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 and Exchange Act of 1934

March 3, 2013

Date of Report (date of Earliest Event Reported)

VELATEL GLOBAL COMMUNICATIONS, INC.

(Exact Name of Registrant as Specified in its Charter)

NEVADA	000-52095	98-0489800
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File No.)	(I.R.S. Employer Identification No.)

5950 La Place Court, Suite 160, Carlsbad, CA 92008

(Address of principal executive offices and zip code)

(760) 230-8986

(Registrant’s telephone number, including area code)

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))

Item 1.01   Entry into Material Definitive Agreements

Second Amendment to China Motion Stock Purchase Agreement

On March 3, 2013, VelaTel Global Communications, Inc., a Nevada corporation and the registrant responsible for the filing of this Form 8-K (“Company”), through its wholly owned subsidiary Gulfstream Capital Partners Ltd. (“Buyer”) (and supported by the Company’s Corporate Guaranty of Buyer’s obligations), entered into (1) a second amendment (“Second Amendment”) to a Stock Purchase Agreement (“SPA”) and Corporate Guaranty, (2) a promissory note (“Note”) and (3) a stock pledge deed and stock escrow agreement (“Stock Pledge Agreement”), each with China Motion Telecom International Limited (“Listco”), Listco’s wholly owned subsidiary China Motion Holdings Limited (“Holdings”), and Holdings’ 95% subsidiary ChinaMotion InfoServices Limited (“CMInfo”) (and Holdings and CMInfo collectively, “Seller”) to acquire 100% of the capital stock (“MVNO Stock”) of China Motion Telecom (HK) Limited (“CMTHK”). The terms of the SPA and Corporate Guaranty were disclosed in a current Report on Form 8-K filed on November 27, 2012 and incorporated by this reference. The terms of a prior First Amendment were disclosed in a current Report on Form 8-K filed on February 4, 2013 and incorporated by this reference. The material terms of the Second Amendment are summarized below. Capitalized terms are as defined in the SPA, the Second Amendment, or other Transaction Documents. Payment amounts are expressed in Hong Kong dollars. Currency conversions to US dollars are expressed in parentheses at a conversion rate of HK$7.75=US$1, with the US equivalent rounded to the nearest US$100, and are therefore approximate and may change as of the date any amount becomes payable or otherwise effective.

The Purchase Price for the MVNO Stock is HK$49,500,000 (US$6,387,100), consisting of HK$12,009,362.55 (US$1,549,600) cash (including HK$4,646,862.55 (US$599,600) deposit paid pursuant to the SPA (“Buyer’s Deposit”), plus HK$7,362,500 (US$950,000) to be paid at Closing (“Down Payment”), plus HK$37,490,637.45 (US$4,837,500) as the principal balance of the Note to be issued by the Company at Closing. The Purchase Price is subject to the following Adjustments, as determined by audit of CMTHK’s balance sheet as of February 28, 2013 to be completed within four months of Closing: (1) a credit to Seller equal to the balance of all cash, accounts receivable, other receivables, inventory, and prepayments to others, and (2) a credit to Buyer equal to the balance of all accounts payable, accruals and other payable, and advance income received. The aggregate Cash Balance in CMTHK’s accounts as of Closing shall be at least HK$7,800,000 (US$1,006,500) and the Company shall cause CMTHK to pay to Seller any Excess Amount within five days of Closing.

The Note is in the total amount of HK$38,990,637.45 (US$5,031,000), of which the principal balance of HK$37,490,637.45 (US$4,837,500) is applicable to the Purchase Price and the remaining HK$1,500,000 (US$193,500) represents interest that will accrue on the Note through its maturity and is not part of the Purchase Price. The Note calls for a payment of HK$4,650,000 (US$600,000) principal only on the date which is the same calendar day three months after Closing (June 1, 2013) and the remaining HK$32,840,637.45 (US$4,237,500) balance of principal and accrued interest due on the date which is the same calendar date six months after Closing (September 1, 2013).

As security for repayment of the Note, the Company agrees to pledge the MVNO Stock to Seller pursuant to the terms of the Stock Pledge Agreement. Seller shall act as Interim Escrow Agent under the Stock Pledge Agreement, subject to appointment of a Substitute Escrow Agent the Parties will promptly locate and retain and who is willing to accept substantially all of the material terms of the Stock Pledge Agreement.

The Company agrees to hold Seller harmless from any claims or damages arising solely out of or in connection with the Company taking over CMTHK during the time period between Closing and final Termination of the Stock Pledge Agreement, including, any diminution of the value of the net current assets of CMTHK to a level below their net value as of Closing.

For so long as the Note remains unpaid, Seller shall be entitled to appoint one of three or more members of the CMTHK’s Board of Directors, and the following fundamental decisions shall require the unanimous consent of all Directors and the written consent of Seller: (a) borrow any sum or enter into any contract for capital expenditures that is in excess of HK$1,500,000 (US$193,500) or is outside the course of CMTHK’s general business model as a telecommunications service provider; (b) vary any rights attaching to any of CMTHK’s shares; (c) consolidate or merge with or acquire any other business or dispose of any existing capital assets of CMTHK; (d) issue any CMTHK shares or create or issue any debentures or other securities convertible into shares or debentures; (e) pass any resolutions in general meeting or by way of written resolution relating to wind-up or dissolution of CMTHK; and (f) distribute any profits of CMTHK.

