exv10w13








    Exhibit
10.13



 




    SEARCHMEDIA
    HOLDINGS LIMITED

    



 




    AMENDED
    AND RESTATED 2008 SHARE INCENTIVE PLAN



 


 




    PREAMBLE



 



    SearchMedia International Limited originally established the
    2008 Share Incentive Plan, effective January 1, 2008.
    In connection with certain transactions (the “Merger”)
    pursuant to Plan of Merger, Conversion and Share Exchange
    between SearchMedia International Limited and SearchMedia
    Holdings Limited (as well as other parties), SearchMedia
    International Limited has become a wholly owned subsidiary of
    SearchMedia Holdings Limited. In connection with the Merger,
    SearchMedia Holdings Limited, subject to and effective only upon
    the approval of its shareholders, hereby assumes, amends and
    restates the 2008 Share Incentive Plan as follows.



 




    ARTICLE 1

    



 




    PURPOSE
    



 



    The purpose of this 2008 Amended and Restated Share Incentive
    Plan (the “Plan”) is to promote the success and
    enhance the value of SearchMedia Holdings Limited, a company
    incorporated under the laws of the Cayman Islands (the
    “Company”) by linking the personal interests of
    the members of the Board, Employees, and Consultants to those of
    the Company’s shareholders and by providing such
    individuals with an incentive for outstanding performance to
    generate superior returns to Company shareholders. The Plan is
    further intended to provide flexibility to the Company in its
    ability to motivate, attract, and retain the services of members
    of the Board, Employees, and Consultants upon whose judgment,
    interest, and special effort the successful conduct of the
    Company’s operation is largely dependent.



 




    ARTICLE 2

    



 




    DEFINITIONS
    AND CONSTRUCTION
    



 



    Wherever the following terms are used in the Plan, they shall
    have the meanings specified below, unless the context clearly
    indicates otherwise. The singular pronoun shall include the
    plural where the context so indicates.



 



    2.1 “Applicable Laws” means
    (i) the laws of the Cayman Islands as they relate to the
    Company and its Shares; (ii) the legal requirements
    relating to the Plan and the Awards under applicable provisions
    of the corporate, securities, tax and other laws, rules,
    regulations and government orders; and (iii) the rules of
    any applicable stock exchange or national market system, of any
    jurisdiction applicable to Awards granted to residents therein.



 



    2.2 “Article” means an article of
    this Plan.



 



    2.3 “Award” means an Option,
    Restricted Share or Restricted Share Units award granted to a
    Participant pursuant to the Plan.



 



    2.4 “Award Agreement” means any
    written agreement, contract, or other instrument or document
    evidencing an Award, including through electronic medium.



 



    2.5 “Board” means the Board of
    Directors of the Company from time to time.



 



    2.6 “Change in Control” means, as
    applicable, a change in ownership or control of the Company
    effected through either of the following transactions:



 



    (a) Prior to the date of the effectiveness of the
    Company’s first registration statement on
    Form F-1
    filed with the U.S. Securities and Exchange Commission (the
    “SEC”), the direct or indirect acquisition by
    any person or related group of persons (other than an
    acquisition from or by the Company) of beneficial ownership
    (within the meaning of
    Rule 13d-3
    under the Exchange Act) of securities possessing




    

    1








 






    more than seventy-five percent (75%) of the total combined
    voting power of the Company’s outstanding
    securities; or



 



    (b) After the date of the effectiveness of the
    Company’s first registration statement on
    Form F-1
    filed with the SEC,



 



    (i) The direct or indirect acquisition by any person or
    related group of persons (other than an acquisition from or by
    the Company) of beneficial ownership (within the meaning of
    Rule 13d-3
    under the Exchange Act) of securities possessing more than fifty
    percent (50%) of the total combined voting power of the
    Company’s outstanding securities pursuant to a tender or
    exchange offer made directly to the Company’s shareholders
    which a majority of the Incumbent Board (as defined below) who
    are not affiliates or associates of the offeror under
    Rule 12b-2
    promulgated under the Exchange Act do not recommend such
    shareholders accept; or



 



    (ii) The individuals, who are members of the Board as of
    the date of the effectiveness of the Company’s first
    registration statement on
    Form F-1
    filed with the SEC (the “Incumbent Board”), cease for
    any reason to constitute at least fifty percent (50%) of the
    Board; provided that if the election, or nomination for election
    by the Company’s shareholders, of any new member of the
    Board is approved by a vote of at least fifty percent (50%) of
    the Incumbent Board, such new member of the Board shall be
    considered as a member of the Incumbent Board.



 



    2.7 “Code” means the Internal
    Revenue Code of 1986 of the United States, as amended.



 



    2.8 “Committee” means the committee
    of the Board described in Article 9.



 



    2.9 “Consultant” means any
    consultant or adviser if: (a) the consultant or adviser
    renders bona fide services to a Service Recipient; (b) the
    services rendered by the consultant or adviser are not in
    connection with the offer or sale of securities in a
    capital-raising transaction and do not directly or indirectly
    promote or maintain a market for the Company’s securities;
    and (c) the consultant or adviser is a natural person who
    has contracted directly with the Service Recipient to render
    such services.



 



    2.10 “Corporate Transaction” means
    any of the following transactions:



 



    (a) an amalgamation, arrangement or consolidation or scheme
    of arrangement (i) in which the Company is not the
    surviving entity, except for a transaction the principal purpose
    of which is to change the jurisdiction in which the Company is
    incorporated, or (ii) following which the holders of the
    voting securities of the Company do not continue to hold more
    than fifty percent (50%) of the combined voting power of the
    voting securities of the surviving entity;



 



    (b) the sale, transfer or other disposition of all or
    substantially all of the assets of the Company; or



 



    (c) the completion of a voluntary or insolvent liquidation
    or dissolution of the Company.



