This matter, having come before the Court on Koninklijke Philips Electronics
N.V.'s ("Philips") Motion to Make Asset Freeze Permanent and Order to Show Cause Why Jingyi
Luo Should Not Be Incarcerated ("Motion for Permanent Asset Freeze and Incarceration of Luo"),
against KXD Technology, Inc., Astar Electronics, Inc., Shenzhen KXD Multimedia Co., Ltd.,
Shenzhen Kaixinda Electronics Co., Ltd., KXD Digital Entertainment, Ltd., Jingyi Luo, a.k.a.
James Luo, Fusheng Liu a.k.a. Liu Fusheng and Astar Electronics USA, Inc. (collectively, "KXD
Defendants" or "KXD"), and the Court, having reviewed and considered all papers submitted in
support of Philips' Ex Parte Motion for an Order to Freeze Assets (Dkt. #604) and supplemental
briefs and documents filed thereafter, and Philips' Ex Parte Application for Civil Contempt
Sanctions and Order for Jingyi Luo, a.k.a. James Luo, to Immediately Surrender His Passport and
Show Cause Why He Should Not Be Incarcerated and for the KXD Defendants' Business
Operations to Be Shut Down (Dkt. #710), and other relevant pleadings, including the papers
submitted in support of the Asset Freeze Order (Dkt. #683), and evidence and argument presented
in this matter, now makes the following ruling based on information set forth herein:

The KXD Defendants, including but not limited to Jingyi Luo as an individual,
have a history of repeatedly ignoring this Court's orders and attempting to move assets out of the
reach of the Court.

The KXD Defendants, including but not limited to Jingyi Luo as an individual, are
likely to liquidate and/or hide all of their evidence and assets unless the Court intervenes.

On August 1, 2007, the Court issued an order to impound the KXD Defendants'
inventory until the KXD Defendants' complied with Civil Contempt Order I (Dkt. #558) and the
Court's other orders. In order to prevent the KXD Defendants from liquidating their inventory
without first complying with the Court's orders and tendering payment to Philips, the Court
ordered that, "The KXD Defendants' inventory located at 5101 Commerce Drive, Baldwin Park,
CA 91706 and any other location where such inventory is located is impounded until the KXD

Defendants have complied with the TRO, PI, and Civil Contempt Order I." (Dkt. #683, Asset
Freeze Order).

The KXD Defendants, including but not limited to Jingyi Luo as an individual,
have now violated the Asset Freeze Order and are transferring, dissipating, secreting or absconding
with evidence and assets of the KXD Defendants.

On August 31, 2007, the Court issued an order (Dkt. #714) ("August 31, 2007,
Order") confirming that the August 1, 2007, impoundment order was still in effect, and in
addition, ordered Jingyi Luo to "relinquish his passport(s), including his Visa(s)," to the United
States Marshals, federal law enforcement officers, state police, local police, local sheriffs or
deputy sheriffs, off-duty offIcers of the same or persons acting under their supervision
("Authorized Officers"). (August 31, 2007, Order, 4: 11-12.) The Court also ordered Jingyi Luo to
appear at a hearing on September 19,2007, at 1:30 p.m. "and show cause why he should not be
held in contempt of this Court's orders, including the Asset Freeze Order." (Id. at 4:15-17.)

Immediately thereafter and pursuant to the Court's order, Authorized Officers
executed the impoundment order and obtained, among other things, two United States passports
belonging to Jingyi Luo, one of which contained Jingyi Luo's Chinese Visa.

NOW, THEREFORE, based on the foregoing, and the evidence submitted by
Plaintiff in support of its Motion for Permanent Asset Freeze and Incarceration of Luo:

IT IS HEREBY ORDERED THAT:

(1) Jingyi Luo, having been remanded to the custody of the United States Marshals at the
hearing in this matter, September 19,2007, shall remain incarcerated until he has purged himself
of this civil contempt as follows:

Satisfaction of requirements "a" and "b" of paragraph one (1) will purge the contempt of
Jingyi Luo such that he may be released from custody.

(2) Jingyi Luo's passports and Chinese Visa were surrendered to a U.S. Marshal and then
placed in Plaintiff's custody. Plaintiff shall file the passports and Visa, with the Court. The Court
shall maintain custody of these documents until further Order of the Court. Jingyi Luo shall not
travel internationally until further Order of the Court.