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The Company commits to begin upgrading CMTHK’s telecommunications network. CMTHK shall bear the expenses of engineering services rendered in connection with such upgrade, upon reasonable commercial terms estimated to total approximately no more than HK$1,300,000 (US$167,700) per month (“Technical Service Fee”), and such fees shall be processed and approved for payment immediately.

The Company agrees to pay to Seller at Closing HK$387,500 (US$50,000) towards reimbursement of total costs and disbursements to Professional Fees incurred by Listco in connection with the First Amendment and the Second Amendment, which payment is in addition to and is not part of the Purchase Price.

The Second Amendment becomes effective as of March 1, 2013 notwithstanding that it is signed on March 3, 2013.

A complete copy of the Second Amendment is attached as Exhibit 10.1 to this Form 8-K, and is incorporated by this reference. The form of the Note and the Stock Pledge Agreement were referred to in the Second Amendment as internal Exhibits 1 and 2, respectively. Those documents were signed separately and are included as independent Exhibits to this Form 8-K.

A complete copy of the Note is attached as Exhibit 10.2 to this Form 8-K, and is incorporated by this reference.

A complete copy of the Stock Pledge Agreement (including its internal Exhibits 1 and 2) is attached as Exhibit 10.3 to this Form 8-K, and is incorporated by this reference.

Closing of the SPA, as amended by the First Amendment and the Second Amendment, and together with the other Transaction Documents, occurred as of March 1, 2013 when the Company initiated a wire transfer for payment of the Down Payment and the Professional Fees, and Seller endorsed and re-issued the MVNO Stock in the name of Buyer. The Parties continued to finalize various details of the Transaction Documents until they were signed, executed and delivered on March 3, 2013.

Item 8.01   Other Events

On March 11, 2013, the Company will issue a press release describing the Closing of the CMTHK acquisition and its expected impact on the Company’s operations. The press release will be available through various media outlets, including the Company’s website, www.velatel.com.

Item 9.01   Exhibits

10.1	Second Amendment to Stock Purchase Agreement and Corporate Guaranty
10.2	Promissory Note
10.3	Stock Pledge Deed and Stock Escrow Agreement

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SIGNATURES

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

Date: March 8, 2013

VelaTel Global Communications, Inc.

By: /s/George Alvarez

Name: George Alvarez

Title: Chief Executive Officer

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EX-10.1

Exhibit 10.1

SECOND AMENDMENT TO STOCK PURCHASE AGREEMENT AND CORPORATE GUARANTY

The parties to this agreement (“Second Amendment”), entered into on March 3, 2013, are China Motion Telecom International Limited (“Listco”), China Motion Holdings Limited (“Holdings”), ChinaMotion InfoServices Limited (“CMInfo” together with Holdings, “Seller”), Gulfstream Capital Partners Ltd. (“Buyer”), and VelaTel Global Communications, Inc.(“Guarantor”), each of the above individually a “Party” and collectively, the “Parties.”

On November 27, 2012, Seller and Buyer entered into an agreement (“Agreement”) for the purchase and sale of the capital stock of China Motion Telecom (HK) Limited (the “Company”). The Agreement was amended by First Amendment on February 4, 2013, the Parties entered into an agreement (“First Amendment”) which modified certain terms of the Transaction Documents (including, but without limitation, the extension of the Outside Closing Date from January 31, 2013 to February 28, 2013).  Buyer, Seller and Angela Ho & Associates (“Original Escrow Agent”) also entered into an Escrow Agreement regarding Buyer’s Deposit, and Guarantor provided a Corporate Guaranty (the Agreement, the First Amendment, the Escrow Agreement, the Corporate Guaranty, together with the Disclosure Schedule Seller provided to Buyer, and this Second Amendment collectively, the “Transaction Documents”).  The Parties now desire to further amend the Transaction Documents to include certain new or revised terms.  All defined terms contained in the Transaction Documents are incorporated by reference in this Second Amendment.

AGREEMENT

1.Section 1.3 of the Agreement is amended or restated in its entirety as follows:

1.3           Purchase Price. The total purchase price (“Purchase Price”) for the MVNO Stock is HK$49,500,000, comprised of (1) HK$4,646,862.55 previously paid to Escrow Agent (“Buyer’s Deposit”), (2) HK$7,362,500 to be paid in cash at or prior to Closing (“Down Payment”),  and (3) HK$37,490,637.45 , being a part of a promissory note in the total amount of HK$38,990,637.45 more fully described in Section 1.8A (“Note”), to be issued by Guarantor in favor of Seller at Closing.  Buyer shall also pay in cash at Closing but not applicable to the Purchase Price Professional Fees, as described in Section 10.  The Purchase Price shall be subject to the Adjustments within 4 months of the date of the Closing on the basis of the above criteria and against the figures contained in the audited balance sheet of the Company made up as at February 28, 2013 at 11:59 p.m. Hong Kong time and the audited profit and loss account of the Company for the year ended on that date. “Adjustments” means: (1) a credit to Seller equal to the balance of all cash, accounts receivable, other receivables, inventory, and prepayments to others on the audited balance sheet of the Company as at February 28, 2013 at 11:59 p.m., and (2) a credit to Buyer equal to the balance of all accounts payable, accruals and other payable, and advance income received , all as shown on the audited balance sheet of the Company as of  February 28, 2013 at 11:59 p.m. Hong Kong time, excluding the balance of the Shareholder Loans.

