**TABLE OF CONTENTS**       **Page** **ARTICLEI**     Purchase; Purchase price; and Closings     SECTION 1.1. Purchase  1 SECTION 1.2. Purchase Price  1 SECTION 1.3. Closing  1      **ARTICLEII**     Representations and Warranties     SECTION 2.1. Representations and Warranties of the Company  4 SECTION 2.2. Representations and Warranties of the Focus Investor  13 SECTION 2.3. Representations and Warranties of the Other Investors  15      **ARTICLE III**     Covenants     SECTION 3.1. Filings; Other Actions  16 SECTION 3.2. Expenses  17 SECTION 3.3. Confidentiality  17 SECTION 3.4. Conduct of the Business  17 SECTION 3.5. Reasonable Efforts  18 SECTION 3.6. Shareholder Litigation  18      **ARTICLE IV**     Additional Agreements     SECTION 4.1. Lock-Up  18 SECTION 4.2. Standstill  19 SECTION 4.3. Legend  20 SECTION 4.4. Indemnity  20 SECTION 4.5. Registration Rights  23 SECTION 4.6. Gross-Up Rights  23 SECTION 4.7. Anti-Takeover Matters; Takeover Laws; No Rights Triggered  25 SECTION 4.8. Continued Listing Authorization  25 SECTION 4.9. Corporate Opportunities  26 SECTION 4.10. Regulatory Matters  27 
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       **Page** **ARTICLE V**     Termination     SECTION 5.1. Termination  28 SECTION 5.2. Effects of Termination  28      **ARTICLE VI**     Miscellaneous     SECTION 6.1. Survival  28 SECTION 6.2. Amendment  29 SECTION 6.3. Waivers  29 SECTION 6.4. Counterparts and Facsimile  29 SECTION 6.5. Governing Law  29 SECTION 6.6. Waiver of Jury Trial  29 SECTION 6.7. Notices  29 SECTION 6.8. Entire Agreement, Etc  31 SECTION 6.9. Definitions  31 SECTION 6.10. Captions  33 SECTION 6.11. Severability  33 SECTION 6.12. No Third-Party Beneficiaries  33 SECTION 6.13. Public Announcements  33 SECTION 6.14. Specific Performance  33 
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**LIST OF SCHEDULES AND EXHIBITS**        SCHEDULE I: InvestorsSCHEDULE II: Disclosure ScheduleExhibit A: Form of Opinion of CounselExhibit B: Form of Officer’s Certificate from the CompanyExhibit C: Form of Registration Rights AgreementExhibit D: Form of Shareholders’ AgreementExhibit E Form of Promissory Note
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**INDEX OF DEFINED TERMS**     **Location of****Term** **Definition**Affiliate SECTION 6.9(2)Agreement PreambleArticles of Association SECTION 2.1(a)Beneficially Own/Beneficial Owner/Beneficial Ownership SECTION 6.9(9)Board of Directors SECTION 2.1(c)(1)Burdensome Condition SECTION 4.10Business day SECTION 6.9(7)Closing SECTION 1.3(a)Closing Date SECTION 1.3(a)Common Shares RecitalsCompany PreambleCompany 20-F SECTION 2.1(c)(1)Company Reports SECTION 2.1(f)(1)Company Restricted Shares SECTION 2.1(c)(1)Company Share Option SECTION 2.1(c)(1)Company Share Option Plans SECTION 2.1(c)(1)control/controlled by/under common control with SECTION 6.9(2)Disclosure Schedule SECTION 2.1(j)Disposition SECTION 4.1Exchange Act SECTION 2.1(f)(1)GAAP SECTION 2.1(e)Governmental Entity SECTION 1.3(b)(1)(i)Group Company /Group Companies SECTION 1.3(b)(1)(iv)herein/hereof/hereunder SECTION 6.9(5)including/includes/included/include SECTION 6.9(4)Information SECTION 3.3(a)Investment Amount SECTION 1.3(a)Investor PreambleLiens SECTION 1.3(a)Material Adverse Effect SECTION 1.3(b)(1)(iv)Material Contract SECTION 2.1(j)Merger Agreement SECTION 4.4(a)New Security SECTION 4.6(a)Other Private Placements RecitalsOther Securities Purchase Agreements RecitalsPer Share Purchase Price SECTION 1.3(a)person SECTION 6.9(8)PRC SECTION 1.3(a)Pre-Closing Period SECTION 3.4
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     **Location of****Term** **Definition**Purchased Shares SECTION 1.3(a)Purchase Price SECTION 1.3(a)Registration Rights Agreement RecitalsSEC SECTION 2.1SEC Comments SECTION 2.1SEC Documents SECTION 2.1Securities Act SECTION 2.1(f)(1)Shareholder Litigation SECTION 3.6Shareholders’ Agreement RecitalsStandstill Period SECTION 4.2(a)subsidiary SECTION 6.9(1)Transaction Documents RecitalsUnaudited Interim Report SECTION 2.1(f)(1)Voting Debt SECTION 2.1(c)(1)Voting Securities SECTION 4.2(a)
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          **THIS SECURITIES PURCHASE AGREEMENT**, dated as of December 30, 2010 (this “*Agreement*”), is madeby and among VisionChina Media Inc., a Cayman Islands company, (the “*Company*”), Focus Media HoldingLimited, a Cayman Islands company (the “*Focus Investor*”), and the Persons other than the FocusInvestor whose names are listed in first column from the left of Schedule I hereto (the“*Other Investors*”, and each an “*Other Investor*”). The Focus Investor and the Other Investors arecollectively referred to herein as the “*Investors*”, and each an “*Investor*”.**RECITALS:**          A. The Investment. The Investors intend to subscribe for and purchase from theCompany, and the Company intends to issue and sell to the Investors, as an investment in theCompany, the securities as described herein. The securities to be purchased at the closing arecommon shares, par value $0.0001, of the Company (“*Common Shares*”).          B. Registration Rights. At the Closing, the Company will enter into a RegistrationRights Agreement, substantially in the form attached as Exhibit C hereto (the “*RegistrationRights Agreement*”), pursuant to which the Company has agreed to provide certain registration rightswith respect to the Purchased Shares issued and sold to the Investors, under the Securities Act andapplicable state securities laws.          C. Shareholders’ Agreement. At the Closing, the Company and the Focus Investor, amongothers will enter into a Shareholders’ Agreement, substantially in the form attached as ExhibitD hereto (the “*Shareholders’ Agreement*”).          D. Transaction Documents. The term “*Transaction Documents*” refers to this Agreement,the Registration Rights Agreement and the Shareholders’ Agreement.          **NOW, THEREFORE**, in consideration of the premises, and of the representations, warranties,covenants and agreements set forth herein, the parties agree as follows:**ARTICLE I****PURCHASE; PURCHASE PRICE; AND CLOSINGS**          SECTION 1.1. Purchase. On the terms and subject to the conditions set forth herein, eachInvestor will severally and not jointly purchase from the Company, and the Company will issue andsell to each Investor, the number of Common Shares set forth in the second column from the left ofSchedule I hereto opposite the name of such Investor (such Common Shares collectively, the“*Purchased Shares*”).          SECTION 1.2. Purchase Price. The purchase price per Purchased Share shall be US$3.979.          SECTION 1.3. Closing.
 

 
          (a) Subject to the satisfaction (or, where permissible, waiver) of the conditions to theclosing set forth in SECTION 1.3(b), the closing shall take place at the Beijing offices ofSkadden, Arps, Slate, Meagher & Flom LLP, the People’s Republic of China (the “*PRC*”), or such otherlocation as agreed by the parties in writing (the “*Closing*”), on the seventh business day from thedate of this Agreement or such other date as agreed by the parties in writing (the date on whichthe Closing actually occurs, the “*Closing Date*”). At the Closing, (i) the Company will (A) makeentries in its register of members in order to record and give effect to the issue to each Investorof the number of Purchased Shares purchased by such Investor, and (B) deliver to each Investor oneor more certificates bearing the appropriate legends herein provided for and free and clear of allliens, adverse rights or claims, charges, options, pledges, covenants, title defects, securityinterests or other encumbrances of any kind (“*Liens*”) representing the number of the PurchasedShares purchased by such Investor, (ii) each Investor shall (i) pay to the Company the amount setforth in the third column from the left of Schedule I hereto opposite the name of suchInvestor by wire transfer of immediately available funds in United States dollars to a bank accountdesignated by the Company and (ii) deliver to the Company a promissory note in favor of the Companyin an amount that equals to the amount set forth in the fourth column from the left of ScheduleI hereto opposite the name of such Investor in the form set forth in Exhibit E hereto,which promissory note shall be due and payable on March 31, 2011. Closing Conditions.     (1) The obligation of each Investor to consummate the Closing is subject to thefulfillment prior to or contemporaneously with the Closing of each of the followingconditions:     (i) no judgment, injunction, order or decree shall prohibit the Closing orshall prohibit or restrict any Investor from owning, voting, converting orexercising any securities of the Company in accordance with the terms thereof and nolawsuit shall have been commenced by any court, administrative agency or commissionor other governmental authority or instrumentality, whether federal, state, local orforeign, or any applicable industry self-regulatory organization (each, a“*Governmental Entity*”) seeking to effect any of the foregoing;     (ii) the representations and warranties of the Company set forth in SECTION 2.1of this Agreement shall be true and correct in all material respects as of the datehereof and as of the Closing Date (except (i) to the extent such representations andwarranties are made as of a specified date, in which case such representations andwarranties shall be true and correct in all material respects as of such date), and(ii) any representations and warranties that have “material” or “Material AdverseEffect” qualifications, in which case such representations and warranties shall betrue in all respects);     (iii) the Company shall have performed in all material respects all obligationsrequired to be performed by it at or prior to or contemporaneously with the Closingunder this Agreement;     (iv) since the date hereof, there shall not have occurred any circumstance,event, change, development or effect that, individually or in the
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aggregate, (1) isor would reasonably be expected to be material and adverse to the financialposition, results of operations, business, assets or liabilities, or management ofthe Company and all of its subsidiaries, consolidated affiliated entities and theirsubsidiaries as of the date of this Agreement (individually, a “*Group Company*” and,collectively, the “*Group Companies*”) taken as a whole, or (2) would or wouldreasonably be expected to materially impair the ability of the Company to performits obligations under this Agreement or the other Transaction Documents or otherwisematerially threaten or materially impede the consummation of the transactionscontemplated by this Agreement or the other Transaction Documents (“*Material AdverseEffect*”).     (v) Maples and Calder, Cayman Islands counsel for the Company, shall havedelivered to the Focus Investor and JJ Media Investment Holding Limited (the “JJMedia Investor”) their written opinion, dated the Closing Date, in the form setforth in Exhibit A hereto;     (vi) the Company shall have delivered to the Focus Investor and the JJ MediaInvestor a duly executed Officer’s Certificate in the form set forth in ExhibitB hereto;     (vii) at Closing, the Registration Rights Agreement shall be executed by theCompany and Front Lead Investments Limited; and     (viii) at Closing, the Shareholders’ Agreement shall be executed by theCompany, Front Lead Investments Limited, and Limin Li.     (2) The obligation of the Company to consummate the Closing is subject to thefulfillment prior to the Closing of each of the following conditions:     (i) no judgment, injunction, order or decree shall prohibit the Closing orshall prohibit or restrict any Investor from owning, voting, converting orexercising any securities of the Company in accordance with the terms thereof and nolawsuit shall have been commenced by any Governmental Entity seeking to effect anyof the foregoing;     (ii) the representations and warranties of each Investor set forth in SECTION2.2 and SECTION 2.3 of this Agreement shall be true and correct in all materialrespects as of the date hereof and as of the Closing Date (except to the extent suchrepresentations and warranties are made as of a specified date, in which case suchrepresentations and warranties shall be true and correct in all material respects asof such date);     (iii) Each Investor shall have performed in all material respects allobligations required to be performed by it at or prior to or contemporaneously withthe Closing under this Agreement;     (iv) at Closing, the Registration Rights Agreement shall be executed by theFocus Investor and the JJ Media Investor; and
