levying fines;

confiscating our or our operating company’s income;

revoking our or our operating company’s business licenses and other operating licenses;

(d)

shutting down the servers or blocking our or our operating company’s web sites;

(e)

restricting or prohibiting our use of the proceeds from this offering to finance our business and operations in China;

(f)

requiring us to restructure our ownership structure or operations; and/or

(g)

requiring us or our operating company to discontinue our wireless value-added services business.

Any of these or similar actions could cause significant disruptions to our business operations or render us unable to conduct our business operations and may materially adversely affect our business, financial condition and results of operations.

Our contractual arrangement with the VIE and their shareholders may not be as effective in providing operational control as direct ownership of these businesses and may be difficult to enforce.

PRC laws and regulations currently restrict foreign ownership of companies that provide value-added telecommunication services, which include wireless value-added services and Internet content services. As a result, we conduct a portion of our operations and could generate revenues through the VIE pursuant to a series of contractual arrangements with it and its respective shareholders. These agreements may not be as effective in providing control over our operations as direct ownership of these businesses. Direct ownership would allow us, for example, to directly exercise our rights as a shareholder to effect changes in the board of the VIE, which, in turn, could affect changes, subject to any applicable fiduciary obligations, at the management level. However, under the current contractual arrangements, as a legal matter, if the VIE or its shareholders fail to perform their respective obligations under these contractual arrangements, we may have to incur substantial costs and expend significant resources to enforce those arrangements, and rely on legal remedies under PRC law. These remedies may include seeking specific performance or injunctive relief, and claiming damages, any of which may not be effective. For example, if the VIE’s shareholders refuse to transfer their equity interest in the VIE to us or our designee when we exercise the purchase option pursuant to these contractual arrangements, or if any of those individuals otherwise act in bad faith towards us, we may have to take legal action to compel them to fulfill their contractual obligations.

Additionally, all of these contractual arrangements are governed by PRC laws and provide for the resolution of disputes through arbitration in the PRC. Accordingly, these contracts would be interpreted in accordance with PRC laws and any disputes would be resolved in accordance with PRC legal procedures. The legal environment in the PRC is not as developed as in other jurisdictions, such as the United States. As a result, uncertainties in the PRC legal system could limit our ability to enforce these contractual arrangements. In the event we are unable to enforce these contractual arrangements, which relate to critical aspects of our operations, we may be unable to exert effective control over the VIE and our ability to conduct our business may be negatively affected.

Online game content providers & Internet cafés may not execute content & revenue sharing agreements with us.

We need to cooperate with online game content providers and Internet cafes in order to carry out our business. We have entered into, and plan to enter into additional cooperation agreements with several online game content providers and Internet cafes. If we are unable to enter into additional agreements with online game content providers or Internet cafes or if these online game content providers or Internet cafes do not provide online games or other services, or do not perform their other business contractual obligations as agreed, we may not be able to carry out our business normally and our financial conditions will be materially and adversely affected.

If we are unable to get additional online games that are attractive to players and result in overall revenue growth, our business, financial condition and results of operations may be materially and adversely affected and our ability to recover related costs may become limited .

In order to maintain our long-term profitability and financial and operational success, we must continually get new online games that are attractive to players. To date, we have signed up 4 online game companies with approximately 30 games. These games may or may not attract players away from other games companies and may or may not be profitable or popular among the online game players in China. If these games fail to attract new players and fail to drive our online game revenues, our business, financial condition and results of operations may be materially and adversely affected.

Our ability to purchase or license successful online games will depend on their availability at acceptable terms, including price, our ability to compete effectively against other potential purchasers or licensees to attract the developers of these games, and our ability to obtain government approvals required for the purchase or licensing and operation of these games.

The games that we purchase or license may not be attractive to players, may be viewed by the regulatory authorities as not complying with content restrictions, may not be launched as scheduled or may not compete effectively with our competitors’ games. Additionally, new technologies in our competitors’ online game programming or operations could render our games obsolete or unattractive to players, thereby limiting our ability to recover related product development costs, purchase costs and licensing fees. If we are not able to develop, purchase or license successfully online games appealing to players, our future profitability and growth prospects will decline.

Our limited operating history and the unproven long-term potential of our business model make evaluating our business and prospects difficult.

We were incorporated in August 29, 2007. As our operating history is limited, the revenue and income potential of our business and markets are yet to be fully proven. In addition, we are exposed to risks, uncertainties, expenses and difficulties frequently encountered by companies at an early stage of development. Some of these risks and uncertainties relate to our ability to:

maintain our current, and develop new, cooperation arrangements;

increase the number of our users by expanding the type, scope and technical sophistication of the content and services we offer;

respond effectively to competitive pressures;

iv.

respond in a timely manner to technological changes or resolve unexpected network interruptions;

comply with changes to regulatory requirements;

vi.

maintain adequate control of our costs and expenses;

vii.

increase awareness of our brand and continue to build user loyalty; and

viii.

attract and retain qualified management and employees.

We cannot predict whether we will meet internal or external expectations of our future performance. If we are not successful in addressing these risks and uncertainties, our business, financial condition and results of operations may be materially adversely affected.

Our success depends on attracting and retaining qualified personnel.

We depend on a core management and key executives. In particular, we rely on the expertise and experience of our founders and senior officers, in our business operations, and their personal relationships with our other significant shareholders, employees, the regulatory authorities, our clients, our suppliers and the PLA. If any of them, become unable or unwilling to continue in their present positions, or if they join a competitor or form a competing company in contravention of their employment agreements, we may not be able to identify a replacement easily, our business may be significantly disrupted and our financial condition and results of operations may be materially adversely affected. We do not currently maintain key-man life insurance for any of our key personnel.

We may need additional capital and may not be able to obtain such capital on acceptable terms.

Capital requirements can be difficult to plan for in our rapidly changing industry. Our operations could be capital intensive as we build out and continue to develop our MoqiZone WiMAX Network. With the net proceeds of our recent Financing, we believe that we will be able to operate until March 2010 before additional capital is required to continue to execute our current growth plans. Based on our current business development plans, we will need approximately US$4 million of additionally financings to fund our WiMAX deployment to the point where our operations before cash flow positive. We also may need additional capital to fund future acquisitions, certain service developments, technological infrastructure and new sales and marketing activities..

Our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties, including:

investors’ perceptions of, and demand for, securities of telecommunications value-added services companies;

conditions of the U.S. and other capital markets in which we may seek to raise funds;

our future results of operations, financial condition and cash flows;

(d)

PRC governmental regulation of foreign investment in value-added telecommunications companies;

(e)

economic, political and other conditions in China; and

(f)

PRC governmental policies relating to foreign currency borrowings.

Any failure by us to raise additional funds on terms favorable to us, or at all, may have a material adverse effect on our business, financial condition and results of operations. For example, we may not be able to carry out parts of our growth strategy to acquire assets, technologies and businesses that are complementary to our existing business or necessary to maintain our growth and competitiveness.

We may not be able to adequately protect our intellectual property, and we may be exposed to infringement claims by third parties.

We have no business insurance coverage.

The insurance industry in China is still at an early stage of development. Insurance companies in China offer limited business insurance products, and do not, to our knowledge, offer business liability insurance. As a result, we do not have any business liability insurance coverage for our operations. Moreover, while business interruption insurance is available, we have determined that the risks of disruption and cost of the insurance are such that we do not require it at this time. Any business disruption, litigation or natural disaster might result in substantial costs and diversion of resources.

The laws and regulations governing the value-added telecommunications and Internet industry in China are developing and subject to future changes. Substantial uncertainties exist as to the interpretation and implementation of those laws and regulations.

Our digital entertainment services are subject to general regulation regarding telecommunication services. In recent years, the PRC government has begun to promulgate laws and regulations applicable to Internet-related services and activities, many of which are relatively new and untested and subject to future changes. In addition, various regulatory authorities of the central PRC government, such as the State Council, the MIIT (formerly known as the Ministry of Information Industry, or MII), the State Administration of Industry and Commerce, or SAIC, and the Ministry of Public Security, are empowered to issue and implement rules to regulate certain aspects of Internet-related services and activities. Furthermore, some local governments have also promulgated local rules applicable to Internet companies operating within their respective jurisdictions. As the Internet industry itself is at an early stage of development in China, there will likely be new laws and regulations promulgated in the future to address issues that may arise from time to time. As a result, uncertainties exist regarding the interpretation and implementation of current and future PRC Internet laws and regulations.

The VIE has obtained various value-added telecommunication service licenses from the MIIT or its local branches, and Tai Ji has obtained PLA Authorization, for the provisions of their services in relation to the usage of 3.5GHz. Tai Ji will apply for licenses for each and all WiMAX base stations when they are built up. These licenses will be held by Tai Ji and Tai Ji will license these stations to the VIE. We cannot assure you that we will be able to obtain or maintain these licenses or that the regulatory authorities will not take any action against us if we fail to obtain or maintain them. If the VIE and/or Tai Ji fails to obtain or maintain any of the required licenses or permits respectively, it may be subject to various penalties, including redressing the violations, confiscation of income, imposition of fines or even suspension of its operations. Any of these measures could materially disrupt our operations and materially and adversely affect our financial condition and results of operations.

The MIIT issued regulations that regulate and limit ownership and investment in internet and other value-added telecommunications businesses in the PRC which may limit the type of businesses we will be able to acquire.

On July 13, 2006, the MII issued a notice with the purpose of increasing the regulation of foreign investment in and operations of value added telecom services which include internet and telecommunication businesses in the PRC. The regulations require Chinese entities to own and control the following: (i) internet domain names, (ii) registered trademarks, and (iii) servers and other infrastructure equipment used to host and operate web-sites and conduct businesses. The ownership requirements functionally limit foreign direct and indirect ownership and control of the intellectual property of these businesses even when attempted through various parallel control, licensing, use and management agreements. It is anticipated that these regulations will be strictly enforced, and the government has provided that the new regulations apply retroactively and provide for audit procedures. The failure to comply may cause the MIIT to terminate a telecommunication license or otherwise modify existing agreements or require the disposition of the assets by the foreign entity. Any anticipated foreign investment in such businesses will be subject to prior approval by the MIIT, and it is expected that approval for investment may not be easily obtained for foreign investment in these businesses unless in strict compliance. Therefore, investment by us in this sector may not be actively pursued because certain assets may not be acquirable and accounting consolidation may be restricted or not permitted as a result of an unfavorable but permitted transaction structure.

The PRC government may prevent us from distributing, and we may be subject to liability for content that any of them believes is inappropriate.

China has promulgated regulations governing telecommunication service providers, Internet access and the distribution of online games and other information. In the past, the PRC government has stopped the distribution of information over the Internet that it believes to violate Chinese law, including content that is obscene, incites violence, endangers national security, is contrary to the national interest or is defamatory.

The growth of our business may be adversely affected due to public concerns over the security and privacy of confidential user information.

The growth of our business may be inhibited if the public concern over the security and privacy of confidential user information transmitted over the Internet and wireless networks is not adequately addressed. Our service quality may decline and our business may be adversely affected if significant breaches of network security or user privacy occur.

We could be liable for breaches of security of our website and third-party online payment system, which may have a material adverse effect on our reputation and business.

Secure transmission of confidential information, such as customers’ debit and credit card numbers and expiration dates, personal information and billing addresses, over public networks, including our official game website, is essential for maintaining consumer confidence. We currently provide password protection, IP address verification and hardware verification for all of player accounts. While we have not experienced any breach of our security measures to date, such current security measures may be inadequate. In addition, we expect that an increasing number of our sales will be conducted over the Internet as result of the growing use of online payment systems. We also expect that associated online crime will likely increase accordingly. We must therefore be prepared to increase our security measures and efforts so that our customers have confidence in the reliability of the online payment system that we use. We do not have control over the security measures of our third-party online payment operator, and its security measures may not be adequate at present or may not be adequate with the expected increased usage of online payment systems. We could be exposed to litigation and possible liability if we fail to secure confidential customer information, which could harm our reputation, ability to attract customers and ability to encourage players to purchase our game points.