2.Section 1.8 of the Agreement (as varied and amended by the First Amendment in that the Outside Closing Date was extended from January 31, 2013 to February 28, 2013) is further amended or restated in its entirety as follows:

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1.8           Closing; Delivery.  The closing of the Agreement (“Closing”) took place as of March 1, 2013 at 12:01 a.m. Hong Kong time (“Outside Closing Date”) , notwithstanding that this Second Amendment is signed on March 3, 2013.  At Closing, (a) Buyer shall deliver the Down Payment to Seller via wire transfer, (b) Buyer’s Deposit shall be released to Seller as a credit to Buyer toward the Purchase Price, (c) Buyer shall deliver the Note to Seller, and (d) Seller shall retain custody of the MVNO Stock, properly endorsed for re-issuance in the name of Buyer or as Buyer directs, in escrow, as more fully described in Section 1.8B.

3.There is added to the Agreement additional Sections 1.8A through 1.8D, containing the following terms:

1.8A         Note.  The Note shall be dated as of Closing, in the principal amount of HK$37,490,637.45, plus interest accrued thereon in an aggregate sum of HK$1,500,000, with a single interim payment of HK$4,650,000 of principal only due as of the same calendar date that is three months after the Closing date, and the balance of HK$32,840,637.45 principal and the said interest in an aggregate sum of HK$1,500,000 due as of the same calendar date that is six months after the Closing date or sooner or upon receiving approval from regulatory and funding sources (“Maturity”).  For the avoidance of doubt, the said interest in an aggregate sum of HK$1,500,000 is not included in the calculation of the Purchase Price in Section 1.3 of the Agreement.  The form of the Note is included as Exhibit 1 to the Agreement.

1.8B         Pledge of MVNO Stock.  As a security for the full and punctual repayment of Note, Buyer hereby pledges back to Seller the total of the MVNO Stock.  At Closing, the certificate(s) representing the MVNO Stock shall be re-issued as a single certificate in the name of Buyer.  The re-issued certificate shall continue to be held by Seller, in its capacity as an interim escrow agent ("Interim Escrow Agent"), pending appointment of a replacement (“Substitute Escrow Agent”). The rights and obligations of Seller as Interim Escrow Agent shall be pursuant to a stock pledge deed and stock escrow agreement (“Stock Pledge Agreement”) between Buyer and Interim Escrow Agent, in the form attached as Exhibit 2 to this Agreement.  The Parties shall promptly locate and retain Substitute Escrow Agent, who shall be a mutually acceptable Hong Kong individual or company who agrees to substantially all of the material terms of the Stock Pledge Agreement. The costs of Substitute Escrow Agent shall be borne by Buyer solely. The MVNO Stock shall be released to Buyer upon full and punctual repayment of the Note, or forfeited to Seller upon default under the Note, all as more fully set forth in the Stock Pledge Agreement.

1.8C         Seat on Board of Directors and Buyer’s Undertaking.  For so long as any portion of the Note remains unpaid and outstanding, Seller shall have the right to appoint one of three or more members of the Board of Directors.  Any of the following decisions shall require unanimous consent of all Directors: (a) borrow any sum or enter into any contract for capital expenditures that is in excess of HK$1,500,000 or is outside the course of the Company’s general business model as a telecommunications service provider; (b) vary any rights attaching to any of the shares of the Company; (c) consolidate or merge with or acquire any other business or dispose of any existing capital assets of the Company; (d) issue any share of the Company or create or issue any debentures or other securities convertible into shares or debentures of the Company; (e) pass any resolutions in general meeting or by way of written resolution relating to wind-up or dissolution of the Company; and (f) distribute any profits of the Company.  Buyer shall procure that for so long as any portion of the Note remains unpaid and outstanding, the Company shall not undertake any of the matters listed above without the prior written consent of Seller.

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1.8D         Notwithstanding anything in this Second Amendment to the contrary, during the time any portion of the Note remains unpaid and outstanding, Buyer is committed to begin upgrading the Company’s network and the Company shall bear the expenses of engineering services rendered in connection with upgrading the Company’s telecommunication network, upon reasonable commercial terms estimated to total approximately no more than HK$1,300,000 per month (“Technical Service Fee”), and such fees shall be processed and approved for payment immediately.

4.Sections 1 and 2 (b) and (c) of the First Amendment shall be void and of no further force and effect.