(3) The United States Department of State, Bureau of Consular Affairs shall deny any and
all requests or applications by Jingyi Luo for a new, replacement or duplicate United States

passport, until further Order of the Court. The Clerk of Court is HEREBY ORDERED to notify
the Department of State of this Court's Order in this regard by mailing a copy of this Order to:

Office of Legal Affairs
2100 Pennsylvania Ave., N.W.
Third Floor
Washington, D.C. 20037

(4) The KXD Defendants and their officers, directors, affiliates, agents, employees and
attorneys, their successors and assigns and all persons in active concert or participation with any of
the KXD Defendants, and all banks, financial institutions, brokerages, or others in possession or
control of their assets shall continue to be enjoined from directly or indirectly transferring,
concealing, secreting, distributing, disposing of, transferring (except to Philips as set forth herein),
shipping in any way or otherwise hiding assets and making unavailable to Philips or their officers,
agents, employees and attorneys any funds in the KXD Defendants' possession, control or in the
possession or control of others on behalf of the KXD Defendants including, but not limited to:

a) KXD Technology, Inc.'s bank account (authorized agent, Jingyi Luo), account
numbers 080312408, 80312424, and 0080312309, located at East West Bank, 2601 N. Broadway
Los Angeles, CA 90031;

b) Astar Electronics, Inc. and KXD Technology, Inc.' s bank account, account
numbers 765-029699 and 765255773, located at Bank of the West at the South Pasadena Office
#765 and 1833 N. Atlantic Blvd., #765;

c) Jingyi Luo's bank account at Downey Savings Bank, 17120 Colima Road,
Hacienda Heights, CA 91745;

d) Jingyi Luo's bank account at HSBC Bank USA, N.A., account number
199059713;

e) Any other bank or other financial accounts under the names KXD Technology,
Inc., Astar Electronics, Inc., Shenzhen KXD Multimedia Co., Ltd., Shenzhen Kaixinda Electronics

Co., Ltd., KXD Digital Entertainment, Ltd., Astar Electronics USA, Inc., Jingyi Luo, a.k.a. James
Luo, including variations ofthis name and alias;

(5) The known and unknown accounts, including additional accounts at the above listed
banks shall be frozen up to $11,000,000.00, except that the KXD Defendants may pay ordinary
and necessary business expenses, and Jingyi Luo may pay ordinary and necessary personal
expenses, with respect to the foregoing accounts ofKXD Technology, Inc., Astar Electronics, Inc.,
and Jingyi Luo. Ordinary expenses referred to herein may be paid as follows:

a) Rent or mortgage in the amount normally paid as required in any lease or loan on
any premises, upon presentation of said lease or loan document to Philips and verification thereof;

b) Ordinary and regular salaries to any bona fide employees, other than any of the
KXD Defendants themselves, or any relatives or dependents thereof, to the extent that such
salaries are not excessive; provided, however, that such salaries shall be paid to persons on the
payroll of the KXD Defendants as of January 1, 2007, and such salaries do not exceed the prior
month's level and further provided that the KXD Defendants shall first present to Philips' counsel
written documentation identifying and verifying all individuals proposed to be paid and the
particulars of the salaries proposed therefore;

c) Ordinary and necessary bills for utilities, after such bills have been verified by
Philips;

d) Payments of any amounts less than Two Thousand Dollars ($2,000), not to
exceed an aggregate ofmore than Five Thousand Dollars ($5,000) per month, for ordinary
business expenses (or ordinary personal expenses for Jingyi Luo), which transfers shall be
documented and such documentation shall be provided to Philips' counsel within ten (10) calendar
days following the end of each month; in the event that the documentation is not provided to
Philips' counsel within ten (10) calendar days, no ordinary expenses will be allowed until the
documentation of the previous month is provided to Philips' counsel;

(6) Jingyi Luo shall be allowed to sell his personal residence located at 16178 Wedgeworth
Drive, Hacienda Heights, CA 91745. The proceeds from the sale of the Wedgeworth property
shall be frozen with the exception that the proceeds may be used solely for the payoff of the Aspen
Grove property. Any remaining proceeds shall be frozen in an existing account;

