EXECUTION VERSION
 
INVESTOR RIGHTS AGREEMENT
 
THIS INVESTOR RIGHTS AGREEMENT (this “Agreement”) is made and entered into as of
December 28, 2007, by and among (i) (a) China Mobile Media Technology Inc., a
Nevada corporation (the “Company”), Magical Insight Investments
Limited (“Magical”), a British Virgin Islands corporation and each of Beihai
Hi-Tech Wealth Technology Development Co. Ltd. and Beijing Hi-Tech Wealth
Communication Technology Co., Ltd., which are incorporated under the laws of the
People’s Republic of China (the “PRC”) (the “WFOE”, and, together with the
companies set forth on Schedule A hereto, the “Group Companies”); (b) Dr. ZHANG
Zhengyu, (c) Mr. MA Qing, (d) Ms. LI Ming (collectively, Messrs. ZHANG and MA
and Ms. LI are referred to herein as the “Controlling Shareholders” and
individually as the “Controlling Shareholder”, and for purposes of Section 6,
each is a “Senior Management Member”); and (ii) Abax Lotus Ltd. (the
“Investor” or “Abax”). Capitalized terms used herein but not otherwise defined
herein shall have the respective meanings set forth in the Purchase Agreement
(as defined below).
 
WITNESSETH:
 
WHEREAS, the Group Companies and the Investor have entered into certain
Securities Purchase Agreement dated as of December 28, 2007 (the “Purchase
Agreement”), pursuant to which Magical has agreed to issue to the Investor, and
the Investor has agreed to purchase from Magical, an aggregate of no more than
RMB 150,000,000 of its Guaranteed Senior Notes due 2014 (the “Notes”) and in
connection therewith purchase from the Company certain warrants (the “Warrants”)
to purchase the Company’s common stock, par value $.001 (the “Common
Stock”, and, together with the Notes, the “Securities”);
 
WHEREAS, in consideration of Investor’s entering into the Purchase Agreement,
the Company, the Group Companies and the Controlling Shareholders have agreed to
provide certain rights to Investor as set forth in this Agreement.
 
NOW, THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound by this agreement, agree as
follows:
 
1. Representations and Warranties of the Group Companies and the Controlling
Shareholders. Each of the Group Companies and the Controlling Shareholders,
jointly and severally, represents and warrants that:
 
1.1 Dr. ZHANG Zhengyu is the beneficial owner, free and clear of all Liens
(other than the pledge of Common Stock given pursuant to that certain Share
Pledge dated February 28, 2006 in favor of Warburg Pincus Asia LLC to secure
certain non-competition obligations by the stockholder in respect of the
Company’s business (the “Noncompetition Pledge”), of 21,200,000 shares of Common
Stock (of record or through a brokerage firm or other nominee arrangement),
which constitutes 3 5.9% of the outstanding voting power of the Company’s
capital stock.
 
 
 

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1.2 Mr. MA Qing is the beneficial owner, free and clear of all Liens (other than
the Noncompetition Pledge), of 5,500,000 shares of Common Stock (of record or
through a brokerage firm or other nominee arrangement), which constitutes 9.3%
of the outstanding voting power of the Company’s capital stock.
 
1.3 Ms. LI Ming is the beneficial owner, free and clear of all Liens (other than
the Noncompetition Pledge), of 9,500,000 shares of Common Stock (of record or
through a brokerage firm or other nominee arrangement), which constitutes 16.1%
of the outstanding voting power of the Company’s capital stock.
 
1.4 Each of the Group Companies and the Controlling Shareholders (each of the
foregoing, a “Warrantor”) has full power and authority to make, enter into and
carry out the terms of this Agreement. This Agreement has been duly executed and
delivered by each Warrantor and constitutes the legal, valid and binding
obligations of such Warrantor enforceable against such Warrantor in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally.
 
1.5 The execution and delivery of this Agreement by each Warrantor do not, and
the performance of this Agreement by such Warrantor will not: (i) conflict with
or violate any law, rule regulation, order, decree or judgment applicable to
such Warrantor or by which such Warrantor or any of the properties of such
Warrantor is or may be bound or affected, or the Charter Documents of any Group
Company; (ii) result in or constitute (with or without notice or lapse of time)
any breach of or default under any contract to which such Warrantor is a party
or by which such Warrantor or any of the affiliates or properties of such
Warrantor is or may be bound or affected, or (iii) result in the creation of any
encumbrance or restriction on any of the shares of Common Stock or equity
interests in any other Group Company or properties of such Warrantor, other than
in each of clause (i), (ii) and (iii), such conflicts, violations, breaches of
defaults that would not, individually or in the aggregate, have a Material
Adverse Effect. The execution and delivery of this Agreement by each Warrantor
do not, and the performance of this Agreement by each Warrantor will not,
require any consent or approval of any Person.
 
