecom and grib; storage and maintenance machineries, vehicles, furniture and other equipments; other property Services.
	Special Agreement:
	(1)	Party B charges the customer directly for the services hereunder;
	(2)	The services management expenses will be charged to the customer solely and timely according to the actual expenses;
	(3)	For the services hereunder, Party A covenants, unless otherwise consented by Party B in writing, Party A will not cooperate or reach a cooperation agreement with any third party (whatever in writing or in oral).

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(c) Future Investment and Expansion

	Party A will consult Party B and seek its prior written permission concerning any and all of its future investment or expansion plan. In the case that the then effective PRC laws and regulations permit, any and all of such investment and expansion will be made directly through Party B.
(d)	Others

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APPENDIX C

Material Actions

For purposes of that certain Services Agreement to which this is Appendix C, “Material Actions” means any of the following:

                         (a)      Any change to the organic or charter documents of Party A;

                         (b)      Any issuance of new equity in Party A, including any securities convertible into equity of Party A, or the acceptance by Party A of any equity investment, or the repurchase or redemption of any equity of Party A;

                         (c)      Any hiring, firing, or discipline of any person who is an executive employee or director of Party A;

                         (d)      The purchase of any material asset by Party A;

                         (e)      The sale, conveyance, licensing or pledge of a material asset of Party A, including, without limitation, any material intellectual property of Party A;

                         (f)      Entering into, amending, supplementing, terminating or otherwise modifying any agreement, contract or other arrangement to which Party A is or could become a party, having a value or impact on Party A, individually or in the aggregate, in excess of RMB 100,000;

                         (g)      Incurring any indebtedness or similar obligation to third parties or subjecting of any of the equity or assets of Party A to any Lien;

                         (h)      Investing in, incorporating or otherwise creating any affiliate or joint venture or purchasing or otherwise acquiring any stock or any equity interest in any entity or business, in one or a series of related transactions, or disposing of any of the foregoing;

                         (i)      Any change to the compensation of any executive employee, consultant or other representative of Party A;

                         (j)      Any transaction, action or agreement by any of Party A other than in the ordinary course of business;

                         (k)      Any transaction, contract or agreement between Party A and the Shareholder;

                         (l)      Declaring or paying dividends on, or making any distributions to any capital stock, except in accordance with the instruments defining the rights of any such capital stock or securities;

                         (m)      The initiation or settlement of any litigation or arbitration involving Party A;

                         (n)      Approving the annual budget and multi-year business plan for Party A;

                         (o)      Approving Party A’s final audits of Party A’s annual consolidated financial statements and tax returns to be filed by Party A with any taxing authority;

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                         (p)      Any material change in Party A’s accounting or tax policies or a change of Party A’s independent auditor; and

                         (q)      Any change in the number of directors of Party A, except as a result of the operation of any other provisions of this Agreement.

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EX-10.2

Exhibit 10.2

EQUITY PLEDGE AGREEMENT

This Equity Pledge Agreement (hereinafter this “Agreement”) is dated June 11, 2010, and is entered into in1-D-1008 Yuanjing Garden, Longxiang Avenue, Longgang District, Shenzhen City, Guangdong, People’s Republic of China (“PRC” or “China”) between and among Shenzhen Zhonghefangda Network Technology Co., Ltd. (“Pledgee”), Shenzhen Jun Long Culture Communication Co., Ltd. (the “Company”), and GUO Dishan, ZENG Jinzhou and WANG Xiaofen, the shareholders of the Company (individually and collectively, the “Pledgor”).

RECITALS

1.           The Company is a company incorporated in the People’s Republic of and is in the business of internet café chain store service; development of computer network hardware; distribution of cultural items; calligraphy and painting artwork exhibition planning, art and cultural activities planning, cultural and courtesy planning, starting businesses; domestic commerce; advertising etc. (the “Business”).

2.           The Pledgee is a limited liability company organized and existing under the laws of PRC has expertise relevant to the Business.

3.           The individuals collectively referred to herein as the “Pledgor” together hold 100% of the outstanding equity interests of the Company.

4.           The Pledgee and the Company have executed a Management and Consulting Services Agreement (the “Management Services Agreement”) concurrently herewith, pursuant to which the Company shall pay consulting and service fees (the “Management Services Fee”) to the Pledgee for various management, technical, consulting and other services in connection with the Business.

5.           In order to ensure that the Company will perform its obligations under the Management Services Agreement, and in order to provide an additional mechanism for the Pledgee to enforce its rights to collect the Management Services Fee from the Company, the Pledgor agrees to pledge all her equity interests in the Company as security for the performance of the obligations of the Company under the Management Services Agreement, including payment of the Management Services Fee.

AGREEMENT

NOW THEREFORE, the Pledgee, the Company and the Pledgor through mutual negotiations hereby enter into this Agreement based upon the following terms:

1.           Definitions and Interpretation. Unless otherwise provided in this Agreement, the following terms shall have the following meanings:

              1.1           “Pledge” refers to the full content of Section 2 hereunder.

Execution Version

              1.2           “Equity Interest” refers to all the equity interests in the Company legally held by the Pledgor.

              1.3           “Term of Pledge” refers to the period provided for under Section 3.2 hereunder.

              1.4           “Event of Default” refers to any event in accordance with Section 7.1 hereunder.

              1.5           “Notice of Default” refers to the notice of default issued by the Pledgee in accordance with this Agreement.

2.           The Pledge. The Pledgor hereby pledges the Equity Interest to the Pledgee as a security for the obligations of the Company under the Management Services Agreement (the “Pledge”). Pursuant thereto, the Pledgee shall have priority in receiving payments from the evaluation or the proceeds from the auction or sale of the Equity Interest. The Equity Interest shall hereinafter be referred to as the “Pledged Collateral”.

3.           Term of Pledge.

              3.1           The Pledge shall take effect as of the date when the Pledge is recorded in the Company’s Register of Shareholders, and shall expire two (2) years from the Company’s satisfaction of all its obligations under the Management Services Agreement (the “Term”).

              3.2           During the Term, the Pledgee shall be entitled to vote, control, sell, or dispose of the Pledged Collateral in accordance with this Agreement in the event that the Company does not perform its obligations under the Management Services Agreement, including without limitations thee failure to pay the Consulting Service Fee.

              3.3           During the Term, the Pledgee shall be entitled to collect any and all dividends declared or paid in connection with the Pledged Collateral.

4.           Pledge Procedure and Registration.

              4.1           The Pledge shall be recorded in the Company’s Register of Shareholders. The Pledgor shall, within ten (10) days after the date of this Agreement, process the registration procedures with the Administration for Industry and Commerce concerning the Pledge.

5.           Representation and Warranties of Pledgor.

              5.1           The Pledgor is the legal owner of the Pledged Collateral.

              5.2           Other than to the Pledgee, the Pledgor has not pledged the Pledged Collateral to any other party, and the Pledged Collateral is not encumbered to any other party.

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6.           Covenants of Pledgor.

              6.1           During the Term, the Pledgor represents and warrants to the Pledgee for the Pledgee’s benefit that the Pledgor shall:

                              6.1.1     Not transfer or assign the Pledged Collateral, nor create or permit to create any pledge or encumbrance to the Pledged Collateral which may adversely affect the rights and/or benefits of the Pledgee without the Pledgee’s prior written consent.

                              6.1.2     Comply with the laws and regulations with respect to the Pledge; present to Pledgee any notices, orders or advisements with respect to the Pledge that may be issued or made by a competent PRC authority within five (5) days upon receiving such notices, orders or advisements; comply with such notices, orders or advisements; or object to the foregoing matters upon the reasonable request of the Pledgee or with consent from the Pledgee.

                              6.1.3     Timely notify the Pledgee of any events which may affect the Pledged Collateral or the Pledgor’s rights thereto, or which may change any of the Pledgor’s warranties or affect the Pledgor’s performance of their obligations under this Agreement.

              6.2           The Pledgor agrees that the Pledgee’s right to the Pledge pursuant to this Agreement shall not be suspended or inhibited by any legal proceedings initiated by the Pledgor, jointly or separately, or by any successor of or any person authorized by the Pledgor.

              6.3           The Pledgor represents and warrants to the Pledgee that in order to protect and perfect the security for the payment of the Management Services Fee, the Pledgor shall execute in good faith and cause other parties who have interests in the Pledged Collateral to execute all the title certificates, contracts, and perform actions and cause other parties who have interests to take action, as required by the Pledgee.

