YOU On Demand Holdings, Inc. - Exhibit 10.1 - Filed by
   newsfilecorp.com






Execution Copy 

MANAGEMENT SERVICES AGREEMENT 

This MANAGEMENT SERVICES AGREEMENT (“Agreement”)
is entered into as of March 9, 2010 (the “Effective Date”), by and
between the following (each a “Party” and together the
“Parties”): 

	 	(i)	
    Party A: Beijing Sino Top Scope Technology Co., Ltd. ()
    , a limited liability company
    with its legal address at Suite 101, Door 7, Building 3, Jingshu Dongli,
    Haidian District, Beijing, People’s Republic of China; and
	 	 	 
	 	(ii)	
    Party B: Sinotop Group Limited, a company limited by shares
    incorporated under the laws of Hong Kong.


Capitalized terms not otherwise defined have the meanings
assigned to them in Appendix A to this Agreement, which is incorporated
and made a part hereof by reference. 

RECITALS 

This Agreement is entered into with reference to the following
facts: 

A.     Party A is a limited liability company incorporated under
the laws of the People’s Republic of China. Party A is 100% owned by ZHANG Yan
(the “Shareholder”). Party A is engaged in business activities
that are not prohibited by law or applicable regulations in the People’s
Republic of China (together with any expansion, contraction or other change to
the scope of that business as contemplated by this Agreement, the
“Business”). 

B.     Party B is a limited liability company incorporated under
the laws of Hong Kong. Party B is 100% owned by LIU Weicheng. Party B has
executive and financial management experience and capability relevant to the
Business. 

D.     Party A desires to engage Party B to provide management,
financial and other services in connection with the operation of the Business,
and Party B desires to provide those services to Party A. The Parties now desire
to memorialize the terms and conditions pursuant to which those services will be
provided by Party B to Party A, and pursuant to which Party A will compensate
Party B therefor. 

NOW, THEREFORE, in consideration for the mutual
covenants and promises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is acknowledged by the
Parties, and through friendly consultation, under the principle of equality and
mutual benefits, in accordance with the relevant laws and regulations of the
People’s Republic of China, the Parties agree as follows: 

AGREEMENT 

1.     Management Services. During the
Term of this Agreement, Party B will identify and provide to Party A executive
and financial management personnel in sufficient numbers and with expertise and
experience appropriate to provide the services identified in Appendix B,
as it may be amended from time to time by written agreement of the Parties (the
“Management Services”), and will provide those Services to Party
A. Party A will take all commercially reasonable actions to permit and
facilitate the provision of the Management Services by Party B and accept those
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2.     Compensation to Party B. As
compensation for providing the Management Services, Party B will be entitled to
receive a fee (the “Management Services Fee”), upon demand, equal
to one hundred percent (100%) of the annual Net Profit of Party A during the
Term of this Agreement. At the sole discretion of Party B, the Net Profit of
Party A shall be calculated through the end of the immediately preceding fiscal
year of Party A, and paid by Party A to Party B within sixty (60) days of demand
therefor. Until and unless such demand is made, the Management Services Fee is
not due and payable to Party A and it is the intent of the Parties that the
income such Fee represents shall not be accrued by Party A. Any dispute between
the Parties concerning any calculation or payment under this Section 2
will be resolved pursuant to the dispute resolution provisions of Section
19. 

3.     Ad Hoc Payment. The Parties
acknowledge that in order to provide the Management Services under this
Agreement, Party B may incur expenses and costs from time to time, and the
Parties further agree that Party B may request an ad hoc payment every calendar
quarter and such payment may be credited against Party A’s future payment
obligations of the Management Services Fee. 

4.     Obligation to Reimburse Net
Losses. In consideration for its right to receive the Net Profit
of Party A as provided in Section 2, Party B will reimburse to Party A
the full amount of any Net Losses incurred by Party A during the Term of this
Agreement. Net Losses will be calculated annually and paid by Party B to Party A
no later than the last day of the first quarter following the end of each
calendar year, commencing on March 31, 2011 for calendar year 2010. Any dispute
between the Parties concerning any calculation or payment under this Section
4 will be resolved pursuant to the dispute resolution provisions of
Section 19. 