2. Covenants and Agreements.
 
Unless the context requires otherwise, each Group Company hereby covenants and
agrees, and each of the Controlling Shareholders hereby covenants and agrees to
cause each Group Company to do, as follows:
 
2.1 Business Plan and Annual Budget. As long as Abax holds in aggregate 10% of
the Notes it purchased under the Purchase Agreement, or at least 3.5 % of the
Company’s issued and outstanding common stock (in either case, the “Minimum
Holding”, such Investor being referred to herein as an “Eligible Investor”), to
the extent permitted by applicable laws and regulations, the Company shall
prepare and submit to the Investor for its approval (such approval is referred
to herein as “Investor Approval”, whether approved by Abax or any other Eligible
Investor) at least thirty (30) days prior to the beginning of the next financial
year or period the annual budget (“Annual Budget”) of the Company and its
Subsidiaries on a consolidated basis setting out in reasonable detail the
planned annual capital and operating budgets in reasonable detail, projected
revenues, a projected financial statement for such fiscal year on a quarterly
basis, and promptly after preparation from time to time, any revisions to the
forecasts contained therein of the Company and its Subsidiaries and attaching
thereto such notes as are necessary, desirable or customary, together with a
business plan setting forth in reasonable detail the operating goals of the
Company and its Subsidiaries for the following year (the “Business
Plan”), accompanied by such qualifications and disclaimers as management shall
deem appropriate in the circumstances.
 
 
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2.2 Other Covenants. As long as the Investor holds the Minimum Holding, each
Group Company hereby covenants and agrees, and the Controlling Shareholders
hereby covenant and agree to cause each Group Company to do, as follows, unless
the Investor otherwise provides prior Investor Approval in its sole discretion:
 
(a) No Group Company shall change the substantive responsibilities of any member
of the senior management of such Group Company and its Subsidiaries, or
substitute any other Person to perform the substantive responsibilities of such
members of senior management as they are performed as of the date hereof, other
than in the case of incapacity of such member of senior management (which for
purposes of this paragraph shall mean Ma Qing, Li Ming and Zhang Zhengyu).
 
(b) No Group Company or its Subsidiaries shall issue any securities, create any
security interest or enter into any transaction or a series of related
transactions the completion of which will result in a Change of Control of the
Company. “Change of Control” shall have the meaning as defined in the Indenture.
 
(c) No Group Company or its Subsidiary shall change the number of members of the
board of directors (“Board”) of such Group Company or its Subsidiaries, or the
composition or structure of the board or board committees of the Group Company
or its Subsidiaries or establish board committees of such Group Company or its
Subsidiaries, or delegate powers of any Board to a committee, or change the
powers, duties or responsibilities delegated to any committee of the Board of
such Group Company in a manner adverse to the Investors.
 
(d) No Group Company shall amend, alter, waive or repeal any provision of such
Group Company’s or its Subsidiaries’ certificate of incorporation, memorandum
and articles of association or any other organizational or constitutional
documents of such Group Company or its Subsidiaries in a manner adverse to the
Investors.
 
(e) The Company shall retain a firm of independent public accountants (the
“Accountants”) of recognized international standing (from those listed on
Schedule B hereto) that is acceptable to the Investors (as determined by
Investor Approval), who shall certify the Company’s consolidated financial
statements each at the end of each fiscal year. The Company shall not terminate
the services of the Accountants without prior written Investor Approval. In the
event that the Accountants elect to terminate their services to the Company, the
Company shall provide Eligible Investors with a written notice prior to such
resignation if reasonably practicable and if not, promptly thereafter notify
Eligible Investors, and in any event shall request the Accountants to deliver to
Eligible Investors a letter from the Accountants setting forth the reasons for
the termination of their services. In the event of such termination, the Company
shall promptly thereafter engage another firm of independent public accountants
of recognized international standing (from those listed on Schedule B hereto)
that is acceptable to the Investors (as determined by Investor Approval) to be
the new Accountants. In its notice to the Investors, the Company shall state
whether the change of Accountants was recommended or approved by the Company’s
Board or any committee thereof.
 
 
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(f) Without prior written Investor Approval, no Group Company shall expend any
money in any financial year or period that deviates in amount by more than 20%
of the amount in the Approved Budget.
 
(g) No Group Company or its Subsidiaries shall enter into any activities which
are not in the Ordinary Course of Business of such Group Company or such
Subsidiary, as the case may be. For the purposes of this paragraph, the term
“Ordinary Course of Business” means the ordinary course of business presently
engaged in by the Group Company or its Subsidiaries as consistent with the past
custom and practice of the Company and permitted under the all necessary
licenses, consents, authorizations, approvals, orders, certificates and permits
duly obtained by the Group Companies.
 