              6.4           The Pledgor represents and warrants to the Pledgee or its appointed representative (whether a natural person or a legal entity) that they will execute all applicable and required amendments in connection with the registration of the Pledge, and within a reasonable amount of time upon request, provide the relevant notice, order and decision regarding such registration to the Pledgee.

              6.5           The Pledgor represents and warrants to the Pledgee that she will abide by and perform all relevant guarantees, covenants, warranties, representations and conditions necessary to insure the rights of the Pledgee under this Agreement. The Pledgor shall compensate all the losses suffered by the Pledgee as a result of the Pledgor’s failure to perform any such guarantees, covenants, warranties, representations or conditions.

7.           Events of Default.

              7.1           The occurrence of any one of the following events shall be regarded as an “Event of Default”:

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                              7.1.1      This Agreement is deemed illegal by a governing authority of the PRC, or the Pledgor is incapable of continuing to perform the obligations herein due to any reason except force majeure;

                              7.1.2      The Company fails to timely pay the Management Services Fee in full as required under the Management Services Agreement;

                              7.1.3      A Pledgor makes any materially false or misleading representations or warranties under Section 5 herein, or breaches any warranties under Section 5 herein;

                              7.1.4      A Pledgor breaches the covenants under Section 6 herein;

                              7.1.5      A Pledgor breaches any terms and conditions of this Agreement;

                              7.1.6      A Pledgor transfers or assigns, cause to be transferred or assigned, or otherwise abandons the Pledged Collateral without the prior written consent of the Pledgee;

                              7.1.7      The Company is incapable of repaying debt;

                              7.1.8      The assets of a Pledgor are adversely affected so as to cause the Pledgee to believe that such Pledgor’s ability to perform the obligations herein is adversely affected;

                              7.1.9      The successors or agents of the Company refuse, or are only partly able, to perform the payment obligations under the Management Services Agreement;

              7.2      A Pledgor shall immediately give a written notice to the Pledgee if such Pledgor is aware of or discovers that any event under Section 7.1 herein, or any event that may result in any one of the foregoing events, has occurred or is likely to occur.

              7.3      Unless an Event of Default has been resolved to the Pledgee’s satisfaction within 15 days of its occurrence (the “Cure Period”), the Pledgee may, at any time thereafter, give a written default notice (the “Default Notice”) to the Pledgor and require the Pledgor to immediately make full payment of the then outstanding Consulting Service Fee and any other outstanding payables in accordance with Section 8 herein.

8.           Exercise of Remedies.

              8.1           Authorized Action by Secured Party. The Pledgor hereby irrevocably appoints Pledgee as the attorney-in-fact of the Pledgor for the purpose of carrying out the security provisions of this Agreement and to take any action and execute any instrument that the Pledgee may deem necessary or advisable to accomplish the purpose of this Agreement. Such power of attorney shall be effective, automatically and without the necessity of any action (including any transfer of any Pledged Collateral) by any person, upon the occurrence an Event of Default. Pledgee shall not have any duty to exercise any such right or to preserve the same and shall not be liable for any failure to do so or for any delay in doing so.

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Execution Version

                         If an Event of Default occurs, or is already proceeding, Pledgee shall have the right to exercise the following rights:

                         (a)      Collect by legal proceedings or otherwise, and endorse and/or receive all payments, proceeds and other sums and property now or hereafter payable on or on account of the Pledged Collateral;

                         (b)      Enter into any extension, reorganization, deposit, merger, consolidation or other agreement pertaining to, or deposit, surrender, accept, hold or apply other property in exchange for the Pledged Collateral;

                         (c)      Transfer the Pledged Collateral under the Pledgee’s name or under an appointed nominee;

                         (d)      Make any compromise or settlement, and take any action the Pledgee deems advisable, with respect to the Pledged Collateral;

                         (e)      Notify any obligor with respect to the Pledged Collateral to make payment directly to the Pledgee;

                         (f)      All rights of the Pledgor that they would otherwise be entitled to enjoy or exercise with respect to the Pledged Collateral, including without limitations the rights to vote and to receive distributions, shall cease without any further action by or notice, and all such rights shall thereupon become vested in the Pledgee; and

                         (g)      The Pledgor shall execute and deliver to the Pledgee such other instruments as the Pledgee may request in order to permit the Pledgee to exercise the rights set forth herein.

              8.2           Other Remedies. Upon the expiration of the Cure Period, the Pledgee, in addition to the remedies set forth in Section 8.1 or such other rights in law, equity or otherwise, may, without notice or demand on the Pledgor, elect any of the following:

                         (a)      Require the Pledgor to immediately pay all outstanding unpaid amounts due under the Management Services Agreement;

                         (b)      Foreclose or otherwise enforce the Pledgee’s security interest to the Pledged Collateral in any manner permitted by law or provided under this Agreement;

                         (c)      Terminate this Agreement pursuant to Section 11;

                         (d)      Exercise any and all rights as the beneficial and legal owner of the Pledged Collateral, including, without limitation, the transfer and exercise of voting and any other rights to the Pledged Collateral; and

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Execution Version

                         (e)      Exercise any and all rights and remedies of a secured party under applicable laws.

              8.3           The Pledgee has priority in the receipt of payments from the proceeds of auction or sale of the Pledged Collateral, in part or in whole, in accordance with legal procedures, until all payment obligations under the Management Services Agreement are satisfied.

              8.4           The Pledgor shall not hinder the Pledgee from exercising its rights in accordance with this Agreement and shall give necessary assistance so that the Pledgee may exercise its rights in full.

9.           Assignment.

              9.1           The Pledgor shall not assign or otherwise transfer the rights and obligations herein without the Pledgee’s prior written consent.

              9.2           This Agreement shall be binding upon the Pledgor and her respective successors, and shall be binding on the Pledgee and each of its successor and assignee.

              9.3           Upon the transfer or assignment by the Pledgee of any or all of its rights and obligations under the Management Services Agreement, the Pledgee’s transferee or assignee shall enjoy and undertake the same rights and obligations as the Pledgee under this Agreement. The Pledgor shall be notified of any such transfer or assignment by written notice and at the request of the Pledgee, the Pledgor shall execute such relevant agreements and/or documents with respect to such transfer or assignment.

              9.4           In the event of the Pledgee’s change in control resulting in the transfer or assignment of this Agreement, the successor to the Pledgee and the Pledgor shall execute a new equity pledge agreement.

10.         Formalities, Fees and Other Charges.

              10.1         The Pledgor shall be responsible for all the fees and expenses in relation to this Agreement, including, but not limited, to legal fees, cost of production, stamp tax and any other taxes and charges. If the Pledgee pays the relevant taxes in accordance with applicable law, the Pledgor shall fully reimburse the Pledgee of such taxes.

              10.2         The Pledgor shall be responsible for all expenses (including, but not limited to, any taxes, application fees, management fees, litigation costs, attorney’s fees, and various insurance premiums in connection with the disposition of the Pledge) incurred by the Pledgee in its recourse to collect from the Pledgor arising from the Pledgor’s failure to pay any relevant taxes and fees.

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Execution Version

11.         Force Majeure.

              11.1         “Force Majeure” shall include, but not be limited, to acts of governments, acts of nature, fire, explosion, typhoon, flood, earthquake, tide, lightning, war, and any unforeseen events beyond a Party’s reasonable control or which cannot be prevented with reasonable care. However, any shortage of credit, capital or finance shall not be regarded as an event beyond a Party’s reasonable control. A Party affected by Force Majeure shall promptly notify the other Parties of such event in order to be exempted from such Party’s obligations under this Agreement.

              11.2         In the event that the affected Party is delayed or prevented from performing its obligations under this Agreement due to Force Majeure, the affected Party shall not be responsible for any damage caused by the delay or prevention of such performance, as long as such damage is within the scope of such delay or prevention. The affected Party shall take appropriate means to minimize or remove the effects of Force Majeure and attempt to resume performance of the obligations delayed or prevented by Force Majeure. When such Force Majeure ceases to exist, both Parties covenant and agree to resume the performance of this Agreement with their best efforts.