Unexpected network interruptions, security breaches or computer virus attacks could have a material adverse effect on our business, financial condition and results of operations.

Any failure to maintain the satisfactory performance, reliability, security and availability of our network infrastructure may cause significant harm to our reputation and our ability to attract and maintain players. All our game servers and all of the servers which handle log-in, billing and data back-up matters are hosted and maintained by third party service providers. Major risks involved in such network infrastructure include any break-downs or system failures resulting in a sustained shutdown of all or a material portion of our servers, including failures which may be attributable to sustained power shutdowns, or efforts to gain unauthorized access to our systems causing loss or corruption of data or malfunctions of software or hardware.

Our network systems are also vulnerable to damage from fire, flood, power loss, telecommunications failures, computer viruses, hacking and similar events. Any network interruption, virus or other inadequacy that causes interruptions in the availability of the online games or deterioration in the quality of access to the online games could reduce our players’ satisfaction and ultimately harm our business, financial condition and results of operations. In addition, any security breach caused by hackings, which involve efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission of computer viruses could have a material adverse effect on our business, financial condition and results of operations. We do not maintain insurance policies covering losses relating to our network systems and we do not have business interruption insurance.

Future acquisitions may have an adverse effect on our ability to manage our business.

Selective acquisitions form part of our strategy to expand our business. We do not, however, have any prior experience integrating any new companies into ours, and we believe that integration of a new company’s operation and personnel will require significant management attention. The diversion of our management’s attention from our business and any difficulties encountered in the integration process could have an adverse effect on our ability to manage our business.

We may pursue acquisitions of companies, technologies and personnel that are complementary to our existing business. However, our ability to grow through future acquisitions or investments or hiring will depend on the availability of suitable acquisition and investment candidates at an acceptable cost, our ability to compete effectively to attract these candidates, and the availability of financing to complete larger acquisitions. We may face significant competition in executing our growth strategy. Future acquisitions or investments could result in potential dilutive issuances of equity securities or incurrence of debt, contingent liabilities or impairment of goodwill and other intangible assets, any of which could adversely affect our financial condition and results of operations. The benefits of an acquisition or investment may also take considerable time to develop and any particular acquisition or investment may not produce the intended benefits.

Future acquisitions would also expose us to potential risks, including risks associated with the assimilation of new operations, technologies and personnel, unforeseen or hidden liabilities, the diversion of resources from our existing businesses, sites and technologies, the inability to generate sufficient revenue to offset the costs and expenses of acquisitions, and potential loss of, or harm to, our relationships with employees, customers, licensors and other suppliers as a result of the integration of new businesses.

We may be subject to infringement and misappropriation claims in the future, which may cause us to incur significant expenses, pay substantial damages and be prevented from providing our services or technologies.

Our success depends, in part, on our ability to carry out our business without infringing the intellectual property rights of third parties. We may be subject to litigation involving claims of patent, copyright or trademark infringement, or other violations of intellectual property rights of third parties. Future litigation may cause us to incur significant expenses, and third-party claims, if successfully asserted against us, may cause us to pay substantial damages, seek licenses from third parties, pay ongoing royalties, redesign our services or technologies, or prevent us from providing services or technologies subject to these claims. Even if we were to prevail, any litigation would likely be costly and time-consuming and divert the attention of our management and key personnel from our business operations.

The successful operation of our business depends upon the performance and reliability of the Internet infrastructure and fixed telecommunication networks in China.

Our business depends, in part, on the performance and reliability of the Internet infrastructure in China. Almost all access to the Internet is maintained through state-owned telecommunication operators under the administrative control and regulatory supervision of the MIIT. In addition, the national networks in China are connected to the Internet through international gateways controlled by the PRC government. These international gateways are the only channels through which a domestic user can connect to the Internet. A more sophisticated Internet infrastructure may not be developed in China. We or the players of online games may not have access to alternative networks in the event of disruptions, failures or other problems with China’s Internet infrastructure. As one of our important business partners are Internet cafés in China, intensified government regulation of Internet cafés could limit our ability to maintain or increase our net revenues and expand our customer base.

We rely on Internet cafes as our business partners in China to provide our services to the final users. Starting in 2001, the Chinese government began tightening its supervision of Internet cafés, closing unlicensed Internet cafés, requiring those remaining open to install software to prevent access to sites deemed subversive and requiring web portals to sign a pledge not to host subversive sites. In February 2007, 14 PRC national government authorities, including the MIIT, the Ministry of Culture and the General Administration of Press and Publication, jointly issued a notice suspending nationwide approval for the establishment of new Internet cafés in 2007 and enhancing the punishment for Internet cafés admitting minors. This suspension may continue indefinitely. Furthermore, the Chinese government’s policy, which encourages the development of a limited number of national and regional Internet café chains and discourages the establishment of independent Internet cafés, may slow down the growth of Internet cafés.

As Internet cafés are the primary venue for users to use our service, any reduction in the number, or any slowdown in the growth, of Internet cafés in China will limit our ability to maintain or increase our net revenues and expand our customer base, which will in turn materially and adversely affect our business and results of operations.

Our business may be adversely affected by public opinion and government policies in China.

Internet cafés, which are currently the most important outlets for online games, have been criticized by the general public in China for having exerted a negative influence on young people. Due primarily to such adverse public reaction, regulators in China have tightened their regulation of Internet café operations through, among other things, suspending the issuance of new operating licenses and further reducing the hours during which the Internet cafés are permitted to remain open for business. Also, local and higher-level governmental authorities may from time to time decide to more strictly enforce age limits and other requirements relating to Internet cafés as a result of the occurrence of, and the media attention on, gang fights, arson and other incidents in or related to Internet cafés. As most of our customers access online games from Internet cafés, any restrictions on Internet café operations could result in a reduction of the amount of time the customers spend on online games or a reduction in or slowdown in the growth of the player base. Moreover, any adverse public reaction to the online game industry may discourage players from spending too much time playing online games, which could limit the growth of or reduce our net revenues. In addition, it is also possible that the Chinese government authorities may decide to adopt more stringent policies to monitor the online game industry as a result of adverse public reaction or otherwise. Any such restrictions on online game playing would adversely affect our business and results of operations.

Our operations may be adversely affected by implementation of new addiction-related regulations.

The Chinese government may decide to adopt more stringent policies to monitor the online game industry as a result of adverse public reaction to perceived addiction to online games, particularly by minors. On April 15, 2007, eight PRC government authorities, including the State Press and Publication Administration, the Ministry of Education and the Ministry of Information Industry issued a Notice on the Implementation of Online Game Anti-Addiction System to Protect the Physical and Psychological Health of Minors (the “Anti-Addiction Notice”), requiring all Chinese game operators to adopt an “anti-addiction system” in an effort to curb addiction to online games by minors. Under the anti-addiction system, three hours or less of continuous play is defined to be “healthy,” three to five hours is defined to be “fatiguing,” and five hours or more is defined to be “unhealthy.” Game operators are required to reduce the value of game benefits for minor players by half when those players reach the “fatigue” level, and to zero when they reach the “unhealthy” level. In addition, online game players in China are now required to register their identity card numbers before they can play an online game. This system allows game operators to identify which players are minors. Failure to comply with the requirements under the Anti-Addiction Notice may subject us to penalties, including but not limited to suspension of the operation of online games, revocation of the licenses and approvals for Internet cafes’ operations, rejection or suspension of the application for approvals, licenses, or filings for any new games, or prohibiting Internet cafes from operating any new game.

Internet cafes currently do not allow the admission of juvenile players. If these restrictions are expanded to apply to adult players in the future, it could have a material and adverse effect on our business, financial condition and operating results.

Substantially all of our assets may be located in the PRC and substantially all of our revenue may be derived from our operations in the PRC. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political and legal policies, developments and conditions in such country.

The PRC economic, political and social conditions, as well as government policies, could affect our business. For instance, the PRC economy differs from the economies of most developed countries in many respects. The PRC economy has been transitioning from a planned economy to a more market-oriented economy. Although in recent years the PRC government has implemented measures emphasizing the use of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of sound corporate governance in business enterprises, a substantial portion of productive assets in the PRC is still owned by the PRC government. In addition, the PRC government continues to play a significant role in regulating industry development by imposing industrial policies. It also exercises significant control over PRC economic growth through the allocation of resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies.

If relations between the United States and the PRC deteriorate, our business or service could become less attractive.

The relationship between the United States and the PRC is subject to sudden fluctuation and periodic tension. For instance, if the United States imposes new short-term quotas on Chinese imports, such import quotas may adversely affect political relations between the two countries and result in retaliatory countermeasures by the PRC in industries that may affect our ultimate business. Relations may also be compromised if the United States becomes a more vocal advocate of Taiwan or proceeds to sell certain military weapons and technology to Taiwan. Relations may also be compromised if either the PRC government or the Taiwan government unilaterally alters the current political status quo between Taiwan and the Chinese mainland.

Changes in political conditions in the PRC and changes in the state of Sino-U.S. relations are difficult to predict and could adversely affect our operations or cause our businesses and services to become less attractive.

We face risks related to health epidemics and other outbreaks, which could adversely affect our operations.

Our business could be materially and adversely affected by the outbreak of avian flu, severe acute respiratory syndrome or another epidemic. From time to time, there have been reports on the occurrences of avian flu in various parts of the PRC, including a few confirmed human cases and deaths. Any prolonged recurrence of avian flu, severe acute respiratory syndrome or other adverse public health developments in the PRC or elsewhere in Asia may have a material and adverse effect on our business operations.

If the PRC imposes restrictions to reduce inflation, future economic growth in the PRC could be severely curtailed which could materially and adversely impact our profitability.

While the economy of the PRC has experienced rapid growth, this growth has been uneven among various sectors of the economy and in different geographical areas of the country. Rapid economic growth can lead to growth in the supply of money and rising inflation. In order to control inflation in the past, the PRC has imposed controls on bank credits, limits on loans for fixed assets and restrictions on state bank lending. Imposition of similar restrictions may lead to a slowing of economic growth and decrease the interest in the services or products we may ultimately offer leading to a material and adverse impact on our profitability.

Any devaluation of currencies used in the PRC could negatively impact our business’ results of operations and any appreciation thereof could cause the cost of our business as measured in dollars to increase.

Because substantially all revenues and income would be received in a foreign currency such as RMB, the national currency in the PRC, the dollar equivalent of our net assets and distributions, if any, would be adversely affected by fluctuations in the value of the RMB. The value of foreign currency fluctuates and is affected by, among other things, changes in political and economic conditions. To the extent that we need to convert U.S. dollars into Chinese currency for our operations, appreciation of this currency against the U.S. dollar could have a material adverse effect on our business, financial condition and results of operations. Conversely, if we decide to convert RMB into U.S. dollars for other business purposes and the U.S. dollar appreciates against this currency, the U.S. dollar equivalent of such currency we convert would be reduced.

The conversion of RMB into foreign currencies such as the U.S. dollar has been generally based on rates set by the People’s Bank of China, which are set daily based on the previous day’s interbank foreign exchange market rates and current exchange rates on the world financial markets. Historically, the PRC “pegged” its currency to the U.S. dollar. This meant that each unit of Chinese currency had a set ratio for which it could be exchanged for United States currency, as opposed to having a floating value like other countries’ currencies. Many countries argued that this system of keeping the Chinese currency low when compared to other countries gave Chinese companies an unfair price advantage over foreign companies. Due to mounting pressure from other countries, the PRC recently reformed its economic policies to establish a floating value for its currency. Since July 21, 2005, RMB has been pegged to a basket of currencies, and permitted to fluctuate within a managed band. As of July 22, 2008 Beijing time, the exchange rate of the RMB was 6.8219:1 against the US dollar. This floating exchange rate, and any appreciation of the RMB that may result from such rate, could cause the cost of our business as measured in dollars to increase. Further, our business may be adversely affected since the competitive advantages that existed as a result of the former policies will cease.

Our corporate structure may limit our ability to receive dividends from, and transfer funds to, our PRC subsidiary, which could restrict our ability to act in response to changing market conditions.