3. Right of First Refusal for Future Securities Offerings.
 
3.1 Issuance Notice.
 
(a) So long as an Investor owns the Minimum Holding, if the Company proposes to
issue or sell any securities to a purchaser that is not an Affiliate of the
Company (the “Proposed Third Party Purchaser”), the Company shall, not less than
twenty (20) days prior to the consummation of such issuance or sale, offer such
securities to each Eligible Investor by sending written notice (an “Issuance
Notice”) to Eligible Investors, which Issuance Note shall state (a) a
description of the securities to be issued or sold, including detailed terms of
such securities, (b) the amount of the securities proposed to be issued to the
Proposed Third Party Purchaser (the “Offered New Securities”); (c) the proposed
purchase price for the Offered Securities (the “Issuance Price”); and (d) the
terms and conditions of such proposed sale. For purposes of this Agreement, an
“Affiliate” shall refer to: (i) any Person directly or indirectly controlling,
controlled by or under common control with another Person, (ii) any Person
owning or controlling 50% or more of the outstanding voting securities of such
other Person, (iii) any officer, director or partner of such Person, (iv) a
trust for the benefit of such Person referred to in the foregoing clause (ii) of
this definition.
 
(b) The Issuance Notice shall also include a copy of any written proposal, term
sheet or letter of intent or other agreement or understanding relating to the
Offered New Securities. Upon delivery of the Issuance Notice, such offer shall
be irrevocable unless and until the rights of first refusal provided for herein
shall have been waived or shall have expired.
 
3.2 Option; Exercise. By notification to the Company within fifteen (15) days
after the Issuance Notice is given, each Eligible Investor may elect to purchase
or otherwise acquire, at the price and on the terms specified in the Issuance
Notice, an amount equal to the proportion of Offered New Securities that bears
the same proportion as such Eligible Investor’s Securities bears to the
Securities owned by all such Eligible Investors who may elect to purchase
Offered New Securities (all such Securities being valued as the aggregate
principal amount of Notes held by such Eligible Investors, and for purposes of
such calculation, any Warrant Shares held by such Eligible Investors valued at
the aggregate amount equal to the product of the number of such shares and the
exercise price thereof, hereinafter referred to as the “Investor’s Pro Rata
Share”); provided, however, that if transaction set forth in the Issuance Notice
involves a registered public offering of securities by the Company, then in such
event, in lieu of its right to purchase of its Investor’s Pro Rata Share of the
Offered New Securities, each Eligible Investor may elect to purchase or
otherwise acquire up to that portion of the Offered New Securities which equals
the proportion that the Common Stock issued and held, or issuable (directly or
indirectly) upon conversion and/or exercise, as applicable, of the Warrants and
any other securities exercisable for or convertible into Common Stock (the
“Derivative Securities”) then held by such Eligible Investor bears to the total
number of shares of Common Stock of the Company then outstanding (assuming full
conversion and/or exercise, as applicable, of all Warrants and other Derivative
Securities). The closing of any sale pursuant to this Section 3.2 shall occur
within thirty (30) days after the date on which such notification is first given
by such Eligible Investor. Each Eligible Investor (or its assignees) shall be
entitled to apportion the rights of first refusal hereby granted to it among
itself and its Affiliates in such proportions as it deems appropriate.
 
 
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3.3 Right to Sell to Proposed Third Party Purchaser. If less than all of the
Offered New Securities entitled to be purchased or acquired by the Eligible
Investors are elected to be purchased or acquired as provided in Section 3.2,
the Company may, during the thirty (30) day period following the expiration of
the fifteen (15) day period provided in Section 3.2, offer and sell the
remaining unsubscribed portion of such securities to the Proposed Third Party
Purchaser in the Issuance Notice at a price not less than, and upon terms not
materially more favorable to the Proposed Third Party Purchaser than, those
specified in the Issuance Notice. If the Company does not enter into an
agreement for the sale of such securities within such period, or if such
agreement is not consummated within thirty (30) days after the execution
thereof, the right of first refusal provided hereunder shall be deemed to be
revived and such securities shall not be offered to a third party unless first
reoffered to all Eligible Investors in accordance with this Section.
 
4. Right of First Refusal for the Controlling Shareholders’ Transfer and
Tag-Along Right.
 
4.1 Securities Notice. As long as an Investor holds the Minimum Holding, subject
to Section 4.8 of this Agreement, if any Controlling Shareholder proposes to
sell or transfer any securities of the Company held by it or any other Permitted
Holder (as defined below) to a third party purchaser (the “Third
Party Purchaser”) other than as otherwise agreed by Investor Approval in writing
prior to such sale or transfer, or in the case of any Exempt Transfer (as
defined in Section 4.7 below), such Controlling Shareholder shall, within twenty
(20) days prior to the consummation of such transfer or sale, offer such
securities to Eligible Investors by sending written notice (an “Offering
Notice”) to Eligible Investors, which shall state (a) the identity of the Third
Party Purchaser, (b) the type and number of such securities proposed to be
transferred (the “Offered Securities”), including detailed terms of such
securities (if other than Common Stock); (c) the proposed purchase price per
share for the Offered Securities (the “Offer Price”); and (d) the terms and
conditions of such sale. The Offering Notice shall also include a copy of any
written proposal, term sheet or letter of intent or other agreement or
understanding relating to the Offered Securities. Upon delivery of the Offering
Notice, such offer shall be irrevocable unless and until the rights of first
refusal provided for herein shall have been waived or shall have expired.
 