12.         Confidentiality. The Parties hereby acknowledge and agree to ensure the confidentiality of all oral and written materials exchanged relating to this Agreement. No Party shall disclose any confidential information to any other third party without the other Parties’ prior written approval, unless: (a) such information was in the public domain at the time it was communicated (unless it entered the public domain without the authorization of the disclosing Party); (b) the disclosure was in response to the relevant laws, regulations, or stock exchange rules; or (c) the disclosure was required by any of the Party’s legal counsel or financial consultant for the purpose of the transaction underlying this Agreement. However, such legal counsel and/or financial consultant shall also comply with the confidentiality as stated hereof. The disclosure of confidential information by employees or agents of the disclosing Party is deemed to be an act of the disclosing Party, and such disclosing Party shall bear all liabilities for any breach of confidentiality.

13.         Dispute Resolution.

              13.1         This Agreement shall be governed by and construed in accordance with the laws of the PRC.

              13.2         The Parties shall strive to resolve any disputes arising from the interpretation or performance of this Agreement through amicable negotiations. If a dispute cannot be settled, any Party may submit such dispute to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration. The arbitration shall abide by the rules of CIETAC, and the arbitration proceedings shall be conducted in Beijing, China in English. The decision of CIETA shall be final and binding upon the parties.

14.         Notices. Any notice given by the parties hereto for the purpose of performing the rights and obligations hereunder shall be in writing. If such notice is delivered by messenger, the time of receipt is the time when such notice is received by the addressee; if such notice is transmitted by facsimile, the time of receipt is the time when such notice is transmitted. If the notice does not reach the addressee by the end of the business day, the following business day shall be the date of receipt. The place of delivery is the Party’s address as set forth in the signature pages hereto or the address advised in writing including via facsimile.

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Execution Version

15.         Entire Contract. The Parties agree that this Agreement constitutes the entire agreement of the Parties upon its effectiveness and supersedes all prior oral and/or written agreements and understandings relating to this Agreement.

16.         Severability. If any provision or provisions of this Agreement shall be held by a proper authority to be invalid, illegal, unenforceable or in conflict with the laws and regulations of the PRC, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

17.         Appendices. The appendices to this Agreement are incorporated into and are a part of this Agreement.

18.         Amendment or Supplement.

              18.1         The Parties may amend this Agreement in writing, provided that such amendment shall be duly executed and signed by the Pledgee, the Company, and the Pledgor, and such amendment shall thereupon become a part of this Agreement and shall have the same legal effect as this Agreement.

              18.2         This Agreement and any amendments, modification, supplements, additions or changes hereto shall be in writing and come into effect upon being executed and stamped by the parties hereto.

19.         Language and Copies of the Agreement. This Agreement shall be executed in English in four (4) original copies. Each Party shall receive one (1) original copy, all of which shall be equally valid and enforceable.

[SIGNATURE PAGE FOLLOWS]

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Execution Version

          IN WITNESS WHEREOF this Agreement is duly executed by each Party or its legal representative as of the date first set forth above.

PLEDGEE:	Shenzhen Zhonghefangda Network Technology Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer
COMPANY:	Shenzhen Jun Long Culture Communication Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer

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Execution Version

PLEDGORS SIGNATURE PAGE

PLEDGORS:

/s/ Guo Dishan

Name: GUO Dishan

ID Card No.: 440301196405141912

/s/ Zeng Jinzhou

Name: ZENG Jinzhou

ID Card No.: 362129197906264218

/s/ Wang Xiaofen

Name: WANG Xiaofen

ID Card No.: 440307197506181529

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EX-10.3

Exhibit 10.3

OPTION AGREEMENT

This Option Agreement (this “Agreement”) is dated June 11, 2010, and is entered into in 1-D-1008 Yuan-jing Garden, Longxiang Avenue, Longgang District, Shenzhen City, Guangdong, People’s Republic of China (“PRC” or “China”) between and among Shenzhen Jun Long Culture Communication Co., Ltd. (“Party A”); the undersigned shareholders of Party A (individually and collectively, the “Shareholder”); and Shenzhen Zhonghefangda Network Technology Co., Ltd. (“Party B”). Party A, Party B and the Shareholder are each referred to individually in this Agreement as a “Party” and collectively as the “Parties.”

R E C I T A L S

1.           Party A is engaged in the business of internet café chain store service; development of computer network hardware; distribution of cultural items; calligraphy and painting artwork exhibition planning, art and cultural activities planning, cultural and courtesy planning, starting businesses; domestic commerce; advertising etc. (the “Business”). Party B has expertise relevant to the Business, and has entered into a Management and Consulting Services Agreement dated as of June 11, 2010 to provide Party A with various management, technical, consulting and other services in connection with the Business.

2.           The individuals collectively referred to herein as the “Shareholder” together hold 100% of the issued and outstanding equity interests of Party A (collectively the “Equity Interest”).

3.           The Parties are entering into this Agreement in connection with the Management Services Agreement.

NOW, THEREFORE, the Parties to this Agreement hereby agree as follows:

A G R E E M E N T

1.        PURCHASE AND SALE OF EQUITY INTEREST

          1.1      Grant of Rights. The Shareholder (hereinafter the “Transferor”) hereby irrevocably grants to Party B or a designee of Party B (the “Designee”) an option to purchase at any time and from time to time, to the extent permitted under PRC Law, all or any portion of the Equity Interest in accordance with such procedures as determined by Party B, at the price specified in Section 1.3 of this Agreement (the “Option”). No Option shall be granted to any party other than to Party B and/or a Designee. As used herein, Designee may be an individual person, a corporation, a joint venture, a partnership, an enterprise, a trust or an unincorporated organization.

          1.2      Exercise of Rights. According with the requirements of applicable PRC laws and regulations, Party B and/or the Designee may exercise the Option at any time or from time to time by issuing a written notice (the “Notice”) to the Transferor and specifying the amount of the Equity Interest to be purchased from the Transferor and the manner of purchase.

Execution Version

          1.3      Purchase Price.

                      1.3.1      The purchase price of the Equity Interest pursuant to an exercise of the Option (the “Purchase Price”) shall be equal to the original paid-in price (paid-in registered capital) of the Transferor, adjusted proportionally for any purchase of less than all of the Equity Interest, unless a different purchase price is mandated by applicable PRC laws and regulations, in which case the minimum purchase price permitted by such laws and regulations shall be the Purchase Price hereunder.

          1.4        Transfer of Equity Interest. Upon each exercise of the Option under this Agreement:

                       1.4.1      The Transferor shall hold or cause to be held a meeting of shareholders of Party A in order to adopt such resolutions as necessary in order to approve the transfer of the relevant Equity Interest (such Equity Interest hereinafter the “Purchased Equity Interest”) to Party B and/or the Designee;

                       1.4.2      The relevant Parties shall enter into an Equity Interest Purchase Agreement, in a form reasonably acceptable to Party B, setting forth the terms and conditions for the sale and transfer of the Purchased Equity Interest;

                       1.4.3      The relevant Parties shall execute, without any security interest, all other requisite contracts, agreements or documents, obtain all requisite approval and consent of the government, conduct all necessary actions, transfer the valid ownership of the Purchased Equity Interest to Party B and/or the Designee, and cause Party B and/or the Designee to be the registered owner of the Purchased Equity Interest. As used herein, “security interest” means any mortgage, pledge, right or interest of the third party, purchase right of equity interest, right of acquisition, right of first refusal, right of set-off, ownership detainment or other security arrangements; provided, however, such term shall not include any security interest created under that certain Equity Pledge Agreement dated as of June 11, 2010 by and among the Parties (the “Pledge Agreement”).

          1.5      Payment. Payment of the purchase price shall be determined through negotiations between the Transferor and Party B (including the Designee) in accordance with the applicable laws at the time of the exercise of the Option.

