Chapter 7 Regulations of Default Settlement

Any legal person, natural person or other organization applying for participating in Canton air shall accept the Exhibitors' Guide and be bound by it. Exhibitors participating in Canton Fair through entering into the Participation Agreement with Canton Fair shall accept the Exhibitors' Guide and be bound by it. Violation of any regulation, regulations or stipulation of the Exhibitors' Guide shall be regarded as a breach. The default party shall accept related breaching punishment in accordance with stipulations herein defined.

1. In Violation of Regulations for Use of stand

Canton Fair shall deal with those exhibitors who violate the regulations herein defined through measures as follows:

(1)Confiscate the badges of all exhibitors of the breaching stand and stop those exhibitors from entering the exhibition hall.

(2)Close down the breaching stand and have it recorded so as to refuse its application in the future.

2. In Violation of Regulations for Exhibits Management

(1)Exhibits of ¡°suspected infringement¡± shall be dealt with pursuant to Complaint and Settlement Provisions of Being Infringing IPR of Chapter 6 herein.

(2)Exhibits excluded in scope defined in the Participation Agreement or in the records agreed by Canton Fair shall be removed from the exhibition hall by Canton Fair in case that the exhibitor refuses to clear the same from the exhibition hall. Canton Fair shall not bear any responsibilities for any losses arising therefrom.

(3) Canton Fair shall confiscate all illegal exhibits or exhibits which the exhibitor is unable to illustrate or proof their legal origins without bearing any responsibilities for any losses arising therefrom.

(4) In case that a punishment imposed by the Chinese customs or other governmental legal departments upon Canton Fair is caused by the exhibitor's violation of the regulations of the Chinese customs in disposing per se import exhibits or exhibiting any kinds of illegal exhibit, Canton Fair shall retain the power to claim from the exhibitor for any losses arising therefrom.

(5)In case that the exhibitor per se shall demonstrate, display and publicize any other materials of Canton Fair in any forms and publicize Canton Fair in the exhibition hall in any forms without written consent of Canton Fair, Canton Fair shall be authorized to confiscate these promotional materials and expostulate the exhibitor. Canton Fair shall confiscate the badges of all participants of such stands, in which the exhibitors ignore the expostulations and continue the aforesaid breaching activities. These participants shall furthermore be refused to enter the exhibition hall.

3. In Violation of Code of Conduct for Participation in the Fair

(1)Exhibitor who distributes promotional booklets, CDs, product catalog and displays gifts in areas other than what specified in the Participation Agreement such as aisles and any public areas in the exhibition hall shall be expostulated by Canton Fair and the aforesaid materials shall be confiscated. Canton Fair shall confiscate the badges of all participants of such stands, in which the exhibitors ignore the expostulations of the Fair and continue the aforesaid breaching activities. These participants shall furthermore be refused to enter the exhibition hall. Non-exhibitors who perform so shall be confiscated of their badges and materials and hence be driven out of the hall.

(2)Any spy filming or recording of exhibits on other stand or its designs without permission from the owner of the stand concerned, Canton Fair shall be entitled to confiscate such films or memory sticks of the recording devices.

(3)Badges of those who takes exhibits from other stand without permission from the owner of the stand concerned shall be retained by Canton Fair who shall be authorized to refuse such person to enter the exhibition hall again; person who pilfers precious exhibits shall be treated as a theft and his badges shall be confiscated by Canton Fair and the person shall be transferred to public security sectors for settlement.

(4)Those who refuse to obey and cooperate with the guards of the exhibition and create any troubles shall be confiscated of their badges and be refused to enter the exhibition hall again.

(5)In case that demonstration in the stand (including noise of the acoustics used shall be greater than 70 decibels) causes a disturbance to the neighboring exhibitors or orders of the exhibition, the Canton Fair shall be entitled to expostulate such exhibitors. Exhibitor refuses to accept such expostulations shall be punished by a electricity cut to the stand by Canton Fair and Canton Fair has full power to handle such misconducts through measures such as confiscating badges of all exhibitors and refuse them to enter the exhibition hall in future.

(6)Following measures shall be undertaken by Canton Fair to handle misconducts such as nailing, drilling, sticking on ceilings, floors, pillars or walls of the exhibition hall, or damage and destruction to the fire-prevention installations, monitoring systems, electricity distribution structures, communication facilities on the ceilings, ditches, pillars and walls of the exhibition hall, or toilet establishments, mobile fireproofing equipments and other portable or fixed installations in the exhibition hall:

The responsible exhibitor or contractor shall be forcibly required to renew the damaged settings to the original status. Or

The responsible exhibitor or contractor shall compensate to Canton Fair as per assessment of such renewal in case the renewal has not been accomplished.

4. In Violation of Stipulations of Application & Setting-up for Customs-Built Stand

(1)In case the design drawings of the customs-built stand have not been submitted for approval or have not been verified and approved, Canton Fair shall not allow the related contractor to execute construction works in the hall.

(2)In case the design drawings of the custom-built stand shall not be submitted for approval within the time limits, Canton Fair shall be entitled to refuse such drawings and stop related contractor from executing construction works in the hall.

(3)Contractor of custom-built stand without Construction License shall be forcibly requested by the Canton Fair to withdraw from the exhibition hall and the contractor shall afterwards be required to accomplish all move-in procedures in accordance with stipulated processes.