 
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4.2 Option; Exercise. For a period of fifteen (15) days after the giving of the
Offering Notice pursuant to Section 4.1 (the “Option Period”), each Eligible
Investor shall have the right to purchase its Investor’s Pro Rata Share of the
Offered Securities at a purchase price equal to the Offer Price and upon terms
and conditions no less favorable than those set forth in the Offering Notice;
provided, however, that if transaction set forth in the Offering Notice involves
a registered public offering of securities by the Controlling Shareholder, then
in such event, in lieu of its right to purchase all of the Offered Securities,
each Eligible Investor may elect to purchase or otherwise acquire that portion
of the Offered Securities which equals the proportion that the Common Stock
issued and held, or issuable (directly or indirectly) upon conversion and/or
exercise, as applicable, of the Warrants and any other Derivative Securities
then held, by such Eligible Investor bears to the total Common Stock of the
Company then outstanding (assuming full conversion and/or exercise, as
applicable, of all Warrants and other Derivative Securities). Each Eligible
Investor (or its assignees) may assign to any of its Affiliates (other than a
Person engaged in the Business) all or any portion of its rights pursuant to
this Section.
 
4.3 The right of an Eligible Investor to purchase all or any part of the Offered
Securities under Section 4.2 above shall be exercisable by delivering written
notice of the exercise thereof (the “ROFR Exercise Notice”), prior to the
expiration of the Option Period, to the Controlling Shareholder. The failure of
such Eligible Investor to respond within the Option Period to such Controlling
Shareholder shall be deemed to be a waiver of that Eligible Investor’s rights
under Section 4.1 above, provided that any other Eligible Investor that is
eligible to tender a ROFR Exercise Notice may elect to exercise its Investor’s
Pro Rata Share of such waived rights under Section 4.2 above prior to the
expiration of the Option Period by giving written notice to the Controlling
Shareholder.
 
4.4 Closing. The closing of the purchases of Offered Securities subscribed for
by such Investors under Section 4.3 shall be held at the executive office of the
Company at 11:00 a.m., local time, on the 30th day after the giving of the
ROFR Exercise Notice pursuant to Section 4.3 or at such other time and place as
the parties to the transaction may agree. At such closing, such Controlling
Shareholder shall deliver certificates representing such Offered Securities,
duly endorsed for transfer and accompanied by all requisite transfer taxes, if
any, and such Offered Securities shall be free and clear of any Liens (other
than those arising hereunder and those attributable to actions by the purchasers
thereof) and the Controlling Shareholder shall so represent and warrant, and
shall further represent and warrant that it is the sole beneficial and record
owner of such Offered Securities. Such Eligible Investors shall deliver at the
closing payment in full in immediately available funds for the Offered
Securities purchased by them or their respective Affiliates. At such closing,
all of the parties to the transaction shall execute such additional documents as
are otherwise necessary or appropriate.
 
 
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4.5 Sale to a Third Party Purchaser. Unless Eligible Investors elect to purchase
all of the Offered Securities under Section 4.2, the Controlling Shareholder
may, subject to Section 4.8, sell the remaining Offered Securities not purchased
by such Eligible Investors to the Third Party Purchaser identified in the
Offering Notice at a price not less than the Offer Price, and on terms not
materially more favorable than the terms set forth in the Offering Notice;
provided, however, that such sale is bona fide and made pursuant to a contract
entered into within thirty (30) days after the earlier to occur of (i) the
waiver by Eligible Investors of their respective rights to purchase the Offered
Securities and (ii) the expiration of the Option Period (the “Contract
Date”); and provided further, that such sale shall not be consummated unless
prior to the purchase by such Third Party Purchaser of any of such Offered
Securities, such Third Party Purchaser shall become a party to this Agreement
and agree to be bound by the terms and conditions hereof that are applicable to
the Controlling Shareholder, provided that if such Third Party Purchaser,
together with any other Third Party Purchasers and on an aggregated basis, owns
less than 10% of the Company’s outstanding capital stock on an as-converted,
fully diluted basis following such sale, then such Third Party Purchaser shall
not be bound by Sections 1, 2, 3 and 6 of this Agreement. If such sale is not
consummated within thirty (30) days after the earlier to occur of (i) the waiver
by Eligible Investors of their respective options to purchase the offer and (ii)
the Contract Date for any reason, then the restrictions provided for herein
shall again become effective, and no transfer of such Offered Securities may be
made thereafter by such Controlling Shareholder without again offering the same
to Eligible Investors in accordance with this Section.
 
4.6 Tag-Along Right. (a) If the Controlling Shareholder is directly or
indirectly transferring Offered Securities to a Third Party Purchaser pursuant
to Section 4.5, then each Eligible Investor shall have the right to sell to such
Third Party Purchaser that number of Shares equal to that percentage of the
Offered Securities determined by dividing (i) the total number of outstanding
shares of the Common Stock of the Company (the “Shares”) (on an as-converted
basis) then owned by such Eligible Investor by (ii) the sum of (x) the total
number of Shares (on an as-converted basis) then owned by such Eligible Investor
and (y) the total number of Shares then owned by the Controlling Shareholder, at
a price equal to the Offer Price, with other terms set forth in the Offering
Notice. The Controlling Shareholder and Eligible Investors shall effect the sale
of the Offered Securities and Eligible Investors shall sell the number of
Offered Securities to be sold by them pursuant to this Section, and the number
of Offered Securities to be sold to such Third Party Purchaser by the
Controlling Shareholder shall be reduced accordingly.
 