2.        REPRESENTATIONS RELATING TO EQUITY INTEREST

           2.1      Party A’s Representations. Party A hereby represents and warrants:

                       2.1.1      Without Party B’s prior written consent, Party A’s Articles of Association shall not be supplemented, changed or renewed in any way, Party A’s registered capital of shall not be increased or decreased, and the structure of the registered capital shall not be changed in any form;

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Execution Version

                       2.1.2      To maintain the corporate existence of Party A and to prudently and effectively operate the business according with customary fiduciary standards applicable to managers with respect to corporations and their shareholders;

                       2.1.3      Without Party B’s prior written consent, upon the execution of this Agreement, to not sell, transfer, mortgage or dispose, in any other form, any asset, legitimate or beneficial interest of business or income, or encumber or approve any encumbrance or imposition of any security interest on Party A’s assets;

                       2.1.4      Without Party B’s prior written consent, to not issue or provide any guarantee or permit the existence of any debt, other than (i) such debt that may arise from Party A’s normal or daily business (excepting a loan); and (ii) such debt which has been disclosed to Party B before this Agreement;

                       2.1.5      To operate and conduct all business operations in the ordinary course of business, without damaging Party A’s business or the value of its assets;

                       2.1.6      Without Party B’s prior written consent, to not enter into any material agreements, other than agreements entered into in the ordinary course of business (for purpose of this paragraph, if any agreement for an amount in excess of One Hundred Thousand Renminbi (RMB 100,000) shall be deemed a material agreement);

                       2.1.7      Without Party B’s prior written consent, to not provide loan or credit to any other party or organization;

                       2.1.8      To provide to Party B all relevant documents relating to its business operations and finance at the request of Party B;

                       2.1.9      To purchase and maintain general business insurance of the type and amount comparable to those held by companies in the same industry, with similar business operations and assets as Party A, from an insurance company approved by Party B;

                       2.1.10    Without Party B’s prior written consent, to not enter into any merger, cooperation, acquisition or investment;

                       2.1.11    To notify Party B of the occurrence or the potential occurrence of litigation, arbitration or administrative procedure relating to Party A’s assets, business operations and/or income;

                       2.1.12     In order to guarantee the ownership of Party A’s assets, to execute all requisite or relevant documents, take all requisite or relevant actions, and make and pursue all relevant claims;

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Execution Version

                       2.1.13    Without Party B’s prior written notice, to not assign the Equity Interest in any form; however, Party A shall distribute dividends to the Shareholder upon the request of Party B; and

                       2.1.14    In accordance with Party B’s request, to appoint any person designated by Party B to be a management member of Party A.

          2.2         Transferor’s Representations. The Transferor hereby represents and warrants:

                       2.2.1      Without Party B’s prior written consent, upon the execution of this Agreement, to not sell, transfer, mortgage or dispose in any other form any legitimate or beneficial interest of the Equity Interest, or to approve any security interest, except as created pursuant to the Pledge Agreement;

                       2.2.2      Without Party B’s prior written notice, to not adopt or support or execute any shareholder resolution at any meeting of the shareholder of Party A that seeks to approve any sale, transfer, mortgage or disposal of any legitimate or beneficial interest of the Equity Interest, or to allow any attachment of security interests, except as created pursuant to the Pledge Agreement;

                       2.2.3      Without Party B’s prior written notice, to not agree or support or execute any shareholder resolution at any meeting of the shareholder of Party A that seeks to approve Party A’s merger, cooperation, acquisition or investment;

                       2.2.4      To notify Party B the occurrence or the potential occurrence of any litigation, arbitration or administrative procedure relevant to the Equity Interest;

                       2.2.5      To cause Party A’s Board of Directors to approve the transfer of the Purchased Equity Interest pursuant to this Agreement;

                       2.2.6      In order to maintain the ownership of Equity Interest, to execute all requisite or relevant documents, conduct all requisite or relevant actions, and make all requisite or relevant claims, or make requisite or relevant defense against all claims of compensation;

                       2.2.7      Upon the request of Party B, to appoint any person designated by Party B to be a director of Party A; and

                       2.2.8      To prudently comply with the provisions of this Agreement and any other agreements entered into with Party B and Party A in connection therewith, and to perform all obligations under all such agreements, without taking any action or nonfeasance that may affect the validity and enforceability of such agreements.

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Execution Version

3.       Representations and Warranties. As of the execution date of this Agreement and on each transfer of Purchased Equity Interest pursuant to an exercise of the Option, Party A and the Transferor hereby represent and warrant as follows:

          3.1      Such Parties shall have the power and ability to enter into and deliver this Agreement and to perform their respective obligations thereunder, and at each transfer of Purchased Equity Interest, the relevant Equity Interest Purchase Agreement and to perform their obligations thereunder. Upon execution, this Agreement and each Equity Interest Purchase Agreement will constitute legal, valid and binding obligations and be fully enforceable in accordance with their terms;

          3.2      The execution and performance of this Agreement and any Equity Interest Purchase Agreement shall not: (i) violate any relevant laws and regulations of the PRC; (ii) conflict with the Articles of Association or other organizational documents of Party A; (iii) cause to breach any agreements or instruments or having binding obligation on it, or constitute a breach under any agreements or instruments or having binding obligation on it; (iv) breach relevant authorization of any consent or approval and/or any effective conditions; or (v) cause any authorized consent or approval to be suspended, removed, or cause other added conditions;

          3.3      The Equity Interest is transferable in whole and in part, and neither Party A nor the Transferor has permitted or caused any security interest to be imposed upon the Equity Interest other than pursuant to the Pledge Agreement;

          3.4      Party A does not have any unpaid debt, other than (i) such debt that may arise during the ordinary course of business; and (ii) debt either disclosed to Party B before this Agreement or incurred pursuant to Party B’s written consent;

          3.5      Party A has complied with all applicable PRC laws and regulations in connection with this Agreement;

          3.6      There are no pending or ongoing litigation, arbitration or administrative procedures with respect Party A, its assets or the Equity Interests, and Party A and the Transferor have no knowledge of any pending or threatened claims to the best of their knowledge; and

          3.7      The Transferor owns the Equity Interest free and clear of encumbrances of any kind, other than the security interest pursuant to the Pledge Agreement.

4.        ASSIGNMENT OF AGREEMENT

          4.1      Party A and the Transferor shall not transfer their rights and obligations under this Agreement to any third party without Party B’s prior written consent.

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Execution Version

          4.2      Party A and the Transferor hereby agrees that Party B shall be able to transfer all of its rights and obligations under this Agreement to any third party, and such transfer shall only be subject to a written notice of Party B to Party A and the Transferor without any further consent from Party A or the Transferor.

5.        EFFECTIVE DATE AND TERM

          5.1      This Agreement shall be effective as of the date first set forth above.

          5.2      The term of this Agreement shall commence from the effective date and shall last for the maximum period of time permitted by law unless it is early terminated in accordance with this Agreement.

          5.3      At the end of the term of this Agreement (including any extension thereto), or if earlier terminated pursuant to Section 5.2, the Parties agree that any transfer of rights and obligations pursuant to Section 4.2 shall continue to be in effect.

6.        APPLICABLE LAWS AND DISPUTE RESOLUTION

          6.1      Applicable Laws. The execution, validity, interpretation and performance of this Agreement and the dispute resolution under this Agreement shall be governed by the laws of PRC.

          6.2      Dispute Resolution. The Parties shall strive to resolve any disputes arising from the interpretation or performance of this Agreement through amicable negotiations. If such dispute cannot be settled within thirty (30) days, any Party may submit such dispute to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration. The arbitration shall abide by the rules of CIETAC, and the arbitration proceedings shall be conducted in Beijing, China in English. The determination of CIETAC shall be final and binding upon the Parties.

          6.3      Taxes and Expenses. Each Party shall, according with PRC laws, bear any and all registration taxes, costs and expenses for the transfer of equity arising from the preparation, execution and completion of this Agreement and all Equity Interest Purchase Agreements.

          6.4      Notices. Notices or other communications required to be given by any Party pursuant to this Agreement shall be written in English and Chinese and delivered personally or sent by registered mail or prepaid mail or by a recognized courier service or by facsimile transmission to the relevant address of each Party as set forth below or other addresses of the Party as specified by such Party from time to time. The date when the notice is deemed to be duly served shall be determined as follows: (a) a notice delivered personally is deemed duly served upon the delivery; (b) a notice sent by mail is deemed duly served the tenth (10th) day after the date of the air registered mail with the postage prepaid has been sent out (as is shown on the postmark), or the fourth (4th) day after the delivery by an internationally recognized courier service; and (c) a notice sent by facsimile transmission is deemed duly served upon the receipt time as shown on the transmission confirmation.