Moqizone is a holding company. Shanghai MoqiZone, our indirectly wholly-owned subsidiary established in China has entered into contractual arrangements with the VIE through which we conduct our wireless value-added activities and receive substantially all of our revenues in the form of service fees. We rely on dividends and other distributions on equity paid by our subsidiary and service fees from the VIE for our cash requirements in excess of any cash raised from investors and retained by us. If our subsidiary incurs debt in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us.

In addition, PRC law requires that payment of dividends by our subsidiary can only be made out of its net income, if any, determined in accordance with PRC accounting standards and regulations. Under PRC law, our subsidiary is also required to set aside no less than 10% of its after-tax net income each year to fund certain reserve funds unless such reserve funds have reached 50% of the registered capital of our subsidiary, and these reserves are not distributable as dividends. Any limitation on the payment of dividends by our subsidiary could materially adversely affect our ability to grow, fund investments, make acquisitions, pay dividends, and otherwise fund and conduct our business. Any transfer of funds from our company to our PRC subsidiary, either as a shareholder loan or as an increase in registered capital, is subject to registration or approval of Chinese governmental authorities, including the relevant administration of foreign exchange and/or the relevant examining and approval authority. These limitations on the free flow of funds between us and our PRC subsidiary could restrict our ability to act in response to changing market conditions.

Recent regulations relating to offshore investment activities by PRC residents may increase the administrative burden we face and create regulatory uncertainties that may limit or adversely affect our ability to acquire PRC companies.

Regulations were issued on January 24, 2005, on April 8, 2005 and on October 21, 2005, by the SAFE, that will require approvals from, and registration with, PRC government authorities in connection with direct or indirect offshore investment activities by PRC residents and PRC corporate entities. The Circular on Issues Relating to the Administration of Foreign Exchange in Fund-raising and Reverse Investment Activities of Domestic Residents Conducted via Offshore Special Purpose Companies, or Circular 75, which were issued on October 21, 2005 and became effective as of November 1, 2005 repealed the previous January and April SAFE regulations. Circular 75 requires each Chinese domestic resident, whether a natural or legal person, to complete the overseas investment foreign exchange registration procedures with the relevant local SAFE branch, prior to establishing or assuming control of an offshore company for the purpose of acquiring assets or equity interests in the PRC and using these assets to seek overseas financing (known as “round-trip investment”). In addition, an amendment to the registration with the local SAFE branch is required to be filed by any Chinese domestic resident that directly or indirectly holds interests in that offshore company upon either (1) the injection of equity interests or assets of an onshore enterprise to the offshore company, or (2) the completion of any overseas fund raising by such offshore company. An amendment to the registration is also required to be filed by such Chinese domestic resident when there is any material change involving a change in the capital of the offshore company. Moreover, Circular 75 applies retroactively. As a result, Chinese domestic residents who have established or acquired control of offshore companies that have made onshore investments in China in the past are required to complete the relevant overseas investment foreign exchange registration procedures. For purposes of SAFE registrations required under Circular 75, “Chinese domestic residents” shall include individuals without mainland China identity papers who have habitually lived in China due to economic interest. In the event that a PRC shareholder with a direct or indirect stake in an offshore parent company fails to obtain the required SAFE approval and make the required registration, the PRC subsidiaries of such offshore parent company may be prohibited from making distributions of profit to the offshore parent and from paying the offshore parent proceeds from any reduction in capital, share transfer or liquidation in respect of the PRC subsidiaries. Further, failure to comply with the various SAFE approval and registration requirements described above, as currently drafted, could result in penalties under PRC foreign exchange administration regulations and liability under PRC law for foreign exchange evasion.

As a Hong Kong company, and therefore an offshore company for purpose of SAFE regulations, if we purchase the assets or equity interest of a Chinese company owned by Chinese domestic residents, including those which we will generate revenue from and exercise control over through agreements, such Chinese domestic residents who may become our shareholders will be subject to registration procedures described in the aforementioned SAFE notice. Moreover, Chinese domestic residents who are already our beneficial shareholders may be required to register with SAFE in connection with their shareholdings in us. Failure of any Chinese shareholders of us to register with SAFE may limit our Chinese subsidiary’s ability to distribute dividends to us.

The PRC regulations relating to acquisitions of PRC companies by foreign entities may create regulatory uncertainties that could restrict or limit our ability to operate, including our ability to pay dividends.

On August 8, 2006, the Ministry of Commerce (“MOFCOM”), joined by the State-Owned Assets Supervision and Administration Commission of the State Council, State Administration of Taxation, State Administration for Industry and Commerce, China Securities Regulatory Commission (“CSRC”) and SAFE, amended and released the Provisions for Foreign Investors to Merge and Acquire Domestic Enterprises, which took effect as of September 8, 2006. This new regulation, among other things, has certain provisions that require SPVs formed for the purpose of acquiring PRC domestic companies and controlled by PRC individuals, to obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock market. However, the new regulation does not expressly provide that approval from the CSRC is required for the offshore listing of a SPV which acquires, directly or indirectly, equity interest or shares of domestic PRC entities held by domestic companies or individuals by cash payment, nor does it expressly provide that approval from CSRC is not required for the offshore listing of a SPV which has fully completed its acquisition of equity interest of domestic PRC equity prior to September 8, 2006. On September 21, 2006, the CSRC published on its official website a notice specifying the documents and materials that are required to be submitted for obtaining CSRC approval.

It is not clear whether the provisions in the new regulation regarding the offshore listing and trading of the securities of a SPV applies to an offshore company such as us which owns controlling contractual interest in the VIE. We believe that the new M&A regulation and the CSRC approval are not required in the context of the share exchange because (i) the Share Exchange is a purely foreign related transaction governed by foreign laws, not subject to the jurisdiction of PRC laws and regulations; (ii) we are not a special purpose vehicle formed or controlled by PRC companies or PRC individuals, (iii) we are owned or substantively controlled by foreigners. However, we cannot assure that the relevant PRC government agencies, including the CSRC, would reach the same conclusion, and we still cannot rule out the possibility that CSRC may deem that the transactions effected by the Share Exchange circumvented the new M&A rules, the PRC Securities Law and other rules and notices, especially when taking into consideration of the performance-based incentive option arrangement by way of the share transfer between Mr. Cheung and other management.

If the CSRC or another PRC regulatory agency subsequently determines that the CSRC’s approval is required for this Offering, we may face sanctions by the CSRC or another PRC regulatory agency. If this happens, these regulatory agencies may impose fines and penalties on our operations in the PRC, limit our operating privileges in the PRC, delay or restrict the repatriation of the proceeds from this offering into the PRC, restrict or prohibit payment or remittance of dividends to us or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our shares. The CSRC or other PRC regulatory agencies may also take actions requiring us, or making it advisable for us, to delay or cancel this offering before settlement and delivery of the shares being offered by us.

The new M&A rules, along with foreign exchange regulations discussed in the above subsection, will be interpreted or implemented by the relevant government authorities in connection with our future offshore financings or acquisitions, and we cannot predict how they will affect our acquisition strategy. For example, our prospective partner’s ability to remit dividends to us, or to engage in foreign-currency-denominated borrowings, may be conditioned upon compliance with the SAFE registration requirements by such Chinese domestic residents, over whom we may have no control. In addition, such Chinese domestic residents may be unable to complete the necessary approval and registration procedures required by the SAFE regulations. Such uncertainties may restrict our ability to implement our acquisition strategy and adversely affect our business and prospects.

Because Chinese law will govern almost all of our business’ material agreements, we may not be able to enforce our rights within the PRC or elsewhere, which could result in a significant loss of business, business opportunities or capital.

The Chinese legal system is similar to a civil law system based on written statutes. Unlike common law systems, it is a system in which decided legal cases have little precedential value. Although legislation in the PRC over the past 25 years has significantly improved the protection afforded to various forms of foreign investment and contractual arrangements in the PRC, these laws, regulations and legal requirements are relatively new. Due to the limited volume of published judicial decisions, their non-binding nature, the short history since their enactments, the discrete understanding of the judges or government agencies of the same legal provision, inconsistent professional abilities of the judicators, and the inclination to protect local interest in the court rooms, interpretation and enforcement of PRC laws and regulations involve uncertainties, which could limit the legal protection available to us, and foreign investors, including you. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital and could have a material adverse impact on our business, prospects, financial condition, and results of operations. In addition, the PRC legal system is based in part on government policies and internal rules (some of which are not published on a timely basis or at all) that may have a retroactive effect. As a result, we may not be aware of our violation of these policies and rules until some time after the violation. In addition, any litigation in the PRC, regardless of outcome, may be protracted and result in substantial costs and diversion of resources and management attention.

You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing original actions in China based on United States or other foreign laws against us and our management.

We conduct substantially all of our operations in China and substantially all of our assets are located in China. In addition, some of our directors and executive officers reside within China. As a result, it may not be possible to effect service of process within the United States or elsewhere outside China upon some of our directors and senior executive officers, including with respect to matters arising under U.S. federal securities laws or applicable state securities laws. It would also be difficult for investors to bring an original lawsuit against us or our directors or executive officers before a Chinese court based on U.S. federal securities laws or otherwise. Moreover, China does not have treaties with the United States or many other countries providing for the reciprocal recognition and enforcement of judgment of courts.

New PRC enterprise income tax law could adversely affect our business and our net income.

On March 16, 2007, the National People’s Congress of the PRC passed the new Enterprise Income Tax Law (or “EIT Law”), which took effect on of January 1, 2008. The new EIT Law imposes a unified income tax rate of 25.0% on all companies established in China. Under the new EIT Law, an enterprise established outside of the PRC with “de facto management bodies” within the PRC is considered as a resident enterprise and will normally be subject to the enterprise income tax at the rate of 25.0% on its global income. If the PRC tax authorities subsequently determine that we should be classified as a resident enterprise, then our global income will be subject to PRC income tax at a tax rate of 25.0%.

With the introduction of the EIT Law, China has resumed imposition of a withholding tax (10.0% in the absence of a bilateral tax treaty or new domestic regulation reducing such withholding tax rate to a lower rate). Per the Double Tax Avoidance Arrangement between Hong Kong and Mainland China, a Hong Kong company as the investor, which is considered a “non-resident enterprise” under the EIT Law, may enjoy the reduced withholding tax rate of 5% if it holds more than 25% equity interest in its PRC subsidiary. As MoqiZone Hong Kong is the sole shareholder of Shanghai MoqiZone, substantially all of our income will be derive from dividends we receive from Shanghai MoqiZone through MoqiZone Hong Kong. When we declare dividends from the income in the PRC, we cannot assure whether such dividends may be taxed at a reduced withholding tax rate of 5% per the Double Tax Avoidance Arrangement between Hong Kong and Mainland China as the PRC tax authorities may regard our MoqiZone Hong Kong as a shell company only for tax purpose and still deem Shanghai MoqiZone in the PRC as the subsidiary directly owned by the Company. Based on the Notice on Certain Issues with Respect to the Enforcement of Dividend Provisions in Tax Treaties, issued on February 20, 2009 by the State Administration of Taxation, if the relevant PRC tax authorities determine, in their discretion, that a company benefits from such reduced income tax rate due to a structure or arrangement that is primarily tax-driven, such PRC tax authorities may adjust the preferential tax treatment.

Investors should note that the new EIT Law provides only a framework of the enterprise tax provisions, leaving many details on the definitions of numerous terms as well as the interpretation and specific applications of various provisions unclear and unspecified. Any increase in our tax rate in the future could have a material adverse effect on our financial conditions and results of operations.

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

Under the new EIT Law, an enterprise established outside of China with its “de facto management body” in China is considered a “resident enterprise,” meaning that it can be treated the same as a Chinese enterprise for enterprise income tax purposes. The implementing rules of the New EIT Law defines “de facto management body” as an organization that exercises “substantial and overall management and control over the production and operations, personnel, accounting, and properties” of an enterprise. Currently no interpretation or application of the new EIT Law and its implementing rules is available, therefore it is unclear how tax authorities will determine tax residency based on the facts of each case.