(a) Each Controlling Shareholder shall give notice to Eligible Investors of each
proposed sale by it, or any other Permitted Holder of Offered Securities which
gives rise to the rights of Eligible Investors set forth in this Section, at
least thirty (30) days prior to the proposed consummation of such sale, setting
forth the type and number of Offered Securities, including detailed terms of
such securities (if other than Common Stock), the name and address of the
proposed Third Party Purchaser, the proposed amount and form of consideration
and terms and conditions of payment offered by such Third Party Purchaser, the
percentage of shares of Common Stock that Eligible Investors may sell to such
Third Party Purchaser (determined in accordance with Section 4.6(a)), and a
representation that such Third Party Purchaser has been informed of the
“tag-along” rights provided for in this Section and has agreed to purchase
Offered Securities in accordance with the terms hereof. The tag-along rights
provided by this Section must be exercised by Eligible Investors within thirty
(30) days following receipt of the notice required by the preceding sentence, by
delivery of a written notice to the Controlling Shareholder indicating such
Eligible Investor’s election to exercise its rights and specifying the number of
shares of Common Stock (up to the maximum number of shares of Common Stock owned
by such Eligible Investor required to be purchased by such Third Party
Purchaser) it elects to sell (the “Tag-along Exercise Notice”), provided that
any Eligible Investor may waive its rights under this Section prior to the
expiration of such thirty (30) day period by giving written notice to the
Controlling Shareholder, with a contemporaneous copy to the Company and any
other Eligible Investors, upon which any other Eligible Investor may elect to
exercise its share of such waived rights (determined in accordance with Section
4.6(a)) prior to the expiration of the allotted time period therefor by giving
written notice to the Controlling Shareholder. The failure of an Eligible
Investor to respond within such thirty (30) day period shall be deemed to be a
waiver of such Eligible Investor’s rights under this Section. If a Third Party
Purchaser fails to purchase shares of Common Stock from any Eligible Investor,
notwithstanding such Eligible Investor’s proper exercise of its tag-along rights
pursuant to this Section 4.6(b), then such Controlling Shareholder shall either
contemporaneously purchase from such Eligible Investor at the Offer Price such
number of shares of Common Stock as the Third Party Purchaser failed to purchase
from such Eligible Investor, or if the Controlling Shareholder does not so
purchase, it shall not be permitted to consummate the proposed sale of the
Offered Securities, the Company shall not register the transfer of such Offered
Securities on its share register, and any such attempted sale shall be null and
void ab initio.
 
 
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4.7 Exempt Transfers. The right of first refusal and tag-along rights set forth
in this Section 4 shall not apply to any of (i) any transfer to a Permitted
Holder; provided that adequate documentation therefor is provided to Eligible
Investors to their satisfaction and that any such Permitted Holder agrees in
writing to be bound by this Agreement in place of the relevant transferor;
provided, further, that such transferor shall remain liable for any breach by
such Permitted Holder of any provision hereunder, (ii) the sale in an
unsolicited broker’s transaction pursuant to Rule 144 under the Securities Act
of 1933, as amended, or (iii) the Transfer (as defined below) by the Controlling
Shareholder of no more than 10% (on an aggregated basis over the term of the
Notes) of the total equity interest beneficially owned by the Controlling
Shareholder in the Company (the “Exempt Transfers”). “Transfer” shall mean sell,
transfer, assign, pledge, hypothecate, dispose of, mortgage, enter into any
voting trust or other agreement, option or other arrangement or understanding
with respect thereto, whether directly or indirectly and whether voluntarily or
involuntarily. “Permitted Holder” means the Controlling Shareholder’s parents,
children or spouse or trusts for the benefit of such persons, and any legal
entity in which such Controlling Shareholder holds a majority of the equity
interests and “controls” such entity.
 
4.8 Prohibited Transfers.
 
(a) Notwithstanding anything to the contrary contained herein, to the extent
permitted under applicable law, each Controlling Shareholder shall not, and each
Controlling Shareholder shall cause the Permitted Holder not to, without prior
written Investor Approval, which shall not be unreasonably withheld, Transfer
through one or a series of transactions more than 10% of the equity securities
of the Company beneficially owned by such Controlling Shareholder to any Person,
so long as one or more Investors own 5% or more of the total outstanding equity
interest in the Company on a fully diluted basis, provided that the foregoing
provision shall not apply to any Exempt Transfer.
 