 



    2.11 “Disability” means that the
    Participant qualifies to receive long-term disability payments
    under the Service Recipient’s long-term disability
    insurance program, as it may be amended from time to time, to
    which the Participant provides services regardless of whether
    the Participant is covered by such policy. If the Service
    Recipient to which the Participant provides service does not
    have a long-term disability plan in place,
    “Disability” means that a Participant is unable to
    carry out the responsibilities and functions of the position
    held by the Participant by reason of any medically determinable
    physical or mental impairment for a period of not less than
    ninety (90) consecutive days. A Participant will not be
    considered to have incurred a Disability unless he or she
    furnishes proof of such impairment sufficient to satisfy the
    Committee in its discretion.



 



    2.12 “Effective Date” shall have
    the meaning set forth in Section 10.1.



 



    2.13 “Employee” means any person,
    including an officer or member of the Board of the Company, any
    Parent or Subsidiary of the Company, who is in the employ of a
    Service Recipient, subject to the control and direction of the
    Service Recipient as to both the work to be performed and the
    manner and method of performance. The payment of a
    director’s fee by a Service Recipient shall not be
    sufficient to constitute “employment” by the Service
    Recipient.




    

    2








 






    2.14 “Exchange Act” means the
    Securities Exchange Act of 1934 of the United States, as amended.



 



    2.15 “Fair Market Value” means, as
    of any date, the value of Shares determined as follows:



 



    (a) If the Shares are listed on one or more established and
    regulated stock exchanges or national market systems, its Fair
    Market Value shall be the closing sales price for such shares
    (or the closing bid, if no sales were reported) as quoted on the
    principal exchange or system on which the Shares are listed (as
    determined by the Committee) on the date of determination (or,
    if no closing sales price or closing bid was reported on that
    date, as applicable, on the last trading date such closing sales
    price or closing bid was reported), as reported in The Wall
    Street Journal or such other source as the Committee deems
    reliable;



 



    (b) If the Shares are regularly quoted on an automated
    quotation system or by a recognized securities dealer, its Fair
    Market Value shall be the closing sales price for such shares as
    quoted on such system or by such securities dealer on the date
    of determination, but if selling prices are not reported, the
    Fair Market Value of a Share shall be the mean between the high
    bid and low asked prices for the Shares on the date of
    determination (or, if no such prices were reported on that date,
    on the last date such prices were reported), as reported in
    The Wall Street Journal or such other source as the
    Committee deems reliable; or



 



    (c) In the absence of an established market for the Shares
    of the type described in (a) and (b), above, the Fair
    Market Value thereof shall be determined by the Committee in
    good faith and in its discretion by reference to (i) the
    placing price of the latest private placement of the Shares and
    the development of the Company’s business operations and
    the general economic and market conditions since such latest
    private placement, (ii) other third party transactions
    involving the Shares and the development of the Company’s
    business operation and the general economic and market
    conditions since such sale, (iii) an independent valuation
    of the Shares, or (iv) such other methodologies or
    information as the Committee determines to be indicative of Fair
    Market Value, relevant.



 



    2.16 “Incentive Share Option” means
    an Option that is intended to meet the requirements of
    Section 422 of the Code or any successor provision thereto.



 



    2.17 “Independent Director” means a
    member of the Board who is not an Employee of the Company.



 



    2.18 “Non-Employee Director” means
    a member of the Board who qualifies as a “Non-Employee
    Director” as defined in
    Rule 16b-3(b)(3)
    under the Exchange Act, or any successor definition adopted by
    the Board.



 



    2.19 “Non-Qualified Share Option”
    means an Option that is not intended to be an Incentive Share
    Option.



 



    2.20 “Option” means a right granted
    to a Participant pursuant to Article 5 of the Plan to
    purchase a specified number of Shares at a specified price
    during specified time periods. An Option may be either an
    Incentive Share Option or a Non-Qualified Share Option.



 



    2.21 “Participant” means a person
    who, as a member of the Board, Consultant or Employee, has been
    granted an Award pursuant to the Plan.



 



    2.22 “Parent” means a parent
    corporation under Section 424(e) of the Code.



 



    2.23 “Plan” means this Amended and
    Restated 2008 Share Incentive Award Plan, as it may be
    amended from time to time.



 



    2.24 “Related Entity” means any
    business, corporation, partnership, limited liability company or
    other entity in which the Company, a Parent or Subsidiary of the
    Company holds a substantial ownership interest, directly or
    indirectly but which is not a Subsidiary and which the Board
    designates as a Related Entity for purposes of the Plan.



 



    2.25 “Restricted Share” means a
    Share awarded to a Participant pursuant to Article 6 that
    is subject to certain restrictions and may be subject to risk of
    forfeiture.




    

    3








 






    2.26 “Restricted Share Unit” means
    the right granted to a Participant pursuant to Article 6 to
    receive a Share at a future date.



 



    2.27 “Securities Act” means the
    Securities Act of 1933 of the United States, as amended.



 



    2.28 “Service Recipient” means the
    Company, any Parent or Subsidiary of the Company and any Related
    Entity to which a Participant provides services as an Employee,
    Consultant or as a Director.



 



    2.29 “Share” means a share of the
    Company, and such other securities of the Company that may be
    substituted for Shares pursuant to Article 8.



 



    2.30 “Subsidiary” means any
    corporation or other entity of which a majority of the
    outstanding voting shares or voting power is beneficially owned
    directly or indirectly by the Company.



 



    2.31 “Trading Date” means the
    closing of the first sale to the general public of the Shares
    pursuant to an effective registration statement under Applicable
    Law, which results in the Shares being publicly traded on one or
    more established stock exchanges or national market systems.



 




    ARTICLE 3

    



 




    SHARES
    SUBJECT TO THE PLAN
    



 



    3.1 Number of Shares.



 



    (a) Subject to the provisions of Article 8 and
    Section 3.1(b), the aggregate number of Shares which may be
    issued or transferred pursuant to Awards under the Plan is
    1,796,452.