If the PRC tax authorities determine that our Hong Kong holding company is a “resident enterprise” for PRC enterprise income tax purposes, a number of unfavorable PRC tax consequences could follow. First, we will be subject to enterprise income tax at a rate of 25% on our worldwide income as well as PRC enterprise income tax reporting obligations. This would mean that income such as interest on offering proceeds and other non-China source income may be subject to PRC enterprise income tax at a rate of 25%. Second, although under the new EIT Law and its implementing rules dividends paid to us by 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, a 10% withholding tax may be imposed on dividends we pay to our non-PRC shareholders.

Under PRC tax law, arrangements and transactions among related parties may be subject to audit or challenge by the PRC tax authorities. We may have related transactions that are not at arm’s length price. If any of the transactions we enter into with potential future PRC subsidiaries and affiliated PRC entities are found not to be on an arm’s-length basis, or to result in an unreasonable reduction in tax under PRC law, the PRC tax authorities have the authority to disallow any tax savings, adjust the profits and losses of such potential future PRC entities and assess late payment interest and penalties. A finding by the PRC tax authorities that we are ineligible for any such tax savings, or that any of our possible future affiliated entities are not eligible for tax exemptions, would substantially increase our possible future taxes and thus reduce our net income and the value of a shareholder’s investment. In particular, we could face material and adverse tax consequences if the PRC tax authorities determine that the contractual arrangements among our PRC subsidiary, the VIE, and the shareholders of the VIE do not represent arm’s-length prices and adjust any of their income in the form of a transfer pricing adjustment. A transfer pricing adjustment could, among other things, result in, for PRC tax purposes, a reduction of expense deductions recorded by our PRC subsidiary or the VIE or an increase in taxable income, all of which could in turn increase our tax liabilities. In addition, the PRC tax authorities may impose late payment fees and other penalties on our PRC subsidiary or the VIE for under-paid taxes.

Our Chinese operating company is obligated to withhold and pay PRC individual income tax in respect of the salaries and other income received by their employees who are subject to PRC individual income tax. If it fails to withhold or pay such individual income tax in accordance with applicable PRC regulations, it may be subject to certain sanctions and other penalties, which could have a material adverse impact on our business.

Under PRC laws, our Chinese operating company will be obligated to withhold and pay individual income tax in respect of the salaries and other income received by its employees who are subject to PRC individual income tax. Our Chinese operating company may be subject to certain sanctions and other liabilities under PRC laws in case of failure to withhold and pay individual income taxes for its employees in accordance with the applicable laws.

In addition, the PRC State Administration of Taxation has issued several circulars concerning employee stock options. Under these circulars, employees working in the PRC (which could include both PRC employees and expatriate employees subject to PRC individual income tax) are required to pay PRC individual income tax in respect of their income derived from exercising or otherwise disposing of their stock options. Our Chinese subsidiary will be obligated to file documents related to employee stock options with relevant tax authorities and withhold and pay individual income taxes for those employees who exercise their stock options. While tax authorities may advise us that our policy is compliant, they may change their policy, and we could be subject to sanctions.

Individual Foreign Debts Registration under the Contractual Arrangement with the VIE.

In accordance with the Measures for the Administration of Individual Foreign Exchange (the “Individual Foreign Debts Measures”), which became effective as of February 1, 2007, where a domestic individual borrows any foreign debt, he/she shall abide by the relevant provisions and go through relevant registration formalities at the State Administration of Foreign Exchange or its local branches (“SAFE”). A fine of 30% of the borrowed amount may be imposed if such amount of foreign debt is not registered with the SAFE. The Implementing Rules of the Individual Foreign Debts Measures, which became effective as of the same day, state that the administration on foreign debts by domestic individuals will be gradually unloosened according to the RMB capital item exchangeable progress, and the detailed rules of such administration will be made separately. The loans between MoqiZone Hong Kong and the individual shareholders of the VIE fall into the definition of the individual’s foreign debts, and shall be registered with the SAFE. However, as far as we know, neither the SAFE nor any of its local branches have accepted or approved such application for registration of individual’s foreign debts. This registration requirement of individual foreign debts is loosely enforced due to the lack of detailed implementing rules as of today. Once the SAFE begins accept application for registration of individual’s foreign debts, we will file the registration application for the three individual shareholders’ foreign debts.

Failure to comply with the United States Foreign Corrupt Practices act could subject us to penalties and other adverse consequences.

If we complete a merger with a US public company we will become subject to the United States Foreign Corrupt Practices Act, which generally prohibits United States companies from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining or retaining business. Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices occur from time-to-time in the PRC. We can make no assurance, however, that our employees or other agents will not engage in such conduct for which we might be held responsible. If our employees or other agents are found to have engaged in such practices, we could suffer severe penalties and other consequences that may have a material adverse effect on our business, financial condition and results of operations.

The Company continues to be a going concern.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has sustained a loss since inception of $1,230,533 and has not earned any revenues from operations since inception. In addition, the Company has a working capital deficiency of $1,169,195 as of December 31, 2008. With the net proceeds of our recent Financing, we believe that we will be able to operate until March 2010 before additional capital is required to continue to execute our current growth plans. Based on our current business development plans, we will need approximately US$4 million of additionally financings to fund our WiMAX deployment to the point where our operations before cash flow positive. Thesefactors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Risks Relating to Our Securities

Insiders have substantial control over us, and they could delay or prevent a change in our corporate control even if our other stockholders wanted it to occur.

Our executive officers, directors, and principal stockholders hold approximately 71.23% of our outstanding common stock. Accordingly, these stockholders are able to control all matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions. This could delay or prevent an outside party from acquiring or merging with us even if our other stockholders wanted it to occur.

There may not be sufficient liquidity in the market for our securities in order for investors to sell their securities.

There is currently only a limited public market for our common stock, which is listed on the Over-the-Counter Bulletin Board, and there can be no assurance that a trading market will develop further or be maintained in the future. During the month of April 2009, our common stock traded an average of approximately 1,980 shares per day. As of May 29, 2009, the closing bid price of our common stock was $0.03 per share. As of May 29, 2009, we had approximately 91 shareholders of record of our common stock, not including shares held in street name. In addition, during the past two years our common stock has had a trading range with a low price of $0.01 per share and a high price of $0.18 per share.

The market price of our common stock may be volatile.

The market price of our common stock has been and will likely continue to be highly volatile, as is the stock market in general, and the market for OTC Bulletin Board quoted stocks in particular. Some of the factors that may materially affect the market price of our common stock are beyond our control, such as changes in financial estimates by industry and securities analysts, conditions or trends in the industry in which we operate or sales of our common stock. These factors may materially adversely affect the market price of our common stock, regardless of our performance. In addition, the public stock markets have experienced extreme price and trading volume volatility. This volatility has significantly affected the market prices of securities of many companies for reasons frequently unrelated to the operating performance of the specific companies. These broad market fluctuations may adversely affect the market price of our common stock.

The outstanding warrants may adversely affect us in the future and cause dilution to existing shareholders.

There will be issued and outstanding a total of 3,330,007 warrants in the Financings. The exercise price of these warrants range from $1.80 to $3.00 per share, subject to adjustment in certain circumstances. Exercise of the warrants may cause dilution in the interests of other shareholders as a result of the additional common stock that would be issued upon exercise. In addition, sales of the shares of our common stock issuable upon exercise of the warrants could have a depressive effect on the price of our stock, particularly if there is not a coinciding increase in demand by purchasers of our common stock. Further, the terms on which we may obtain additional financing during the period any of the warrants remain outstanding may be adversely affected by the existence of these warrants as well.

Our common stock is considered a “penny stock” and may be difficult to sell.

The SEC has adopted regulations which generally define a “penny stock” to be an equity security that has a market price of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to specific exemptions. The market price of our common stock is less than $5.00 per share and, therefore, it is designated as a “penny stock” according to SEC rules. This designation requires any broker or dealer selling these securities to disclose certain information concerning the transaction, obtain a written agreement from the purchaser and determine that the purchaser is reasonably suitable to purchase the securities. These rules may restrict the ability of brokers or dealers to sell our common stock and may affect the ability of investors to sell their shares.

The market for penny stocks has experienced numerous frauds and abuses which could adversely impact investors in our stock.

OTCBB securities are frequent targets of fraud or market manipulation, both because of their generally low prices and because OTCBB reporting requirements are less stringent than those of the stock exchanges or NASDAQ.

Patterns of fraud and abuse include:

Control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer;

Manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases;

“Boiler room" practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons;

(d)

Excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and

(e)

Wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses.

Our management is aware of the abuses that have occurred historically in the penny stock market.

We have not paid dividends in the past and do not expect to pay dividends in the future, and any return on investment may be limited to the value of our stock.

We have never paid any cash dividends on our common stock and do not anticipate paying any cash dividends on our common stock in the foreseeable future and any return on investment may be limited to the value of our stock. We plan to retain any future earnings to finance our business growth.

USE OF PROCEEDS

We will not receive any proceeds upon the conversion of the preferred shares into shares of our common stock, however, we received gross proceeds of approximately $5,245,000 from the sale of the Notes and we could receive net proceeds of approximately $8,125,000 as a result of the exercise of the associated warrants. The net proceeds of approximately $4,437,000 from the sale of the Notes and any proceeds received from the exercise of the Warrants have been and will be used as set forth in the table below.

Deal expenses				$	812,500
Capital Expenditure
	WiMAX equipment, rent, installation, shipping			$	500,000
	Server equipment			$	1,000,000
Military spectrum fee				$	500,000
Working capital
	LAN & IDC rental	$	400,000
	Payroll	$	1,440,000
	Advertising Marketing and Promotion	$	300,000
	Legal, consulting, audit	$	400,000
	Other Admin	$	725,000
Game Publishing and Development				$	1,000,000
3G Mobile Game Platform Development				$	1,000,000
Total spending				$	8,125,000

MARKET FOR OUR COMMON STOCK, DIVIDENDS AND

RELATED STOCKHOLDER INFORMATION

The Common Stock is currently quoted on the over–the-counter (“OTC”) Bulletin Board under the symbol “MOQZ.”. Prior to August 27, 2009, shares of our common stock were quoted on the OTC Bulletin Board under the trading symbol “TLHO”. Prior to October 6, 2003, the Company’s common stock was traded on the OTC Bulletin Board under the symbol “SLDE” and prior to August 9, 2002, the Company’s common stock was traded on the OTC Bulletin Board under the symbol “SUN.”

Accordingly, the following table sets forth the quarterly high and low bid prices for the common stock since the quarter ended December 31, 2007. The pricesbelow have been adjusted for the recent reverse split and represent inter-dealer quotations, without retail markup, markdown or commission and may not be reflective of actual transactions.

	High		Low
Quarter ended June 30, 2008	$	17.82	$	2.55
Quarter ended September 30, 2008	$	7.64	$	2.55
Quarter ended December 31, 2008	$	5.09	$	2.55
Quarter ended March 31, 2009	$	7.64	$	2.55
Quarter ended June 30, 2009	$	12.73	$	2.55
Quarter ended September 30, 2009	$	3.08	$	0.02

At January 19, 2010, the closing price of the Common Stock was $10.00 and we had approximately 83 record holders of our Common Stock. This number excludes any estimate by us of the number of beneficial owners of shares held in street name, the accuracy of which cannot be guaranteed.

Dividend Policy

We have never declared or paid dividends on our Common Stock. We intend to retain earnings, if any, to support the development of our business and therefore do not anticipate paying cash dividends for the foreseeable future. Payment of future dividends, if any, will be at the discretion of our board of directors after taking into account various factors, including current financial condition, operating results and current and anticipated cash needs.

Securities Authorized for Issuance Under Equity Compensation Plans

We did not have any equity compensation plans as of January 19, 2010. Our Board of Directors may adopt an equity compensation plan in the future.