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Execution Version

Party A:	Shenzhen Jun Long Culture Communication Co., Ltd.
	Address: 1-D-1010 Yuanjing Garden, Longxiang Avenue, Longgang District,
	Shenzhen City, Guangdong
	Attn: Guo Dishan
	Fax: 86-755-28943610
	Tel: 86-755-28943820
Party B:	Shenzhen Zhonghefangda Network Technology Co., Ltd.
	Address: 1-D-1008 Yuanjing Garden, Longxiang Avenue, Longgang District,
	Shenzhen City, Guangdong
	Attn: Guo Dishan
	Fax: 86-755-28943853
	Tel: 86-755-28943610
Shareholder:	Guo Dishan
	Address: Room 103, Block 71, Jiayuxin Village, Wenjinzhong Street, Luohu Dis-
	trict, Shenzhen, Guangdong
	Tel: 13924671599
	Wang Xiaofen
	Address: Room 408, Block 33, Zhongxinchengshi Garden, Longgang District,
	Shenzhen, Guangdong
	Tel: 13924643920
	Zeng Jinzhou
	Address: No. 96, Xinjianzu, Hecao Village, Linbei Town, Dingnan County, Gan-
	zhou City, Jiangxi Province
	Tel: 13676143283

          6.5      Confidentiality. The Parties acknowledge and confirm that any oral or written information exchanged by the Parties in connection with this Agreement is confidential. The Parties shall maintain the confidentiality of all such information. Without the written approval by the other Parties, any Party shall not disclose to any third party any confidential information except as follows:

                       6.5.1      Such information was in the public domain at the time it was communicated;

                       6.5.2      Such information is required to be disclosed pursuant to the applicable laws, regulations, policies relating to the stock exchange; or

                       6.5.3      Such information is required to be disclosed to a Party’s legal counsel or financial consultant, provided however, such legal counsel and/or financial consultant shall also comply with the confidentiality as stated hereof. The disclosure of confidential information by employees or agents of the disclosing Party is deemed to be an act of the disclosing Party, and such Party shall be responsible for all breach of confidentiality arising from such disclosure. This provision shall survive even if certain clauses of this Agreement are subsequently amended, revoked, terminated or determined to be invalid or unable to implement for any reason.

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Execution Version

          6.6      Further Warranties. The Parties agree to promptly execute such documents as required to perform the provisions of this Agreement, and to take such actions as may be reasonably required to perform the provisions of this Agreement.

7.        MISCELLANEOUS

          7.1      Amendment, Modification and Supplement. Any amendments and supplements to this Agreement shall only take effect if executed by both Parties in writing.

          7.2      Entire Agreement. Notwithstanding Article 5 of this Agreement, the Parties acknowledge that this Agreement constitutes the entire agreement of the Parties with respect to the subject matters therein and supercede and replace all prior or contemporaneous agreements and understandings, whether oral or in writing.

          7.3      Severability. If any provision of this Agreement is deemed invalid or non-enforceable according with relevant laws, such provision shall be deemed invalid only within the applicable laws and regulations of the PRC, and the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired in any way. The Parties shall, through reasonable negotiation, replace such invalid, illegal or non-enforceable provisions with valid provisions in order to bring similar economic effects of those invalid, illegal or non-enforceable provisions.

          7.4      Headings. The headings contained in this Agreement are for reference only and shall not affect the interpretation and explanation of the provisions in this Agreement.

          7.5      Language and Copies. This Agreement shall be executed in English in six (6) duplicate originals. Each Party shall hold one (1) original, each of which shall have the same legal effect.

          7.6      Successor. This Agreement shall be binding on the successors of each Party and the transferee allowed by each Party.

          7.7      Survival. Each Party shall continue to perform its obligations notwithstanding the expiration or termination of this Agreement. Article 6, Article 8, Article 9 and Section 7.7 hereof shall continue to be in full force and effect after the termination of this Agreement.

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Execution Version

          7.8      Waiver. Any Party may waive the terms and conditions of this Agreement in writing with the written approval of all the Parties. Under certain circumstances, any waiver by a Party to the breach of other Parties shall not be construed as a waiver of any other breach by any other Parties under similar circumstances.

[SIGNATURE PAGE FOLLOWS]

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Execution Version

          IN WITNESS WHEREOF this Agreement is duly executed by each Party or its legal representative as of the date first set forth above.

PARTY A:	Shenzhen Jun Long Culture Communication Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer
PARTY B:	Shenzhen Zhonghefangda Network Technology Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer

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Execution Version

SIGNATURE PAGE FOR SHAREHOLDERS OF PARTY A

SHAREHOLDERS OF PARTY A:

/s/ Guo Dishan
GUO Dishan
ID Card No.: 440301196405141912

/s/ Zeng Jinzhou
ZENG Jinzhou
ID Card No.: 362129197906264218

/s/ Wang Xiaofen
WANG Xiaofen
ID Card No.: 440307197506181529

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EX-10.4

Exhibit 10.4

VOTING RIGHTS PROXY AGREEMENT

This Voting Rights Proxy Agreement (the “Agreement”) is entered into as of June 11, 2010, in 1-D-1008 Yuanjing Garden, Longxiang Avenue, Longgang District, Shenzhen City, Guangdong, People’s Republic of China (“PRC” or “China”), between and among Shenzhen Jun Long Culture Communication Co., Ltd. (the “Company” or “Party A”); the undersigned shareholders of Party A (individually and collectively, the “Shareholder”); and Shenzhen Zhonghefangda Network Technology Co., Ltd. (“Party B”). Party A, Party B and the Shareholder are each referred to in this Agreement as a “Party” and collectively as the “Parties.”

RECITALS

A.           Party A is engaged in the business of internet café chain store service; development of computer network hardware; distribution of cultural items; calligraphy and painting artwork exhibition planning, art and cultural activities planning, cultural and courtesy planning, starting businesses; domestic commerce; advertising etc. Party B has expertise in consulting, and Party B has entered into one or more agreements with Party A to provide Party A with various management, technical, administrative, consulting and other services.

B.           The individuals collectively referred to herein as the “Shareholder” together hold 100% of the issued and outstanding equity interests of the Company (the “Equity Interest”).

C.           The Shareholder desires to grant to Party B a proxy to vote the Equity Interest for the maximum period of time permitted by law in consideration of good and valuable consideration, the receipt of which is hereby acknowledged and agreed by Party B.

AGREEMENT

NOW THEREFORE, the Parties agree as follows:

1.           The Shareholder hereby agrees to irrevocably grant and entrust Party B, for the maximum period of time permitted by law, with all of her voting rights as shareholder of the Company. Party B shall exercise such rights in accordance with and within the parameters of the laws of the PRC and the Articles of Association of the Company.

2.           Party B may establish and amend rules to govern how Party B shall exercise the powers granted by the Shareholder herein, including, but not limited to the number or percentage of directors of Party B which shall be required to authorize the exercise of the voting rights granted by the Shareholder, and Party B shall only proceed in accordance with such rules.

3.           The Shareholder shall not transfer or cause to be transferred the Equity Interest to any party (other than Party B or a designee of Party B).

4.           This Proxy Agreement has been duly executed by the Parties as of the date first set forth above, and in the event that a Party is not a natural person, then such Party’s action has been duly authorized by all necessary corporate or other action and executed and delivered by such Party’s duly authorized representatives. This Agreement shall take effect upon the execution of this Agreement.

5.           Each Shareholder represents and warrants to Party B that such Shareholder owns such amount of the Equity Interest as set forth next to its name on the signature page below, free and clear of all liens and encumbrances, and such Shareholder has not granted to any party, other than Party B, a power of attorney or proxy over any of such amount of the Equity Interest or any of such Shareholder’s rights as a shareholder of Company. Each Shareholder further represents and warrants that the execution and delivery of this Agreement by such Shareholder shall not violate any law, regulations, judicial or administrative order, arbitration award, agreement, contract or covenant applicable to such Shareholder.

Execution Version

6.           This Agreement may not be terminated without the unanimous consent of all Parties, except that Party B may, by giving a thirty (30) day prior written notice to the Shareholder, terminate this Agreement, with or without cause.

7.           Any amendment to and/or rescission of this Agreement shall be in writing by the Parties.

8.           The execution, validity, creation and performance of this Agreement shall be governed by the laws of PRC.

9.           This Agreement shall be executed in two (2) duplicate originals in English, and each Party shall receive one (1) duplicate original, each of which shall be equally valid.

10.          The Parties agree that in the event a dispute shall arise from this Agreement, the Parties shall settle their dispute through amicable negotiations. If the Parties cannot reach a settlement within 45 days following the negotiations, the dispute shall be submitted to be determined by arbitration through China International Economic and Trade Arbitration Commission (“CIETAC”) in accordance with CIETAC arbitration rules. The arbitration shall be conducted in Beijing in English. The determination of CIETAC shall be conclusively binding upon the Parties and shall be enforceable in any court of competent jurisdiction.