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     (v) the Shareholders’ Agreement shall have been executed by the Focus Investorand the JJ Media Investor.**ARTICLE II****REPRESENTATIONS AND WARRANTIES**          SECTION 2.1. Representations and Warranties of the Company. Except informationpublicly disclosed by the Company in the Company Reports filed by it with or furnished to the U.S.Securities and Exchange Commission (the “*SEC*”), including amendments thereto filed prior to thedate hereof and publicly available prior to the date hereof (the “*SEC Documents*”) or as disclosedin Schedule II hereto or as set out in the SEC’s comments dated December 22, 2010 in connectionwith the Company’s Form 20-F for the fiscal year ended December 31, 2009 (the “*SEC Comments*”),which shall be deemed as general disclosure that qualifies any provision of this Agreement, theCompany represents and warrants as of the date of this Agreement and as of the Closing Date (exceptto the extent made only as of a specified date, in which case as of such date) to each Investor ona several but not a joint basis that:          (a) Organization and Authority. The Company is an exempted company with limitedliability duly organized and validly existing under the laws of the Cayman Islands, is dulyqualified to do business and is in good standing in all jurisdictions where its ownership orleasing of property or the conduct of its business requires it to be so qualified, and hascorporate power and authority to own its properties and assets and to carry on its business as itis now being conducted. The Company has furnished or made available to the Investor, prior to thedate hereof, true, correct and complete copies of the Company’s Memorandum and Articles ofAssociation, as amended through the date of this Agreement (the “*Articles of Association*”).          (b) Group Companies. The Company has disclosed in the SEC Documents a true, completeand correct list of all of its Group Companies. Each Group Company is an entity duly organized,validly existing, duly qualified to do business and in good standing under the laws of itsjurisdiction of organization, and has corporate or other appropriate organizational power andauthority to own or lease its properties and assets and to carry on its business as it is now beingconducted.          (c) Capitalization.     (1) The authorized share capital of the Company consists of 200,000,000 Common Shares.As of the date hereof, there are 84,833,219 Common Shares outstanding. From the date hereofthrough the Closing Date, except pursuant to the Transaction Documents and the transactionscontemplated hereby and thereby, the Company shall not have (i) issued, approved or agreedthe issuance of any Common Shares, or any securities convertible into or exchangeable orexercisable for Common Shares (other than shares issued upon the exercise of share option(s)issued pursuant to the Amended and Restated 2006 Share Incentive Plan as filed as exhibit4.6 to theCompany’s Annual Report on Form 20-F for the year ended December 31, 2008 (the “*CompanyShare Option Plan*”) outstanding on the date of this Agreement, (ii) reserved for issuanceany Common Shares or (iii) repurchased or redeemed, or approved or agreed
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the repurchase orredemption of, any Common Shares or any securities convertible into or exchangeable orexercisable for Common Shares. As of the date hereof, there are (i) outstanding shareoptions issued under the Company’s Share Option Plan to purchase an aggregate of 2,367,662Common Shares (each, a “*Company Share Option*”) and (ii) 1,277,339 Common Shares reserved forissuance under the Company Share Option Plan. Other than in respect of awards outstandingunder or pursuant to the Company Share Option Plan, no Common Shares are reserved forissuance. All of the issued and outstanding shares of the Company have been duly authorizedand validly issued and are fully paid, in accordance with applicable law, nonassessable andfree of preemptive rights. Each Company Share Option (i) was granted in compliance with allapplicable laws and all of the terms and conditions of the Company Share Option Plan. Nobonds, debentures, notes or other indebtedness having the right to vote on any matters onwhich the shareholders of the Company may vote (“*Voting Debt*”) are issued and outstanding.Except as set forth elsewhere in this SECTION 2.1(c), the Company does not have and is notbound by any outstanding subscriptions, options, warrants, calls, repurchase rights,commitments, or agreements of any character calling for the purchase or issuance of, orsecurities or rights convertible into or exchangeable or exercisable for, any Common Shareor any other equity securities of the Company or Voting Debt or any securities representingthe right to purchase or otherwise receive any shares of the Company (including any rightsplan or agreement). The Company has disclosed in the Company Reports all shares of theCompany that have been purchased, redeemed or otherwise acquired, directly or indirectly, bythe Company or any Group Company since December 31, 2009 and all dividends or otherdistributions that have been declared, set aside, made or paid to the shareholders of theCompany since that date.          (d) Authorization.     (1) The Company has the corporate power and authority to enter into and deliver theTransaction Documents and to carry out its obligations thereunder. The execution, deliveryand performance of the Transaction Documents by the Company and the consummation of thetransactions contemplated thereby, including the issuance of Common Shares in accordancewith the terms of this Agreement, have been duly authorized by all requisite actions on thepart of the Company. The Transaction Documents constitute the valid and legally bindingobligation of the Company, enforceable against the Company in accordance with theirrespective terms, except as such enforceability may be limited by bankruptcy, insolvency,moratorium, reorganizations, fraudulent transfer or similar laws relating to or affectingcreditors generally or by general equitable principles (whether applied in equity or atlaw). No approvals or authorizations by the Company shareholders are necessary for theexecution and delivery by the Company of the Transaction Documents, the performance by theCompany of its obligations thereunder or the consummation by the Company of the transactionscontemplated thereby.     (2) Neither the execution, delivery and performance by the Company of any of theTransaction Documents, nor the consummation of the transactions contemplated thereby will(i) violate, conflict with, or result in a breach of any provision of, or constitute adefault (or an event which, with notice or lapse of time or both, would
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constitute adefault) under, or result in the termination of, or result in the loss of any benefit orcreation of any right on the part of any third party under, or accelerate the performancerequired by, or result in a right of termination or acceleration of any material contract towhich the Company or any Group Company is a party, or result in the creation of, anymaterial Lien, upon any of the properties or assets of the Company or any Group Company (ii)violate any ordinance, permit, concession, grant, franchise, law, statute, rule orregulation or any judgment, ruling, order, writ, injunction or decree applicable to theCompany or any Group Company or any of their respective properties or assets.     (3) No notice to, registration, declaration or filing with, exemption or review by, orauthorization, order, consent or approval of, any Governmental Entity, or expiration ortermination of any statutory waiting period, is necessary for the execution and delivery ofthe Transaction Documents or the consummation by the Company of the transactionscontemplated thereby.          (e) Financial Statements. The annual consolidated financial statements of the Companyfor the fiscal years ended on December 31, 2007, December 31, 2008, and December 31, 2009 filedwith the SEC on the Form 20-Fs filed on April 3, 2008, April 6, 2009, and June 23, 2010respectively, and the unaudited consolidated balance sheet of the Company as of September 30, 2010and related consolidated statement of operations for the three-month period then ended, filed as anexhibit to Form 6-K for the period ended September 30, 2010 (the “*Unaudited Interim Report*”) (1)have been prepared from, and are in accordance with, the books and records of the Group Companies,(2) complied, as of each of their dates of filing with the SEC, in all material respects withapplicable accounting requirements and with the published rules and regulations of the SEC withrespect thereto, (3) have been prepared, in all material respects, in accordance with U.S.generally accepted accounting principles (“*GAAP*”) applied on a consistent basis except as disclosedin such financial statements or the notes thereto and (4) present fairly in all material respectsthe consolidated financial position of the Company and the Group Companies at the dates set forththerein and the consolidated results of operations and cash flows of the Company and the GroupCompanies for the periods stated therein, subject to (1) the absence of notes and year-end auditand closing adjustments, and (2) the omission of consolidated statements of cash flows and footnotedisclosures, each in the case of the Unaudited Interim Report.          (f) Reports.     (1) Since December 31, 2007, the Company has filed all reports, registrations,documents, filings, statements and submissions together with any required amendmentsthereto, that it was required to file with the SEC (the foregoing, collectively, the“*Company Reports*”) and have paid all fees and assessments due and payable in connectiontherewith. As of their respective filing dates, the Company Reports complied in allmaterial respects with all statutes and applicable rules and regulations of the applicableGovernmental Entities, as the case may be. As of the date of this Agreement,except for the SEC Comments, there are no outstanding comments from the SEC or anyother Governmental Entity with respect to any Company Report. Each Company Report, includingthe documents incorporated therein by reference, when it was filed with or furnished to theSEC, did not, as of its date or if amended prior to the date of this