SELECTED CONSOLIDATED FINANCIAL DATA

Consolidated Statement of Operations Data:

	Ended September 30, 2009						Years ended December 31,
	Three Months			Nine Months			2008			2007

	(in thousands)
Revenues	$	-		$	-		$	-		$	-
Cost of revenues		-			-			-			-
Gross profit		-			-			-			-
Depreciation and amortization expenses		3			6			-			-
Selling, general and administrative and research and development expenses		888			1,861			913			317
Other expense		(14,070	)		(14,098	)		-			-
Income taxes		-			-			-			-
Net profit (Loss)		(14,962	)		(15,965	)		(913	)		(317	)
Foreign adjustment		2			(1	)		(6	)		1
Comprehensive income (Loss)		(14,960	)		(15,966	)		(919	)		(316	)

Consolidated Balance Sheet Data:

	As of September 30,			As of December 31,
	2009			2008			2007
	(in thousands)
Balance Sheet Data:
Cash and cash equivalents	$	1,503		$	18		$	43
Accounts receivable		-			-			-
Inventory		-			-			-
Other current assets		729			0			-
Property and equipment, net		514			199			40
Intangibles, net		-			-			-
Loan receivable		-			249
Due from related parties		67			-
Total assets		2,812			466			83
Total Current Liabilities		20,426			1,187			83
Long-term liabilities		-			-			-
Total Liabilities		20,426			1,187			83
Total Stockholders’ Deficiency	$	(17,614	)	$	(721	)	$	-

SUPPLEMENTARY FINANCIAL INFORMATION

The supplementary financial information presented below summarizes certain financial data which has been derived from and should be read in conjunction with our consolidated financial statements and footnotes thereto included in the section beginning on page F-1.

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(in thousands, except per share amount)
2009
Revenue	$	-		$	-		$	-		$	N/A
Gross Profit		-			-			-			N/A
Operating Profit (Loss)		(405	)		(570	)		(891	)		N/A
Net Income (Loss)		(405	)		(598	)		(14962	)		N/A
Net Income (Loss) per share – basic		N/A			N/A			(3.56	)		N/A
Net Income (Loss) per share – diluted		N/A			N/A			(3.56	)		N/A

	Year ending December 31, 2008
2008
Revenue		$	-
Gross Profit			-
Operating Profit (Loss)			(913	)
Net Income (Loss)			(913	)
Net Income per share –basic			N/A
Net Income per share – diluted			N/A

	Year ending December 31, 2007
2007
Revenue		$	-
Gross Profit			-
Operating Profit (Loss)			(317	)
Net Income (Loss)			(317	)
Net Income per share –basic			N/A
Net Income per share – diluted			N/A

MANAGEMENT DISCUSSION AND ANALYSIS

Except for the historical information contained herein, the matters discussed in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this prospectus are forward-looking statements that involve risks and uncertainties. The factors listed in the section captioned “Risk Factors,” as well as any cautionary language in this prospectus, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from those projected. Except as may be required by law, we undertake no obligation to update any forward-looking statement to reflect events after the date of this prospectus.

The following discussion and analysis of financial condition and results of operations relates to the operations and financial condition reported in the financial statements of Moqizone for the fiscal years ended December 31, 2008 and 2007 and for the nine month period ended September 30, 2009 and 2008 and should be read in conjunction with such financial statements and related notes included in this prospectus..

Overview

Through our Shanghai MoqiZone subsidiary, we provide a digital entertainment delivery platform that delivers online content and games to internet cafes in China via our proprietary MoqiZone WiMAX Network. Our primary business focus is to provide content delivery to the viral online gaming market and connect game players to online content providers. Our MoqiZone WiMAX Network is a wireless virtual proprietary network serving designed to provide digital entertainment to the internet cafes. Our market estimation of internet cafés come from various sources including:- (a) according to the unofficial report from the Ministry of Culture of the PRC, there are currently over 150,000 licensed internet cafés in China, with an average of not less than 100 personal computers, or PCs; (b) according to the unofficial report from the China Cyber Police, the total number of licensed and unlicensed internet cafés exceed 300,000; and (c) according to the Nikko Partners’ report on China’s Internet Cafés Study 2008 , there are estimated 185,000 Internet cafés nationwide in China, 71,000 of which are unlicensed with approximately 22 million PC installed throughout China. Our targeted market is licensed internet cafes in cities where the internet cafés business is more developed. Our existing penetration to internet cafes is very low as we are still developing our other ancillary system and peripherals, however, we have already connected a few internet cafes in our testing cities, namely Suzhou and Chengdu and have lined up with local internet café associations in order to accelerate our business penetration when we are technically all ready.

Our business revenue will be collecting cash from game players through issuing prepaid game cards and we provide internet cafes, game providers and ourselves with real time reporting and customer tracking via www.moqizone.com, and share prepaid game card payments among internet cafés, online game providers and marketing promotion companies. Subject to receipt of the maximum proceeds of this offering, our goal is to deploy our digital entertainment delivery platform on the MoqiZone WiMAX Network in various targeted cities initially in China, initially Beijing, Chengdu, Guizhou, Suzhou and Zhengzhou. Amongst all these cities, the number of internet cafes is approximately as follows:-

City		Number of Internet Cafes
Beijing		2000
Chengdu		1000
Guizhou		1000
Suzhou		700
Zhenzhou		1000

On October 31, 2007, the PLA Resource Office, granted to Tai Ji the PLA Authorization for the exclusive use for commercial purposes throughout China of 3.5GHz radio frequencies belonging to the PLA. On September 25, 2009, Tai Ji has agreed to authorize SZ Alar to use the PLA Authorization exclusively in the PRC for Internet café network deployment purposes subject to payment of certain licensing fees,. With the 3.5GHz, we can roll out our MoqiZone WiMAX Network to provide wireless “last mile” service to our internet cafes for consuming our products to be hosted on our B2C gaming platform www.53mq.com. The MoqiZone WiMAX Network enables direct access between the internet cafes and the content providers hosted by us at CERNET and enables a redistribution of profits in China’s online media industry, specifically to the highly fragmented internet cafés industry. The Company is currently the only Chinese WiMAX carrier with permitted national coverage license granted by the PLA, although we are aware of other carriers who may have been granted similar licenses by the Ministry of Industry and Information Technology (“MIIT”). The MoqiZone Network enables direct access between the internet cafes and the content providers and enables a redistribution of profits in China’s online media industry, specifically to the highly fragmented internet cafés industry.

We believe that the PLA Authorization is the only national WiMAX license for the use of 3.5GMHz radio frequencies granted by the PLA using the WiMAX technology. As a result, under our current arrangements, and as long as the PLA Authorization granted to Tai Ji and its authorization to the VIE is retained, we believe that no existing or potential competitor can foreclose our access to any market in China for Internet cafés. Accordingly, we believe that the Company has access to the necessary business and operating licenses to deploy China’s first national WiMAX network for Internet cafés.

Reorganization

Since September 2006, we were previously a non-operating public company that was seeking out suitable candidates for a business combination with a private company. Trestle previously developed and sold digital tissue imaging and telemedicine applications linking dispersed users and data primarily in the healthcare and pharmaceutical markets.

On March 15, 2009, Trestle entered into a Share Exchange Agreement with MoqiZone Cayman, Lawrence Cheung, the principal shareholder of MoqiZone Cayman, and MKM, our former principal stockholder (the “Agreement”). MoqiZone Cayman is the record and beneficial owner of 100% of the share capital of MoqiZone Hong Kong and MoqiZone Hong Kong is the record and beneficial owner of 100% of the share capital of Shanghai MoqiZone. On June 1, 2009, pursuant to the Agreement, and as a result of MoqiZone Hong Kong’s receipt of approximately $4,345,000 in gross proceeds from our private financing, we acquired all of the issued and outstanding capital stock of MoqiZone Cayman in exchange for the issuance to Lawrence Cheung and the other shareholders of MoqiZone Cayman of 10,743 shares of our sought to be created Series B convertible preferred stock. Following the reverse stock split described below, such Series B preferred stock shall automatically (and without any action on the part of the holders) convert (on the basis of 1,000 shares of common stock for each share of Series B Preferred Stock) into an aggregate of 10,743,000 shares of our common stock, representing approximately 95% of our issued and outstanding shares of common stock, on a fully-diluted basis, as at the time of conversion (but prior to the issuance of any other equity or equity type securities). The remaining 5% of the then outstanding shares of the Company’s common stock are publicly traded and are owned by approximately 83 shareholders of record

Following the closing of the share exchange and pursuant to the Share Exchange Agreement, we issued 10,000,000 shares of Trestle preferred stock (including the Series B Preferred Stock), containing such rights, preferences and designations as the board of directors of Moqizone may, from time to time designate and effect a one-for-254.5 reverse stock split (the “Reverse Stock Split”).

As a result of the transactions described above, we became the record and beneficial owner of 100% of the share capital of MoqiZone Cayman and therefore own 100% of the share capital of MoqiZone Hong Kong and Shanghai MoqiZone indirectly.

Liquidity and Capital Resources

As of December 31, 2008, we had negative working capital of approximately US$1.17 million, including cash and cash equivalents. On June 1, 2009, we received net proceeds of approximately US$3,637,000 from the June 1 Financing after the payment of certain financing related commissions and certain non-financing related expenses.

Net cash used in operating activities was approximately US$71,000 for the fiscal year ended December 31, 2008 as compared to approximately US$16,000 for the fiscal year ended December 31, 2007.

Net cash used in investing activities for the fiscal year ended December 31, 2008 totaled approximately US$158,000 and related to the acquisition of property and equipment. Net cash used in investing activities for the fiscal year ended December 31, 2007 totaled approximately US$40,000 and related to the acquisition of property and equipment.

Net cash provided by financing activities for the fiscal year ended December 31, 2008 totaled approximately US$210,000. Net cash provided by financing activities for the fiscal year ended December 31, 2007 was approximately US$98,000. The increase in net cash provided by financing activities in the 2008 period was primarily the result of financings from convertible notes payable, capital contribution offset by the issuance of a note receivable.

On June 1, 2009, we completed a private financing of $4,345,000, with 10 accredited investors (the “June 1 Financing”), which initially included $300,000 that we received in October 2008 pursuant to a Convertible Loan Agreement with two accredited investors (the “Convertible Notes”), however, on August 20, 2009, the holders of the Convertible Notes elected to repaid the principle of the Convertible Notes rather than convert them into the same securities issued to the investors pursuant to the June 1 Financing. The net proceeds from the June 1 Financing were approximately $3,337,000 after fees and expenses of the Offering as well as repayment of the Convertible Notes. Consummation of the June 1 Financing was a condition to the completion of the Share Exchange Agreement. The securities offered in the June 1 Financing was sold pursuant to a Securities Purchase Agreement (the “Purchase Agreement”) by and among the Company, MoqiZone Cayman, Lawrence Cheung, MKM and each of the purchasers thereto (the “Investors”). Pursuant to the Purchase Agreement and subsequent repayment of $300,00 of Convertible Notes, we issued a total of approximately 405 Units of securities consisting of (a) $10,000 of 8% exchangeable convertible notes of MoqiZone Hong Kong due March 31, 2011 (the “Notes”), (b) three year Class A callable warrants (the “Class A Warrants”) to purchase 2,771 shares of common stock of Trestle, at an exercise price of $2.50 per share, and (c) three year Class B non-callable warrants (the “Class B Warrants”) to purchase 2,771 shares of common stock of the Company at an exercise price of $3.00 per share. Both Class A Warrants and Class B Warrants are collectively referred to as “Warrants”. The exercise prices of the Warrants are subject to weighted average and other anti-dilution adjustments. Pursuant to the sale of approximately 405 Units, we issued an aggregate of approximately $4,045,000 of Notes, Class A Warrants to purchase up to 1,123,611 shares of common stock and Class B Warrants to purchase up to 1,123,611 shares of common stock will be issued. The Notes were and will be issued by MoqiZone Hong Kong and the Warrants will be issued by Trestle.