5. Notwithstanding anything in the Transaction Documents and in particular in the Disclosure Schedule to the contrary, the aggregate cash balance in the bank accounts of the Company as of Closing shall not be less than HK$7,800,000 (the “Cash Balance”) for the daily operation of the Company and any excess amount over the Cash Balance in such bank accounts (the “Excess Amount”) shall belong to Seller and Buyer hereby undertakes to procure the Company to pay Seller or as they or any of them may direct the Excess Amount in cash within 5 business days of Closing.

6.Buyer shall at all times hold Seller, the Substitute Escrow Agent (when appointed) and the Company harmless from, and indemnify each of them in full in respect of, any and all claims, demands, actions or proceedings whatsoever brought or threatened by or against any of them and all losses, damage, costs, expenses and other liabilities of whatever nature suffered, sustained, incurred or payable by them or any of them arising solely out of or in connection with the Buyer taking over the Company during the period between (i) the time immediately after Closing and (ii) final Termination of the Stock Pledge Agreement ("Buyer's Control Time Period") including, but without limitation, any diminution of the net current assets of the Company to a level below the net current assets of the Company as at Closing.  If the nature or description of any claim also arises out of or in connection with any time period prior to Closing, or if the relevant time period cannot be ascertained from the nature or description of the claim, then Buyer’s obligation to indemnify Seller shall abide the result of any resolution of the claim in accordance with the Agreement and shall be limited to the portion finally determined to be solely related to the Buyer's Control Time Period. This Section 6 shall survive notwithstanding termination of this Second Amendment.

7.In consideration of Seller and Listco entering into this Second Amendment and other valuable considerations, Guarantor hereby unconditionally and irrevocably guarantees to Seller each and every obligation of Buyer under this Second Amendment.  Guarantor agrees that it is directly and primarily liable to Seller, that its obligations hereunder are independent of the obligations of Buyer under this Second Amendment, and that a separate action or actions may be brought and prosecuted against Guarantor, whether action is brought against Buyer or whether Buyer is joined in any such action or actions.

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8.Subject only to the variations contained in this Second Amendment and such other alterations (if any) as may be necessary to make the Transaction Documents consistent with this Second Amendment, all terms and conditions of the Transaction Documents remain in full force and effect and shall be read and construed and be enforceable as if the relevant terms of this Second Amendment were inserted therein by way of addition or substitution, as the case may be. In case of any conflict between the terms of this Second Amendment and the terms of any of the Transaction Documents, the terms of this Second Amendment shall prevail.

9.The Parties shall do and execute or procure to be done and executed all such further acts, deeds, documents and things as may be necessary to give full effect to the terms and intent of this Second Amendment.

10.At or before Closing, Buyer shall forthwith pay to Seller a total sum of HK$387,500 (all inclusive) in cash, towards reimbursement of total costs and disbursements to professional parties appointed by Listco involved in the preparation and execution of, and other matters incidental to, the First Amendment and this Second Amendment, which payment is in addition to and is not part of the Purchase Price.

11.The Parties agree that this Second Amendment takes effect as from March 1, 2012, notwithstanding that it is signed on March 3, 2013.

12.This Second Amendment is made and shall be governed by, and construed and enforced in accordance with, the laws of Hong Kong, without regard to the conflict of laws principles thereof as the same apply to agreements executed solely by residents of Hong Kong and wholly to be performed within Hong Kong.

13.Each of Buyer and Guarantor hereby appoints Mr. Lawrence Lo of Room 1307, Tower 1, Lippo Centre, No. 89 Queensway, Admiralty, Hong Kong as its agent to receive and acknowledge on its behalf service of any writ, summons, order, judgment or other notice of legal process in Hong Kong.  If for any reason the agent named above (or its successor) ceases to be able to act as such or no longer has an address in Hong Kong, the Buyer and Guarantor shall promptly appoint a successor agent and notify the other Parties.  Each of Buyer and Guarantor agrees that any such legal process shall be sufficiently served on it if delivered to such agent for service at its address for the time being in Hong Kong whether or not such agent gives notice thereof to the Buyer and Guarantor.

14.This Second Amendment may be executed in one or more counterparts, including facsimile copies of signatures, each of which shall be deemed to be an original and all of which, when taken together, shall be deemed to constitute one and the same agreement.

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

(THE SIGNATURES OF THE PARTIES APPEAR ON THE FOLLOWING PAGE)

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GULFSTREAM CAPITAL PARTNERS LTD. By /s/ Colin Tay                                                                 Colin Tay, its President   As a Deed VELATEL GLOBAL COMMUNICATIONS, INC.     By /s/ Colin Tay                                                                 Colin Tay, its President     Notice addresses for Gulfstream and VelaTel   Room 1307, Tower 1, Lippo Centre, No. 89 Queensway, Admiralty, Hong Kong and 4F-1 No. 102 Kuang Fu South Road Taipei  106 Taiwan Facsimile: + (886) 2 2778-1534 E-Mail:  ctay@trussadc.com CHINA MOTION TELECOM INTERNATIONAL LIMITED     By /s/ Wu Chi Chiu                                                                     Wu Chi Chiu, Director   CHINA MOTION HOLDINGS LIMITED     By /s/ Wu Chi Chiu                                                                     Wu Chi Chiu, Director   CHINAMOTION INFOSERVICES LIMITED       By /s/ Wu Chi Chiu                                                                     Wu Chi Chiu, Director   Notice address for CMT Int., CM Holdings, and CM InfoServices   Unit 3101, Level 31, Tower 1, Enterprise Square Five 38 Wang Chiu Road Kowloon Bay, Hong Kong Facsimile: + (852) 2209 1388 E-Mail: wu.chcc@chinamotion.com