5.     Advances Against Net Losses .
From time to time, in its sole discretion, Party B may advance to Party
A amounts to be credited against Party B’s future obligations to reimburse Net
Losses of Party A. Any such advances will be treated as prepayments and not as
loans. Party A will have no obligation to repay any such advances except by
crediting the amount thereof against Party B’s obligation to reimburse Net
Losses, or by adding the amount thereof to Net Profit when and as requested by
Party B.

6.     Credit for Amounts Paid Under Other
Agreements. Party B and Party A are or may be parties to certain other
agreements (collectively, the “Business Cooperation Agreements”),
some or all of which may require certain payments to be made by Party A to Party
B in consideration for services, equipment or other items of value provided by
Party B to Party A. The Parties agree that any and all such amounts may be (a)
separately paid by Party A to Party B and accordingly counted as expenses of
Party A, reducing Party A’s Net Profit; or (b) included in the aggregate Net
Profit of Party A and not separately paid to Party B.

7.     Interest Penalty. If any amounts
due and payable under this Agreement are not paid when due, interest will
accumulate on such amounts at the rate of four percent (4%) per annum until
paid. This interest penalty may be reduced or waived by the Party entitled to
receive it in light of actual circumstances, including the reason for any delay
in payment. 

8.     Guarantees. To the extent and
only to the extent permitted by applicable law, each Party agrees to act as a
guarantor of the indebtedness of the other, as and only as follows: 

(a)     Party A will not incur any indebtedness to any Person not a
party to this Agreement without the advance written consent of Party B in the
exercise of its obligations to provide comprehensive Management Services under this Agreement. If Party A
incurs any indebtedness as contemplated by this Section 8(a), Party B
will act as a guarantor of that indebtedness. 

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(b)     Party B may, in the exercise of its reasonable business
judgment, incur indebtedness to any Person not a party to this Agreement,
provided that any such indebtedness may only be in connection with the
Business. If Party B incurs any indebtedness as contemplated by this Section
8(b), Party A will act as a guarantor of that indebtedness. 

9.     Exclusivity. During the Term of
this Agreement, (a) Party A will not contract with any other Person to provide
services which are the same or similar to the Management Services, and (b) Party
B will not provide services which are the same or similar to the Management
Services to any other Person. For purposes of this Section 9 only,
“Person” does not include any Affiliate of either Party, including other
entities that may become affiliated with either Party. 

10.     Operation of Business.
During the Term of this Agreement: 

	 	(a) 	The Party A will ensure that: 
	 	  	  
	 	(i) 	the business of Party A, together with all
      business opportunities presented to or which become available to Party A,
      will be treated as part of the Business cov- ered by the Management
      Services and this Agreement; 
	 	  	  
	 	(ii) 	all cash of Party A will be maintained in
      Company Bank Accounts or disposed of in accordance with this Agreement;
  
	 	  	  
	 	(iii) 	all business income, working capital, recovered
      accounts receivable, and any other funds which come into the possession of
      Party A or are derived from or re- lated to the operation of the business
      of Party A, are deposited into a Company Bank Account; 
	 	  	  
	 	(iv) 	all accounts payable, employee compensation and
      other employment-related ex- penses, and any payments in connection with
      the acquisition of any assets for the benefit of Party A or the
      satisfaction of any liabilities of Party A, are paid from amounts
      maintained in Company Bank Accounts; 
	 	  	  
	 	(v) 	Party B or any third party designated by Party
      B will have full access to the fi- nancial records of Party A and from
      time to time, Party B may request, at its sole option, to conduct an
      auditing with regard to the financial status of Party A; 
	 	  	  
	 	(vi) 	ensure that a majority of the members of its
      board of directors are also members of the board of directors of Party B;
      and 
	 	  	  
	 	(vii) 	no action is taken without the prior written
      consent of Party B that that would have the effect of entrusting all or
      any part of the business of Party A to any other Person. 
	 	  	  