(7) Jingyi Luo shall continue to be enjoined from selling or otherwise encumbering his
personal residence located at 18319 Art Street, Unit 17, Reseda, CA 91335, until all amounts owed
to Philips pursuant to this Court's orders are paid in full;

(8) Jingyi Luo shall be enjoined from selling or otherwise encumbering his personal
residence located at 7001 Etiwanda Avenue, Reseda, CA 91335, until all amounts owed to Philips
pursuant to this Court's orders are paid in full;

(9) In accordance with Fed. R. Civ. P. 64 and 65 that KXD Defendants, and their agents,
servants, employees, and any other person in active concert or participation with them, and any
person who has benefitted, directly or indirectly, from the profits of the KXD Defendants, or such
companies, and any banks, savings and loan associations, or other financial institutions, or
agencies which engage in the transfer of real property, who receive actual notice of this Order by
personal service or otherwise, are restrained and enjoined during the pendency of this action from
transferring (except to Philips as set forth herein), disposing of, distributing, or secreting any
money, stocks, or other assets of the KXD Defendants without prior approval of the Court;

(10) The Court-ordered assignment to Philips of the KXD Defendants' right to payment
from third party debtors of the KXD Defendants until the Civil Contempt Order I is satisfied shall
continue during the pendency of this action;

(11) The KXD Defendants shall continue to repatriate all funds transferred overseas,
individually or jointly, since January 5,2006; to deposit those funds into a bank within the Central
District of California; and to disburse those funds only after giving notice to Philips and obtaining
Court approval;

(12) The impoundment already ordered and extended by the Court is ongoing. The
locations covered by this Court's Asset Freeze Order and this Order shall cover and include:
KXD's warehouses, located at 5101 Commerce Drive, Baldwin Park, CA 91706,5270 Edison
Avenue, Chino, CA 91710,5917 Oak Avenue #380, Temple City, CA 91780,9602 Las Tunas
Drive #203, Temple City, CA 91780, and any other warehouses or storage facilities utilized by the
KXD Defendants and any carton, container, vehicle, or other means of carriage in which the assets
used in the course ofKXD's business are found ("KXD Facilities"); Jingyi Luo's residences,
located at 1703 Aspen Grove Lane, Diamond Bar, CA 91765 and 16178 Wedgeworth Drive,
Hacienda Heights, CA 91745; and Fusheng Liu's residence, located at 1825 Carlisle Drive, San
Marino, CA 91108.

(13) KXD Facilities

With respect to KXD Facilities, any Authorized Officers(s), with the assistance of a Philips
representative and Philips' counsel is/are hereby authorized to:

a) Impound, seize, and take possession of any ofthe KXD Defendants' assets,
including but not limited to, computers, servers, financial and other documents, evidence,
inventory, and other assets. Plaintiff or Plaintiffs designee shall maintain custody of these assets
pending further Order of the Court; and/or

b) Enter the KXD Facilities and lock down the premises to prevent KXD
Defendants' employees, agents, or representatives, from entering the KXD Facilities until further
Order from the Court.

(14) KXD Residential Properties

(The residential properties owned or utilized by any ofKXD Defendants, including but not
limited to: 4906 Bleecker Street, Baldwin Park, CA 91706, Jingyi Luo's residences, located at
1703 Aspen Grove Lane, Diamond Bar, CA 91765 and 16178 Wedgeworth Drive, Hacienda
Heights, CA 91745; and Fusheng Liu's residence, 1825 Carlisle Drive, San Marino, CA 91108.)

With respect to KXD Residential Properties, the Authorized Officers shall impound, seize
and take possession of any and all assets used in the course ofKXD's business, including, but not
limited to, computers, servers, drives, financials and other documents, evidence, inventory and
other assets at KXD Residential Properties. Plaintiff or Plaintiffs designee (including but not
limited to the Trustee in the Chapter 7 Trustee for the bankruptcy estate ofKXD Technology, Inc.
in a case pending before the United States Bankruptcy Court, Central District of California, Los
Angeles Division ("USBC"), case no. LA 2:07-17054-RN) shall maintain custody ofthese assets
pending further order of the Court.

(15) It is intended and hereby authorized that the Authorized Officers shall impound and
seize assets as many times as necessary to impound any and all inventory and other KXD
Defendants' assets during this period of time at any or all of the locations set forth above.