We raised a total of $4,945,000 from 11 accredited investors from the Financings after repayment of the Convertible Notes. As a result of the Financings, we issued a total of approximately 494.5 Units of securities each consisting of (a) the Notes, (b) the Class A Warrants, and (c) the Class B Warrants. Pursuant to the sale of approximately 494.5 Units, we issued an aggregate of approximately $4,945,000 of Notes, Class A Warrants to purchase up to 1,373,614 shares of common stock and Class B Warrants to purchase up to 1,373,614 of common stock will be issued. The net proceeds from the Financings are to be used for working capital and general corporate purposes. . We are obligated to file a registration statement within 150 days of the second closing, providing for the resale of the shares of common stock underlying the securities issued pursuant to the Financings.

Following our one-for-254.5 reverse stock split (the “Reverse Stock Split”), which shall be effective upon the effectiveness of the Information Statement on Schedule 14C that was mailed to our shareholders on or about August 28, 2009, the Notes from the Financings will be automatically cancelled and exchanged for a total of 2,747,223 shares of Series A Preferred Stock, which are convertible into an aggregate of 2,747,223 shares of common stock.

The Company has sustained a loss since inception of $1,230,533 and has not earned any revenues from operations since inception. In addition, the Company has a working capital deficiency of $1,169,195 as of December 31, 2008. We received approximately US$4.3 million of net proceeds from the recent Financings. With these net proceeds, we believe we will be able to operate until March 2010 before additional capital is required to continue to execute our current growth plans. Our historical monthly operation expenses are about RMB1.2 million or US$176,000) per month. Our estimate capital expenditures over the next 12 months is approximately US$2 million for building out the MoqiZone WiMAX Network internet café infrastructure. As such, we believe that our business will require as much as $ 2million of additional financings between March and December 2010, excluding any major additional capital expenditure In additional, based on our current business development plans, we will need a total of approximately US$4 million of to fund our WiMAX deployment to the point where our operations before cash flow positive. In January 2010, we have also entered into the gaming publication business and have signed development and publishing contract. The total development cost will be an additional US1.5 million. In addition, we are planning to enter into the 3G mobile game as a platform provider as well as content provider. We estimate that the cost will be approximately US1.5 million to initiate the project.

Our cash requirements may vary materially from those currently anticipated due to changes in our operations, including our marketing and distribution activities, product development, expansion of our personnel and the timing of our receipt of revenues. Our ability to obtain additional financing in the future will depend in part upon the prevailing capital market conditions, as well as our business performance. There can be no assurance that we will be successful in our efforts to arrange additional financing on terms satisfactory to us or at all. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Critical Accounting Policies and Estimates

Our financial information has been prepared in accordance with generally accepted accounting principles in the United States, which requires us to make judgments, estimates and assumptions that affect (1) the reported amounts of our assets and liabilities, (2) the disclosure of our contingent assets and liabilities at the end of each fiscal period and (3) the reported amounts of revenues and expenses during each fiscal period. We continually evaluate these estimates based on our own historical experience, knowledge and assessment of current business and other conditions, our expectations regarding the future based on available information and reasonable assumptions, which together form our basis for making judgments about matters that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates. Some of our accounting policies require a higher degree of judgment than others in their application.

When reviewing our financial statements, you should consider (1) our selection of critical accounting policies, (2) the judgment and other uncertainties affecting the application of those policies, and (3) the sensitivity of reported results to changes in conditions and assumptions. We believe the following accounting policies involve the most significant judgment and estimates used in the preparation of our financial statements.

Fair Value.

Fair value is generally based on independent sources such as quoted market prices or dealer price quotations. To the extent certain financial instruments trade infrequently or are non-marketable securities, they may not have readily determinable fair values. The Company estimated the fair value of the Warrants and Preferred stock using various pricing models and available information that management deems most relevant. Among the factors considered in determining the fair value of financial instruments are discounted anticipated cash flows, the cost, terms and liquidity of the instrument, the financial condition, operating results and credit ratings of the issuer or underlying company, the quoted market price of similar traded securities, and other factors generally pertinent to the valuation of financial instruments.

Stock Compensation.

We account for stock-based employee compensation arrangements using the fair value method in accordance with the provisions of the FASB issued Statement of Financial Accounting Standards No, 123 (revised 2004) (Share-Based Payment) (“SFAS 123R”). SFAS 123R is a revision of SFAS 123 (Accounting for Stock-Based Compensation), and supersedes Accounting Principles Beard (“APB”) Opinion No. 25 (Accounting for Stock Issued to Employees). SFAS 123R requires that the fair value of employees awards issued, modified, repurchased or cancelled after implementation, under share-based payment arrangements, be measured as of the date the award is issued, modified, repurchased or cancelled. The resulting cost is then recognized in the statement of earnings over the service period.

We periodically issue common stock for acquisitions and services rendered. Common stock issued is valued at the estimated fair market value, as determined by our management and board of directors. Management and the board of directors consider market price quotations, recent stock offering prices and other factors in determining fair market value for purposes of valuing the common stock. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model with the various weighted average assumptions, including dividend yield, expected volatility, average risk-free interest rate and expected lives.

FASB Establishes Accounting Standards Codification ™

In June 2009, the FASB issued Accounting Standards Update No. 2009-01, “Generally Accepted Accounting Principles” (ASC Topic 105) which establishes the FASB Accounting Standards Codification (“the Codification” or “ASC”) as the official single source of authoritative U.S. generally accepted accounting principles (“GAAP”). All existing accounting standards are superseded. All other accounting guidance not included in the Codification will be considered non-authoritative. The Codification also includes all relevant Securities and Exchange Commission (“SEC”) guidance organized using the same topical structure in separate sections within the Codification.

Following the Codification, the Financial Accounting Standards Board will not issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts. Instead, it will issue Accounting Standards Updates (“ASU”) which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.

The Codification is not intended to change GAAP, but it will change the way GAAP is organized and presented. The Codification is effective for our third-quarter 2009 financial statements and the principal impact on our financial statements is limited to disclosures as all future references to authoritative accounting literature will be referenced in accordance with the Codification. In order to ease the transition to the Codification, we are providing the Codification cross-reference alongside the references to the standards issued and adopted prior to the adoption of the Codification.

Basis of Presentation - Development Stage Company

The Company has been obtaining the requisite approvals from the Chinese government and since inception, has not earned any revenue from operations. Accordingly, the Company’s activities have been accounted for as those of a “Development Stage Enterprise”, as set forth in Financial Accounting Standards Board Statement No. 7 (SFAS 7"). Among the disclosures required by SFAS 7 are that the Company’s financial statements be identified as those of a development stage company, and that the statements of operations and other comprehensive income (loss), owner’s equity and cash flows disclose activity since the date of the Company’s inception.

Use of estimates in the preparation of financial statements

The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of expenses during the reporting period. On an ongoing basis, we evaluate our estimates which are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities and the reported amount of expenses that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions. The following accounting policies require significant management judgments and estimates:

Impairment of long-lived assets. We assess the potential impairment of long-lived assets and identifiable intangibles under the guidance of SFAS 144, "Accounting for the Impairment or Disposal of Long-Lived Assets." which states that a long-lived asset should be tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset exceeds its fair value. An impairment loss is recognized only if the carrying amount of the long-lived asset exceeds its fair value and is not recoverable.

Deferred income taxes. The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards No. 109 ( A SFAS 109") which requires that deferred tax assets and liabilities be recognized for future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, SFAS 109 requires recognition of future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance be provided when it is more likely than not that some portion of the deferred tax asset will not be realized.

Foreign currency translation. Our reporting currency is the US dollar. Our functional currency is United States dollars (“US$”), and the functional currency of our Hong Kong subsidiary is Hong Kong dollars (“HK$”). The functional currency of our PRC operating entities is the Renminbi (“RMB’), and PRC is the primary economic environment in which our businesses operate. Assets and liabilities are translated into U.S. Dollars at the year end exchange rates and records the related translation adjustments as a component of other comprehensive income (loss). Revenue and expenses are translated using average exchange rates prevailing during the period. Foreign currency transaction gains and losses are included in current operations.

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from these estimates.

Income Taxes

Under the current laws of the Cayman Islands, we are not subject to tax on income or capital gains. In addition, payment of dividends by us is not subject to withholding tax in the Cayman Islands.

Under the current Hong Kong Inland Revenue Ordinance, MoqiZone Hong Kong is subject to 16.5% income tax on its taxable income generated from operations in Hong Kong. Additionally, payments of dividends by MoqiZone Hong Kong to us are not subject to any Hong Kong withholding tax.

The new Enterprise Income Tax Law (or EIT Law) imposes a unified income tax rate of 25.0% on all companies established in China. Shanghai MoqiZone and the VIE are subject to 25% PRC income tax. Under the new EIT Law, an enterprise established outside of the PRC with “de facto management bodies” within the PRC is considered as a resident enterprise and will normally be subject to the enterprise income tax at the rate of 25.0% on its global income. The new EIT Law, however, does not define the term “de facto management bodies.” If the PRC tax authorities subsequently determine that we should be classified as a resident enterprise, then our global income will be subject to PRC income tax at a tax rate of 25.0%.

With the introduction of the EIT Law, China has resumed imposition of a withholding tax (10.0% in the absence of a bilateral tax treaty or new domestic regulation reducing such withholding tax rate to a lower rate). As MoqiZone Hong Kong is the sole shareholder of Shanghai MoqiZone, the dividends from Shanghai MoqiZone may be taxed at a reduced withholding tax rate of 5% per the Double Tax Avoidance Arrangement between Hong Kong and Mainland China.

Our PRC companies are subject to PRC business tax. We primarily pay business tax on gross revenues generated from online game operations, rentals, service fees and license fees. Our PRC operating companies pay business tax on their gross revenues derived from online game operations at a rate ranging from 3% to 5%, and this business tax is deducted from total revenues. In addition, our PRC subsidiaries pay a 5% business tax on the gross revenues derived from their contractual arrangements with our PRC operating companies, and these taxes are primarily recorded in operating expenses in accordance with our accounting policy.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Results of Operations

The following table shows the results of our business. All references to the results of operations and financial condition are those of Moqizone Holdings Corporation, formerly “Trestle Holdings, Inc.”.

Comparison of Fiscal Year Ended December 31, 2008 and 2007

Year Ended December 31	2008			2007
Revenues	US$	0		US$	0

Cost of revenues	US$	0		US$	0

Gross profit	US$	0		US$	0

Selling, general and administrative expenses	US$	913,157		US$	317,068

Other income (expense)	US$	(325	)	US$	17

Income taxes	US$	0		US$	0

Net profit (Loss)	US$	(913,482	)	US$	(317,051	)

Foreign currency translation adjustment	US$	(5,577	)	US$	889

Comprehensive income (Loss)	US$	(991,059	)	US$	(316,162	)

Revenues. Total revenues for the year ended December 31, 2008 were $0. This is unchanged from total revenue of $0 for the period from inception (August 29, 2007) to December 31, 2007.

Selling, general and administrative expenses. Operating expenses were approximately US$913,000 for the year ended December 31, 2008 as compared to approximately US$317,000 for the period from inception (August 29, 2007) to December 31, 2007, an increase of approximately US$596,000 or 188%. Since the Company was only established in September 2007, the increase was mainly due to the company operating for entire 12 months of 2008 as opposed to 4 months in the previous year. The Company also recruited additional staffing and accrued salaries for certain senior management and our founders. Management expects that operating expenses will continue to rise as we work to expand our operations.

Other expense. Interest income was approximately US$240 for the year ended December 31, 2008, and US$17 for the period from inception (August 29, 2007) to December 31, 2007. Loss on foreign currency transactions was roughly US$565 for the year ended December 31, 2008, as compared to nil for the period from inception (August 29, 2007) to December 31, 2007.

Net loss. Net loss was approximately US$913,000 for the year ended December 31, 2008, as compared to net loss of approximately US$317,000 for the period from inception (August 29, 2007) to December 31, 2007, an increase of US$596,000. The increase in the net loss was mainly due to the fact that since the Company was only established in September 2007, the increase was mainly due to operations for the entire 12 month period in 2008 as opposed to 4 months in 2007.