 



    (b) To the extent that an Award terminates, expires, or
    lapses for any reason, any Shares subject to the Award shall
    again be available for the grant of an Award pursuant to the
    Plan. To the extent permitted by Applicable Laws, Shares issued
    in assumption of, or in substitution for, any outstanding awards
    of any entity acquired in any form or combination by the Company
    or any Parent or Subsidiary of the Company shall not be counted
    against Shares available for grant pursuant to the Plan. Shares
    delivered by the Participant or withheld by the Company upon the
    exercise of any Award under the Plan, in payment of the exercise
    price thereof or tax withholding thereon, may again be optioned,
    granted or awarded hereunder, subject to the limitations of
    Section 3.1(a). If any Restricted Shares are forfeited by
    the Participant or repurchased by the Company, such Shares may
    again be optioned, granted or awarded hereunder, subject to the
    limitations of Section 3.1(a). Notwithstanding the
    provisions of this Section 3.1(b), no Shares may again be
    optioned, granted or awarded if such action would cause an
    Incentive Share Option to fail to qualify as an incentive share
    option under Section 422 of the Code.



 



    3.2 Shares Distributed.  Any Shares
    issued pursuant to an Award may consist, in whole or in part, of
    authorized and unissued Shares, treasury Shares (subject to
    Applicable Laws) or Shares purchased on the open market.
    Additionally, in the discretion of the Committee, American
    Depository Shares in an amount equal to the number of Shares
    which otherwise would be distributed pursuant to an Award may be
    distributed in lieu of Shares in settlement of any Award. If the
    number of Shares represented by an American Depository Share is
    other than on a one-to-one basis, the limitations of
    Section 3.1 shall be adjusted to reflect the distribution
    of American Depository Shares in lieu of Shares.



 




    ARTICLE 4

    



 




    ELIGIBILITY
    AND PARTICIPATION
    



 



    4.1 Eligibility.  Persons eligible
    to participate in this Plan include Employees, Consultants, and
    all members of the Board, as determined by the Committee.



 



    4.2 Participation.  Subject to the
    provisions of the Plan, the Committee may, from time to time,
    select from among all eligible individuals, those to whom Awards
    shall be granted and shall determine the nature and amount of
    each Award. No individual shall have any right to be granted an
    Award pursuant to this Plan.




    

    4








 






    4.3 Jurisdictions.  In order to
    assure the viability of Awards granted to Participants employed
    in various jurisdictions, the Committee may provide for such
    special terms as it may consider necessary or appropriate to
    accommodate differences in local law, tax policy, or custom
    applicable in the jurisdiction in which the Participant resides
    or is employed. Moreover, the Committee may approve such
    supplements to, or amendments, restatements, or alternative
    versions of, the Plan as it may consider necessary or
    appropriate for such purposes without thereby affecting the
    terms of the Plan as in effect for any other purpose;
    provided, however, that no such supplements, amendments,
    restatements, or alternative versions shall increase the share
    limitations contained in Section 3.1 of the Plan.
    Notwithstanding the foregoing, the Committee may not take any
    actions hereunder, and no Awards shall be granted, that would
    violate any Applicable Laws.



 




    ARTICLE 5

    



 




    OPTIONS
    



 



    5.1 General.  The Committee is
    authorized to grant Options to Participants on the following
    terms and conditions:



 



    (a) Exercise Price.  The exercise
    price per Share subject to an Option shall be determined by the
    Committee and set forth in the Award Agreement which may be a
    fixed or variable price related to the Fair Market Value of the
    Shares; provided, however, that no Option may be
    granted to an individual subject to taxation in the United
    States at less than the Fair Market Value on the date of grant,
    without the Participant’s consent. The exercise price per
    Share subject to an Option may be amended or adjusted in the
    absolute discretion of the Committee, the determination of which
    shall be final, binding and conclusive. For the avoidance of
    doubt, to the extent not prohibited by Applicable Laws or any
    exchange rule, a re-pricing of Options mentioned in the
    preceding sentence shall be effective without the approval of
    the Company’s shareholders or the approval of the
    Participants. Notwithstanding the foregoing, the exercise price
    per Share subject to an Option shall not be increased without
    the approval of the affected Participants.



 



    (b) Time and Conditions of
    Exercise.  The Committee shall determine the
    time or times at which an Option may be exercised in whole or in
    part, including exercise prior to vesting; provided that
    the term of any Option granted under the Plan shall not exceed
    ten years, except as provided in Section 11.1. The
    Committee shall also determine any conditions, if any, that must
    be satisfied before all or part of an Option may be exercised.



 



    (c) Payment.  The Committee shall
    determine the methods by which the exercise price of an Option
    may be paid, the form of payment, including, without limitation
    (i) cash or check denominated in a currency determined by
    the Committee, and subject to Applicable Law, (ii) Shares
    held for such period of time as may be required by the Committee
    in order to avoid adverse financial accounting consequences and
    having a Fair Market Value on the date of delivery equal to the
    aggregate exercise price of the Option or exercised portion
    thereof, (v) after the Trading Date the delivery of a
    notice that the Participant has placed a market sell order with
    a broker with respect to Shares then issuable upon exercise of
    the Option, and that the broker has been directed to pay a
    sufficient portion of the net proceeds of the sale to the
    Company in satisfaction of the Option exercise price;
    provided that payment of such proceeds is then made to
    the Company upon settlement of such sale, (vi) other
    property acceptable to the Committee with a Fair Market Value
    equal to the exercise price, or (vii) any combination of
    the foregoing. Notwithstanding any other provision of the Plan
    to the contrary, no Participant shall be permitted to pay the
    exercise price of an Option in any method which would violate
    Applicable Law.



 



    (d) Evidence of Grant.  All Options
    shall be evidenced by an Award Agreement between the Company and
    the Participant. The Award Agreement shall include such
    additional provisions as may be specified by the Committee.