 
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(b) Each Controlling Shareholder shall ensure that no other Permitted Holder
shall sell or transfer equity securities of the Company that were received from
a Controlling Shareholder and are held by such Permitted Holder, other than as
provided in this Agreement. Any attempt by any Controlling Shareholder or any
other Permitted Holders to sell or transfer any equity securities of the Company
held by it or any other Permitted Holder in violation of this Section shall be
void and the Company hereby agrees it will not effect such a transfer on its
share register nor will it treat any alleged transferee as the holder of such
shares.
 
5. Board Representation.
 
5.1 Number of Board Members. The Company shall, effective upon Closing and until
the termination of this Agreement, take all appropriate actions to fix and
maintain a Board of no more than nine (9) voting members and the Company shall
not change the number of voting members of its Board without Abax’s prior
written approval.
 
5.2 Abax Nominees. Upon the Abax Election (as defined below), as long as Abax
continues to hold more than 5% of the outstanding shares of Common Stock on an
as exercised and fully-diluted basis, it shall be entitled to appoint one (1) of
the voting members of the Company’s Board (the “Abax Nominee”).
 
5.3 Board Committees. The Company shall not, without the prior written consent
of Abax, establish any committee of its Board, delegate powers of its Board to a
committee, or change the powers, duties or responsibilities delegated to any
committee of the Board of the Company. To the extent permitted by applicable law
and exchange listing rules, the Abax Nominee shall be entitled to be members of
all committees of the boards of directors of the Company and its Subsidiaries,
if any, it being understood that the Abax Nominee shall not be a member of the
Audit Committee until he or she is an independent director.
 
5.4 Abax Election. If Abax provides written notice to the Company informing the
Company of (i) its election (the “Abax Election”) to be represented on the Board
and (ii) the name of the Abax Nominee, then, as soon as practicable after its
receipt of such notice from Abax, but in no event later than thirty (30)
business days after such receipt, the Company shall:
 
(a) provide notice of the Abax Election to the Company’s Board and the
Controlling Shareholders, and
 
(b) to the extent permissible under applicable laws and regulations (including
rules of any relevant listing exchange), take all necessary actions so as to
permit the Abax Nominee to be duly appointed or elected as members of the
Company’s Board as soon as practicable.
 
Subject to the conditions and limitations set forth herein, the Abax Election
may be exercised by Abax at any time in its sole discretion.
 
 
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5.5 Voting Agreement. Upon the Abax Election, each of the Controlling
Shareholders agrees to vote, or cause to be voted, all of the Company’s Shares
owned by such Controlling Shareholder or any other Permitted Holder (of record
or through a brokerage firm or other nominee arrangement), or over which such
Controlling Shareholder has voting control, from time to time and at all times,
in whatever manner as shall be necessary to ensure that at each annual or
special meeting of shareholders at which an election of directors is held or
pursuant to any written consent of the shareholders, the Abax Nominee is duly
elected to the Board. Each Controlling Shareholder further covenants not to
frustrate the purpose of the immediately preceding sentence by any means,
including through entering into any agreement or commitment inconsistent with
such purpose, including but not limited to any inconsistent pledge, charge,
hypothecation, voting agreement, voting trust or other disposition of voting
rights of the Common Stock over which such Controlling Shareholder retains
beneficial ownership or the economic benefits and risks attendant thereto.
 
5.6 Vacancies. Any vacancies created by the resignation, removal or death of the
Abax Nominee appointed or elected to the Board shall be filled pursuant to the
provisions of this Section.
 
5.7 Quorum. Following the Abax Election, the Company’s by-laws shall provide
that a quorum for any meeting of the Board shall require the attendance of the
Abax Nominee, provided that the Abax Nominee may participate in such meetings by
telephone conference call.
 
5.8 Reimbursement. Each time the Abax Nominee attends a face-to-face meeting of
the Board, the Company shall reimburse such director for reasonable travel
expenses on the same basis as the other members of the Board.
 
6. Mandatory Exercise of Warrants.
 
Upon the occurrence of, and simultaneously with, (i) the consummation of the
listing of the Common Stock of the Company on the Nasdaq Capital Market, Global
Market, Global Select Market or the New York Stock Exchange and (ii) the
Company’s filing of a registration statement with the U.S. Securities and
Exchange Commission (the “SEC”) to register all the Warrant Shares issuable upon
exercise of the Warrants, which registration statement has been declared
effective by the SEC, if (x) the volume weighted average closing price per share
of Common Stock for a 20-trading day period exceeds $7.00, then Abax shall
within 5 trading days thereafter exercise not less than 50% of the outstanding
Warrants at the price and in accordance with the terms provided in this Warrant
Agreement, and (y) the volume weighted average closing price per share of Common
Stock for a 20-trading day period exceeds $9.00, then Abax shall within 5
trading days thereafter exercise the outstanding Warrants at the price and in
accordance with the terms provided in this Warrant Agreement.
 
7. Redemption of Abax’s Warrants
 
7.1 If on January 1, 2014, any Warrant remains unexercised, or if any Event of
Default shall occur under the Indenture (the fifteenth Business Day following
January 1, 2014, or the fifteenth Business Day following the date of any Event
of Default under the Indenture, the “Redemption Date”), then on the Redemption
Date the Company agrees to and shall, redeem the Warrants tendered by Abax for a
redemption price of $1.00 per Warrant Share.
 