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Agreement, as of thedate of such amendment, contain any untrue statement of a material fact or omit to state amaterial fact necessary in order to make the statements made in it, in the light of thecircumstances under which they were made, not misleading and complied as to form in allmaterial respects with the applicable requirements of the Securities Act of 1933, as amended(the “*Securities Act*”), and the Securities Exchange Act of 1934, as amended (the “*ExchangeAct*”). The Company’s financial condition is, in all material respects, as described in theCompany Reports, except for changes in the ordinary course of business. No executiveofficer of the Company has failed in any respect to make the certifications required of himor her under Section 302 or 906 of the Sarbanes-Oxley Act of 2002. As of the date hereof,the Company is not aware of any facts or circumstances that would prevent its chiefexecutive officer and chief financial officer or persons performing similar functions fromgiving the certifications and attestations required pursuant to Rules 13a-14 and 15d-14under the Exchange Act, without qualification, when next due.     (2) The records, systems, controls, data and information of the Company and the GroupCompanies are recorded, stored, maintained and operated under means (including anyelectronic, mechanical or photographic process, whether computerized or not) that are underthe exclusive ownership and direct control of the Company or the Group Companies oraccountants (including all means of access thereto and therefrom). The Company (A) hasimplemented and maintains disclosure controls and procedures (as defined in Rule 13a-15(e)of the Exchange Act) to ensure that material information relating to the Company, includingits consolidated subsidiaries, is made known to the chief executive officer and the chieffinancial officer of the Company or other persons performing similar functions by otherswithin those entities, and (B) has disclosed, based on its most recent evaluation prior tothe date of this Agreement, to the Company’s outside auditors and the audit committee of theBoard of Directors of the Company (the “*Board of Directors*”) (x) any significantdeficiencies and material weaknesses in the design or operation of internal control overfinancial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that are reasonablylikely to adversely affect the Company’s ability to record, process, summarize, and reportfinancial information, and (y) any fraud, whether or not material, that involves managementor other employees who have a significant role in the Company’s internal controls overfinancial reporting. The Company has no knowledge of any reason that its chief executiveofficer and chief financial officer or persons performing similar functions will not be ableto give the certifications and attestations required pursuant to the rules and regulationsadopted pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, without qualification,when next due. Since December 31, 2007, (i) neither the Company nor, to the knowledge ofthe Company, any director, officer, employee, or accountant of the Company has received anymaterial complaint, allegation, assertion or claim, whether written or oral, regarding theaccounting practices, procedures, methodologies or methods of the Company or any GroupCompany or their respective internal accounting controls, including any material complaint,allegation, assertion or claim that the Company or anyGroup Company has engaged in questionable accounting practices, and (ii) no attorneyrepresenting the Company, whether or not employed by the Company, has reported evidence of aviolation of securities laws, breach of fiduciary duty or similar violation by the Companyor any of the Group Companies or any of their respective officers,
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directors, employees oragents to the Board of Directors or any committee thereof or to any director or officer ofthe Company or any of the Group Companies.          (g) Properties and Leases. Except for any Permitted Liens, the Company and each GroupCompany have good title free and clear of any Liens to all the real and personal property that arematerial to their respective businesses, which are reflected in the Company’s consolidated balancesheet as of December 31, 2009 included in the Company 20-F for the period then ended, and all realand personal property that are material to their respective businesses acquired since such date,except such real and personal property as has been disposed of in the ordinary course of business.For purposes of this Agreement, “*Permitted Liens*” means (i) Liens for taxes and other governmentalcharges and assessments arising in the ordinary course which are not yet due and payable, (ii)Liens of landlords and Liens of carriers, warehousemen, mechanics and materialmen and other likeLiens arising in the ordinary course of business for sums not yet due and payable, (iii) any Lienthat may arise by operation of law, and (iv) other Liens or imperfections on property which are notmaterial in amount or do not materially detract from the value of or materially impair the existinguse of the property affected by such Lien or imperfection. All leases of real property and allother leases pursuant to which the Company or such Group Company, as lessee, leases real orpersonal property, which are material to their respective businesses, are valid and effective inall material respects in accordance with their respective terms and there is not, under any suchlease, any existing material default by the Company or such Group Company.          (h) Tax. The Company and each Group Company have timely prepared and filed all taxreturns required to have been filed by the Company with the appropriate Government Entities andtimely paid all taxes shown thereon or otherwise owed by it, except as would not have a MaterialAdverse Effect. The charges, accruals and reserves on the books of the Company and each GroupCompany in respect of taxes for all fiscal period are adequate in all material respects, and thereare no material unpaid assessments against the Company or any Group Company. All taxes and otherassessments and levies that the Company or any Group Company is required to withhold or to collectfor payment have been duly withheld and collected and paid to the proper Governmental Entity orthird party when due. There are no tax Liens or claims pending against the Company, any GroupCompany or any of their assets or property, other than Permitted Liens. There are no tax audits orinvestigations pending, which if adversely determined would result in a Material Adverse Effect.          (i) Absence of Certain Changes. Since December 31, 2009, the business and operationsof the Company and the Group Companies have been conducted in the ordinary course of businessconsistent with past practice, and there has not been any Material Adverse Effect or any change inany method of accounting or accounting policies by the Company or any of the Group Companies.          (j) Material Contracts. The contracts (“*Material Contract*”) set forth in Part 1 ofthe disclosure schedule set forth in Schedule II attached hereto (the “*Disclosure Schedule*”)include all of the material contracts relating to the subway and public bus LCD displayadvertising business engaged in by the Company and the Group Companies. Each Material Contract isvalid and binding on the Company and the Group Companies, as applicable, and in full force andeffect. The Company and each of the Group Companies, as applicable, are in
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compliance in allmaterial respects with and have performed in all material respects all obligations required to beperformed by them to date under each Material Contract. As of the date hereof, neither the Companynor any of the Group Companies knows of, or has received notice of, any material violation ordefault (or any condition which with the passage of time or the giving of notice would cause such aviolation of or a default) by any party under any Material Contract. Each of the Company and theGroup Companies has not received any written notice from any party under any Material Contract thatit intends to stop performing such Material Contract or materially and adversely change any of thematerial terms (whether related to payment, price or otherwise) with respect to such MaterialContracts (whether as a result of the transactions contemplated by this Agreement or otherwise).Consummation of the transactions contemplated by this Agreement will not place the Company or anyof the Group Companies in breach or default of any Material Contract, or trigger any modification,termination or acceleration thereunder.          (k) Related Party Transaction. Other than disclosed in the SEC Documents, there areno material transactions or series of related transactions, agreements, arrangements orunderstandings, nor are there any currently proposed material transactions, or series of relatedtransactions between the Company or any Group Companies, on the one hand, and the Company, anycurrent or former director or executive officer of the Company or any Group Companies or any personwho Beneficially Owns 5% or more of the Common Shares (or any of such person’s immediate familymembers or Affiliates) (other than Group Companies), on the other hand.          (l) Offering of Securities. Neither the Company nor any person acting on its behalfhas taken any action (including, any offering of any securities of the Company under circumstanceswhich would require the integration of such offering with the offering of any of the Common Sharesto be issued pursuant to this Agreement or any other Transaction Document under the Securities Actand the rules and regulations of the SEC promulgated thereunder) which would subject the offering,issuance, or sale of any of such Common Shares to be issued to the registration requirements of theSecurities Act.          (m) Litigation and Other Proceedings.     (1) Except as disclosed in Part 2 of the Disclosure Schedule, there is no pending or,to the knowledge of the Company, threatened, claim, action, suit, arbitration, mediation,demand, hearing, investigation or proceeding against the Company or any Group Company thatinvolves a claim that is or that, if adversely determined, would result in a MaterialAdverse Effect. Neither the Company nor any Group Company is subject to any injunction,order, judgment or decree, nor are there any proceedings with respect to the foregoingpending, or to the knowledge of the Company, threatened.     (2) Neither the Company nor any of the Group Companies has any material liabilities orobligations (absolute, accrued, or otherwise) arising from any legal, governmental oradministrative proceedings, claims or penalty, which are notappropriately reflected or reserved against in the financial statements described inSECTION 2.1(e) to the extent required to be so reflected or reserved against in accordancewith GAAP.