 



    5.2 Incentive Share
    Options.  Incentive Share Options may be
    granted to Employees of the Company, a Parent or Subsidiary of
    the Company. Incentive Share Options may not be granted to
    Employees of a Related




    

    5








 






    Entity or to Independent Directors or Consultants. The terms of
    any Incentive Share Options granted pursuant to the Plan, in
    addition to the requirements of Section 5.1, must comply
    with the following additional provisions of this
    Section 5.2:



 



    (a) Expiration of Option.  An
    Incentive Share Option may not be exercised to any extent by
    anyone after the first to occur of the following events:



 



    (i) Ten years from the date it is granted, unless an
    earlier time is set in the Award Agreement;



 



    (ii) 90 days after the Participant’s termination
    of employment as an Employee (save in the case of termination on
    account of Disability or death or for cause); and



 



    (iii) One year after the date of the Participant’s
    termination of employment or service on account of Disability or
    death. Upon the Participant’s Disability or death, any
    Incentive Share Options exercisable at the Participant’s
    Disability or death may be exercised by the Participant’s
    legal representative or representatives, by the person or
    persons entitled to do so pursuant to the Participant’s
    last will and testament, or, if the Participant fails to make
    testamentary disposition of such Incentive Share Option or dies
    intestate, by the person or persons entitled to receive the
    Incentive Share Option pursuant to the applicable laws of
    descent and distribution.



 



    (b) Individual Dollar
    Limitation.  The aggregate Fair Market Value
    (determined as of the time the Option is granted) of all Shares
    with respect to which Incentive Share Options are first
    exercisable by a Participant in any calendar year may not exceed
    U.S.$100,000 or such other limitation as imposed by
    Section 422(d) of the Code, or any successor provision. To
    the extent that Incentive Share Options are first exercisable by
    a Participant in excess of such limitation, the excess shall be
    considered Non-Qualified Share Options.



 



    (c) Ten Percent Owners.  An
    Incentive Share Option shall be granted to any individual who,
    at the date of grant, owns Shares possessing more than ten
    percent of the total combined voting power of all classes of
    shares of the Company only if such Option is granted at a price
    that is not less than 110% of Fair Market Value on the date of
    grant and the Option is exercisable for no more than five years
    from the date of grant.



 



    (d) Transfer Restriction.  The
    Participant shall give the Company prompt notice of any
    disposition of Shares acquired by exercise of an Incentive Share
    Option within (i) two years from the date of grant of such
    Incentive Share Option or (ii) one year after the transfer
    of such Shares to the Participant.



 



    (e) Expiration of Incentive Share
    Options.  No Award of an Incentive Share
    Option may be made pursuant to this Plan after the tenth
    anniversary of the Effective Date.



 



    (f) Right to Exercise.  During a
    Participant’s lifetime, an Incentive Share Option may be
    exercised only by the Participant.



 




    ARTICLE 6

    



 




    RESTRICTED
    SHARES AND RESTRICTED SHARE UNITS
    



 



    6.1 Grant of Restricted
    Shares.  The Committee is authorized to make
    Awards of Restricted Shares
    and/or
    Restricted Share Units to any Participant selected by the
    Committee in such amounts and subject to such terms and
    conditions as determined by the Committee. All Awards of
    Restricted Shares shall be evidenced by an Award Agreement.



 



    6.2 Issuance and
    Restrictions.  Restricted Shares shall be
    subject to such restrictions on transferability and other
    restrictions as the Committee may impose (including, without
    limitation, limitations on the right to vote Restricted Shares
    or the right to receive dividends on the Restricted Share).
    These restrictions may lapse separately or in combination at
    such times, pursuant to such circumstances, in such
    installments, or otherwise, as the Committee determines at the
    time of the grant of the Award or thereafter.




    

    6








 






    6.3 Forfeiture/Repurchase.  Except
    as otherwise determined by the Committee at the time of the
    grant of the Award or thereafter, upon termination of employment
    or service during the applicable restriction period, Restricted
    Shares that are at that time subject to restrictions shall be
    forfeited or repurchased in accordance with the Award Agreement;
    provided, however, that the Committee may
    (a) provide in any Restricted Share Award Agreement that
    restrictions or forfeiture and repurchase conditions relating to
    Restricted Shares will be waived in whole or in part in the
    event of terminations resulting from specified causes, and
    (b) in other cases waive in whole or in part restrictions
    or forfeiture and repurchase conditions relating to Restricted
    Shares.



 



    6.4 Certificates for Restricted
    Shares.  Restricted Shares granted pursuant to
    the Plan may be evidenced in such manner as the Committee shall
    determine. If certificates representing Restricted Shares are
    registered in the name of the Participant, certificates must
    bear an appropriate legend referring to the terms, conditions,
    and restrictions applicable to such Restricted Shares, and the
    Company may, at its discretion, retain physical possession of
    the certificate until such time as all applicable restrictions
    lapse.



 



    6.5 Restricted Share Units.  At the
    time of grant, the Committee shall specify the date or dates on
    which the Restricted Share Units shall become fully vested and
    nonforfeitable, and may specify such conditions to vesting as it
    deems appropriate. At the time of grant, the Committee shall
    specify the maturity date applicable to each grant of Restricted
    Share Units which shall be no earlier than the vesting date or
    dates of the Award and may be determined at the election of the
    grantee. On the maturity date, the Company shall, subject to
    Sections 7.4 and 7.5, transfer to the Participant one
    unrestricted, fully transferable Share for each Restricted Share
    Unit scheduled to be paid out on such date and not previously
    forfeited.



 




    ARTICLE 7

    



 




    PROVISIONS
    APPLICABLE TO AWARDS
    



 



    7.1 Award Agreement.  Awards under
    the Plan shall be evidenced by Award Agreements that set forth
    the terms, conditions and limitations for each Award which may
    include the term of an Award, the provisions applicable in the
    event the Participant’s employment or service terminates,
    and the Company’s authority to unilaterally or bilaterally
    amend, modify, suspend, cancel or rescind an Award.