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EX-10.2

Exhibit 10.2

PROMISSORY NOTE

March 1, 2013  HK$38,990,637.45

For value received, VelaTel Global Communications, Inc. (“Maker”) promises to pay to the order of China Motion Holdings Limited and ChinaMotion InfoServices Limited (collectively “Holder”) the principal sum of HK$37,490,637.45, plus interest accrued thereon in an aggregate sum of HK$1,500,000, with installments as follows:

HK$4,650,000 on or before May 31, 2013; and

the balance of HK$34,340,637.45  on or before August 31, 2013.

Maker may prepay all or any portion of the amount due at any time without penalty, in which case payments shall be applied first to interest accrued and then to unpaid principal.

If not previously paid, the entire remaining principal balance plus all interest accrued shall be due and payable in full on August 31, 2013 (“Maturity”).

This Promissory Note is secured by a pledge of 378,467,031 ordinary shares of China Motion Telecom (HK) Limited, pursuant to a Stock Pledge Agreement of even date hereof.

This Promissory Note is made and shall be governed by, and construed and enforced in accordance with, the laws of Hong Kong, without regard to the conflict of laws principles thereof as the same apply to agreements executed solely by residents of Hong Kong and wholly to be performed within Hong Kong.

VELATEL GLOBAL COMMUNICATIONS, INC.
By:	/s/ Colin Tay
	Colin Tay, its President

EX-10.3

Exhibit 10.3

STOCK PLEDGE DEED AND STOCK ESCROW AGREEMENT

The parties to this Stock Pledge Deed and Stock Escrow Agreement (“Stock Pledge Agreement”), entered into as of March 3, 2013, are China Motion Holdings Limited and ChinaMotion InfoServices Limited (collectively, “Seller”) and Gulfstream Capital Partners, Ltd. (“Buyer”).  Seller is also referred to herein as “Interim Escrow Agent.” Subject to future amendment, the Parties intend that the material terms of this Stock Pledge Agreement shall also apply to a “Substitute Escrow Agent.”  Interim Escrow Agent and Substitute Escrow Agent are sometimes referred to collectively as “Escrow Agent.” Buyer, Seller and Escrow Agent are sometimes referred to herein jointly as the “Parties,” and Buyer and Seller are sometimes referred to herein jointly as the “Business Parties.”

1.Cross-Reference to Transaction Documents.  The Business Parties are each also parties to a Stock Purchase Agreement dated November 27, 2012 and subsequently amended on two occasions along with other Transaction Documents associated with the Stock Purchase Agreement (“Agreement”) between the Business Parties.  All defined terms contained in the Transaction Documents are incorporated by reference in this Stock Pledge Agreement.

2.Appointment.  The Business Parties hereby appoint Escrow Agent as escrow agent to hold the MVNO Stock to be delivered to Buyer at Closing of the Agreement in accordance with the terms of this Stock Pledge Agreement, and Escrow Agent hereby accepts said appointment as escrow agent.

3.Pledge; Delivery of Documents.

(a)In consideration of Seller agreeing to allow Buyer to pay the Purchase Price under the Transaction Documents by installments, Buyer as beneficial owner hereby mortgages, charges, assigns, pledges as mortgagor, charger, assignor and pledgor, to Seller, as mortgagee, charge, assignee and pledgee by way of first legal mortgage each and every share of the MVNO Stock, and all security interest in all of Buyer's right, title and interest in and to each and every share of the MVNO Stock, and any adjustments, stock dividends or distributions relating thereto (collectively, "Pledged Collateral") as a continuing security for the due, complete and punctual payment of the Secured Obligations and the due, complete and punctual performance and observance by Buyer of all other obligations of the Buyer contained in this Stock Pledge Agreement.

(b)Buyer hereby delivers to Escrow Agent (i) the MVNO Stock, (ii) instrument of transfer and bought and sold notes (in duplicate) for the Pledged Collateral, substantially in the form of Exhibits 1 and 2 hereto respectively, all undated and appropriately endorsed in blank.  Buyer agrees (iii) to take such other steps as Seller may from time to time reasonably request to perfect Seller's security interest in the Pledged Collateral or any part thereof under applicable law, and (iv) after the occurrence and during the continuance of an Event of Default, to execute and deliver on behalf of Buyer such other documents of transfer as Seller or Escrow Agent may from time to time reasonably require to enable Seller to transfer the Pledged Collateral into the name of Seller or the name of its nominee(s) (sub-sections (i) to (iv) collectively "Assignments").

(c)Seller hereby delivers to Escrow Agent the original of the Note, to be held under the terms of this Stock Pledge Agreement.

