1. Business scope of WFOE and subsidiary

1) WFOE business scope

Research and development of electronic communications equipments and software products; Technology transfer, technology services, technology consulting, technology training; Sales of own software products, wholesale of electronic communications equipments

2) Subsidiary business scope

Research, development and production of software products; provision of technology transfer, technology services and technology consulting; Sales of HQ's products

3) Contents of the sales and support contract

- Initial technology solutions: The system engineers are responsible for collecting potential customers’ technical network requirements, including the issue of specific network solutions.  After the installation of the network system, ensure the effectiveness of the network solutions and the consistency of the technology solutions with the technology support services.

- Products technology service:  own network products technology gaps or lack of technology repair services, Technology optimization services, IT services

2. WFOE main business and preferential tax policies:

Business	VAT	CIT	Financial Subsidy
Technology development	Technology development VAT exemption	25%	—
Market related technology support	Offshore outsourcing (BPO) VAT exemption

3. 2014-2015 Chinese tax and financial preferential opportunities: 

Opportunities	Objectives	Timing
VAT exemption	Ensure no risk on the overseas VAT exempted revenue and application of the 2014 ATSE	1. Complete the draft of the  sales support technology contract  before 31 January 2015
		2. Update the registration of the contract filing before 10 February 2015
		3. Registration of the development contract at the Commission of Commerce (COC) before 20 January 2015
2014 Advanced technology service outsourcing enterprise (ATSE)	15% CIT rate	1. Issue the audit report before 31 January 2015
		2. Prepare all the relevant application documents
		3. Apply ATSE approval on February 2015
2015 Financial Subsidy	Get 0.1 RMB on every 1 USD	—