 



    7.2 Limits on Transfer.  No right
    or interest of a Participant in any Award may be pledged,
    encumbered, or hypothecated to or in favor of any party other
    than the Company or a Subsidiary, or shall be subject to any
    lien, obligation, or liability of such Participant to any other
    party other than the Company or a Subsidiary. Except as
    otherwise provided by the Committee, no Award shall be assigned,
    transferred, or otherwise disposed of by a Participant other
    than by will or the laws of descent and distribution. The
    Committee by express provision in the Award or an amendment
    thereto may permit an Award (other than an Incentive Share
    Option) to be transferred to, exercised by and paid to certain
    persons or entities related to the Participant, including but
    not limited to members of the Participant’s family,
    charitable institutions, or trusts or other entities whose
    beneficiaries or beneficial owners are members of the
    Participant’s family
    and/or
    charitable institutions, or to such other persons or entities as
    may be expressly approved by the Committee, pursuant to such
    conditions and procedures as the Committee may establish. Any
    permitted transfer shall be subject to the condition that the
    Committee receive evidence satisfactory to it that the transfer
    is being made for estate
    and/or tax
    planning purposes (or to a “blind trust” in connection
    with the Participant’s termination of employment or service
    with the Company or a Subsidiary to assume a position with a
    governmental, charitable, educational or similar non-profit
    institution) and on a basis consistent with the Company’s
    lawful issue of securities.



 



    7.3 Beneficiaries.  Notwithstanding
    Section 7.2, a Participant may, in the manner determined by
    the Committee, designate a beneficiary to exercise the rights of
    the Participant and to receive any distribution with respect to
    any Award upon the Participant’s death. A beneficiary,
    legal guardian, legal representative, or other person claiming
    any rights pursuant to the Plan is subject to all terms and
    conditions of the Plan and any Award Agreement applicable to the
    Participant, except to the extent the Plan and Award Agreement
    otherwise provide, and to any additional restrictions deemed
    necessary or appropriate by the Committee. If the Participant is
    married and resides in a community property jurisdiction, a
    designation of a person other than




    

    7








 






    the Participant’s spouse as his or her beneficiary with
    respect to more than 50% of the Participant’s interest in
    the Award shall not be effective without the prior written
    consent of the Participant’s spouse. If no beneficiary has
    been designated or survives the Participant, payment shall be
    made to the person entitled thereto pursuant to the
    Participant’s will or the laws of descent and distribution.
    Subject to the foregoing, a beneficiary designation may be
    changed or revoked by a Participant at any time provided the
    change or revocation is filed with the Committee.



 



    7.4 Share
    Issuance.  Notwithstanding anything herein to
    the contrary, the Company shall not be required to issue or
    deliver any certificates or make any book entries evidencing
    Shares pursuant to the exercise of any Award, unless and until
    the Board has determined, with advice of counsel, that the
    issuance and delivery of such Shares is in compliance with all
    Applicable Laws, regulations of governmental authorities and, if
    applicable, the requirements of any exchange on which the Shares
    are listed or traded. All Share certificates delivered pursuant
    to the Plan and all Shares issued pursuant to book entry
    procedures are subject to any stop-transfer orders and other
    restrictions as the Committee deems necessary or advisable to
    comply with all Applicable Laws, and the rules of any national
    securities exchange or automated quotation system on which the
    Shares are listed, quoted, or traded. The Committee may place
    legends on any Share certificate to reference restrictions
    applicable to the Share. In addition to the terms and conditions
    provided herein, the Board may require that a Participant make
    such reasonable covenants, agreements, and representations as
    the Board, in its discretion, deems advisable in order to comply
    with any such laws, regulations, or requirements. The Committee
    shall have the right to require any Participant to comply with
    any timing or other restrictions with respect to the settlement
    or exercise of any Award, including a window-period limitation,
    as may be imposed in the discretion of the Committee.
    Notwithstanding any other provision of the Plan, unless
    otherwise determined by the Committee or required by Applicable
    Law, the Company shall not deliver to any Participant
    certificates evidencing Shares issued in connection with any
    Award and instead such Shares shall be recorded in the books of
    the Company (or, as applicable, its transfer agent or stock plan
    administrator).



 



    7.5 Paperless
    Administration.  Subject to Applicable Laws,
    the Committee may establish, for itself or using the services of
    a third party, an automated system for the documentation,
    granting or exercise of Awards, such as a system using an
    internet website or interactive voice response, then the
    paperless documentation, granting or exercise of Awards by a
    Participant may be permitted through the use of such an
    automated system.



 



    7.6 Applicable Currency.  Unless
    otherwise required by Applicable Law, or as determined in the
    discretion of the Committee, all Awards shall be designated in
    U.S. dollars. A Participant may be required to provide
    evidence that any currency used to pay the exercise price of any
    Award were acquired and taken out of the jurisdiction in which
    the Participant resides in accordance with Applicable Laws,
    including foreign exchange control laws and regulations. In the
    event the exercise price for an Award is paid in Chinese
    Renminbi or other foreign currency, as permitted by the
    Committee, the amount payable will be determined by conversion
    from U.S. dollars at the official rate promulgated by the
    People’s Bank of China for Chinese Renminbi, or for
    jurisdictions other than the People’s Republic of China,
    the exchange rate as selected by the Committee on the date of
    exercise.



