THIS NOVATION AGREEMENT is made as of 26/th/ September 2003

BETWEEN

(1) WANG XIU LING, holder of the passport of People's Republic of China numbered PCHN 143637106 and whose correspondence address is at Room 3-101, Floor 7, Wushengdongli, Chaoyang District, Beijing ("WXL");

(2) SHENG YONG, holder of People's Republic of China Identity Card numbered 110108197508120016 and whose correspondence address is at Room 6, Unit 1, Jiwei Dormitory, 9 Huangchenggen Nanjie Street, Xicheng District, Beijing ("SY"); and

(3) SHENZHEN FREENET INFORMATION TECHNOLOGY COMPANY LIMITED, a company incorporated with limited liability under the laws of the PRC and its registered address is at Room 616, Block 1, Pengyi Garden Bagua Road 2, Futian District, Shenzhen, PRC

 (each a "Party" and collectively "Parties").

WHEREAS

(A) Pursuant to a Loan Agreement dated 25/th/ November 2002 and made between, inter alia, WXL and Shenzhen Freenet ("Original Agreement"), WXL has granted a loan of a principal amount of RMB136,032,781 to Shenzhen Freenet subject to the terms and conditions therein.

(B) The Parties have agreed to enter into this Agreement for the purpose of assigning and transferring part of the interests and rights in respect of WXL (in particular, all rights in respect of a sum of RMB30,309,834 forming part of the principal loan of RMB136,032,781 granted by WXL to Shenzhen Freenet) under the Original Agreement to SY, subject to the terms and conditions set out in this Agreement.

NOW THEREFORE, IT IS AGREED as follows:

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