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4.Security for Secured Obligations.  The Pledged Collateral secures the due, complete and punctual payment, performance and observance of the terms of the Note, and all obligations of Buyer pursuant to this Stock Pledge Agreement (collectively “Secured Obligations”).

5.Continuing Security. This Stock Pledge Agreement shall be a continuing security and shall remain in full force and effect until the Secured Obligations have been paid or discharged in full, notwithstanding the insolvency or liquidation or any incapacity or change in the constitution or status of Buyer or any other person or other matter whatsoever.

6.Pledged Collateral Adjustments. Ifduring the term of this Stock Pledge Agreement:

(a)any non-cash dividend or distribution, reclassification, readjustment or other change is declared or made in the capital structure of the Company, or any option, warrant or similar instrument included within the Pledged Collateral is exercised, or both, or

(b)any subscription, warrants, or options shall be issued by the Company to Buyer, then Buyer shall promptly deliver new, substituted and additional shares, warrants, options, or other equity securities, issued by reason of any of the foregoing, and all certificates and other instruments evidencing the same to Escrow Agent to be held under the terms of this Stock Pledge Agreement and shall constitute Pledged Collateral hereunder.

7.Representations, Warranties and Undertakings.

(a)Buyer represents and warrants to Seller and Escrow Agent that: (i) Buyer has full power, authority and legal right to enter into and engage in the transactions contemplated by this Stock Pledge Agreement and has taken or obtained all necessary corporate and other action to authorise the execution and performance of this Stock Pledge Agreement; (ii) this Stock Pledge Agreement constitutes legal, valid and binding obligations of Buyer enforceable in accordance with its terms; (iii) neither the execution of this Stock Pledge Agreement nor the performance of any of its obligations or the exercise of any of its rights hereunder will conflict with or result in a breach of any law, regulation, judgment, order, authorisation, agreement or obligation applicable to it or cause any limitation placed on it or the powers of its directors to be exceeded; (iv) all authorisations required from any governmental or other authority or from any shareholders or creditors of Buyer for or in connection with the execution, validity and performance of this Stock Pledge Agreement have been obtained and are in full force and effect; (v) Buyer is the sole beneficial owner of the Pledged Collateral and is the legal owner of  the Pledged Collateral; (vi) no mortgage, charge, pledge, lien, encumbrance, hypothecation or other security interest or security arrangement of any kind (collectively, “Charge”) exists over all or any part of the Pledged Collateral (except as created under this Stock Pledge Agreement);

(b)Buyer undertakes and agrees with Seller throughout the continuance of this Stock Pledge Agreement and so long as the Secured Obligations or any part thereof remains owing or un-discharged that Buyer will (i) not create or attempt to create or permit to arise or exist and Charge over all or any part of the Pledged Collateral or any interest therein or otherwise assign, deal with or dispose of all or any part of the Pledged Collateral (except under this Stock Pledge Agreement; (ii) not grant in favour of any other person any interest in or any option or other rights in respect of any of the Pledged Collateral; (iii) procure that the Company shall not issue or resolve or agree to issue or grant any option or other right to acquire shares to any person other than Seller (and subject always to this Stock Pledge Agreement); (iv) at all times remain the beneficial owner of the Pledged Collateral; (v) procure that no amendment or supplement is made to the memorandum or articles of association of the Company which may have an adverse effect on the security created hereunder; (vi) not do or cause or permit to be done anything which may in any way jeopardise the value of Seller’s security hereunder; and

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(c)Buyer agrees that all the cost in connection with the registration of this Stock Pledge Agreement at the Hong Kong Companies Registry shall be borne by Buyer, up to a limit of HK$10,000.

8.Dividends and Other Distributions.  Escrow Agent shall be entitled to delivery of any and all stock dividends and other distributions paid in respect of the MVNO Stock, which dividends and/or distributions Buyer shall promptly deliver to Escrow Agent to be held under the terms of this Stock Pledge Agreement and which shall constitute Pledged Collateral hereunder.

9.Voting Rights.  Subject to the Transaction Documents and this Stock Pledge Agreement, during the term of this Stock Pledge Agreement and until its Termination as described in Section 16, Buyer shall have the right to vote any MVNO Stock which forms all or a portion of the Pledged Collateral, on all questions presented to the holders of capital stock of Seller, and Escrow Agent shall deliver all necessary documents to allow Buyer to take such action upon Buyer's request.

10.Transfers and Other Liens. Buyer agrees that until all of the Obligations are satisfied in full, Buyer will not (i) sell or otherwise dispose of, or grant any option or other rights with respect to, any of the Pledged Collateral without the prior written consent of Seller, or (ii) create or permit to exist any lien upon or with respect to any of the Pledged Collateral, except for the lien created by this Stock Pledge Agreement.

11.Payment.  Upon timely payment in full of the Note, Buyer shall be entitled to deliver to Escrow Agent, with a copy to Seller, a written notice along with any proof of payment, and a request to release all Pledged Collateral to Buyer (“Release Notice”).  Unless within five days of delivery of the Release Notice, Seller delivers to Escrow Agent with a copy to Buyer a written notice disputing payment (“Objection Notice”), Escrow Agent shall promptly deliver all of the Pledged Collateral to Buyer, along with the original Note, marked “cancelled.”