 




    ARTICLE 8

    



 




    CHANGES IN
    CAPITAL STRUCTURE
    



 



    8.1 Adjustments.  In the event of
    any distribution, share split, combination or exchange of
    Shares, amalgamation, arrangement or consolidation,
    reorganization of the Company, including the Company becoming a
    subsidiary in a transaction not involving a Corporate
    Transaction, spin-off, recapitalization or other distribution
    (other than normal cash dividends) of Company assets to its
    shareholders, or any other change affecting the Shares or the
    share price of a Share, the Committee shall make such
    proportionate and equitable adjustments, if any, to reflect such
    change with respect to (a) the aggregate number and type of
    shares that may be issued under the Plan (including, but not
    limited to, adjustments of the limitations in Section 3.1
    and substitutions of shares in a parent or surviving company);
    (b) the terms and conditions of any outstanding Awards
    (including, without limitation, any applicable performance
    targets or criteria with respect




    

    8








 






    thereto); and (c) the grant or exercise price per share for
    any outstanding Awards under the Plan. The form and manner of
    any such adjustments shall be determined by the Committee in its
    sole discretion.



 



    8.2 Acceleration upon a Change of
    Control.  Except as may otherwise be provided
    in any Award Agreement or any other written agreement entered
    into by and between the Company and a Participant, if a Change
    of Control occurs and a Participant’s Awards are not
    converted, assumed or replaced by a successor, the vesting of
    such Awards shall accelerate by one (1) year upon such
    Change of Control. Upon, or in anticipation of, a Change of
    Control, the Committee may in its sole discretion provide for
    (i) any and all Awards outstanding hereunder to terminate
    at a specific time in the future and shall give each Participant
    the right to exercise such Awards during a period of time as the
    Committee shall determine, (ii) either the purchase of any
    Award for an amount of cash equal to the amount that could have
    been attained upon the exercise of such Award or realization of
    the Participant’s rights had such Award been currently
    exercisable or payable or fully vested (and, for the avoidance
    of doubt, if as of such date the Committee determines in good
    faith that no amount would have been attained upon the exercise
    of such Award or realization of the Participant’ s rights,
    then such Award may be terminated by the Company without
    payment), (iii) the replacement of such Award with other
    rights or property selected by the Committee in its sole
    discretion or the assumption of or substitution of such Award by
    the successor or surviving corporation, or a parent or
    subsidiary thereof, with appropriate adjustments as to the
    number and kind of Shares and prices, or (iv) provide for
    payment of Awards in cash based on the value of Shares on the
    date of the Change of Control plus reasonable interest on the
    Award through the date such Award would otherwise be vested or
    have been paid in accordance with its original terms, if
    necessary to comply with Section 409A of the Code.



 



    8.3 Outstanding Awards — Corporate
    Transactions.  In the event of a Corporate
    Transaction, each Award will terminate upon the consummation of
    the Corporate Transaction, unless the Award is assumed by the
    successor entity or Parent thereof in connection with the
    Corporate Transaction. Except as provided otherwise in an
    individual Award Agreement, in the event of a Corporate
    Transaction and:



 



    (a) the Award either is (x) assumed by the successor
    entity or Parent thereof or replaced with a comparable Award (as
    determined by the Committee) with respect to shares of the
    capital stock (or equivalent) of the successor entity or Parent
    thereof or (y) replaced with a cash incentive program of
    the successor entity which preserves the compensation element of
    such Award existing at the time of the Corporate Transaction and
    provides for subsequent payout in accordance with the same
    vesting schedule applicable to such Award, then such Award (if
    assumed), the replacement Award (if replaced), or the cash
    incentive program automatically shall become fully vested,
    exercisable and payable and be released from any restrictions on
    transfer (other than transfer restrictions applicable to
    Options) and repurchase or forfeiture rights, immediately upon
    termination of the Participant’s employment or service with
    all Service Recipients within twelve (12) months of the
    Corporate Transaction without cause; and



 



    (b) For each Award that is neither assumed nor replaced,
    such portion of the Award shall automatically become fully
    vested and exercisable and be released from any repurchase or
    forfeiture rights (other than repurchase rights exercisable at
    Fair Market Value) for all of the Shares at the time represented
    by such portion of the Award, immediately prior to the specified
    effective date of such Corporate Transaction, provided that the
    Participant remains an Employee, Consultant or Director on the
    effective date of the Corporate Transaction.



 



    8.4 Outstanding Awards — Other
    Changes.  In the event of any other change in
    the capitalization of the Company or corporate change other than
    those specifically referred to in this Article 8, the
    Committee may, in its absolute discretion, make such adjustments
    in the number and class of shares subject to Awards outstanding
    on the date on which such change occurs and in the per share
    grant or exercise price of each Award as the Committee may
    consider appropriate to prevent dilution or enlargement of
    rights.



 



    8.5 No Other Rights.  Except as
    expressly provided in the Plan, no Participant shall have any
    rights by reason of any subdivision or consolidation of shares
    of any class, the payment of any dividend, any increase or
    decrease in the number of shares of any class or any
    dissolution, liquidation, merger, or consolidation of the
    Company or any other corporation. Except as expressly provided
    in the Plan or pursuant to action of the Committee under the
    Plan, no issuance by the Company of shares of any class, or
    securities convertible into




    

    9








 






    shares of any class, shall affect, and no adjustment by reason
    thereof shall be made with respect to, the number of shares
    subject to an Award or the grant or exercise price of any Award.



 




    ARTICLE 9

    



 




    ADMINISTRATION
    



 



    9.1 Committee.  The Plan shall be
    administered by the Compensation Committee of the Board;
    provided, however that the Compensation Committee may
    delegate to a committee of one or more members of the Board the
    authority to grant or amend Awards to Participants other than
    Independent Directors and executive officers of the Company. The
    Committee shall consist of at least two individuals, each of
    whom qualifies as a Non-Employee Director. Reference to the
    Committee shall refer to the Board if the Compensation Committee
    has not been established or ceases to exist and the Board does
    not appoint a successor Committee. Notwithstanding the
    foregoing, the full Board, acting by majority of its members in
    office shall conduct the general administration of the Plan if
    required by Applicable Law, and with respect to Awards granted
    to Independent Directors and for purposes of such Awards the
    term “Committee” as used in the Plan shall be deemed
    to refer to the Board.