	 	(b) 	Party B will ensure that:



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	 	(i) 	
      it exercises with respect to the conduct of the Business
      the same level of care it exercises with respect to the operation of its
      own business and will at all times act in accordance with its Reasonable
      Business Judgment, including taking no ac- tion which it knows, or in the
      exercise of its Reasonable Business Judgment should have known, would
      materially adversely affect the status of any of per- mits, licenses and
      approvals necessary for the conduct of the Business or consti- tute a
      violation of all Legal Requirements;

	 	 	 
	 	(ii) 	
      neither it, nor any of its agents or representatives,
      takes any action that interferes with, or has the effect of interfering
      with, the operation of the Business in accor- dance with this Agreement,
      or which materially adversely affects its assets, op- erations, business
      or prospects;

	 	 	 
	 	(iii) 	
      use its Best Efforts to cooperate and assist Party B and
      Party A to maintain in ef- fect all permits, licenses and other
      authorizations and approvals necessary or ap- propriate to the conduct of
      the Business; and

	 	 	 
	 	(iv) 	
      use its Best Efforts to assist Party B and Party A to
      maintain positive and produc- tive relations with relevant Governmental
      Authorities and their representatives.

	 	 	 
	 	(v) 	
      a majority of the members of its board of directors are
      also members of the board of directors of Party A; and

	 	 	 
	 	(vi) 	
      subject to the provisions of Section 13 relating
      to the Transition period, it will preserve intact the business and
      operations of Party A and take no action which it knows, or in the
      exercise of its Reasonable Business Judgment should have known, would
      materially adversely affect the business, operations, or prospects of
      Party A.



11.     Material Actions. The Parties
acknowledge and agree that the economic risk of the operation of the Business is
being substantially assumed by Party B and that the continued business success
of Party A is necessary to permit the Parties to realize the benefits of this
Agreement and the other Business Cooperation Agreements. During the Term of this
Agreement, the Parties therefore will ensure that Party A does not take any
Material Action without the advance written consent of Party B, which consent
will not be unreasonably withheld or delayed.

12.     Right of First Refusal. Party A will ensure as follows: if the Shareholder proposes to Transfer to
any other Person (the “Proposed Transferee”) all or any portion of
the equity of Party A held by the Shareholder (the “Selling
Shareholder”), Party A shall urge the Selling Shareholder to first
deliver to Party B a written notice (the “Notice”) offering to
Party B or its designee(s) all of the equity proposed to be Transferred by the
Shareholder, on terms and conditions no less favorable to Party B than those
offered to the Proposed Transferee. The Notice will include all relevant terms
of the Proposed Transfer, and will be irrevocable for a period of thirty (30)
calendar days after its receipt by Party B. Party B will have the right and
option, by written notice delivered within thirty (30) calendar days after
receipt of the Notice, to notify the Shareholder in writing of its acceptance of
all or any part of the equity so offered in the Notice, at the purchase price
and on the terms stated in the Notice. If Party B so accepts the offer contained
in the Notice, then the equity of Party A proposed to be Transferred will be
Transferred to Party B at the purchase price and on the terms stated in the
Notice. If Party B is not able to accept the transferred equity of Party A only due to the restrictions set forth by the
then effective PRC regulations, without prior written approval from Party B,
Party A shall not make the Proposed Transfer to any third party. Whereas, the
fulfillment of this Agreement shall not conflict with the right granted to Party
B under Option Agreement entered into between Shareholder and Party B dated of
even date herewith. 