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          (n) Compliance with Laws and Other Matters; Insurance. The Company and each GroupCompany:     (1) in the conduct of its business is in compliance in all material respects with all,and the condition and use of its properties does not violate or infringe in any materialrespect any, applicable laws, statutes, ordinances, licenses, rules, regulations, judgments,demands, writs, injunctions, orders, decrees, rules, circulars or notices applicable theretoor to employees conducting its business, including the Sarbanes-Oxley Act of 2002;     (2) except as disclosed in the SEC Documents, has all material permits, licenses,franchises, authorizations, orders, and approvals of, and has made all filings,applications, and registrations with, Governmental Entities that are required in order topermit it to own or lease its properties and assets and to carry on its business aspresently conducted and that are material to the business of the Company or such GroupCompany; all such permits, licenses, certificates of authority, orders and approvals are infull force and effect, and all such filings, applications and registrations are current,and, to the knowledge of the Company, no suspension or cancellation of any of them isthreatened;     (3) currently is complying in all material respects with and, to the knowledge of theCompany, is not under investigation with respect to, nor has been given notice of anymaterial violation of, all applicable laws, regulations, rules, judgments, injunctions,decrees rules, circulars or notices; and     (4) is presently insured, and during each of the past two calendar years (or duringsuch lesser period of time as the Company has owned such Group Company) has been insured,for reasonable amounts with, to the knowledge of the Company, financially sound andreputable insurance companies against such risks as companies engaged in a similar businesswould, in accordance with industry practice, customarily be insured.          (o) Labor. There is no strike or material labor dispute pending between the Companyor any of the Group Companies and its employees. Each of the Company and the Group Companies arein compliance in all material respects with all applicable laws respecting employment andemployment practices, terms and conditions of employment, and wages and hours.          (p) Status of Securities. The Common Shares to be issued pursuant to this Agreementhave been duly authorized by all necessary corporate action of the Company. When issued and soldagainst receipt of the consideration therefor as provided in this Agreement, such Common Shareswill be validly issued, fully paid and nonassessable, and will not subject the holders thereof topersonal liability and will not be subject to preemptive rights of any other shareholder of theCompany, nor will such issuance result in the violation or triggering of any price-basedantidilution adjustments under any agreement to which the Company or any Group Company is a party.          (q) Investment Company. Neither the Company nor any of the Group Companies is an“investment company” as defined under the Investment Company Act of 1940,
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as amended, and neitherthe Company nor any of the Group Companies sponsors any person that is such an investment company.          (r) Foreign Corrupt Practices and International Trade Sanctions. Neither the Companynor any Group Company, nor any of their respective directors, officers, agents, employees or anyother persons acting on their behalf (i) has violated the Foreign Corrupt Practices Act, 15 U.S.C.§ 78dd-1 *et seq*., as amended, or any other similar applicable PRC, foreign, U.S. federal, or statelegal requirement, (ii) has, in violation of any applicable laws and regulations, made or provided,or caused to be made or provided, directly or indirectly, any payment or thing of value to aforeign official, foreign political party, candidate for office or any other person knowing thatthe person will pay or offer to pay the foreign official, party or candidate, for the purpose ofinfluencing a decision, inducing an official to violate their lawful duty, securing any improperadvantage, or inducing a foreign official to use their influence to affect a governmental decision,(iii) has paid, accepted or received any unlawful contributions, payments, expenditures or gifts,(iv) has violated or operated in noncompliance with any export restrictions, money laundering law,anti-terrorism law or regulation, anti-boycott regulations or embargo regulations, or (v) iscurrently subject to any United States sanctions administered by the Office of Foreign AssetsControl of the United States Treasury Department.          (s) Environmental Liability. Except as has not had and would not have a MaterialAdverse Effect, the Company and each Group Company are in compliance with all applicableEnvironmental Laws. For purposes of this Agreement, “*Environmental Law*” means any law, regulation,order, decree, common law or agency requirement relating to the protection of the environment orhuman health and safety.          (t) Anti-Takeover Provisions. The Company and the Board of Directors has taken allactions necessary, if any, to ensure that the transactions contemplated by the TransactionDocuments, individually or taken as a whole (including the investment hereunder), are not subjectto the provisions of any U.S. or foreign, federal or state “anti-takeover,” “fair price,”“moratorium,” “control share,” “supermajority,” “affiliate transaction,” or “business combination”law (each, a “*Takeover Law*”) and any other similar provisions of an anti-takeover nature containedin its organizational documents. In the case that any such transactions are subject to suchprovisions or laws, the Board of Directors has taken and shall take all necessary action to ensurethat such transactions shall be deemed to be exceptions to such provisions or laws.          (u) Intellectual Property.     (1) (i) The Company and the Group Companies own (free and clear of any claims, liens orencumbrances (including any exclusive licenses or non-exclusive licenses not granted in theordinary course of business)) or have a valid license to use all material IntellectualProperty used in or necessary to carry on their business as currently conducted, and (ii)such Intellectual Property referenced in clause (i) above is valid, subsisting andenforceable in all material respects, and is not subject to any outstanding order, judgment,decree or agreement adversely affecting the Company’s or the GroupCompanies’ use of, or rights to, such Intellectual Property in any material respect.The Company and the Group Companies have sufficient rights to use all material Intellectual
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Property used in their business as presently conducted, all of which rights shall surviveunchanged following the consummation of the transactions contemplated by this Agreement.     (2) There have been no claims made asserting the invalidity, misuse or unenforceabilityof any material Intellectual Property owned or used by the Company or any Group Company.Neither the Company nor any Group Company has received any notice of infringement ormisappropriation of, or any conflict with, the rights of others with respect to any materialIntellectual Property (including without limitation any demand or request that the Companyor any Group Company licenses any rights to any Intellectual Property from a third party).To the Company’s knowledge, the conduct of the business of the Company and any Group Companyhas not infringed, misappropriated or conflict with any Intellectual Property Rights of anythird party. To the Company’s knowledge, no third party has infringed, misappropriated orotherwise violated the Intellectual Property rights of the Company or the Group Companies.The Company and each of the Group Companies has taken reasonable measures to protect thematerial Intellectual Property owned by or licensed to the Company or any of the GroupCompanies.          “*Intellectual Property*” shall mean all trademarks, service marks, brand names, trade names,slogans, logos domain names, certification marks, trade dress and other indications of origin, thegoodwill associated with the foregoing and registrations in any jurisdiction of, and applicationsin any jurisdiction to register, the foregoing, including any extension, modification or renewal ofany such registration or application; inventions, discoveries and ideas, whether patentable or not,in any jurisdiction; patents, applications for patents (including divisions, continuations,continuations in part and renewal applications), and any renewals, extensions or reissues thereof,in any jurisdiction; nonpublic information, know-how, trade secrets and confidential informationand rights in any jurisdiction to limit the use or disclosure thereof by any person; writings andother works, whether copyrightable or not, in any jurisdiction; registrations or applications forregistration of copyrights in any jurisdiction, and any renewals or extensions thereof; and anysimilar intellectual property or proprietary rights; and computer software (including withoutlimitation, source code, executable code, data, databases and documentation thereof).          (v) Brokers and Finders. Neither the Company nor any Group Company nor any of theirrespective officers, directors or employees has employed any broker or finder or incurred anyliability for any financial advisory fees, brokerage fees, commissions or finder’s fees, and nobroker or finder has acted directly or indirectly for the Company or any Group Company inconnection with the Transaction Documents or the transactions contemplated hereby and thereby.          (w) Structure Agreements.     (1) Each Group Company that is a party to a Structure Agreement (a) has full power,authority and legal right to enter into, execute, adopt, assume, issue, deliver andperform its obligations under such Structure Agreement, and (b) has taken all necessarycorporate and other actions and fulfilled and done all conditions and things required
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under applicable PRC laws (including the obtaining and possessing of all relevant approvals, ifnecessary) for the entering into, execution, adoption, assumption, issue, delivery andperformance of its obligations under such Structure Agreement.     (2) Each of the Structure Agreement is in proper legal form under PRC law for theenforcement thereof against each of the parties thereto in the PRC without further action byany of them, subject as to enforcement to bankruptcy, insolvency, reorganization and otherPRC laws of general applicability relating to or affecting creditors’ rights generally andto general equity principles.     (3) The execution, delivery and performance of each of the Structure Agreements by theparties thereto, and the consummation of the transactions contemplated thereunder, will not(i) result in any violation of or penalty of the existing business license, articles ofassociation, other constituent documents or approvals of any of the Group Companies; (ii)result in any violation of or penalty under any currently applicable PRC law; or (iii)conflict with or result in a breach or violation of any of the terms or provisions of, orconstitute a default under, any other existing contract, license, indenture, mortgage, deedof trust, loan agreement, note, lease or other agreement or instrument to which any of theparties thereto is a party or by which any of the parties thereto or to which any ofproperty or assets of any of the parties thereto is subject, except for such violation,breach or default under clauses (ii) and (iii) which would not, individually or in theaggregate, have a Material Adverse Effect.          SECTION 2.2. Representations and Warranties of the Focus Investor. The Focus Investorhereby represents and warrants as of the date hereof and as of the Closing Date to the Companythat:          (a) Organization and Authority. The Focus Investor is an exempted company withlimited liability duly organized and validly existing under the laws of the Cayman Islands, is dulyqualified to do business and is in good standing in all jurisdictions where its ownership orleasing of property or the conduct of its business requires it to be so qualified, and hascorporate power and authority to own its properties and assets and to carry on its business as itis now being conducted.          (b) Authorization.     (1) The Focus Investor has the corporate power and authority to enter into and delivereach of the Transaction Documents and to carry out its obligations hereunder and thereunder.The execution, delivery and performance of the Transaction Documents by the Focus Investorand the consummation of the transactions contemplated hereby and thereby have been dulyauthorized by all requisite action on the part of the Focus Investor. This Agreementconstitutes the valid and legally binding obligation of the Focus Investor, enforceableagainst the Focus Investor in accordance with its terms, except as such enforceability maybe limited by bankruptcy, insolvency, moratorium,reorganizations, fraudulent transfer or similar laws relating to or affecting creditorsgenerally or by general equitable principles (whether applied in equity or at law).
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     (2) Neither the execution, delivery and performance by the Focus Investor of any of theTransaction Documents, nor the consummation of the transactions contemplated hereby andthereby will (i) violate, conflict with, or result in a breach of any provision of, orconstitute a default (or an event which, with notice or lapse of time or both, wouldconstitute a default) under, or result in the termination of, or result in the loss of anybenefit or creation of any right on the part of any third party under any material contractto which the Focus Investor is a party, or (ii) violate any ordinance, permit, concession,grant, franchise, law, statute, rule or regulation or any judgment, ruling, order, writ,injunction or decree applicable to the Focus Investor or any of its properties or assets.     (3) No notice to, registration, declaration or filing with, exemption or review by, orauthorization, order, consent or approval of, any Governmental Entity, or expiration ortermination of any statutory waiting period, is required on the part of the Focus Investorfor the execution and delivery of the Transaction Documents by the Focus Investor or theconsummation by the Focus Investor of the transactions contemplated thereby.          (c) Purchase for Investment. The Focus Investor acknowledges that the Common Shareshave not been registered under the Securities Act or under any state securities laws. The FocusInvestor (1) is acquiring the Common Shares pursuant to an exemption from registration under theSecurities Act for its own account solely for investment with no present intention or plan todistribute any of the Common Shares to any person nor with a view to or for sale in connection withany distribution thereof, in each case in violation of the Securities Act, (2) will not sell orotherwise dispose of any of the Common Shares, except in compliance with the registrationrequirements or exemption provisions of the Securities Act and any other applicable securitieslaws, (3) has such knowledge and experience in financial and business matters and in investments ofthis type that the Focus Investor is capable of evaluating the merits and risks of the investmentin the Common Shares and of making an informed investment decision, and (4) is an “accreditedinvestor” (as that term is defined by Rule 501 of the Securities Act). Without limiting any of theforegoing, neither the Focus Investor nor any of its Affiliates has taken, and the Focus Investorwill not, and will cause its Affiliates not to, take any action that would otherwise cause thesecurities to be purchased hereunder to be subject to the registration requirements of theSecurities Act.          (d) Financial Capability. The Focus Investor will have immediately available fundsnecessary to consummate the Closing, as of the date of the Closing, on the terms and conditionscontemplated by this Agreement.          (e) Existing Ownership. The Focus Investor does not legally or beneficially ownor control, directly or indirectly, any shares, convertible debt or any securities convertible intoor exercisable or exchangeable for, or any rights, warrants or options to acquire, any shares orconvertible debt in the Company, or have any agreement, understanding or arrangement toacquire any of the foregoing, except with respect to such Purchased Shares as to be purchasedby the Focus Investor pursuant to the transactions contemplated herein.