 



    9.2 Action by the Committee.  A
    majority of the Committee shall constitute a quorum. The acts of
    a majority of the members present at any meeting at which a
    quorum is present, and acts approved in writing by a majority of
    the Committee in lieu of a meeting, shall be deemed the acts of
    the Committee. Each member of the Committee is entitled to, in
    good faith, rely or act upon any report or other information
    furnished to that member by any officer or other employee of the
    Company or any Subsidiary, the Company’s independent
    certified public accountants, or any executive compensation
    consultant or other professional retained by the Company to
    assist in the administration of the Plan.



 



    9.3 Authority of
    Committee.  Subject to any specific
    designation in the Plan, the Committee has the exclusive power,
    authority and discretion to:



 



    (a) Designate eligible Employees, Directors and Consultants
    to receive Awards;



 



    (b) Determine the type or types of Awards to be granted to
    each Participant;



 



    (c) Determine the number of Awards to be granted and the
    number of Shares to which an Award will relate;



 



    (d) Determine the terms and conditions of any Award granted
    pursuant to the Plan, including, but not limited to, the
    exercise price, grant price, or purchase price, any restrictions
    or limitations on the Award, any schedule for lapse of
    forfeiture restrictions or restrictions on the exercisability of
    an Award, and accelerations or waivers thereof, any provisions
    related to non-competition and recapture of gain on an Award,
    based in each case on such considerations as the Committee in
    its sole discretion determines;



 



    (e) Determine whether, to what extent, and pursuant to what
    circumstances an Award may be settled in, or the exercise price
    of an Award may be paid in, cash, Shares, other Awards, or other
    property, or an Award may be canceled, forfeited, or surrendered;



 



    (f) Prescribe the form of each Award Agreement, which need
    not be identical for each Participant;



 



    (g) Decide all other matters that must be determined in
    connection with an Award;



 



    (h) Establish, adopt, or revise any rules and regulations
    as it may deem necessary or advisable to administer the Plan;



 



    (i) Interpret the terms of, and any matter arising pursuant
    to, the Plan or any Award Agreement; and



 



    (j) Make all other decisions and determinations that may be
    required pursuant to the Plan or as the Committee deems
    necessary or advisable to administer the Plan.




    

    10








 






    9.4 Decisions Binding.  The
    Committee’s interpretation of the Plan, any Awards granted
    pursuant to the Plan, any Award Agreement and all decisions and
    determinations by the Committee with respect to the Plan are
    final, binding, and conclusive on all parties.



 




    ARTICLE 10

    



 




    EFFECTIVE
    AND EXPIRATION DATE
    



 



    10.1 Effective Date.  The Effective
    Date of the Plan is January 1, 2008.



 



    10.2 Expiration Date.  The Plan
    will expire on, and no Award may be granted pursuant to the Plan
    after, the tenth anniversary of the Effective Date. Any Awards
    that are outstanding on the tenth anniversary of the Effective
    Date shall remain in force according to the terms of the Plan
    and the applicable Award Agreement.



 




    ARTICLE 11

    



 




    AMENDMENT,
    MODIFICATION, AND TERMINATION
    



 



    11.1 Amendment, Modification, And
    Termination.  With the approval of the Board,
    at any time and from time to time, the Committee may terminate,
    amend or modify the Plan; provided, however, that
    (a) to the extent necessary and desirable to comply with
    Applicable Laws, or stock exchange rules, the Company shall
    obtain shareholder approval of any Plan amendment in such a
    manner and to such a degree as required, and
    (b) shareholder approval is required for any amendment to
    the Plan that (i) increases the number of Shares available
    under the Plan (other than any adjustment as provided by
    Article 8), (ii) permits the Committee to extend the
    term of the Plan or the exercise period for an Option beyond ten
    years from the date of grant, or (iii) results in a
    material increase in benefits or a change in eligibility
    requirements.



 



    11.2 Awards Previously
    Granted.  Except with respect to amendments
    made pursuant to Section 11.1, no termination, amendment,
    or modification of the Plan shall adversely affect in any
    material way any Award previously granted pursuant to the Plan
    without the prior written consent of the Participant.



 




    ARTICLE 12

    



 




    GENERAL
    PROVISIONS
    



 



    12.1 No Rights to Awards.  No
    Participant, employee, or other person shall have any claim to
    be granted any Award pursuant to the Plan, and neither the
    Company nor the Committee is obligated to treat Participants,
    employees, and other persons uniformly.



 



    12.2 No Shareholders Rights.  No
    Award gives the Participant any of the rights of a Shareholder
    of the Company unless and until Shares are in fact issued to
    such person in connection with such Award.



 



    12.3 Taxes.  No Shares shall be
    delivered under the Plan to any Participant until such
    Participant has made arrangements acceptable to the Committee
    for the satisfaction of any income and employment tax
    withholding obligations under Applicable Laws. The Company or
    any Subsidiary shall have the authority and the right to deduct
    or withhold, or require a Participant to remit to the Company,
    an amount sufficient to satisfy all applicable taxes (including
    the Participant’s payroll tax obligations) required or
    permitted by law to be withheld with respect to any taxable
    event concerning a Participant arising as a result of this Plan.
    The Committee may in its discretion and in satisfaction of the
    foregoing requirement allow a Participant to elect to have the
    Company withhold Shares otherwise issuable under an Award (or
    allow the return of Shares) having a Fair Market Value equal to
    the sums required to be withheld. Notwithstanding any other
    provision of the Plan, the number of Shares which may be
    withheld with respect to the issuance, vesting, exercise or
    payment of any Award (or which may be repurchased from the
    Participant of such Award after such Shares were acquired by the
    Participant from the Company) in order to satisfy all of the
    Participant’s income and payroll tax liabilities with
    respect to the issuance, vesting, exercise or payment of the
    Award shall, unless specifically




    

    11








 






    approved by the Committee, be limited to the number of Shares
    which have a Fair Market Value on the date of withholding or
    repurchase equal to the aggregate amount of such liabilities
    based on the minimum statutory income and payroll tax
    withholding rates that are applicable to such supplemental
    taxable income under Applicable Law.