(16) KXD Defendants shall cease doing any further business in the United States involving
DVD recorders, DVD players, DVD computer drives, or DVD discs, until further order of this
Court.

(17) KXD Technology, Inc. Bankruptcy

a) Whereas, KXD Technology, Inc. filed a Voluntary Petition under Chapter 11 of
the Bankruptcy Code on August 15,2007, in the USBC, case no. LA 2:07-17054-RN;

b) Whereas, on August 31, 2007 KXD Technology, Inc.' s Chapter 11 case was
converted to a Chapter 7 proceeding (USBC Dkt. #50) and Christopher R. Barclay was appointed
as the Chapter 7 Trustee ("Trustee") (USBC Dkt. #58);

c) Whereas, the Trustee is required to pay certain general administrative expenses
relating to the Chapter 7 case, including certain charges for rent, utilities, insurance, storage, and
other ancillary expenses, all of which payments are governed by various provision of the
Bankruptcy Code ("Administrative Expenses");

d) Whereas, the Trustee is required to take possession of an administer all of the
property ofKXD Technology, Inc. for the benefit of the creditors, which administration will

necessarily require the Trustee to, among other things, sell, assign or otherwise dispose of all of
the property ofKXD Technology, Inc. in accordance with various provisions of the Bankruptcy
Code ("Trustee Dispositions");

e) Whereas, the Bankruptcy Code provides for the payment of certain professional
fees, which fees are subject to Bankruptcy Court approval, induding Chapter 7 Trustee fees and
costs, and the fees and costs of his counsel, accountants and other similar professional fees and
costs ("Bankruptcy Court Approved Fees");

f) Whereas, the Trustee is required to collect and deposit or invest all funds ofKXD
Technology, Inc. induding all bank deposits and payment receipts, in accordance with various
provisions of the Bankruptcy Code and the financial policies, procedures and requirements of the
Office of the United States Trustee;

g) Whereas, a dispute exists between the Plaintiff and the Trustee concerning their
respective rights and interests in, and ownership of the accounts receivable ofKXD Technology,
Inc. and the proceeds thereof, induding the proceeds of accounts receivable which presently are,
and in the future come into, the possession of the Plaintiff and its affiliates; and

h) Whereas, the Trustee is required to make distributions to creditors ofKXD
Technology, Inc. in accordance with various provision ofthe Bankruptcy Code and the financial
policies, procedures, and requirements ofthe Office ofthe United States Trustee;

i) Based on the foregoing, IT IS FURTHER ORDERED THAT the Trustee shall be
permitted to:

i. Collect and take possession and custody of all property ofKXD
Technology, Inc.;

ii. Pay any and all Administrative Expenses in accordance with the
provisions of the Bankruptcy Code;

iii. Execute any and all Trustee Dispositions of property ofKXD
Technology, Inc. in accordance with the provisions of the Bankruptcy Code;

iv. Pay any and all Bankruptcy Court Approved Fees, in accordance with
the provisions of the Bankruptcy Code; and

v. Make distributions to creditors ofKXD Technology, Inc. in accordance
with the provisions of the Bankruptcy Code.

j) Finally, any person or entity holding funds ofKXD Technology, Inc. shall
immediately tum over said funds to the direction and control of the Trustee, provided however,
pending the resolution of the dispute between the Plaintiff and the Trustee concerning the accounts
receivable and their proceeds as described above, the Plaintiff shall be permitted to use its
commercially reasonable good faith efforts to collect the accounts receivable at Plaintiffsown
cost and shall continue to retain all such proceeds in a segregated account.

k) Notwithstanding anything else in this Order, the provisions of this paragraph
seventeen (17) shall supersede any of the other provisions of this Order as they pertain to KXD
Technology, Inc.

(18) Jingyi Luo's Wife: Insofar as Jingyi Luo's wife's income is not derived from KXD
Defendants, their successors in interest, or affiliates, the income shall not be frozen and may be
placed in a separate account; proof of non-affiliation with the entities in this litigation or their
successors in interest shall be submitted to the Court and to Plaintiffs counsel. Ifpossible,
Plaintiffs counsel and Jingyi Luo's counsel shall then jointly submit a proposed order concerning
this income as soon as possible.

(19) Anyone interfering with the execution of this Order is subject to arrest by the
Authorized Officers or other law enforcement personnel.