Foreign Currency Translation Adjustment. Our reporting currency is the US dollar. Our local currency, Renminbi (RMB), is our functional currency. Results of operations and cash flow are translated at average exchange rates during the period, and assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income in the statement of shareholders’ equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

Currency translation adjustments resulting from this process are included in accumulated other comprehensive income in the consolidated statement of shareholders' equity and amounted to a loss of US$5,577 and a gain of $889 as of December 31, 2008, and 2007 respectively.

Comprehensive Loss. As a result of the above, the comprehensive loss, which adds the currency adjustment to Net Income, were roughly US$919,000 for the year ended December 31, 2008, as compared to the comprehensive loss of approximately US$316,000 for the period from inception (August 29, 2007) to December 31, 2007, an increase of US$603,000.

For the three months ended September 30, 2009

Three months ended September 30,	2009
Revenues	$	-
Cost of revenues	$	-
Gross profit	$	-
Depreciation and amortization expense	$	3,476
Selling, general and administrative expenses	$	888,446
Other income (expense)	$	(14,069,811	)
Income taxes	$	-
Net profit (Loss)	$	(14,961,733	)
Foreign adjustment	$	1,843
Comprehensive income (Loss)	$	(14,959,930	)

Revenues. Total revenues for the three months ended September 30, 2009 were $0. The Company is only in the initial stages of launching its business plan of providing “last mile” connectivity to internet cafés through our own proprietary MoqiZone WiMAX Network. During the reporting period, the Company is aggregating content and building out our infrastructure. Management believes that as it begins providing a digital entertainment delivery platform that delivers online content and games to internet cafes in China via our Network that revenue will be generated in the near term. Furthermore, management believes that over the next two years as we work towards growing and expanding our business penetration in Internet cafes throughout targeted cities in China that we will experience significant revenue growth. However, until the product is developed you will not be able to commence marketing or receive material revenues.

Selling, general and administrative expenses. The Selling, General and Administrative expenses were approximately $888,486 for the three months ending September 30, 2009. These costs were mainly attributable to the increase of staffing as well as legal expenses, due diligence expenses and other professional expenses in relation to the Financing. By September 30, 2009, we have had approximately 15 technical related staff in charge of system design, base station build out, network deployment, game portal development, and data centre management, as well as research and development. We also have a team of approximately 5 people focusing on online games and other contents aggregation and 10 people on sales and marketing; senior management now constitutes approximately 10 people. We have also established a branch office in Chengdu and our Shanghai office to supervise our operations in Suzhou. Legal expenses were increasesd as we engaged our Chinese lawyers as well as our US lawyers to perform such company reorganization and due diligence processes for the Offering. Management expects that general and administrative expenses in salaries may continue to increase as we continue to expand our operations. However, we believe that any increase will begin to be offset by our expected revenue growth.

Other expense. Interest income was approximately $119 for the three months ended September 30, 2009 and interest expense was approximately $100,524. Additionally, losses related to of the amortization of certain placement fee associated with our convertible note financing resulted in losses of roughly $476,621 for the three months ended September 30, 2009. Non cash items include a charge of $4,521,000 upon conversion of convertible note and recognition of warrants, and a change in fair value of warrants of $8,951,000.Loss on foreign currency transactions was roughly $20,736 for the three months ended September 30, 2009. As a result, other expenses for the three months ended September 30, 2009 were approximately $14,069,855.

Net loss. Net loss was $14,961,773 for the three months ended September 30, 2009. This net loss was substantially due to the non cash items described in “Other expense” above. The net loss was also mainly due to the increase of staffing as well as legal expenses, due diligence expenses and other professional expenses in relation to the Financing and in the change in the fair value of the warrants. In the near term, Management believes that our net loss may actually increase until we begin to gain traction and start producing revenue from the delivery of digital entertainment via our Network.

Foreign Currency Translation Adjustment. Our reporting currency is the US dollar. The functional currency of our PRC operating entities including Shanghai Moqizone and SZ Mellow is RMB. Results of operations and cash flow are translated at average exchange rates during the period, and assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income in the statement of shareholders’ equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

Comprehensive Loss. As a result of the above, the comprehensive loss, which adds the currency adjustment to Net Income, was roughly $14,959,974 for the three months ended September 30, 2009.

For the Nine Months Ended September 30, 2009

Nine months ended September 30,	2009
Revenues	$	-
Cost of revenues	$	-
Gross profit	$	-
Depreciation and amortization expense	$	5,554
Selling, general and administrative expenses	$	1,861,341
Other income (expense)	$	(14, 097,917)
Income taxes	$	-
Net profit (Loss)	$	(15,964,768	)
Foreign adjustment	$	(976	)
Comprehensive income (Loss)	$	(15,965,744	)

Revenues. Total revenues for the nine months ended September 30 2009 were $0. The Company is only in the initial stages of launching its business plan of providing “last mile” connectivity to internet cafés through our own proprietary MoqiZone WiMax Network. Management believes that as it begins providing a digital entertainment delivery platform that delivers online content and games to internet cafes in China via our Network that revenue will be generated in the near term. Furthermore, management believes that over the next two years as we work towards growing and expanding our business penetration in Internet cafes throughout targeted cities in China that we will experience significant revenue growth.

Selling, General and Administrative Expenses. The Selling, General and Administrative expenses were approximately $1,861,341 for the nine months ending September 30, 2009. These costs were mainly attributable to the consolidation of company operation in January 2009 and our increase of staffing as well as legal expenses, due diligence expenses and other professional expenses in relation to the Financing. Since April, 2009, we have gradually increased the number of staffing in various department including, without limitation, sales and marketing, software programming, as well as network deployment for site visits. We have had approximately 15 technical related staff in charge of base station build out, network deployment, game portal development, and data centre management, as well as research and development. We also have a team of approximately 5 people focusing on online games and other contents aggregation and 10 people on sales and marketing; Senior management now constitutes approximately 10 people. We have also established a branch office in Chengdu and our Shanghai office to supervise our operations in Suzhou. Management expects that general and administrative expenses may continue to increase as we continue to expand our operations. However, we believe that any increase will begin to be offset by our expected revenue growth.

Other expense. Interest income was approximately $331 for the nine months ended September 30, 2009 and interest expense was approximately $130,867. Additionally, losses related to of the amortization of certain placement fee associated with our convertible note financing resulted in losses of roughly $495,007 for the nine months ended September 30, 2009. Loss on foreign currency transactions was roughly $281 for the nine months ended September 30, 2009. Non cash items include a charge of $4,521,000 upon conversion of convertible notes and recognition of warrants, and a change in fair value of warrants of $8,951,000.There is also a charge of $4,521,000 upon conversion of convertible notes and recognition of warrants, and a change in fair value of warrants of $8,951,000. As a result, other expenses for the nine months ended September 30, 2009 were approximately $14,097,917.

Net loss. Net loss was $15,964,768 for the nine months ended September 30, 2009. This net loss was substantially due to the non cash items described in “Other expense” above. The net loss was also mainly attributable to the consolidation of company operation in January 2009 and to the increase of staffing as well as legal expenses, due diligence expenses, other professional expenses in relation to the Financing and in the change in the fair value of the warrants.In the near term, Management believes that our net loss may actually increase until we begin to gain traction and start producing revenue from the delivery of digital entertainment via our Network.

Currency translation adjustments resulting from this process are included in accumulated other comprehensive income in the consolidated statement of shareholders' equity and amounted to a loss of roughly $976 for the nine months ended September 30, 2009.

Comprehensive Loss. As a result of the above, the comprehensive loss, which adds the currency adjustment to Net Income, was roughly $15,965,788 for the nine months ended September 30, 2009.

Currency fluctuations and restrictions on currency exchange may adversely affect our business, including limiting our ability to convert Chinese Renminbi into foreign currencies and, if Chinese Renminbi were to decline in value, reducing our revenue in U.S. dollar terms.

Our reporting currency is the U.S. dollar and our operations in China use their local currency as their functional currencies. Substantially all of our revenue and expenses are in Chinese Renminbi. We are subject to the effects of exchange rate fluctuations with respect to any of these currencies. For example, the value of the Renminbi depends to a large extent on Chinese government policies and China’s domestic and international economic and political developments, as well as supply and demand in the local market. Since 1994, the official exchange rate for the conversion of Renminbi to the U.S. dollar had generally been stable and the Renminbi had appreciated slightly against the U.S. dollar. However, on July 21, 2005, the Chinese government changed its policy of pegging the value of Chinese Renminbi to the U.S. dollar. Under the new policy, Chinese Renminbi may fluctuate within a narrow and managed band against a basket of certain foreign currencies. As a result of this policy change, Chinese Renminbi appreciated approximately 2.5% against the U.S. dollar in 2005, 3.3% in 2006, and 6.5% in 2007. It is possible that the Chinese government could adopt a more flexible currency policy, which could result in more significant fluctuation of Chinese Renminbi against the U.S. dollar. We can offer no assurance that Chinese Renminbi will be stable against the U.S. dollar or any other foreign currency.

The income statements of our operations are translated into U.S. dollars at the average exchange rates in each applicable period. To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currencies denominated transactions results in reduced revenue, operating expenses and net income for our international operations. Similarly, to the extent the U.S. dollar weakens against foreign currencies, the translation of these foreign currency denominated transactions results in increased revenue, operating expenses and net income for our international operations. We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign subsidiaries into U.S. dollars in consolidation. If there is a change in foreign currency exchange rates, the conversion of the foreign subsidiaries’ financial statements into U.S. dollars will lead to a translation gain or loss which is recorded as a component of other comprehensive income. In addition, we have certain assets and liabilities that are denominated in currencies other than the relevant entity’s functional currency. Changes in the functional currency value of these assets and liabilities create fluctuations that will lead to a transaction gain or loss. We have not entered into agreements or purchased instruments to hedge our exchange rate risks, although we may do so in the future. The availability and effectiveness of any hedging transaction may be limited and we may not be able to successfully hedge our exchange rate risks.

Although Chinese governmental policies were introduced in 1996 to allow the convertibility of Chinese Renminbi into foreign currency for current account items, conversion of Chinese Renminbi into foreign exchange for capital items, such as foreign direct investment, loans or securities, requires the approval of the State Administration of Foreign Exchange, or SAFE, which is under the authority of the People’s Bank of China. These approvals, however, do not guarantee the availability of foreign currency conversion. We cannot be sure that we will be able to obtain all required conversion approvals for our operations or that Chinese regulatory authorities will not impose greater restrictions on the convertibility of Chinese Renminbi in the future. Because a significant amount of our future revenue may be in the form of Chinese Renminbi, our inability to obtain the requisite approvals or any future restrictions on currency exchanges could limit our ability to utilize revenue generated in Chinese Renminbi to fund our business activities outside of China, or to repay foreign currency obligations, including our debt obligations, which would have a material adverse effect on our financial condition and results of operations

Changes in foreign exchange regulations in the PRC may affect our ability to pay dividends in foreign currency or conduct other foreign exchange business.

The Renminbi is not a freely convertible currency currently, and the restrictions on currency exchanges may limit our ability to use revenues generated in RMB to fund our business activities outside the PRC or to make dividends or other payments in United States dollars. The PRC government strictly regulates conversion of RMB into foreign currencies. Over the years, foreign exchange regulations in the PRC have significantly reduced the government’s control over routine foreign exchange transactions under current accounts. In the PRC, the State Administration for Foreign Exchange, or the SAFE, regulates the conversion of the RMB into foreign currencies. Pursuant to applicable PRC laws and regulations, foreign invested enterprises incorporated in the PRC are required to apply for “Foreign Exchange Registration Certificates.” Currently, conversion within the scope of the “current account” (e.g. remittance of foreign currencies for payment of dividends, etc.) can be effected without requiring the approval of SAFE. However, conversion of currency in the “capital account” (e.g. for capital items such as direct investments, loans, securities, etc.) still requires the approval of SAFE.