 
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7.2 Any Warrants redeemed by the Company pursuant to Section 7.1 shall be
cancelled and no rights shall thereafter exist with respect to such Warrants.
 
7.3 The Company shall not have any redemption rights with respect to the
Warrants except as expressly set forth in Section 7.1.
 
8. Indemnification.
 
(a) In addition to all rights and remedies available to any Investor at law or
in equity, each Group Company and each Controlling Shareholder shall jointly and
severally indemnify each Investor, and its Affiliates, stockholders, officers,
directors, employees, agents, representatives, successors and permitted assigns
(collectively, the “Indemnified Parties”) and save and hold each of them
harmless against and pay on behalf of or reimburse such party as and when
incurred for any loss (including, without limitation, diminutions in value),
liability, demand, claim, action, cause of action, cost, damage, deficiency,
tax, penalty, fine or expense, whether or not arising out of any claims by or on
behalf of any third party, including interest, penalties, reasonable attorneys’
fees and expenses and all reasonable amounts paid in investigation, defense or
settlement of any of the foregoing (collectively, “Losses”) which any such party
may suffer, sustain or become subject to, as a result of, in connection with,
relating or incidental to or by virtue of:
 
(i) any misrepresentation or breach of a representation or warranty on the part
of any Warrantor herein;
 
(ii) any nonfulfillment or breach of any covenant or agreement herein on the
part of any Group Company or any Controlling Shareholder, or of any Senior
Management Member pursuant to the Noncompetition and Non-Solicitation Agreement
entered into the date hereof between the Investors and each such Senior
Management Member; or
 
(iii) any action, demand, proceeding, investigation or claim by any third party
(including, without limitation, governmental agencies) against or affecting any
Group Company and/or its Affiliates or Subsidiaries which, if successful, would
give rise to or evidence the existence of or relate to a breach of (A) any of
the representations or warranties at the time made or (B) covenants of such
Group Company or the Controlling Shareholders.
 
(b) Notwithstanding the foregoing, and subject to the following sentence, upon
judicial determination, which is final and no longer appealable, that the act or
omission giving rise to the indemnification hereinabove provided resulted
primarily out of or was based primarily upon the Indemnified Party’s gross
negligence, fraud or willful misconduct (unless such action was based upon the
Indemnified Party’s reliance in good faith upon any of the representations,
warranties, covenants or promises made by any Warrantor herein) by the
Indemnified Party, neither any Group Company nor any Controlling Shareholder
shall be responsible for any Losses sought to be indemnified in connection
therewith, and each Group Company and the Controlling Shareholders shall be
entitled to recover from the Indemnified Party all amounts previously paid in
full or partial satisfaction of such indemnity, together with all costs and
expenses of such Group Company and the Controlling Shareholders reasonably
incurred in effecting such recovery, if any.
 
 
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(c) All indemnification rights hereunder shall survive indefinitely, regardless
of any investigation, inquiry or examination made for or on behalf of, or any
knowledge of any Investor and/or any of the other Indemnified Parties.
 
(d) The indemnity obligations that each Group Company and the Controlling
Shareholders have under this Section shall be in addition to any liability that
such Group Company and the Controlling Shareholders may otherwise have.
 
9. Miscellaneous.
 
9.1 Termination. Except for Sections 8 and 9, which shall survive the
termination of this Agreement, or as otherwise expressly provided herein, this
Agreement will be automatically terminated with no further effect with respect
to an Investor at such time that such Investor no longer holds any Securities
(including the Warrant Shares issued upon exercise of the Warrants).
 
9.2 Specific Enforcement. Upon a breach by any Controlling Shareholder or any
Group Company of this Agreement, in addition to any such damages as any Investor
is entitled to, directly or indirectly, by reason of said breach, each Investor
shall be entitled to injunctive relief against such Controlling Shareholder or
such Group Company if such relief is applicable and available, as a remedy at
law would be inadequate and insufficient. Nothing in this Section shall be
construed as limiting any Investor’s remedies in any way.
 
9.3 Notices. All notices, requests, consents and other communications hereunder
shall be in writing and shall be personally delivered or delivered by overnight
courier or mailed by first-class registered or certified mail, postage prepaid,
return receipt requested, or by facsimile transmission. Every notice hereunder
shall be deemed to have been duly given or served on the date on which
personally delivered, with receipt acknowledged, upon transmission by facsimile
and confirmed facsimile receipt, or two (2) days after the same shall have been
deposited with a reputable international overnight courier.
 
(a) If to an Investor, at its address as set forth in the Purchase Agreement, or
at such other address as may have been furnished to the Company by it in
writing.
 
(b) If to the Controlling Shareholders, at the address set forth on Schedule C
to this Agreement, or at such other address as may have been furnished to the
Company by it in writing.
 