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          SECTION 2.3. Representations and Warranties of the Other Investors. Each OtherInvestor hereby severally but not jointly represents and warrants as of the date hereof and as ofthe Closing Date to the Company and to the Focus Investor on a several but not a joint basis that:          (a) Organization and Authority. Such Other Investor is a company duly organized andvalidly existing under the laws of the jurisdiction in which it is incorporated, is duly qualifiedto do business and is in good standing in all jurisdictions where its ownership or leasing ofproperty or the conduct of its business requires it to be so qualified, and has corporate power andauthority to own its properties and assets and to carry on its business as it is now beingconducted.          (b) Authorization.     (1) Such Other Investor has the power and authority to enter into and deliver thisAgreement and the Shareholders’ Agreement and to carry out its obligations hereunder andthereunder. This Agreement constitutes valid and legally binding obligations of such OtherInvestor, enforceable against it in accordance with its terms, except as such enforceabilitymay be limited by bankruptcy, insolvency, moratorium, reorganizations, fraudulent transferor similar laws relating to or affecting creditors generally or by general equitableprinciples (whether applied in equity or at law).     (2) Neither the execution, delivery and performance by such Other Investor of thisAgreement or the Shareholders’ Agreement, nor the consummation of the transactionscontemplated hereby and thereby will (i) violate, conflict with, or result in a breach ofany provision of, or constitute a default (or an event which, with notice or lapse of timeor both, would constitute a default) under, or result in the termination of, or result inthe loss of any benefit or creation of any right on the part of any third party under anymaterial contract to which such Other Investor is a party, or (ii) violate any ordinance,permit, concession, grant, franchise, law, statute, rule or regulation or any judgment,ruling, order, writ, injunction or decree applicable to it or any of its properties orassets.     (3) No notice to, registration, declaration or filing with, exemption or review by, orauthorization, order, consent or approval of, any Governmental Entity, or expiration ortermination of any statutory waiting period, is required on the part of such Other Investorfor the execution and delivery of this Agreement or the Shareholders’ Agreement, asapplicable, by it or the consummation by it of the transactions contemplated by thisAgreement or the Shareholders’ Agreement.          (c) Financial Capability. Such Other Investor will have immediately available fundsnecessary to consummate the Closing, as of the date of the Closing, on the terms and conditionscontemplated by this Agreement.          (d) Sophisticated Investor. Such Other Investor is knowledgeable, sophisticated andexperienced in making, and is qualified to make, decisions with respect toinvestments in shares representing an investment decision like that involved in the purchaseof the Purchased Shares, including investments in securities issued by the Company, and has
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requested, received, reviewed and considered all information it deems relevant in making aninformed decision to evaluate the merits and risks of a purchase of the Purchased Shares, and canbear the economic risk and complete loss of its investment in the Purchased Shares.**ARTICLE III****COVENANTS**          SECTION 3.1. Filings; Other Actions.          (a) The Investors and the Company will cooperate and consult with each other and usecommercially reasonable efforts to prepare and file all necessary documentation, to effect allnecessary applications, notices, petitions, filings, and other documents, and to obtain allnecessary permits, consents, orders, approvals, and authorizations of, or any exemption by, allthird parties and Governmental Entities, and expiration or termination of any applicable waitingperiods, necessary or advisable to consummate the transactions contemplated by this Agreement andto perform covenants contemplated by this Agreement. Each party shall execute and deliver bothbefore and after the Closing such further certificates, agreements, and other documents and takesuch other actions as the other party may reasonably request to consummate or implement suchtransactions or to evidence such events or matters. The Focus Investor and the Company will eachhave the right to review in advance, and to the extent practicable, each will consult with theother, in each case subject to applicable laws relating to the exchange of information andconfidential information related to the Company or to the Focus Investor, all the information(other than personal or sensitive information) relating to such other party, and any of theirrespective Affiliates, which appears in any filing made with, or written materials submitted to,any third party or any Governmental Entity in connection with the transactions contemplated by thisAgreement. In exercising the foregoing right, each of the parties hereto agrees to act reasonablyand as promptly as practicable. Each party hereto agrees to keep the other party apprised of thestatus of matters relating to completion of the transactions contemplated hereby. The FocusInvestor and the Company shall promptly furnish each other to the extent permitted by applicablelaws with copies of written communications received by them or their Affiliates from, or deliveredby any of the foregoing to, any Governmental Entity in respect of the transactions contemplated bythis Agreement or any other Transaction Document. Notwithstanding anything in this Agreement tothe contrary, Neither the Focus Investor nor the Company shall be required to provide any materialsto the other party that it deems private or confidential nor shall either be required to make anycommitments (other than the passivity commitments described above) to any Governmental Entity inconnection therewith or suffer any Burdensome Condition.          (b) Each party agrees, upon request, to furnish the other party with all informationconcerning itself, its subsidiaries, Affiliates, directors, officers, partners, and shareholdersand such other matters as may be reasonably necessary or advisable in connection with anystatement, filing, notice, or application made by or on behalf of such other party or any of itssubsidiaries to any Governmental Entity in connection with this Agreement. Notwithstandinganything herein to the contrary, neither the Focus Investor nor the Companyshall be required to furnish the other party with any (1) sensitive personal biographical orpersonal financial information of any of the directors, officers, employees, managers or partners
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of the Investor or any of its Affiliates, (2) proprietary and non-public information related to theorganizational terms of, or investors in, the it or its Affiliates, or (3) any information that itdeems private or confidential.          (c) From the time of this Agreement until the Closing, the Company shall not act, directly orindirectly, to amend, modify, or waive, and the Board of Directors shall not recommend approval ofany proposal to the shareholders having the effect of amending, modifying, or waiving any provisionin the Articles of Association of the Company in any manner adverse to the Investors.          SECTION 3.2. Expenses. Each of the parties will bear and pay all costs and expensesincurred by it or on its behalf in connection with this Agreement and the transactions contemplatedunder this Agreement.          SECTION 3.3. Confidentiality.          (a) Each party to this Agreement will hold, and will cause its respective subsidiaries andtheir directors, officers, employees, agents, consultants, and advisors to hold, in strictconfidence, unless disclosure to a Governmental Entity is necessary in connection with anynecessary regulatory approval or unless compelled to disclose by judicial or administrative processor, in the written opinion of its counsel, by other requirement of law or the applicablerequirements of any Governmental Entity, all nonpublic records, books, contracts, instruments,computer data and other data and information (collectively, “*Information*”) concerning the otherparty hereto furnished to it by such other party or its representatives pursuant to this Agreement(except to the extent that such information can be shown to have been (1) previously known by suchparty on a nonconfidential basis, (2) in the public domain through no fault of such party, or (3)later lawfully acquired from other sources by the party to which it was furnished), and neitherparty hereto shall release or disclose such Information to any other person, except its auditors,attorneys, financial advisors, other consultants, and advisors.          (b) Prior to the Closing, the Company shall promptly provide the Focus Investor with writtennotice of the occurrence of any circumstance, event, change, development or effect occurring afterthe date hereof and relating to the Company or any Group Company of which the Company has knowledgeand which constitutes a Material Adverse Effect or, in the reasonable judgment of the Company, mayotherwise cause or render any of the representations and warranties of the Company set forth inSECTION 2.1 of this Agreement to be inaccurate in any material respect.          SECTION 3.4. Conduct of the Business. Prior to the earlier of the Closing Date andthe termination of this Agreement pursuant to SECTION 5.1 (the “*Pre-Closing Period*”), the Companyshall, and shall cause each Group Company to, (i) conduct its business in the ordinary courseconsistent with past practice, (ii) use commercially reasonable efforts to preserve intact itscurrent business organizations and its rights and permits issued by Governmental Entities, keepavailable the services of its current officers and key employees and preserve its relationshipswith customers, suppliers, Governmental Entities and others havingbusiness dealings with it to the end that its goodwill and ongoing businesses shall beunimpaired, and (iii) not take any action that would reasonably be expected to materially adverselyaffect or
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materially delay the consummation of the transactions contemplated by the TransactionDocuments.          SECTION 3.5. Reasonable Efforts. Each of the Investors and the Company will use itscommercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause tobe done all things necessary, proper or advisable to consummate and make effective, in the mostexpeditious manner practicable, the transactions contemplated by this Agreement, including usingcommercially reasonable efforts to accomplish the following: (a) the taking of all reasonable actsnecessary to cause the conditions to Closing to be satisfied; (b) the obtaining of all necessaryactions or nonactions, waivers, consents and approvals from Governmental Entities and the making ofall necessary registrations and filings and the taking of all reasonable steps necessary to obtainan approval or waiver from, or to avoid an action or proceeding by any Governmental Entity; (c) theobtaining of all necessary consents, approvals or waivers from third parties; and (d) executing anddelivering any additional instruments necessary to consummate the transactions contemplated by, andto fully carry out the purposes of, this Agreement.          SECTION 3.6. Shareholder Litigation. The Company shall promptly inform the FocusInvestor of any claim, action, suit, arbitration, mediation, demand, hearing, investigation orproceeding (“*Shareholder Litigation*”) against the Company or any of the past or present executiveofficers or directors of the Company that is threatened or initiated by or on behalf of anyshareholder of the Company in connection with or relating to the transactions contemplated hereby.The Company shall consult with the Focus Investor and keep the Focus Investor informed of allmaterial filings and developments relating to any such Shareholder Litigation.**ARTICLE IV****ADDITIONAL AGREEMENTS**          SECTION 4.1. Lock-Up. Each Investor agrees that it will not, without the priorwritten consent of the Board of Directors, (i) offer, pledge, sell, contract to sell, sell anyoption or contract to purchase, purchase any option or contract to sell, grant any option, right orwarrant for the sale of, lend or otherwise dispose of or transfer any of its Purchased Shares or(ii) enter into any swap or any other agreement or any transaction that transfers, in whole or inpart, directly or indirectly, the economic consequence of ownership of any of its Purchased Shares(each of the foregoing in (i) and (ii) a “*Disposition*”) prior to the date 365 days after theClosing Date, *provided, however,*that nothing in this SECTION 4.1 shall apply to a Disposition bysuch Investor in connection with a transaction in which (a) any person or group shall have acquiredor entered into a binding definitive agreement that has been approved by the Board of Directors (orany duly constituted committee thereof composed entirely of independent directors ) to acquire (i)more than 50% of the Voting Securities of the Company or (ii) assets of the Company and/or itsGroup Companies representing more than 50% of the consolidated earnings power of the Company andits Group Companies, taken as a whole; or (b) any person shall have commenced a tender or exchangeoffer which, if consummated, would result in such person’s acquisition of beneficial ownership ofmore than 50% of the Voting Securities of the Company, and inconnection therewith, the Company files with the SEC a Schedule 14D-9 with respect to suchoffer that does not either (i) recommend that the Company’s shareholders reject such offer or (ii)
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advise the Company’s shareholders that the Board of Directors is considering its response to theoffer or (c) such Investor transfers its Purchased Shares to an Affiliate of such Investor thatshall be bound by this Agreement as if such Affiliate were a party, *provided*that, prior to suchAffiliate ceasing to be an Affiliate of such Investor, such Affiliate shall transfer such PurchasedShares back to such Investor or another Affiliate of such Investor in compliance with this SECTION4.1.          SECTION 4.2. Standstill.          (a) Each of the Focus Investor and JJ Media Investor hereby agrees that, without the priorwritten approval of the Board of Directors, it or its Affiliates will not, from the date of thisAgreement until the earlier of (i) the third anniversary of the Closing Date and (ii) the secondanniversary of the Closing Date if the volume-weighted average closing price of Common Shares forthe twenty (20) consecutive trading days immediately prior to the date that is the secondanniversary of the Closing Date is less than US$2.00 per American Depositary Share subject to anyequitable adjustment pursuant to any change to the number of Common Shares or securitiesconvertible or exchangeable into or exercisable for Common Shares issued and outstanding prior tothe second anniversary of the Closing Date as a result of a reclassification, share split(including a reverse share split), share dividend or distribution, recapitalization, merger, issuertender or exchange offer, or other similar transaction (the “*Standstill Period*”), acquire or offerto acquire any Voting Securities of the Company. “*Voting Securities*” shall mean the Common Sharesand any other securities entitled to vote generally for the election of directors of the Companyother than those acquired by each Investor on the Closing Date.          (b) Each of the Focus Investor and JJ Media Investor hereby agrees that, without the priorwritten approval of the Board of Directors, it or its Affiliates will not, during the StandstillPeriod, directly or indirectly, acting alone or with others, assist, support, encourage, finance,participate with or advise any other Person’s or entity’s efforts to:     (1) propose or make a merger, business combination, tender or exchange offer, shareexchange, recapitalization, consolidation or other similar transaction involving any of theCompany and the Group Companies;     (2) propose or offer to purchase, lease or otherwise acquire all or a substantialportion of the assets of any of the Company and the Group Companies;     (3) form, join or in any way participate in a “group” (as defined in Section 13(d)(3)of the Exchange Act), or act in concert with any person with respect to the securities ofany of the Group Companies in an attempt to circumvent the provisions of this Agreement;     (4) solicit or participate in the solicitation of any proxies or consents with respectto the voting securities of any of the Group Companies; or     (5) enter into discussions or arrangements with any third party with respect to any ofthe foregoing.