In addition, on October 21, 2005, SAFE issued the Notice on Issues Relating to the Administration of Foreign Exchange in Fundraising and Reverse Investment Activities of Domestic Residents Conducted via Offshore Special Purpose Companies (“Notice 75”), which became effective as of November 1, 2005. Notice 75 replaced the two rules issued by SAFE in January and April 2005.

According to Notice 75:

prior to establishing or assuming control of an offshore company for the purpose of obtaining overseas equity financing with assets or equity interests in an onshore enterprise in the PRC, each PRC resident, whether a natural or legal person, must complete the overseas investment foreign exchange registration procedures with the relevant local SAFE branch;

an amendment to the registration with the local SAFE branch is required to be filed by any PRC resident that directly or indirectly holds interests in that offshore company upon either (1) the injection of equity interests or assets of an onshore enterprise to the offshore company, or (2) the completion of any overseas fund raising by such offshore company; and

an amendment to the registration with the local SAFE branch is also required to be filed by such PRC resident when there is any material change in the capital of the offshore company that does not involve any return investment, such as (1) an increase or decrease in its capital, (2) a transfer or swap of shares, (3) a merger or division, (4) a long term equity or debt investment, or (5) the creation of any security interests.

Moreover, Notice 75 applies retroactively. As a result, PRC residents who have established or acquired control of offshore companies that have made onshore investments in the PRC in the past are required to complete the relevant overseas investment foreign exchange registration procedures by March 31, 2006. Under the relevant rules, failure to comply with the registration procedures set forth in Notice 75 may result in restrictions being imposed on the foreign exchange activities of the relevant onshore company, including the payment of dividends and other distributions to its offshore parent or affiliate and the capital inflow from the offshore entity, and may also subject relevant PRC residents to penalties under PRC foreign exchange administration regulations.

In addition, SAFE issued updated internal implementing rules (“Implementing Rules”) in relation to Notice 75. The Implementing Rules were promulgated and became effective on May 29, 2007. Such Implementing Rules provide more detailed provisions and requirements regarding the overseas investment foreign exchange registration procedures. However, even after the promulgation of Implementing Rules there still exist uncertainties regarding the SAFE registration for PRC residents’ interests in overseas companies.

As a result, we cannot predict how they will affect our business operations following a business combination. For example, our ability to conduct foreign exchange activities following a business combination, such as remittance of dividends and foreign-currency-denominated borrowings, may be subject to compliance with the SAFE registration requirements by such PRC residents, over whom we have no control. In addition, we cannot assure you that such PRC residents will be able to complete the necessary approval and registration procedures required by the SAFE regulations. We will require all our shareholders, following a business combination, who are PRC residents to comply with any SAFE registration requirements, if required by Notice 75, Implementing Rules or other applicable PRC laws and regulations, although we have no control over either our shareholders or the outcome of such registration procedures. Such uncertainties may restrict our ability to implement our business combination strategy and adversely affect our business and prospects following a business combination.

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

In recent years, the Chinese economy has experienced periods of rapid expansion and high 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 Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. While inflation has been more moderate since 1995, high inflation may in the future cause 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.

BUSINESS

Business Overview

Our business revenue will be collecting cash from game players through issuing prepaid game cards and we provide cafes, game providers and ourselves with real time with real time reporting and customer tracking via www.moqizone.com, and shareprepaid game card payments among internet cafés, online game providers and marketing promotion companies. Subject to receipt of the maximum proceeds of this offering, our goal is to deploy our digital entertainment delivery platform on the MoqiZone WiMAX Network in various targeted cities in China, commencing initially from Suzhou, Chengdu, Zhengzhou, Beijing, and Guizhou.

3.5GMHz Spectrum License

On October 31, 2007, the Communications Resource Management Office of the General Staff Department of Communication of the PLA, renewed its exclusive grant to Tai Ji the PLA Authorization for the usage right of the 3.5GHz radio frequencies throughout China. On September 25, 2009, Tai Ji agreed to authorize SZ Alar to use the PLA Authorization exclusively in the PRC for Internet café network deployment purposes subject to payment of certain licensing fees,. With the 3.5GHz, we can roll out our MoqiZone WiMAX Network to provide wireless “last mile” service to our internet cafes for consuming our products to be hosted on our B2C gaming platform www.53mq.com. The MoqiZone WiMAX Network enables direct access between the internet cafes and the content providers hosted by us at CERNET and enables a redistribution of profits in China’s online media industry, specifically to the highly fragmented internet cafés industry.

As a result of the exclusivity granted by the PLA to Tai Ji and as a result of Tai Ji granting us the exclusive usage of the 3.5GMHz radio frequency for Internet café business, we believe that the Company is the only Chinese WiMAX carrier with permitted national coverage license granted indirectly by the PLA to deploy a network similar to the MoqiZone WiMAX Network. Such exclusivity, however, does not extend to other potential competitors who may obtain WiMAX radio spectrum via the MIIT as we are aware of other carriers who may have been granted similar licenses by the MIIT. Nevertheless, we believe that the PLA Authorization is the only national WiMAX license for the use of 3.5GMHz radio frequencies granted by the PLA using the WiMAX technology.

We are not aware, however, that any of our potential competitors has any plans to utilize a WiMAX platform to specifically target the Internet Café business, as is our current plan. As a result, under our current arrangements, and as long as the PLA Authorization granted to Tai Ji and its authorization to SZ Alar is retained, we believe that no existing or potential competitor can foreclose our access to any market in China for Internet cafés. Accordingly, we believe that the Company has access to the necessary business and operating licenses to deploy China’s first national WiMAX network for Internet cafés.

Tai Ji is one of our key cooperative partners that licenses the 3.5GHz radio frequency resources to the Company and its affiliates in China. The advantages and disadvantages of using the 3.5GHz frequency resources from Tai Ji (via PLA Approval) versus MIIT can be summarized as below:-

Tai Ji via PLA Approval		MIIT
Advantages		Advantages
Minimal upfront licence fees		Investors may be easier to understand and verify
National coverage		Mainly restricted to existing more established TELCO operators
No tendering process		General public may be easier to access the approval information
Company registered capital can be much smaller
Longer renewal period.

Disadvantages		Disadvantages
Only semi-commercial		Require larger capital investment
Separate notification to each individual military zones (in total ther are 7)		Require tendering process and each province or city will be tendered out separately
Each base station will require separate annual license fee		Require local application/notification notwithstanding having a provincial license
Investor may not understand the background and validity as it is a military licence		Require larger amount of upfront license fees
		Shorter renewal periods (2-5 years)

The VIE

In July 2007, MoqiZone Hong Kong signed a Memorandum of Cooperation with Tai Ji and SZ Mellow which also included a draft of Cooperation Agreement to be entered into among Tai Ji, a WOFE to be established by MoqiZone and SZ Mellow. According to this Memorandum of Cooperation, the major terms are:

Tai Ji agreed that the MoqiZone Hong Kong can authorize its cooperative partners or subsidiaries in China ("MoqiZone's Representatives") to use the 3.5GMHz radio frequency resources;

Tai Ji will collect an annual license fees of RMB 2,500,000 for Year 2008, RMB 3,000,000 for Year 2009 and thereafter, each year annual license fee shall be increased by RMB 500,000 per year based on the previous year annual license fee to a maximum of RMB 7,000,000 per year until the license expires; and

Tai Ji will further collect a usage fee of RMB 20,000 per year per radio base station.

On January 25, 2009 Shanghai MoqiZone was incorporated, and on January 26, 2009, Shanghai MoqiZone, Tai Ji and SZ Mellow executed the formal Cooperation Agreement, under which Tai Ji will provide SZ Mellow and Shanghai MoqiZone the exclusive use of the 3.5GHz on Internet Cafes gaming business.

As a result of disputes with the shareholders of Shenzhen Mellow (see below “Legal Proceeding” for further information), on September 21, 2009, in accordance with the terms of the SZ Mellow Agreements, we sent out a 30 days' prior written notice to SZ Mellow stating our intention of terminating the SZ Mellow Agreements. In order to continue our business and operations as planned, on September 25, 2009, Shanghai MoqiZone, Tai Ji and SZ Alar executed another Cooperation Agreement, under which Tai Ji will provide SZ Alar and Shanghai MoqiZone the exclusive use of the 3.5GHz on Internet cafes gaming business. Certain of our principal shareholders and executive officers are also affiliated with Tai Ji and the SZ Alar.

We believe that the MoqiZone WiMAX Network provides a cheaper data transmission alternative than those provided by incumbent telecoms and internet data centers. The MoqiZone Network provides direct access between the Internet cafés and the content providers and enables a redistribution of profits in China’s online media industry, specifically to the highly fragmented Internet cafés industry.

According to a report published by the CNNIC, the number of Internet users in China reached 210 million as at December 31, 2007, or which an estimated 120 million are unique online game players. On January 13, 2009, CNNIC released the “23rd Statistical Survey Report on the Internet Development in China” in Beijing. According to the report, by the end of 2008, the Internet penetration rate of 22.6% in China had surpassed the global average level of 21.9% for the first time. Meanwhile, the amount of Internet users in China had reached 298 million, with 279 million broadband users. The report further states that the industry is expected to have a compounded annual growth rate of 28.16% and grow from $2.85 billion to approximately $6.0 billion by 2011. The top 25 Chinese games sold of $1.4 billion in prepaid cards in 2007.

We believe that our competitive advantages include:

WiMAX First Mover Advantage. Through the PLA Authorization, we are able to invest in WiMAX base station and CPE and install them more cost-effectively on roof tops of buildings in a way similar to GSM radio stations. WiMAX is in particularly cost effective for the “last mile” wireless internet connection.

Reallocation of Online Gaming Value Chain. The MoqiZone WiMAX Network increases the net economic benefit to the content providers and the Internet cafés and eliminates the prepaid card distributors.

Other Benefits to Internet Cafés. The MoqiZone WiMAX Network also benefits the Internet Café’s by eliminating certain duplicative resources and costs and providing incentives.

iv.

Benefits to Content Providers. The MoqiZone WiMAX Network benefits the Content Provider by eliminating server storage and bandwidth hosting fees, and also protects their IP from piracy and hackers, via a closed network.

Benefits to Game Publishers. With our Moqizone business model, game companies can have one stop shopping with Moqizone and can assess all the Internet cafés at one location.

vi.

Benefits of MoqiZone Prepaid Card. Our platform uses a proprietary prepaid game card that is game publisher agnostic (i.e. accessible for all games), thereby reducing game card inventory costs for Internet café’s, as well as reducing black marketed discounted prepaid cards and content theft for the Content Provider.

vii.

Realtime Reporting. Our solution shares valuable point of sale (POS) data throughout the network to allow for real-time reporting, customer and payment tracking, and targeted marketing; a service that was previously unavailable to game content providers and publishers and Internet cafés

viii.

Access to Extensive Game Content. In addition to its current arrangements, we expect to execute content agreements with the major online gaming companies that represent more than 10 million unique concurrent users.

ix.

Significant Management Experience. Our management team has long term business relationship and experience in dealing with the gaming companies and also leading players in the entertainment industry, including movies producers, music publisher as well as distributors and we believe that we will be able to obtain the best online digital content in Asia.

Key Corporate Objectives

Our key business development objectives over the next two years are to grow and expand our business penetration in Internet cafes throughout thirteen targeted cities in China.

We will initially determine our targeted cities or provinces based on whether the targeted city or province has a backbone connection to CERNET. CERNET is the first nationwide education and research computer network in China. The CERNET project is funded by the Chinese government and directly managed by the Chinese Ministry of Education. Our base stations will be connecting to CERNET as we will be hosting our games servers within the CERNET’s IDC. The current number of internet cafes in the targeted thirteen cities is as follows:-

Beijing	1500
Nanjing	2000
Chengdu	3300
Suzhou	2000
Xiameng	1200
Hangzhou	1300
Chongqing	800
Yangzhou	1000
Zhenijang	850
Ningbo	1160
Kunming	450
Jinan	260
Qingdao	500
	600

Before we can achieve our business objectives, we will need to:-

build out our MoqiZone WiMAX Network, which involve the construction of a WiMAX base station covering our targeted internet cafes at each city;

install CPE at each internet café;