(c) If to the Company at:
 
China Mobile Media Technology Inc.
9th Floor, Block C, Intell-Center
No.18 Zhongguancun East Road
Haidian District
Beijing, China 100083
Fax: + 86 10 8620 1927
Attention: Chief Financial Officer
 
 
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with a copy to:
 
Loeb & Loeb LLP
345 Park Avenue
New York, NY 10154
Attention: Mitchell S. Nussbaum, Esq.
Facsimile No.: +1 212 202 7829
 
9.4 Amendments and Waiver. Unless otherwise specifically stated herein, any term
of this Agreement may be amended with the written consent of the party against
whom enforcement may be sought and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively) by the Company and the Controlling Shareholders,
in the case of an Investor’s obligations, and by the Investors entitled to
rights hereunder in the case of the obligations of any other parties hereto. No
waivers of or exceptions to any term, condition or provision of this Agreement,
in any one or more instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such term, condition or provision.
 
9.5 Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties hereto and supersedes all prior agreements and
understandings relating to the subject matter hereof.
 
9.6 Severability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provisions of this Agreement to the extent permitted by law.
 
9.7 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. Each Group Company and
Controlling Shareholder agrees that any suit, action or proceeding against it
arising out of or based upon this Agreement or the transactions contemplated
hereby may be instituted in any State or U.S. federal court in The City of New
York and County of New York, and waives any objection which it may now or
hereafter have to the laying of venue of any such proceeding, and irrevocably
submits to the non-exclusive jurisdiction of such courts in any suit, action or
proceeding.
 
9.8 Successors and Assigns. Except as otherwise provided herein, the terms and
conditions of this Agreement shall be binding upon, and inure to the benefit of,
the respective representatives, successors and assigns of the parties hereto;
provided, however, any right of Abax under this Agreement (except for Abax’s
right granted under Section 7) shall only be assignable or transferable to any
person who holds the Minimum Holding (in the case of rights granted to Abax
under Section 2, Section 3 and Section 4) or holds more than 5% of the
outstanding shares of Common Stock on an as exercised and fully-diluted basis
(in the case of right granted to Abax under Section 5), provided, further, that
rights, obligations and other duties set forth in Section 7 hereof shall be
exercisable and assumed by Abax only and shall not be assignable or transferable
to any other person, including without limitation, the successors or assigns of
Abax.
 
 
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9.9 Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
 
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
 

 
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IN WITNESS WHEREOF, the undersigned have executed this Investor Rights Agreement
as of the day and year written above.
      GROUP COMPANIES       CHINA MOBILE MEDIA TECHNOLOGY INC.  
   
   
  By:    

--------------------------------------------------------------------------------

Name:
Title:
 

        MAGICAL INSIGHT INVESTMENTS LIMITED  
   
   
  By:    

--------------------------------------------------------------------------------

Name:
Title:
 

        BEIHAI HI-TECH WEALTH TECHNOLOGY DEVELOLPMENT CO. LTD.  
   
   
  By:    

--------------------------------------------------------------------------------

Name:
Title:
 

       
BEIJING HI-TECH WEALTH COMMUNICATION TECHNOLOGY CO., LTD.
 
   
   
  By:    

--------------------------------------------------------------------------------

Name:
Title:
   

 
[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]
 

--------------------------------------------------------------------------------

 
 

        CONTROLLING SHAREHOLDERS:  
   
   
  By:    

--------------------------------------------------------------------------------

Dr. ZHANG Zhengyu
as the Controlling Shareholder
 

      By:    

--------------------------------------------------------------------------------

Mr. MA Qing
as the Controlling Shareholder
 

      By:    

--------------------------------------------------------------------------------

Ms. LI Ming
as the Controlling Shareholder
   

 
[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]
 

--------------------------------------------------------------------------------

 
 
Accepted and Agreed to:
 
ABAX LOTUS LTD.
 
By:
 
By: 

--------------------------------------------------------------------------------

Name:
Title: Authorized Signatory
 
 
 

[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]
 

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Schedule A
 
List of Group Companies
 
1. China Mobile Media Technology Inc.
 
2. Magical Insight Investments Limited
 
3. Beihai Hi-Tech Wealth Technology Development Co., Ltd.
 
4. Beijing Hi-Tech Wealth Communication Technology Co., Ltd.
 
 

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Schedule B
 
List of Top 15 Accounting Firms
 
1. PricewaterhouseCoopers
 
2. Deloitte Touche Tohmatsu
 
3. Ernst & Young
 
4. KPMG
 
5. BDO International
 
6. Grant Thornton International
 
7. RSM International
 
8. Baker Tilly International
 
9. Horwath International
 
10. Moores Rowland International
 
11. Moss Adams
 
12. J.H. Cohn
 
13. Crowe Chizek and Co. LLC
 
14. Plante & Moran PLLC
 
15. BKD LLP
 
 

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Schedule C
 
Addresses of Controlling Shareholders:
 
c/o China Mobile Media Technology Inc.
9th Floor, Block C, Intell-Center
No.18 Zhongguancun East Road
Haidian District
Beijing, China 100083
Fax: + 86 10 8620 1927
 
 

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