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13.     Transition of Business to Party B;
Future Expansion. At the sole discretion of Party B, during the
Term of this Agreement, Party B may transfer or cause to be transferred from
Party A to Party B or its designee (referred to collectively for purposes of
this Section 13 as “Party B”) any part or all of the business,
personnel, assets and operations of Party A which may be lawfully conducted,
employed, owned or operated by Party B (the “Transition”),
including any of the following: 

(a)     business opportunities presented to, or available to Party
A may be pursued and contracted for in the name of Party B rather than Party A,
and at its discretion Party B may employ the resources of Party A to secure such
opportunities;

(b)     any tangible or intangible property of Party A, any
contractual rights, any personnel, and any other items or things of value held
by Party A may be transferred to Party B at book value; 

(c)     real property, personal or intangible property, personnel,
services, equipment, supplies and any other items useful for the conduct of the
Business may be obtained by Party B by acquisition, lease, license or otherwise,
and made available to Party A on terms to be determined by agreement between
Party B and Party A;

(d)     contracts entered into in the name of Party A may be
transferred to Party B, or the work under such contracts may be subcontracted,
in whole or in part, to Party B, on terms to be determined by agreement between
Party B and Party A; and 

(e)     any changes to, or any expansion or contraction of, the
Business may be carried out in the exercise of the sole discretion of Party B,
and in the name of and at the expense of, Party B; 

provided, however, that none of the foregoing, and no
other part of the Transition may cause or have the effect of terminating
(without being substantially replaced under the name of Party B) or adversely
affecting any license, permit or regulatory status of Party A. Any of the
activity contemplated by this Section 13 will be deemed part of
the “Business.” 

14.     Ownership of Intellectual Property.
All Intellectual Property created by Party B in the course of providing
the Management Services will be the sole property of Party B and Party A will
have no right to any ownership or use of such Intellectual Property except under
separate written agreement with Party B. 

15.     Representations and Warranties of Party
A. Party A hereby makes the following representations and warranties for
the benefit of Party B:

(a)     Corporate Existence and Power. Party A is a
limited liability company duly organized and validly existing under the laws of
the PRC, and has all legal or corporate power and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted and as currently contemplated to be conducted. Party A has never
approved, or commenced any proceeding or made any election contemplating, the
dissolution or liquidation of Party A or the winding up or cessation of the
business or affairs of Party A. 

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(b)     Authorization; No Consent. Party A (i) has
taken all necessary corporate and other actions to authorize its execution,
delivery and performance of this Agreement and all related documents and has the
corporate and other power and authorization to execute, deliver and perform this
Agreement and the other related documents; (ii) has the absolute and
unrestricted right, power, authority, and capacity to execute and deliver this
Agreement and the other related documents and to perform its obligations under
this Agreement and the other related documents; (iii) is not required to give
any notice to or obtain any Consent from any Person in connection with the
execution and delivery of this Agreement or the consummation or performance of
any of the transactions or actions contemplated by any of the Business
Cooperation Agreements, except for any notices that have been duly given or
Consents that have been duly obtained; and (iv) holds all the governmental
authorizations necessary to permit it to lawfully conduct and operate its
business in the manner it currently conducts and operates such business and to
permit Party A to own and use its assets in the manner in which it currently
owns and uses such assets. To the best knowledge of Party A, there is no basis
for any governmental authority to withdraw, cancel or cease in any manner any of
such governmental authorizations.

(c)     No Conflicts. The execution and
perform of this Agreement by Party A will not contravene, conflict with, or
result in violation of (i) any provision of the organizational documents of
Party A; (ii) resolution adopted by the board of directors or the equity holders
of Party A; and (iii) any laws and regulations to which Party A or the
transactions and relationships contemplated in this Agreement and the Business
Cooperation Agreements are subject. 

16.     Representations and Warranties of Party
B. Party B hereby makes the following representations and warranties for
the benefit of Party A:

(a)     Corporate Existence and Power. Party B (i) is
a limited liability company duly organized and validly existing under the laws
of Hong Kong, and has all corporate power and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted and as currently contemplated to be conducted; and (ii) has not ever
approved, or commenced any proceeding or made any election contemplating, the
dissolution or liquidation of Party B or the winding up or cessation of the
business or affairs of Party B.