(4)In case the custom-built stand shall not be constructed in accordance with the stipulations, Canton Fair shall hence warm the related contractor and forcibly order such contractor to terminate all construction works for modification. No electricity shall be connected to such stand in case of a refusal for modification or completed modification not be accepted by Canton Fair. Connected electricity under such circumstances shall therefore be cut off. Construction License of those who refuse to carry out such modifications shall be cancelled by Canton Fair and whose construction qualifications for next Canton Fair shall accordingly be terminated. Furthermore, parts or the entire constructional safety deposits of the contractor shall be deducted as a penalty for such misconduct following the stipulations agreed upon between the contractor and Canton Fair. All consequences arising therefrom shall be borne by the contractor. Such breaches shall include but not limit to the following:

-- Execution of works not comply with design drawings verified by the Canton Fair including over height and putting a roof on the stand.

-- Not utilize fire-resisting construction materials as per stipulations or not take adequate measures for fire-prevention as per requirements of Canton Fair even stipulated materials have been employed.

-- Not utilize qualified electric materials and equipment as per stipulations.

-- Electric equipment is not installed and operated as per stipulations.

-- Obstruction to fire-prevention installations or electricity distribution and communication establishment however not adequate safe distance has been reserved.

-- Modification of any fixed installations inside or nearby the stand; any fixation, suspension or decoration on/to the ceiling, floors, pillars or walls of the exhibition hall.

-- Exposed components of the back side or flanks of the stand have not been beautified through double decoration covers and advertisements have not been decorated from outside.

-- Construction License is not hanging in a prominent location in the stand during construction; Construction works exceed the scope covered in the license.

5. In Violation of regulations of use of standard stand

(1)In case that the exhibitor per se dismantles or alters the standard stand and the fascia, aluminum materials, exhibition accessories, lightings and distribution circuits without permission of Canton Fair, Canton Fair shall be authorized to temporarily detain the badges of all exhibitors in the breaching stand and afterwards settle the case through following measures:

The exhibitor will be required to renew the stand to the original state and bear all expenses incurred therein, or

The exhibitor shall compensate to Canton Fair RMB 600 for per stand as penalty if aforesaid renewal becomes impossible. The exhibitor shall furthermore pay to Canton Fair extra penalties in case of damages to the fascia, aluminum materials, exhibition accessories, lightings and distribution circuits.

(2)In case that he shall modify any wordings of the fascia or cover up the fascia by any means, the exhibitor shall be required to have it renewed to the original state by the Canton Fair. The exhibitor shall accordingly pay to Canton Fair all expenses arising therefrom and an amount of RMB 100 as a default penalty.

(3)All identical installation materials for standard stand or similar exhibition materials and accessories to the Canton Fair brought into the hall by the exhibitor without permission of or registration with the Canton Fair shall be confiscated and all losses therefrom arising shall be borne by the exhibitor.

(4)Any cuttings on the allocated exhibition panel and aluminum materials, or painting, nailing and trilling on the penal or exhibition materials, or losses of exhibition penal and aluminum materials, Canton Fair shall charge from the exhibitor RMB 300 for each lost or damaged penal and RMB 500 for each damaged or lost aluminum material as penalty.

(5)Canton Fair shall collect RMB 500 as a clearance deposit in case of any sticking on the exhibition panel. Such deposit will be only reimbursed to the exhibitor provided that clearance of the sticking has been accomplished or otherwise it shall be confiscated by Canton Fair.

(6) In case of the exhibitor's installation of extra lightings or casually connection to electricity supply without application to and approved by Canton Fair, Canton Fair shall switch off the electricity supply to the stand and the exhibitor shall accordingly compensate to Canton Fair for all losses may arise therefrom.

(7)Canton Fair shall charge penalties for the damaged items in the stand in the following criteria: RMB 100 for per lighting, RMB 100 for per meter of distributor wire, and RMB 500 for per electricity distributor.

6. In violation of Regulations of Safety and Fireproofing and other Regulations

(1)All articles such as packaging cases (packaging materials), constructional tools storing inside or beside the stand shall be forcibly cleared by Canton Fair and all expenses arising therefrom shall be borne by the breaching exhibitor or the constructional contractor.

(2)Following measures will be undertaken by the Canton Fair to deal with smokers who smoke in the non-smoking areas in the hall:

Exhibitor: the exhibition badge will be temporarily detained and the same will be returned only subsequent to the exhibitor's submission of a written commitment of non-repetition of such violation in future. The badge will not be returned to those who repeat such violations.

Non-exhibitor: the badge will be confiscated and person will be driven out of the hall.

(3) The second storey of Two-Storey Structures shall be mainly inspected. The exhibitor will be warned in case of following defaults, and he shall immediately correct such misconducts. If no correction is carried out or the exhibitor refuses to obey such regulations, Canton Fair shall be entitled to close down this storey and forcibly clear up all items in this area. In case of stand collapse due to exhibitor's refusal to carry out the required corrections, the exhibitor and his constructor shall then be responsible for all consequences arising therefrom. Canton Fair will accordingly investigate the safety responsibilities of the exhibitor and the constructor and deduct all safety security of the constructor. Furthermore, Canton Fair shall be entitled to claim from the exhibitor and contractor for all losses may arise therefrom.

Utilization of electronic heaters on the second storey.

Demonstration and other activities on the second storey which may be treated as unsafe in accordance with the Chinese security and fire-prevention department.

Weight of exhibits or numbers of people excess the designed criteria.

(4) In case that the exhibitor shall be unable to remove his exhibits or special constructional materials from the hall or have them stored on spaces outside the hall or on roads surrounding the China Import and Export Fair Complex subsequent to stand dismantling, Canton Fair shall not return the clearance deposit to the exhibitor and shall further retain the power to claim from related units for all losses arising therefrom.

(5)Canton Fair shall be entitled to draw back all stands which have no exhibits in display after 12:00 on April 14, 2008 and the exhibitor of the stands shall be responsible for any losses arising therefrom.