[SIGNATURE PAGE FOLLOWS]

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Execution Version

          IN WITNESS WHEREOF this Agreement is duly executed by each Party or its legal representative.

PARTY A:	Shenzhen Jun Long Culture Communication Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer
PARTY B:	Shenzhen Zhonghefangda Network Technology Co., Ltd.
	Legal/Authorized Representative: /s/ Guo Dishan
	Name: Guo Dishan
	Title: Chief Executive Officer

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Execution Version

SIGNATURE PAGE FOR SHAREHOLDERS OF PARTY A

SHAREHOLDERS OF PARTY A:

/s/ Guo Dishan
GUO Dishan
ID Card No.: 440301196405141912

/s/ Zeng Jinzhou
ZENG Jinzhou
ID Card No.: 362129197906264218

/s/ Wang Xiaofen
WANG Xiaofen
ID Card No.: 440307197506181529

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EX-10.5

Exhibit 10.5

English Translation of Shenzhen Employment Agreement
(For full-time employees)

Prepared by Shenzhen Bureau of Labor and Social Security

Party A (Employer): Shenzhen Junlong Culture Communication Co., Ltd.

Address: Suite 1010, Unit D, Block 1, Yuanjing Garden, Longxiang Road, Zhongxin Cheng, Longgang District, Shenzhen, PRC

Legal representative (Principal): Guo Dishan

Contact Person: _______________

Telephone: 28943820

Party B (Employee): Tu Fan

Sex: Female

ID No.: 140103198009130621

Address: ____________________

Tel: 13798292063

This employment agreement is made and entered into by and between Party A and party B according to Labor Law of the People’s Republic of China (hereafter referred to as Labor Law), Labor Contract Law of the People’s Republic of China (hereafter referred to Labor Contract Law) and other relevant laws and administrative regulations, on voluntary basis and equal standing:

Article 1 Employment Term

1. Party A and Party B agree to choose the (1) way below to determine the employment term.

(1) Fixed term: commencing from April 1, 2009 to March 31, 2012.

(2) Non-fixed term: commencing upon the ___/___ day of ___/___ , ___/___ .

(3) Term of completion of certain work: commencing upon the ___/___ day of ___/___, till the work of ___/______________has been completed. The sign of the completion of the work is ___________/__________.

2. Probationary period

The probationary period shall be ______________/________________. (The probationary period is included in the employment term; if no probationary period, please fill in “No”.)

Article 2 Job and place of work

Party B shall undertake the job of secretary of board of directors.

The place of work is Shenzhen.

Article 3 Working hour, rest and vocation

1. Party A and Party B agree to choose the (1) way below to determine Party B’s working time.

(1) Standard working hours system: Party B shall work for 8 hours a day (not to exceed eight hours), and 40 hours for a week (not to exceed forty hours), and at least one day rest per week.

(2) Irregular working hours system: after the examination and approval of the bureau of labor and social security, the parties may choose irregular working hours system.

(3) Comprehensive working hours system: after the examination and approval of the bureau of labor and social security, the parties may choose comprehensive working hours system.

2. If due to needs in production and operations, Party A may extend working hours. The parties shall abide by Article 41 of Labor Law in overtime working.

3. Party B shall enjoy statutory holidays, annual leave, wedding leave, maternity leave and funeral leave as provided by law.

4. Other rest and leave arranged for Party B__________/____________. 

Article 4 Salary

1. Party A shall establish its own salary distribution regulation, and shall inform Party B. The salary paid to Party B shall not be lower than the annual minimum wage standard of the locality.

2. Party B’s salary shall be 4,000.00 RMB Yuan / month (Party B’s salary during probationary period shall be __________/____________ RMB Yuan ___/___ month.), or Party B’s salary shall be determined by __________/____________

3. Party A shall pay Party B his salary on the 15^th day of every month. Party B’s salary shall be paid in cash and shall be paid monthly at least.

4. Party B’s overtime pay, leave pay and pay for specific circumstances shall be paid according to relevant laws and regulations.

5. Other provisions on salary payment agreed by Party A and Party B: __________/____________

Article 5 Social insurance and welfare

1. Party A and Party B shall participate in social insurance schemes according to law, provincial and municipal regulations and pay social insurance fees.

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2. Where Party B suffers from diseases or non-work-related injury, Party A shall arrange a medical treatment period for Party B and pay the medical subsidy fee for Party B according to law, or provincial and municipal regulations.

3.Where Party B suffers from occupational diseases, or work-related injury, Party A shall handle the occasion according to Laws of the People’s Republic of China on the Prevention and Treatment of Occupational Diseases and Regulation on Work-related Injury Insurance and other related laws and regulations.

4. Other welfares provided by Party A: accommodation and meal.

Article 6 Labor protection and working condition

1. To effectively protect Party B’s safety and health, Party A shall provide Party B with workshop whose condition shall comply with national health standards and necessary labor protection articles according to the relevant state, provincial and municipal labor protection regulations.

2. Party A shall provide special labor protection for female and minor employees according to state, provincial and municipal regulations.

3. When undertaking the operation of __________/____________, Party B may expose to the occupational diseases of __________/____________, and Party A shall take the labor protection of __________/____________, and organize Party B to go for body check-up(s) __/__a year.

4. Party B has the right to refuse to engage in dangerous operations forced upon him by the management personnel of Party A in violation of the relevant regulations, and has the right to require Party A to stop the foresaid act or report the foresaid acts to administrative authority.

Article 7 Rules and regulations

1. The lawful rules and regulations stipulated by Party A shall informed to Party B.

2. Party B shall observe the laws and state, provincial and municipal regulations and the lawful rules and regulations stipulated by Party A, abide by the safety rule and ethics, timely fulfill his job assignments and improve his vocational skills.

3. Party B shall observe the laws and state, provincial and municipal regulations regulation on birth planning.

Article 8 Modification

The modification of this agreement shall be agreed upon by both parties through negotiations and in written form. Each party shall hold a modified copy.

Article 9 Dissolution and termination of agreement

1. Party A and Party B may dissolve the agreement if they so agree upon negotiations.

2. Party B may dissolve the agreement if he notifies Party A in writing 30 days in advance. During the probationary period, Party B may dissolve the agreement if he/she notifies Party A 3 days in advance.

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3. Where Party A is under any of the following circumstances, Party B may notify Party A to dissolve the agreement:

(1) Party A fails to provide labor protection or work conditions as provided in the agreement;

(2) Party A fails to timely pay the full amount of remunerations;

(3) Party A fails to pay security premiums for Party B;

(4) The rules and regulations stipulated by Party A are contrary to any law or regulation and impair the rights and interests of Party A;

(5) The agreement is invalid where Party A induced Party B to enter into or modify the agreement against Party B’s true intention by fraud or duress, or by taking advantage of Party B’s hardship;

(6) Party A disclaims its legal liability or denies Party B’s rights, which invalidates the agreement;

(7) Where Party A violates the mandatory provisions of law or administrative regulations; or

(8) Any other circumstances prescribed by other laws or administrative regulations subject to which Party B is entitled to dissolve the agreement.

4. If Party B forces Party A to work by the means of violence, threat, or illegally restraining personal freedom, or violates the safety regulations to order or force Party B to perform dangerous operations that endanger Party B’s personal life, Party B may immediately dissolve the agreement without notifying Party A in advance.

5. Where Party B is under any of the following circumstances, Party A may dissolve the agreement:

(1) It is proved that Party B does not meet the recruitment requirements during the probation period;

(2) Party B seriously violates the rules and regulations stipulated by Party A;

(3) Party B causes any severe damage to Party A because Party B seriously neglects his duties or seeks private benefits;

(4) Party B simultaneously enters into other employment relationships with other employers and thus seriously affects his completion of his job assignment; or Party B refuses to make the ratification after Party A points out the problem;

(5) The agreement is invalid where Party B induced Party A to enter into or modify the agreement against Party A’s true intention by fraud or duress, or by taking advantage of Party A’s hardship; or

(6) Party B is under investigation for criminal liabilities according to law.