(b)     Authorization; No Consent. Party B (i) has
taken all necessary corporate actions to authorize its execution, delivery and
performance of this Agreement and all related documents and has the corporate
power and authorization to execute, deliver and perform this Agreement and the
other related documents; (ii) has the absolute and unrestricted right, power,
authority, and capacity to execute and deliver this Agreement and the other
related documents and to perform its obligations under this Agreement and the
other related documents; (iii) is not required to give any notice to or obtain
any Consent from any Person in connection with the execution and delivery of
this Agreement or the consummation or performance of any of the Business
Cooperation Agreements, except for any notices that have been duly given or
Consents that have been duly obtained; and (iv) has all the governmental
authorizations necessary to permit Party B to lawfully conduct and operate its
business in the manner it currently conducts and operates such business and to
permit Party B to own and use its assets in the manner in which it currently
owns and uses such assets. To the best knowledge of Party B, there is no basis
for any governmental authority to withdraw, cancel or cease in any manner any of
such governmental authorizations.

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(c)     No Conflicts. The execution and
perform of this Agreement by Party B will not contravene, conflict with, or
result in violation of (i) any provision of the organizational documents of
Party B; (ii) any resolution adopted by the board of directors or the equity
holders of Party B; and (iii) any laws and regulations to which Party B or the
transactions and relationships contemplated in this Agreement and the Business
Cooperation Agreements are subject. 

17.     Liability for Breach; Indemnification
and Hold Harmless. Each of the Parties will be liable to the
other Party for any damage or loss caused by such Party’s breach of this
Agreement. Party A will indemnify and hold harmless Party B from and against any
claims, losses or damages unless caused by a breach by Party B of its
obligations under this Agreement or by the willful, reckless or illegal conduct
of Party B. Party B will indemnify and hold harmless Party A from and against
any claims, losses or damages caused by any breach by Party A of its obligations
under this Agreement or by the willful, reckless or illegal conduct of Party A.


18.     Liquidated Damages.
Party A acknowledges and agrees that Party B will be incurring significant
expense in order to fulfill its obligations under this Agreement. Party A
further acknowledges that breach of this Agreement by it would cause Party B and
Party B’s stockholders significant damages and perhaps the complete cessation of
Party B’s business. Since the exact amount of such damages would be extremely
difficult, if not impossible to calculate, Party A agrees that in the event of
the material breach by it of this Agreement, which breach has not been cured
within sixty (60) days of receipt of notice from Party B of such material breach
and a description of such breach, Party A will be obligated to pay to Party B
liquidated damages in an amount equal to the greater of (a) eight (8) times the
annualized revenues of Party B for the last completed fiscal quarter, or (b)
US$50 million. 

19.     Dispute Resolution.

(a)     Friendly Consultations. Any and all disputes,
controversies or claims arising out of or relating to the interpretation or
implementation of this Agreement, or the breach hereof or relationships created
hereby, will be settled through friendly consultations.

(b)     Arbitration. If any such dispute is not
resolved through friendly consultations within sixty (60) days from the date a
Party gives the other Parties written notice of a dispute, then it will be
resolved exclusively by arbitration under the auspices of and in accordance with
the Arbitration Rules of China International Economic and Trade Arbitration
Commission (“CIETAC”) and will be submitted to CIETAC Shanghai
Branch. Any arbitration will be heard before three (3) arbitrators, one (1) of
whom will be appointed by Party B, one (1) of whom will be appointed by Party A,
and the remaining one (1) arbitrator (chairman of the arbitration tribunal) will
be appointed by the Director of CIETAC. Any arbitration will be conducted in
both the English and Chinese languages. The arbitration award will be final and
binding on both Parties and will not be subject to any appeal, and the Parties
agree to be bound thereby and to act accordingly. 

(c)     Continuation of Agreement. It is not
necessary for any Party to declare a breach of this Agreement in order to
proceed with the dispute resolution process set out in this Section 19.
Unless and until this Agreement is terminated pursuant to Section 20,
this Agreement will continue in effect during the pendency of any discussions or
arbitration under this Section 19. 

20.     Term. This Agreement is
effective as of the date first set forth above, and will continue in effect for
a period of twenty (20) years (the “Initial Term”), and for
succeeding periods of the same duration (each, “Subsequent Term”), until
terminated by one of the following means either during the Initial Term or
thereafter. The period during which this Agreement is effective is referred to
as the “Term.”