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          (c) The provisions in SECTION 4.2(a) and (b) above shall not apply to any acquisition by theFocus Investor of the Voting Securities of the Company pursuant to its gross-up rights set forth inSECTION 4.6 of this Agreement or pursuant to its right of first offer set forth in Section 3.3 andSection 3.4 of the Shareholders’ Agreement. In addition, the provisions of SECTION 4.2(a) and (b)above shall not apply to any transaction in which: (a) any person or group shall have acquired orentered into a binding definitive agreement that has been approved by the Board of Directors (orany duly constituted committee thereof composed entirely of independent directors ) to acquire (i)more than 50% of the Voting Securities of the Company or (ii) assets of the Company and/or itsGroup Companies representing more than 50% of the consolidated earnings power of the Company andits Group Companies, taken as a whole; or (b) any person shall have commenced a tender or exchangeoffer which, if consummated, would result in such person’s acquisition of beneficial ownership ofmore than 50% of the Voting Securities of the Company, and in connection therewith, the Companyfiles with the SEC a Schedule 14D-9 with respect to such offer that does not either (i) recommendthat the Company’s shareholders reject such offer or (ii) advise the Company’s shareholders thatthe Board of Directors is considering its response to the offer.          SECTION 4.3. Legend.          (a) Each Investor agrees that all certificates or other instruments representing thesecurities subject to this Agreement will bear a legend substantially to the following effect:“THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THESECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOTBE TRANSFERRED, SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSEDOF EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCHACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROMREGISTRATION UNDER SUCH ACT OR SUCH LAWS. ANY ATTEMPT TO TRANSFER, SELL, OFFER TOSELL, PLEDGE, HYPOTHECATE OR OTHERWISE DISPOSE OF THIS INSTRUMENT IN VIOLATION OFTHESE RESTRICTIONS SHALL BE VOID.”          (b) Upon request of the Investor, upon receipt by the Company of an opinion of counselreasonably satisfactory to the Company to the effect that such legend is no longer required underthe Securities Act or applicable state laws, as the case may be, the Company shall promptly causethe legend to be removed from any certificate for any securities. Each Investor acknowledges thatthe Purchased Shares have not been registered under the Securities Act or under any statesecurities laws and agrees that it will not sell or otherwise dispose of any of the PurchasedShares except in compliance with the registration requirements or exemption provisions of theSecurities Act and any other applicable securities laws.          SECTION 4.4. Indemnity.
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          (a) The Company agrees to indemnify and hold harmless each Investor and its Affiliates andeach of their respective officers, directors, partners, members, managers, employees and agents, tothe fullest extent lawful, from and against any and all actions, suits, claims, proceedings, costs,losses, liabilities, damages, expenses (including attorneys’ fees and disbursements), amounts paidin settlement and other costs incurred by such party (collectively, “*Losses*”) arising out of orresulting from (1) any inaccuracy in or breach of the Company’s representations or warranties inSECTION 2.1 of this Agreement, (2) the Company’s breach of agreements or covenants made by theCompany in this Agreement, and (3) any litigation in connection with the Company’s acquisition ofDigital Media Group Company Limited, a company organized under the laws of the British VirginIslands, pursuant to the Amended and Restated Agreement and Plan of Merger dated as of November 16,2009 (the “*Merger Agreement*”) and its related documents, which results in a final and nonappealablejudgment against the Company to pay any amount in excess of the unpaid First Deferred Considerationand Second Deferred Consideration, contemplated in section 1.8 of the Merger Agreement and theunreleased Indemnity Escrow Fund, contemplated in section 1.9(c) of the Merger Agreement.          (b) Each Investor agrees to, severally but not jointly, indemnify and hold harmless each ofthe Company and its Affiliates and each of their respective officers, directors, partners, members,managers, employees and agents, to the fullest extent lawful, from and against any and all Lossesarising out of or resulting from (1) any inaccuracy in or breach of such Investor’s representationsor warranties in this Agreement or (2) such Investor’s breach of agreements or covenants made by itin this Agreement.          (c) A party entitled to indemnification hereunder (an “*Indemnified Party*”) shall give writtennotice to the party indemnifying it (the “*Indemnifying Party*”) of any claim with respect to whichit seeks indemnification promptly after the discovery by such Indemnified Party of any mattersgiving rise to a claim for indemnification; *provided*that the failure of any Indemnified Party togive notice as provided herein shall not relieve the Indemnifying Party of its obligations underthis SECTION 4.4 unless and to the extent that the Indemnifying Party shall have been actuallyprejudiced by the failure of such Indemnified Party to so notify such party. Such notice shalldescribe in reasonable detail such claim. In case any such action, suit, claim or proceeding isbrought against an Indemnified Party, the Indemnified Party shall be entitled to hire, at the costand expense of the Indemnifying Party, counsel and conduct the defense thereof; *provided*, *however*,that the Indemnifying Party shall only be liable for the legal fees and expenses of one law firmfor all Indemnified Parties, taken together with regard to any single action or group of relatedactions, upon agreement by the Indemnified Parties and the Indemnifying Parties. If theIndemnifying Party assumes the defense of any claim, all Indemnified Parties shall thereafterdeliver to the Indemnifying Party copies of all notices and documents (including court papers)received by the Indemnified Party relating to the claim, and any Indemnified Party shall cooperatein the defense or prosecution of such claim. Such cooperation shall include the retention and(upon the Indemnifying Party’s request) the provision to the Indemnifying Party of records andinformation that are reasonably relevant to such claim, and making employees available on amutually convenient basis to provide additional information and explanation of any materialprovided hereunder. The Indemnifying Party shall not be liable for any settlement of any action,suit, claim or proceeding effected without itswritten consent; *provided*, *however*, that the Indemnifying Party shall not unreasonablywithhold, delay or condition its consent. The Indemnifying Party further agrees that it will not,without the
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Indemnified Party’s prior written consent (which shall not be unreasonably withheld ordelayed), settle or compromise any claim or consent to entry of any judgment in respect thereof inany pending or threatened action, suit, claim or proceeding in respect of which indemnification hasbeen sought hereunder unless such settlement or compromise includes an unconditional release ofsuch Indemnified Party from all liability arising out of such action, suit, claim or proceeding.          (d) For purposes of the indemnity contained in SECTION 4.4(a)(1) and SECTION 4.4(b)(1), allqualifications and limitations set forth in the parties’ representations and warranties as to“materiality,” “Material Adverse Effect” and words of similar import, shall be disregarded indetermining (i) whether there shall have been any inaccuracy in or breach of any representationsand warranties in this Agreement and (ii) the amount of Losses in respect of any breach of anyrepresentation or warranty.          (e) The Company shall not be required to indemnify the Indemnified Parties pursuant to SECTION4.4(a)(1) (other than the Fundamental Representations), disregarding all qualifications orlimitations set forth in its representations and warranties as to “materiality,” “Material AdverseEffect” and words of similar import, (1) with respect to any claim for indemnification if theamount of Losses with respect to such claim are less than $100,000 (any claim involving Losses lessthan such amount being referred to as a “*De Minimis Claim*”) and (2) unless and until the aggregateamount of all Losses incurred with respect to all claims (other than De Minimis Claims) pursuant toSECTION 4.4(a)(1) exceed $1,000,000 (the “*Threshold Amount*”), in which event the Company shall beresponsible for the entire amount of such Losses. Each Investor shall not be required to indemnifythe Indemnified Parties pursuant to SECTION 4.4(b)(1) (other than the Fundamental Representations),disregarding all qualifications or limitations set forth in the representations and warranties asto “materiality,” “Material Adverse Effect” and words of similar import, (1) with respect to any DeMinimis Claim and (2) unless and until the aggregate amount of all Losses incurred with respect toall claims (other than De Minimis Claims) pursuant to SECTION 4.4(b)(1) exceed the ThresholdAmount, in which event such Investor shall be responsible for the entire amount of such Losses.Notwithstanding anything in this SECTION 4.4 or in this Agreement provided otherwise, the aggregatetotal liability of the Company in relation to each Investor under SECTION 4.4(a)(1) and SECTION4.4(a)(2) shall not exceed ten percent (10%) of the amount set forth in the last column from theleft of Schedule I hereto opposite the name of such Investor, and the aggregate totalliability of the Company in relation to each Investor under SECTION 4.4(a) shall not exceed fifteenpercent (15%) of the amount set forth in the last column from the left of Schedule I heretoopposite the name of such Investor. Notwithstanding anything in this SECTION 4.4 or in thisAgreement provided otherwise, the aggregate total liability of each Investor in relation to theCompany under this SECTION 4.4 shall not exceed ten percent (10%) of the amount set forth in thelast column from the left of Schedule I hereto opposite the name of such Investor. Absenta showing of fraud by a party, and assuming the Closing has occurred, the indemnificationobligation of a party under this SECTION 4.4 shall be the sole remedy of any other party againstsuch party for monetary damages for breach of any representation or warranty or covenant containedin this Agreement. Nothing herein shall limit a party’s right to seek injunctive or otherequitable relief in connection with the enforcement of this Agreement.          (f) The obligations of the Indemnifying Party under this SECTION 4.4 shall survive thetransfer or redemption of the Common Shares issued pursuant to this Agreement, or