12.Event of Default.  If Buyer fails to comply with any Obligation, Seller shall be entitled to deliver to Buyer with a copy to Escrow Agent written notice asking Buyer to remedy such failure (“Default Notice”).  If Buyer cures such non-compliance within thirty days of delivery of a Default Notice, Buyer shall be entitled to deliver to Seller with a copy to Escrow Agent written notice that the non-compliance has been remedied, along with any proof of payment or other required compliance (“Cure Notice”).  If no Cure Notice is received within thirty days of delivery of a Default Notice (any such un-remedied Obligation, an "Event of Default"), Seller shall be entitled to send a Forfeiture Notice as described in Section13.

13.Remedies; Transfer of Pledged Collateral and Cancellation of Note.After any un-remedied Event of Default, as Seller’s sole and exclusive remedy under the Note, Seller shall be entitled to deliver to Escrow Agent with a copy to Buyer a request to forfeit the Pledged Collateral and the Assignments to Seller (“Forfeiture Notice”).  Unless within five days of delivery of the Forfeiture Notice, Buyer delivers to Escrow Agent with a copy to Buyer a written notice disputing the Forfeiture Notice with reasonable grounds (“Objection Notice”), Escrow Agent shall promptly deliver all of the Pledged Collateral and Assignments to Seller, and shall deliver to the Buyer the original Note, marked “cancelled.”

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14.Disputes; Arbitration.

(a)Upon delivery of an Objection Notice by either Business Party, such party shall within ten days of delivery of such Objection Notice commence (by filing with HKIAC) an arbitration against the other Business Party, with notice of such filing to Escrow Agent.  If no such arbitration is filed, Escrow Agent is entitled to disregard the Objection Notice as if it had never been delivered, and to instead comply with the Release Notice or Forfeiture Notice, as the case may be.

(b)Any dispute between the Parties arising out of or relating to this Stock Pledge Agreement shall be submitted to binding arbitration with the HKIAC for binding arbitration conducted in English by a single arbitrator.  The dispute(s) shall be resolved pursuant to the United Nations Commission on International Trade Law Arbitration Rules.  The award of the arbitrator shall be final and binding on the Parties and may be enforced in any court of competent jurisdiction.  If any action at law or in equity (including arbitration) is necessary to enforce or interpret the terms of any of this Stock Pledge Agreement, the prevailing Party shall be entitled to reasonable attorney fees, costs and necessary disbursements in addition to any other relief to which such Party may be entitled.

15.Granting of Time; No Waiver.  Seller may at all times, without discharging or in any way affecting its right to strict enforcement of this Stock Pledge Agreement: (i) grant to Buyer and/or the Company and/or to any other person any time or indulgence and/or (ii) deal with, exchange, release, modify, or abstain from perfecting or enforcing this Stock Pledge Agreement, any security guarantee or other right which Seller may now or hereafter have regarding this Stock Pledge Agreement or agree to any amendment to the said document and/or any document executed or to be executed pursuant thereto.

16.Termination.  Subject to the following provisions of this Section16, this Stock Pledge Agreement shall be terminated as follows (“Termination”): (i) upon the release to Buyer or the forfeiture to Seller of the Pledged Collateral; or (ii) by Escrow Agent giving notice of immediate termination to both Business Parties at any time after the Seller and/or the Buyer have/has, in the reasonable opinion of Escrow Agent, contravened, breached or not observed any of the provisions of this Stock Pledge Agreement and failed to rectify such contravention, breach or non-observance within 7 days after a notice identifying such contravention, breach or non-observance has been sent to Seller and/or Buyer by Escrow Agent. Upon receiving or giving of any notice of termination by Escrow Agent under this Section 16, both Business Parties shall assist in relation to such termination and give effect thereto by securing the appointment of a substituted escrow agent.  Escrow Agent shall then be authorised to release and deliver the Pledged Collateral to such substituted escrow agent. Any release , forfeiture or transfer of all of the Pledged Collateral pursuant to the terms of this Stock Pledge Agreement, whether or not following termination, shall terminate the Escrow Agent's duties hereunder in respect of all of Pledged Collateral for the periods after the Pledged Collateral has been so released, forfeited or transferred, but without prejudice to the right of Escrow Agent to settle any transactions entered into or to settle any liability incurred by Seller and/or Buyer under this Stock Pledge Agreement or by Escrow Agent on behalf of Seller and/or Buyer prior to termination. All the costs incurred by Escrow Agent in connection with the appointment of a substituted escrow agent (including legal costs) shall be borne by the Business Party or Parties in default of this Stock Pledge Agreement.