6. Under any of the following circumstances, Party A may dissolve the agreement if it notifies Party B in writing 30 days in advance or after it pays the employee an extra month’s salary:

(1) Party B suffers from diseases or non-work-related injuries, and cannot resume his original position after the expiration of the prescribed time period for medical treatment, nor can he assume any other position arranged by Party A;

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(2) Party B is incompetent to his position and remains incompetent after training or changing the position; or

(3) The objective situation, on which the conclusion of the agreement is based, has changed dramatically, and the agreement is unable to be performed and no amendment is reached after negotiations between Party A and Party B

7. Under any of the following circumstances, if it is necessary to lay off 20 or more employees, or if it is necessary to lay off less than 20 employees but the layoff accounts for 10% or more of the total number of the employees, Party A shall make a statement to the labor union or all its employees 30 days in advance. After it has solicited the opinions from the labor union or of the employees, it may lay off the numbers of employees upon reporting the employee reduction plan to the labor administrative departments:

(1) It is under revitalization according to the Enterprise Bankruptcy Law;

(2) It encounters serious difficulties in production and business operation;

(3) The enterprise changes products, makes important technological renovation, or adjusts the methods of its business operation, and it is still necessary to lay off the number of employees after changing the employment agreement; or

(4) The objective economic situation, on which the employment agreement is based, has changed dramatically and Party B is unable to perform the agreement.

8. Under any of the following circumstances, the employment agreement ends:

(1) The term of the agreement has expired;

(2) Party B has begun to enjoy the basic benefits of his pension;

(3) Party B is deceased, or is declared dead or missing by the People’s Court;

(4) Party A is declared bankrupt;

(5) Party A’s business license is revoked or Party A is ordered to close down its business or to dissolve its business entity, or Party A makes a decision to liquidate its business ahead of the schedule; or

(6) Other circumstances proscribed by other laws or administrative regulations.

Article 10 Pecuniary compensation

1. Under any of the following circumstances, Party A shall pay Party B pecuniary compensation.

(1) Party A terminates the agreement upon the negotiation with Party B as prescribed in sub-clause 1 of Article 9;

(2) Party B terminates the agreement as prescribed in sub-clause 3 and 4 of Article 9;

(3) Party A terminates the agreement as prescribed in sub-clause 6 of Article 9;

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(4) Party A terminates the agreement as prescribed in sub-clause 7 of Article 9;

(5) The agreement is terminated as prescribed in item 1 of sub-clause 8 of Article 9 except that Party A maintains the original condition or sets stringent condition for renewing the agreement and Party B does not agree to renew the agreement.

(6) The agreement is terminated as prescribed in item 4 and 5 of sub-clause 8 of Article 9;

(7) Any other circumstances prescribed by other laws or administrative regulations that authorized the pecuniary compensation.

2. Where the parties dissolve or terminate the agreement, the pecuniary compensation shall be paid as prescribed in Labor Contract Law and state, provincial and municipal regulations. Where Party A shall pay pecuniary compensation to Party B, it shall pay it when Party B completes the hand-over procedure.

Article 11 Procedure of dissolution and termination of agreement

When the parties dissolve or terminate the agreement, they shall proceed to complete the hand-over procedures and Party A shall issue a written certification for Party B and transfer Party B’s archives and social insurance.

Article 12 Settlement of disputes

Where a labor dispute arises out of this employment agreement, it shall be settled through negotiation. If no settlement is reached upon negotiation, the parties concerned may apply with the labor dispute mediation committee or labor union of Party A for mediation or may apply with the labor disputes arbitration committee for arbitration. If no party raises an objection to the arbitration award, each party shall fulfill his respective obligations according to the arbitration award. If the arbitration award is not accepted, the case may be brought before the people’s court.

Article 13 Other provisions needed to be agreed to by the parties:

            /
__________________________________________________________________________________

Article 14 Miscellaneous

1. Where matters have not been provided in the agreement or provisions of this agreement conflict with the law and regulations in effect, the law and regulations in effective govern or prevail.

2. This agreement shall take effect where the parties set their hands or seals hereunto. The agreement is invalid if it is altered or being signed by other person without written authorization.

3. This agreement is made in two duplicates and each party will hold one copy.

Party A (seal):	Party B (signature): Tu Fan
Shenzhen Junlong Culture Communication Co., Ltd.	/s/ Tu Fan

Legal representative: Guo Dishan
(Principal)
/s/ Guo Dishan
Date : April 1, 2009	Date : April 1, 2009

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EX-10.6

Exhibit 10.6

English Translation of
Form of Non-disclosure and Non-competition Agreement

This Non-disclosure and Non-competition Agreement (“Agreement”) is entered on March 11, 3010 by and between the following parties:

Shenzhen Junlong Cultural Communication Co., Ltd. (Company)

Registered Address:

Legal representative:

And

Party B: [name of employee]

ID No.:

Contact Information:

Whereas:

A.	The Employee acknowledges that due to his employment by the Company (including training he receives from the Company from time to time), he may have full access to the Confidential Information (as defined below), and be familiar with the operation, business and outlooks of the Company and the clients, suppliers and other persons that have business relationship with the Company.
B.	The Employee acknowledges any unauthorized disclosure, use or disposal of the Confidential Information during the employment or after the employment will have negative impacts on the operations of the Company and will has irreparable loss and injury to the Company;
C.	The Employee agrees to maintain the confidentiality of such Confidential Information and not to engage in any business compete with the Company or its affiliated company according to the terms and conditions of this Agreement.

          After friendly discussions and negotiation, the parties have agreed to the following terms and conditions with respect to the confidentiality and non-competition:

I. Definitions

          Unless otherwise required by the context of this Agreement, the following terms used in this Agreement shall have the meanings set forth below:

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a.	“Confidential Information” shall mean any information of the Company or its Affiliates which is transferred or contained in any form related to the product, service, operation, confidential methods, training materials, plans or projections, financial information, proprietary mechanism and knowledge, system, techniques, formula, and current and prospective customer list and information, manual, training materials, plan or projections, financial information, proprietary knowledge, design rights, business secrets, business opportunity.
b.	“Competing Business” shall mean (1) business currently conducted or planned by the Company or any of its Affiliates; and (2) any other business that is same as or similar to, and which competes with the business of the Company or any of its Affiliates.
c.	“Competitor” shall mean any individual, corporation, partnership, joint venture, sole proprietary and other entities that engage in the Competing Business.
d.	“Territory” shall mean any geographic area where the Company or its Affiliates is or plans to conduct its business;
e.	“Period” shall mean the period of the employment of the Employer by the Company and one year from the termination of the employment;
f.	“Affiliate” shall mean any other affiliate that controls the Company, controlled by the Company or under common control with the Company.

II.	Confidentiality
	A.	The Employee undertakes that during his or her employment hereunder he or she will maintain the strictest confidentiality of the Confidential Information of the Company and will return to the Employer all Confidential Information and copies thereof.
	B.	The Employee undertakes that during the Period, he or she will not (a) disclose Confidential Information, whole or in part, to other employees of the Company or its Affiliates whose work does not involve Confidential Information; (b) to any Competitor; (c) to any other individual or entities other than for the interest of the Company, unless the disclosure is required by law, under which circumstance the disclosure shall be made strictly to the extent required.
III.	Non-Competition
	A.	The Employee undertakes, that during the Period and within the Territory, she or he will not (a) invest or participate in the Competition Business, or establish any business which engages in the Competition Business; and (b) provide service to or disclose any Confidential Information to the Competition on behalf of him or herself or any third party as principal, licensor, licensee, principal, agent, employee, independent contractor, partner, lessor, shareholder, director or executive or otherwise.

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B.

The Employee undertakes that, during the Period, he or she will not, directly or indirectly, solicit, induce, encourage or otherwise any officer or employee of the Company or its Affiliates to terminate their employment relationship with the Company or such Affiliate, or any customer, supplier, licensee, licensor other person or entity that have actual or potential business with the Company or the Affiliates to terminate or otherwise change the business relation with the Company or such Affiliate.

C.

The Employee undertakes that she or he has not entered into, and will not enter into, any oral or written agreement in conflict with the terms of this Agreement.