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the Closing ortermination of this Agreement; *provided*that in the event of any transfer of the Common Shares to athird party that is not an Affiliate of the transferor, the Indemnifying Party shall have noobligations under this SECTION 4.4 to such transferee. The indemnity provided for in this SECTION4.4 is in addition to, and not in derogation of, any statutory, equitable or common law remedy thatany party may have with respect to a breach of the provisions hereof, any other agreement orcontract or the transactions contemplated by this Agreement. The Company and the Investors andtheir Affiliates have and retain all other rights and remedies existing in their favor at law orequity, including without limitation, any actions for specific performance and/or injunctive orother equitable relief (without posting a bond or other security) to enforce or prevent anyviolations of any provisions of this Agreement. No party to this Agreement (or any of itsAffiliates) shall, in any event, be liable or otherwise responsible to any other party (or any ofits Affiliates) for any consequential or punitive damages of such other party (or any of itsAffiliates) arising out of or relating to this Agreement or the performance or breach hereof. Theindemnification rights contained in this SECTION 4.4 are not limited or deemed waived by anyinvestigation or knowledge by the Indemnified Party prior to or after the date hereof.          (g) Any indemnification payments pursuant to this SECTION 4.4 shall be treated as anadjustment to the Investment Amount for the Purchased Shares for U.S. federal income and applicablestate and local Tax purposes, unless a different treatment is required by applicable law.          SECTION 4.5. Registration Rights.          At the Closing, the Company will enter into the Registration Rights Agreement, substantiallyin the form attached as Exhibit C hereto.          SECTION 4.6. Gross-Up Rights.          (a) Sale of New Securities. For so long as the Focus Investor, together with itsAffiliates, owns 10% or more of all of the outstanding Common Shares (counting for such purposesall Common Shares into or for which the securities of the Company owned by the Investor and itsAffiliates are directly or indirectly convertible or exercisable) (before giving effect to anyissuances triggering provisions of this Section) if, at any time after the date hereof and on orbefore the fifth anniversary of the date hereof, the Company makes any nonpublic offering or saleof any equity security (including Common Shares, preferred shares or restricted shares), or anysecurities, options or debt that is convertible or exchangeable into equity or that includes anequity component (such as an “equity kicker”) (any such security, a “*New Security*”) (other than (i)any Common Shares or other securities issuable upon the exercise or conversion of any securities ofthe Company issued or agreed to be issued as of the date hereof; (ii) pursuant to the granting orexercise of employee share options or other share incentives pursuant to the Company’s shareincentive plans approved by the Board of Directors or the issuance of shares pursuant to theCompany’s employee share purchase plan approved by the Board of Directors or similar plan whereshares are being issued or offered to a trust, other entity or otherwise, for the benefit of anyemployees, officers or directors of the Company, in each case in the ordinarycourse of providing incentive compensation; or (iii) issuances of shares or other securitiesas full or partial consideration for a merger, acquisition, joint venture, strategic alliance,license
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agreement or other similar nonfinancing transaction), then, to the extent not prohibited,not restricted, and not requiring any shareholders’ approval by any applicable law or byobligations pursuant to any listing agreement with any securities exchange or any securitiesexchange regulation, the Focus Investor shall be afforded the opportunity to acquire from theCompany for the same price (net of any underwriting discounts or sales commissions) and on the sameterms (except that, to the extent permitted by law and the Articles of Association, the Investormay elect to receive such securities in nonvoting form, convertible into voting securities in awidely dispersed or public offering) as such securities are proposed to be offered to others, up tothe amount of New Securities in the aggregate required to enable it to maintain its interest in thePurchased Shares proportionate to the total number of Common Shares of the Company eitheroutstanding or issued pursuant to currently exercisable rights of Common Share-equivalent interestin the Company immediately prior to any such issuance of New Securities; *provided*, that, except inthe case of any transfer of Common Shares to an Affiliate of the Focus Investor, who will from thatdate forward assume jointly with the Focus Investor all obligations under the TransactionDocuments, such right to acquire such securities is not transferable. The amount of New Securitiesthat the Focus Investor shall be entitled to purchase in the aggregate shall be determined bymultiplying (x) the total number or principal amount of such offered New Securities by (y) afraction, the numerator of which is the number of Purchased Shares held by the Focus Investor, andthe denominator of which is the number of Common Shares outstanding immediately prior to theissuance of such New Securities.          (b) Notice. In the event the Company proposes to make any nonpublic offering or saleof New Securities, it shall give the Focus Investor written notice of its intention, describing theprice (or range of prices), anticipated amount of securities, timing, and other terms upon whichthe Company proposes to offer the same, no later than two business days after the Company proposesto pursue such offering or sale. The Focus Investor shall have 5 business days from the date ofreceipt of such a notice to notify the Company in writing that it intends to exercise its rightsprovided in this SECTION 4.6 and, as to the amount of New Securities the Focus Investor desires topurchase, up to the maximum amount calculated pursuant to SECTION 4.6(a). Such notice shallconstitute an irrevocable offer and legally binding obligation of the Focus Investor to purchasethe amount of New Securities so specified at the price and other terms set forth in the Company’snotice to it, subject only to (i) the completion of the issuance of such New Securities specifiedin the Focus Investor’s notice, and (ii) the required regulatory or corporate approvals, if any.The failure of the Focus Investor to respond within such 5 business day period shall be deemed tobe a waiver of the Focus Investor’s rights under this SECTION 4.6 only with respect to the offeringdescribed in the applicable notice.          (c) Purchase Mechanism. If the Focus Investor exercises its rights provided in thisSection 4.5, the closing of the purchase of the New Securities with respect to which such right hasbeen exercised shall take place within 30 calendar days after the giving of notice of suchexercise, which period of time shall be extended for a maximum of 180 days in order to comply withapplicable laws and regulations (including receipt of any applicable regulatory or corporateapprovals). The Company and the Focus Investor agree to use commercially reasonable efforts tosecure any regulatory or corporate approvals or other consents, and tocomply with any law or regulation necessary in connection with the offer, sale and purchaseof, such New Securities.
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          (d) Failure of Purchase. In the event that the Focus Investor fails to exercise itsrights provided in this SECTION 4.6 within said 5 business day period or, if so exercised, theFocus Investor is unable to consummate such purchase within the time period specified in SECTION4.6(c) because of the Focus Investor’s failure to obtain any required regulatory or corporateconsent or approval, the Company shall thereafter be entitled (during the period of 180 daysfollowing the conclusion of the applicable period) to sell or enter into an agreement (pursuant towhich the sale of the New Securities covered thereby shall be consummated, if at all, within 30days from the date of said agreement) to sell the New Securities not elected to be purchasedpursuant to this SECTION 4.6 by the Focus Investor or which the Focus Investor is unable topurchase because of such failure to obtain any such consent or approval, at a price and upon termsno more favorable in the aggregate to the purchasers of such securities than were specified in theCompany’s notice to the Focus Investor. Notwithstanding the foregoing, if such sale is subject tothe receipt of any regulatory or corporate approval or consent or the expiration of any waitingperiod, the time period during which such sale may be consummated shall be extended until theexpiration of five business days after all such approvals or consents have been obtained or waitingperiods expired, unless such time period exceed 180 days from the date of the applicable agreementwith respect to such sale. In the event the Company has not sold the New Securities or enteredinto an agreement to sell the New Securities within said 180-day period (or sold and issued NewSecurities in accordance with the foregoing within 30 days from the date of said agreement (as suchperiod may be extended in the manner described above for a period not to exceed 180 days from thedate of said agreement)), the Company shall not thereafter offer, issue or sell such New Securitieswithout first offering such securities to the Focus Investor in the manner provided above.          (e) Non-Cash Consideration. In the case of the offering of securities for aconsideration in whole or in part other than cash, including securities acquired in exchangetherefor (other than securities by their terms so exchangeable), the consideration other than cashshall be deemed to be the fair value thereof as determined by the Board of Directors; *provided*,*however*, that such fair value as determined by the Board of Directors shall not exceed theaggregate market price of the securities being offered as of the date the Board of Directorsauthorizes the offering of such securities.          (f) Cooperation. The Company and the Investor shall cooperate in good faith tofacilitate the exercise of the Investor’s rights under this SECTION 4.6, including to secure anyrequired approvals or consents.          SECTION 4.7. Anti-Takeover Matters; Takeover Laws; No Rights Triggered. If anyTakeover Law may become, or may purport to be, applicable to the transactions contemplated orpermitted by this Agreement, the Company and the members of the Board of Directors shall grant suchapprovals and take such actions as are necessary so that the transactions contemplated or permittedby this Agreement may be consummated, as promptly as practicable, on the terms contemplated by thisAgreement and the other respective Transaction Documents, as the case may be, and otherwise act toeliminate or minimize the effects of any Takeover Law on any of the transactions contemplated orpermitted by this Agreements.          SECTION 4.8. Continued Listing Authorization. For so long as the Focus Shareholder,together with its Affiliates, owns not less than five percent (5%) of all of the
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outstanding CommonShares (counting for such purposes all Common Shares into or for which the securities of theCompany owned by the Focus Shareholder and its Affiliates are directly or indirectly convertible orexercisable), the Company shall use its commercially reasonable efforts to prevent the CommonShares from being delisted from the NASDAQ.SECTION 4.9. Corporate Opportunities.          (a) For so long as the Focus Investor, together with its Affiliates, owns five percent (5%) ormore of all of the outstanding Common Shares (counting for such purposes all Common Shares into orfor which the securities of the Company owned by the Focus Shareholder and its Affiliates aredirectly or indirectly convertible or exercisable), neither the Focus Investor, nor its Affiliates,nor the Focus Nominee (as defined in the Shareholders’ Agreement) shall, directly or indirectly,engage in, invest in, participate in, control, operate, manage or otherwise compete with theCompany in the Company Business without the prior written approval of the Board of Directors,except for the investment by the Focus Investor and/or its Affiliates in the Company in accordancewith the Transaction Documents. Notwithstanding anything to the contrary, the foregoing provisionsof this SECTION 4.9(a) shall not prohibit the Focus Investor from, directly or indirectly, doingany of the following: (i) acquiring ownership of securities having less than five percent (5%) ofthe outstanding voting power of any person engaged in any Company Business, *provided*that the FocusInvestor does not, as a result of acquiring such ownership of securities, directly or indirectlyown five percent (5%) or more of the outstanding voting power of any person engaged in any CompanyBusiness; or (ii) acquiring ownership of any economic interest in a person which is an investmentvehicle with respect to which the Focus Investor has no control and which is not formed for thepurpose of making investments in persons engaged in any Company Business.          (b) For so long as the Focus Investor, together with its Affiliates, owns five percent (5%) ormore of all of the outstanding Common Shares (counting for such purposes all Common Shares into orfor which the securities of the Company owned by the Focus Shareholder and its Affiliates aredirectly or indirectly convertible or exercisable), neither the Company nor its Affiliates shall,directly or indirectly, engage in, invest in, participate in, control, operate, manage or otherwisecompete with the Focus Investor and its Affiliates in the Focus Business without the prior writtenapproval of the Board of Directors of the Focus Investor. Notwithstanding anything to thecontrary, the foregoing provisions of this SECTION 4.9(b) shall not prohibit the Company from,directly or indirectly, doing any of the following: (i) acquiring ownership of securities havingless than five percent (5%) of the outstanding voting power of any person engaged in any FocusBusiness, *provided*that the Company does not, as a result of acquiring such ownership ofsecurities, directly or indirectly own five percent (5%) or more of the outstanding voting power ofany person engaged in any Focus Business; or (ii) acquiring ownership of any economic interest in aperson which is an investment vehicle with respect to which the Company has no control and which isnot formed for the purpose of making investments in persons engaged in any Focus Business.          (c) To the fullest extent permitted by applicable law or regulation, neither the FocusInvestor nor any of its Affiliates, nor the Focus Nominee shall be restricted in any waywhatsoever by this Agreement from engaging in the Focus Business, nor shall be obliged torefer or present any particular business opportunity to the Company unless otherwise provided in