 



    12.4 No Right to Employment or
    Services.  Nothing in the Plan or any Award
    Agreement shall interfere with or limit in any way the right of
    the Service Recipient to terminate any Participant’s
    employment or services at any time, nor confer upon any
    Participant any right to continue in the employ or service of
    any Service Recipient.



 



    12.5 Effect of Plan upon Other Compensation
    Plans.  The adoption of the Plan shall not
    affect any other compensation or incentive plans in effect for
    any Service Recipient. Nothing in the Plan shall be construed to
    limit the right of any Service Recipient: (a) to establish
    any other forms of incentives or compensation for Employees,
    Directors or Consultants, or (b) to grant or assume options
    or other rights or awards otherwise than under the Plan in
    connection with any proper corporate purpose including without
    limitation, the grant or assumption of options in connection
    with the acquisition by purchase, lease, merger, consolidation
    or otherwise, of the business, stock or assets of any
    corporation, partnership, limited liability company, firm or
    association.



 



    12.6 Unfunded Status of
    Awards.  The Plan is intended to be an
    “unfunded” plan for incentive compensation. With
    respect to any payments not yet made to a Participant pursuant
    to an Award, nothing contained in the Plan or any Award
    Agreement shall give the Participant any rights that are greater
    than those of a general creditor of the Company or any
    Subsidiary.



 



    12.7 Indemnification.  To the
    extent allowable pursuant to applicable law, each member of the
    Committee or of the Board shall be indemnified and held harmless
    by the Company from any loss, cost, liability, or expense that
    may be imposed upon or reasonably incurred by such member in
    connection with or resulting from any claim, action, suit, or
    proceeding to which he or she may be a party or in which he or
    she may be involved by reason of any action or failure to act
    pursuant to the Plan and against and from any and all amounts
    paid by him or her in satisfaction of judgment in such action,
    suit, or proceeding against him or her; provided he or
    she gives the Company an opportunity, at its own expense, to
    handle and defend the same before he or she undertakes to handle
    and defend it on his or her own behalf. The foregoing right of
    indemnification shall not be exclusive of any other rights of
    indemnification to which such persons may be entitled pursuant
    to the Company’s Memorandum of Association and Articles of
    Association, as a matter of law, or otherwise, or any power that
    the Company may have to indemnify them or hold them harmless.



 



    12.8 Relationship to other
    Benefits.  No payment pursuant to the Plan
    shall be taken into account in determining any benefits pursuant
    to any pension, retirement, savings, profit sharing, group
    insurance, welfare or other benefit plan of the Company or any
    Subsidiary except to the extent otherwise expressly provided in
    writing in such other plan or an agreement thereunder.



 



    12.9 Expenses.  The expenses of
    administering the Plan shall be borne by the Company and its
    Subsidiaries.



 



    12.10 Titles and Headings.  The
    titles and headings of the Sections in the Plan are for
    convenience of reference only and, in the event of any conflict,
    the text of the Plan, rather than such titles or headings, shall
    control.



 



    12.11 Fractional Shares.  No
    fractional Share shall be issued and the Committee shall
    determine, in its discretion, whether cash shall be given in
    lieu of fractional shares or whether such fractional shares
    shall be eliminated by rounding up or down as appropriate.



 



    12.12 Government and Other
    Regulations.  The obligation of the Company to
    make payment of awards in Shares or otherwise shall be subject
    to all Applicable Laws and to such approvals by government
    agencies as may be required. The Company shall be under no
    obligation to register any of the Shares paid pursuant to the
    Plan under the Securities Act or any other similar law in any
    applicable jurisdiction. If the Shares paid pursuant to the Plan
    may in certain circumstances be exempt from registration
    pursuant to the Securities Act




    

    12








 






    or other Applicable Laws, the Company may restrict the transfer
    of such Shares in such manner as it deems advisable to ensure
    the availability of any such exemption.



 



    12.13 Governing Law.  The Plan and
    all Award Agreements shall be construed in accordance with and
    governed by the laws of the Cayman Islands.



 



    12.14 Section 409A.  To the
    extent that the Committee determines that any Award granted
    under the Plan is or may become subject to Section 409A of
    the Code, the Award Agreement evidencing such Award shall
    incorporate the terms and conditions required by
    Section 409A of the Code. To the extent applicable, the
    Plan and the Award Agreements shall be interpreted in accordance
    with Section 409A of the Code and the U.S. Department
    of Treasury regulations and other interpretative guidance issued
    thereunder, including without limitation any such regulation or
    other guidance that may be issued after the Effective Date.
    Notwithstanding any provision of the Plan to the contrary, in
    the event that following the Effective Date the Committee
    determines that any Award may be subject to Section 409A of
    the Code and related U.S. Department of Treasury guidance
    (including such U.S. Department of Treasury guidance as may
    be issued after the Effective Date), the Committee may adopt
    such amendments to the Plan and the applicable Award agreement
    or adopt other policies and procedures (including amendments,
    policies and procedures with retroactive effect), or take any
    other actions, that the Committee determines is necessary or
    appropriate to (a) exempt the Award from Section 409A
    of the Code and /or preserve the intended tax treatment of the
    benefits provided with respect to the Award, or (b) comply
    with the requirements of Section 409A of the Code and
    related U.S. Department of Treasury guidance.



 



    12.15 Appendices.  The Committee
    may approve such supplements, amendments or appendices to the
    Plan as it may consider necessary or appropriate for purposes of
    compliance with applicable laws or otherwise and such
    supplements, amendments or appendices shall be considered a part
    of the Plan; provided, however, that no such
    supplements shall increase the share limitations contained in
    Section 3.1 of the Plan.




    

    13