IV.	Consideration
	A.	The Employee acknowledges that remuneration and other compensation and benefit that the Employee will received from the company from time to time constitute the entire consideration for her or his covenants in Section II and Section III of this Agreement.
V.	Performance
	A.	The parties agree to perform this Agreement to the greatest extent permitted by law. If any portion of this Agreement that is held to be void, invalid or unenforceable, neither the validity nor the enforceability of the remaining provisions thereof shall thereby be affected.
VI.	Fairness
	A.	The parties agree that the covenants contained in Section II and Section III of this Agreement are fair and reasonable with regard to scope and nature and is reasonably required by the Company to protect of business.
VII.	Liability for Breach
	A.	The Employee recognizes that any breach of this Agreement shall cause irreparable loss to the Company and/or the Affiliates which may not be sufficiently compensated in money obtained through litigation. The Employee agrees that the Company and/or the Affiliates are entitled to prevent the breach of the Contract through interim restraining order, forbidding order, specific performance of the Contract, and other remedies. However, this article shall not be constructed as waiver by the Company and/or the Affiliates of rights for compensation or other remedies.
VIII.	Revision and Assignment of Contract
	A.	The contract shall constitute the complete agreement and understanding of the subject of the Contract between both parties. The Contract shall not be revised, supplemented, or assigned without written consent by both parties.
	B.	The Employee shall not assign the obligation or interest under or arising from the Contract.

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IX.	Governing Law and Dispute Resolution
	A.	The contract shall be governed and constructed under the law of the People’s Republic of China.
	B.	Both parties shall resolve the disputes arising from or in connection with the Contract through amicable negotiation. If the negotiation fails, the disputes shall be submitted to China International Economic and Trade Arbitration Commission through arbitration according to its rules and procedures in [Beijing/Shanghai]. During the arbitration, both parties shall take every possibility to continue performance of the remaining part of Contract which is outside the dispute.
X.	Duplicate
	The contract shall be signed in two duplicates. Each of the parties holds one with equal effectiveness.

IN WITNESS WHEREOF, Both parties shall execute the Contract as of the date first set forth above.

Company Chop: ________________________

Authorized Representative: ________________

Employee: _____________________________

ID Number: ____________________________

Domicile: ______________________________

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EX-10.7

Exhibit 10.7

English Summary of Small Enterprise Small Amount Credit Loan Contract without Mortgage Entered into by and between Shenzhen Junlong Culture Communication Co., Ltd. ("the Company") and Shenzhen Branch, Construction Bank of China ("the Creditor") dated October 23, 2009

Main contents

• Contract number: ECheng 0572009727;

• The Creditor will provide to the Company a credit with maximum amount of RMB 1 million for the period from October 26, 2009 to October 25, 2010;

• Interest rate of loan: for short term loan (less than one year), the rate is 20% above benchmark rate published by the People’s Bank. The interest shall be settled on a monthly basis.

• The Company shall pay RMB 40,000 as credit warranty fee to the Creditor before receiving the loan from the Creditor.

• The Creditor’s approval shall be obtained in case of material change of the Company, including transfer of the significant assets, lease out, reform as a company limited by shares, joint operation, combination, merger, division, joint venture, equity transfer, and any other activities which shall affect the realization of the Creditor’s rights hereunder.

• Breach of contract penalty: adjustment of credit, cancellation of unused credit, imposition of punitive interest, demand prepayment of loan and other measures;

Summary of the articles omitted

• Use of credit

• Repayment

• Rights and obligations of Company

• Rights and obligations of Creditor

• Breach Liability and Remedies

• Suspension of Credit

• Miscellaneous

• Dispute Settlement

• Conditions of Effectiveness

• Acknowledgement

EX-10.8

Exhibit 10.8

English Summary of Guaranty Contract of Maximum Amount (Version for Individual)( the “Contract”) Entered into by and between Guo Dishan (“Guarantor”) and Shenzhen Branch, Construction Bank of China ("the Creditor") dated October 23, 2009

Main contents:

• Guaranty Contract number: Bao Cheng 0572009727.

• Guo Dishan undertakes to assume joint and several liabilities for Shenzhen Junlong Culture Communication Co., Ltd. (the “Obligor”)’s indebtedness towards Construction Bank of China under the Small Enterprise Small Amount Credit Loan Contract without Mortgage (Contract number ECheng 0572009727) and the maximum amount secured is RMB 1.2 million.

• Guaranty Responsibility: The guaranty under this Contract shall be guaranty with joint and several liabilities. The Guarantor is obligated to pay off the debt in the event the Obligor is unable to pay off the debt (including the Creditor declares the debt becomes mature in advance to its original expiry date due to default of the Obligor or the Guarantor).

• Scope of Guaranty: The guaranty shall cover all of the loan principal, interest, penalty interest, breach of contract compensation, damages, undertaking fee and all the expenses such as litigation cost, lawyer’s fee, notification cost and public notice cost etc. which is incurred to the Creditor in realizing its creditor’s right.

• Guaranty period: The guaranty period is from the effective date of this Contract to two years after the expiry of the term of relevant agreements entered into under the Contract.

Headlines of the articles omitted:

• Independence of guaranty contract

• Revision of master contract

• Representation and warranty of guarantor

• Miscellaneous

EX-10.9

Exhibit 10.9

English Summary of Purchase Contract Entered into by and between Shenzhen Junlong Culture Communication Co., Ltd. ("the Buyer") and Shenzhen SEG Industrial Investment Co., Ltd. ("the Seller") dated as of June 7, 2010

Main contents

• Contract number: SGSY20100604002;

• The Seller will sell to the Buyer 6810 sets of Windows Operation Systems with total price of RMB 1,566,300;

• Quality standard subject to the standard of the manufacturer of the products.

• The Buyer shall make the first installment, RMB 299,000 within 15 days since the execution of the contract. The rest of the price, RMB 1,267,300, shall be paid within 3 days after installment and testing of the products.

• The Seller will keep the ownership of the products before paying all the price under the contract.

• The Buyer will authorize the Seller to install the products on the computers of the Buyer. The Seller warrants that it has obtained written authorization from Microsoft (China) Co., Ltd. before signing this contract

Summary of the articles omitted

• Details of products

• Quality standard and packaging

• Delivery

• Product Receiving

• Inspection and Acceptance

• Liability of Breach

• Dispute Resolution

• Miscellaneous

EX-10.10

Exhibit 10.10

English Summary of Shenzhen Premises Lease Contract Entered into by and between Shenzhen Junlong Culture Communication Co., Ltd. ("the Company") and Zou Zhiwei ("the Landlord") dated September 1, 2006

Main contents

• The landlord will lease to the Company the premises at the third floor, Jianshe Rd., Pinghuan Community, Pingshan Street, Shenzhen of 1218 square meters for the purpose of internet café operation.

• Term: From September 2006 to September 2011. The contract will be negotiated every 5 years.

• Rental/Deposit: RMB 18,000 per month with 2 months rental as deposit. The rental shall be paid every month.

• In case of late payment by the Company, the penalty is 0.03% of the rental per day. The landlord is entitled to terminate the contract if the payment has been delayed for three months.

• If the landlord intends to take back the leased premises before the expiration of the contract, the landlord shall pay double of the rental with months written notice to the Company and compensate the Company for economic losses.

• The landlord is responsible for maintenance of the leased premises.

Summary of the articles omitted

• Other fees involved

• Sublease and renew of contract

• Force majeure

• Miscellaneous

EX-10.11

Exhibit 10.11

English Summary of Shenzhen Premises Lease Contract Entered into by and between Shenzhen Junlong Culture Communication Co., Ltd. ("the Company") and Hao Changsheng ("the Landlord") dated December 15, 2009

Main contents

• The landlord will lease to the Company the premises at Suite 1010, Unit D, Block 1, Yuanjing Garden, Longxiang Avenue, Shenzhen of 124.81 square meters for the purpose of office.

• Term: From December 1, 2009 to December 1, 2010.

• Rental/Deposit: RMB 1860 per month with 1 month rental as deposit. The rental shall be paid on monthly basis.

• The landlord may not sublease the leased premises in part or in whole to a third party without a prior written consent from the landlord.

• The landlord is responsible for maintenance and safety of the leased premises.

• The company shall take good care of and reasonably use the premises and the attached facilities during the lease term. The company shall be responsible for the immediate repair for the damages to the leased premises or facilities due to the company’s improper use. In case the company fails to fix the damages on time, the landlord may have them repaired on the company’s behalf with the fees incurred born by the company.

Summary of the articles omitted

• Other fees involved

• Conditions for returning deposit.

• Maintenance of leased premises

• Termination and amendment of agreement

• Returning of leased premises

• Dispute resolution

• Registration of lease agreement

• Miscellaneous

EX-21

Exhibit 21

Name of Subsidiary	Jurisdiction of Organization	% Owned
Classic Bond Development Limited	British Virgin Islands	100%
Shenzhen Zhonghefangda Network Technology Co., Ltd.	PRC	100%
Shenzhen Junlong Culture Communication Co., Ltd.	PRC	VIE