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17.Notices.  All notices and other communications given or made pursuant to this Stock Pledge Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (i) personal delivery to the Party to be notified; (ii) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day; (iii) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (iv) one (1) business day after deposit with a worldwide recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt.  All communications shall be sent to the respective Parties at their address as set forth on the signature page, or to such e-mail address, facsimile number or address as subsequently modified by Notice given in accordance with this Section 17.  The Business Parties authorise Escrow Agent to accept notices from each of them if they are signed on their behalf by the person signing this Stock Pledge Agreement on their behalf or by any other person appointed by their respective boards of directors. Whenever this Stock Pledge Agreement refers to notice by both Business Parties, such term also encompasses two separate notices delivered from each Business Party.

18.Counterparts.  This Stock Pledge Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

19.Effective Date. The Parties agree that this Stock Pledge Agreement shall take effect as from March 1, 2013.

20.Choice of Law.  This Stock Pledge Agreement is made and shall be governed by, and construed and enforced in accordance with, the laws Hong Kong, without regard to the conflict of laws principles thereof as the same apply to agreements executed solely by residents of Hong Kong and wholly to be performed within Hong Kong.

21.Local Agent of Buyer.  Buyer hereby appoints Mr. Lawrence Lo of Room 1307, Tower 1, Lippo Centre, No. 89 Queensway, Admiralty, Hong Kong as its agent to receive and acknowledge on its behalf service of any writ, summons, order, judgment or other notice of legal process in Hong Kong.  If for any reason the agent named above (or its successor) ceases to be able to act as such or no longer has an address in Hong Kong, the Buyer shall promptly appoint a successor agent and notify the other Parties.  The Buyer agrees that any such legal process shall be sufficiently served on it if delivered to such agent for service at its address for the time being in Hong Kong whether or not such agent gives notice thereof to the Buyer.

IN WITNESS WHEREOF the parties hereto have set their hands, as of the day of the year first above mentioned.

THE SIGNATURES OF THE PARTIES APPEAR ON THE FOLLOWING PAGE

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The COMMON SEAL of GULFSTREAM CAPITAL PARTNERS, LTD. was affixed in hereto in the presence of           /s/ Colin Tay                                                             Colin Tay, its President Notice addresses for Gulfstream:   Room 1307, Tower 1, Lippo Centre, No. 89 Queensway, Admiralty, Hong Kong and 4F-1 No. 102 Kuang Fu South Road Taipei  106, Taiwan Facsimile: + (886) 2 2778-1534 E-Mail:  ctay@trussadc.com CHINA MOTION HOLDINGS LIMITED       By /s/ Wu Chi Chiu                                                                  Wu Chi Chiu, Director   CHINAMOTION INFOSERVICES LIMITED       By /s/ Wu Chi Chiu                                                                  Wu Chi Chiu, Director   Notice address for CM Holdings and ChinaMotion Info Services:   Unit 3101, Level 31, Tower 1, Enterprise Square Five 38 Wang Chiu Road Kowloon Bay, Hong Kong Facsimile: + (852) 2209 1388 E-Mail: wu.chcc@chinamotion.com  

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EXHIBIT 1

(to Stock Pledge Agreement)

 

FORM OF INSTURMENT OF TRANSFER (UNDER SECTION 3)

INSTRUMENT OF TRANSFER

CHINA MOTION TELECOM (HK) LIMITED

(incorporated in the Hong Kong Special Administrative Region of

the People's Republic of China with limited liability)

We,	Gulfstream Capital Partners Ltd.	("Transferor")
(Occupation)	Corporation
of (full address)
in consideration of
by		("Transferee")
(occupation)
of (full address)

do hereby transfer to the Transferee the_____________ Shares numbered

standing in our name in the register of members of China Motion Telecom (HK) Limited to hold unto the Transferee or its assigns, subject to the several conditions upon which we hold the same at the time of execution hereof.  And we the Transferee do hereby agree to take the said Shares subject to the same conditions.

Witness our hands the ________ day of __________, 20   .
Signed by the Transferor                                                                                                   )
in the presence of:                                                                                                            )
)	For and on behalf of
)	Gulfstream Capital Partners Ltd.
Witness Signature ____________________________________________________   )
Name ______________________________________________________________   )
Address ____________________________________________________________   )
___________________________________________________________________   )	Transferor
___________________________________________________________________   )
Signed by the Transferee                                                                                                  )
in the presence of:                                                                                                            )
)
Witness signature _____________________________________________________  )
Name_______________________________________________________________  )
Address_____________________________________________________________  )
___________________________________________________________________   )	Transferee
___________________________________________________________________   )

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EXHIBIT 2

(to Stock Pledge Agreement)

FORM OF BOUGHT AND SOLD NOTES (UNDER SECTION 3)

SOLD NOTE

Name of Buyer :

Address :

Occupation :

Name of Company in which the shares to be transferred : China Motion Telecom (HK) Limited

Number of Shares : ________________________ of	HK$1.00	each
Consideration Received:

For and on behalf of

Gulfstream Capital Partners Ltd.

(Seller)

Dated the            day of            , 20   .

BOUGHT NOTE

Name of Seller :	Gulfstream Capital Partners Ltd.
Address :
Occupation :	Corporation

Name of Company in which the shares to be transferred : China Motion Telecom (HK) Limited

Number of Shares : ________________________ of	HK$1.00	each
Consideration Paid:

(Buyer)

Dated the            day of            , 20    .

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