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SECTION 4.9(d) and SECTION 4.9(e) below. Unless otherwise provided in SECTION 4.9(d) below, theFocus Investor shall have the right to take all business opportunities within the scope of theFocus Business for its own account (individually or as a partner, shareholder, member, participantor fiduciary) or recommend to others such particular opportunity.          (d) Subject to SECTION 4.9(a), so long as the Focus Nominee remains a director of the Company,in the event the Focus Nominee learns from the Board of Directors of any business opportunities(*provided*he has not previously learned of or obtained information regarding such businessopportunity from any other source), he shall not recommend to the Focus Investor or any Affiliatesof the Focus Investor or any other persons such business opportunity unless and until (i) the FocusNominee has provided written notice to the Board of Directors indicating his intention to recommendsuch opportunity to the Focus Investor and (ii) (x) within ninety (90) days of the receipt of suchnotice by the Board of Directors the Company has decided not to pursue such opportunity or has notpursued such opportunity or (y) the Company subsequently determines to abandon the pursuit of suchbusiness opportunity.          (e) Subject to SECTIONS 4.9(a) to (c), until the earlier of (i) the third anniversary of theClosing Date and (ii) the date on which the Focus Nominee remains a director of the Company, in theevent the Focus Nominee, in his capacity as a director of the Company, learns of any businessopportunities other than through the Board of Directors (*provided*he has not previously learned ofor obtained information regarding such business opportunity in a capacity other than as a directorof the Company), he shall not recommend to the Focus Investor or any Affiliates of the FocusInvestor such business opportunity without first presenting such opportunity to the Company inwriting. Subject to SECTION 4.9(a), if the Company does not decide to pursue such businessopportunity within thirty (30) days of the written notice of the Focus Nominee in respect of suchbusiness opportunity, or subsequently determines to abandon the pursuit of such businessopportunity, the Focus Nominee (and the Focus Investor or its Affiliates) shall have the right torecommend to the Focus Investor or any of its Affiliate or any other persons such businessopportunity.          (f) In the event of any dispute arising from this SECTION 4.9, the Focus Investor and theCompany shall use their respective reasonable efforts to resolve such dispute between such partiesthrough negotiations.          SECTION 4.10. Regulatory Matters.          Notwithstanding anything in this Agreement to the contrary, neither any of the Investorsincluding their respective Affiliates nor the Company shall be required (i) to modify or limit itsoperations or commercial practices; (ii) to modify or limit its governance, structure, orcompensation arrangements; (iii) to modify the terms of this Agreement, including, for theavoidance of doubt, the terms or the amount of the Purchased Shares to be delivered by the Companyunder this Agreement; (iv) to become subject to or otherwise permit or accept any other condition,limitation, restriction, or restraint that would reasonably be expected to adversely affect (withrespect to an Investor or its Affiliates) any material financial term of the transactionscontemplated by this Agreement or the anticipated benefits or burdens to suchInvestor and its Affiliates or the Company of the transactions contemplated hereby; (v) topropose, agree, or accept any of the items described in clauses (i) through (iv) as a condition to
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receiving any regulatory or governmental approval or consent (each of clauses (i) through (v), a“*Burdensome Condition*”).**ARTICLE V****TERMINATION**          SECTION 5.1. Termination. This Agreement may be terminated prior to the Closing:          (a) by mutual written consent of the Focus Investor and the Company;          (b) by the Company, upon written notice to the Focus Investor, in the event that any of theconditions of Closing set forth in SECTION 1.3(b)(2) are not satisfied, or waived by the Company,on or before the seventh business day after the date hereof; *provided, however,*that the right toterminate this Agreement pursuant to this SECTION 5.1(b) shall not be available to any party whosefailure to fulfill any obligation under this Agreement shall have been the cause of, or shall haveresulted in, the failure of the Closing to occur on or prior to such date;          (c) by the Focus Investor, upon written notice to the Company, in the event that theconditions of Closing set forth in SECTION 1.3(b)(1) are not satisfied, or waived by the FocusInvestor, on or before the seventh business day after the date hereof; *provided, however,*that theright to terminate this Agreement pursuant to this SECTION 5.1(c) shall not be available to anyparty whose failure to fulfill any obligation under this Agreement shall have been the cause of, orshall have resulted in, the failure of the Closing to occur on or prior to such date; or          (d) by the Company or the Focus Investor, upon written notice to the other parties, in theevent that any Governmental Entity shall have issued any order, decree or injunction or taken anyother action restraining, enjoining or prohibiting any of the transactions contemplated by thisAgreement, and such order, decree, injunction or other action shall have become final andnonappealable.          SECTION 5.2. Effects of Termination. In the event of any termination of thisAgreement as provided in SECTION 5.1, this Agreement (other than SECTION 3.2, SECTION 4.4, thisSECTION 5.2, ARTICLE VI (other than SECTION 6.1) and all applicable defined terms, which shallremain in full force and effect) shall forthwith become wholly void and of no further force andeffect; *provided*that nothing herein shall relieve any party from liability for willful breach ofthis Agreement.**ARTICLE VI****MISCELLANEOUS**          SECTION 6.1. Survival. Each of the representations and warranties set forth in thisAgreement shall survive the Closing under this Agreement but only for a period of eighteen (18)months following the Closing Date (or until final resolution of any claim or actionarising from the breach of any such representation and warranty, if notice of such breach wasprovided prior to the end of such period) and thereafter shall expire and have no further force and
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effect; *provided*that the representations and warranties in SECTION 2.1(a), SECTION 2.1(c), SECTION2.1(d), SECTION 2.2(a), and SECTION 2.2(b) (collectively, the “*Fundamental Representations*”) shallsurvive indefinitely and the representations and warranties in SECTION 2.1(h) and SECTION 2.1(s)shall survive until 90 days after the expiration of the applicable statutory periods oflimitations. Except as otherwise provided herein, all covenants and agreements contained hereinshall survive for the duration of any statutes of limitations applicable thereto or until, by theirrespective terms, they are no longer operative.          SECTION 6.2. Amendment. No amendment or waiver of this Agreement will be effectivewith respect to any party unless made in writing and signed by an officer of a duly authorizedrepresentative of such party.          SECTION 6.3. Waivers. No failure or delay by any party in exercising any right, poweror privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercisethereof preclude any other or further exercise thereof or the exercise of any other right, power orprivilege. The conditions to each party’s obligation to consummate the Closing are for the solebenefit of such party and may be waived by such party in whole or in part to the extent permittedby applicable law. No waiver of any party to this Agreement will be effective unless it is in awriting signed by a duly authorized officer of the waiving party that makes express reference tothe provision or provisions subject to such waiver.          SECTION 6.4. Counterparts and Facsimile. For the convenience of the parties hereto,this Agreement may be executed in any number of separate counterparts, each such counterpart beingdeemed to be an original instrument, and all such counterparts will together constitute the sameagreement. Executed signature pages to this Agreement may be delivered by facsimile and suchfacsimiles will be deemed as sufficient as if actual signature pages had been delivered.          SECTION 6.5. Governing Law. This Agreement shall be governed by, and construed inaccordance with, the substantive laws of the State of New York, without regard to New York choiceof law rules. Any dispute arising out of or in connection with this Agreement shall be referred tothe Hong Kong International Arbitration Centre in Hong Kong. The arbitration proceedings shall beconducted in English pursuant to the Arbitration Rules of the United Nations Commission onInternational Trade Law, as currently in effect and a decision rendered by the arbitral tribunal insuch proceedings shall be final and binding on the parties. All rights to apply or appeal to anycourt on a preliminary or other point of law are excluded; *provided, however*, that nothing hereinshall limit the ability of a party to seek specific performance or interim injunctive relief in anycourt of competent jurisdiction.          SECTION 6.6. Waiver of Jury Trial EACH OF THE PARTIES HERETO HEREBY IRREVOCABLYWAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THISAGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.          SECTION 6.7. Notices. Any notice, request, instruction or other document to be givenhereunder by any party to the other will be in writing and will be deemed to have been duly given(a) on the date of delivery if delivered personally or by telecopy or facsimile, upon
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confirmationof receipt, (b) on the first business day following the date of dispatch if delivered by arecognized next-day courier service, or (c) on the third business day following the date of mailingif delivered by registered or certified mail, return receipt requested, postage prepaid. Allnotices hereunder shall be delivered as follows:          (a) If to the Focus Investor:Focus Media Holding Limited