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(a)     Mutual Consent. This Agreement may be
terminated at any time by the mutual consent of the Parties, evidenced by an
agreement in writing signed by both Parties.

(b)     Termination by Party B. This Agreement may be
terminated by Party B ((i) upon written notice delivered to Party A no later
than ten (10) calendar days before the expiration of the Initial Term or any
Subsequent Term; or (ii) at any time by upon ninety (90) calendar days’ written
notice delivered to Party A. 

(c)     Breach or Insolvency. Either of Party
A or Party B may terminate this Agreement immediately (a) upon the material
breach by the other of its obligations hereunder and the failure of such Party
to cure such breach within thirty (30) working days after written notice from
the non-breaching Party; or (b) upon the filing of a voluntary or involuntary
petition in bankruptcy by the other or of which the other is the subject, or the
insolvency of the other, or the commencement of any proceedings placing the
other in receivership, or of any assignment by the other for the benefit of
creditors. 

(d)     Consequences of Termination. Upon any
effective date of any termination of this Agreement: (i) Party B will instruct
all management personnel identified or provided by it to Party A to cease
working for Party A; (ii) Party B will deliver to Party A all chops and seals of
Party A; (iii) Party B will deliver to Party A, or grant to Party A unrestricted
access to and control of, all of the financial and other books and records of
Party A, including any and all permits, licenses, certificates and other
proprietary and operational documents and instruments; (iv) Party B will
cooperate fully in the replacement of any signatories or persons authorized to
act on behalf of Party A with persons appointed by Party A; and (v) any licenses
granted by Party B to Party A during the Term will terminate unless otherwise
agreed by the Parties. 

(e)     Survival. The provisions of Section 17
(Indemnification; Hold Harmless); Section 18 (Liquidated
Damages), Section 19 (Dispute Resolution), Section
20(d) (Consequences of Termination), and Section 21
(Miscellaneous) will survive any termination of this Agreement. Any
amounts owing from any Party to any other Party on the effective date of any
termination under the terms of this Agreement will continue to be due and owing
despite such termination. 

21.     Miscellaneous. 

(a)     Headings and Gender. The headings of
Sections in this Agreement are provided for convenience only and will not affect
its construction or interpretation. All references to “Section” or “Sections”
refer to the corresponding Section or Sections of this Agreement. All words used
in this Agreement will be construed to be of such gender or number as the
circumstances require. Unless otherwise expressly provided, the word “including”
does not limit the preceding words or terms. 

(b)     Usage. The words “include” and “including”
will be read to include “without limitation.” 

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(c)     Severability. Whenever possible each
provision and term of this Agreement will be interpreted in a manner to be
effective and valid but if any provision or term of this Agreement is held to be prohibited by or invalid, then such provision or term
will be ineffective only to the extent of such prohibition or invalidity,
without invalidating or affecting in any manner whatsoever the remainder of such
provision or term or the remaining provisions or terms of this Agreement. If any
of the covenants set forth in this Agreement are held to be unreasonable,
arbitrary, or against public policy, such covenants will be considered divisible
with respect to scope, time and geographic area, and in such lesser scope, time
and geographic area, will be effective, binding and enforceable against the
Parties. 

(d)     Waiver. No failure or delay by any
Party to exercise any right, power or remedy under this Agreement will operate
as a waiver of any such right, power or remedy. 

(e)     Integration. This Agreement and the other
Business Cooperation Agreements supersede any and all prior discussions and
agreements (written or oral) between the Parties with respect to the exclusive
cooperation arrangement and other matters contained herein. 

(f)     Assignments, Successors, and No Third-Party Rights.
No Party may assign any of its rights under this Agreement without the
prior consent of the other Parties, which will not be unreasonably withheld.
Notwithstanding the foregoing, the Parties understand that Party B is intending
to set up a wholly foreign owned enterprise (the “WFOE”) in China
and it is the agreement between the Parties that all the rights and obligations
of Party B under this Agreement and the Business Cooperation Agreement will be
assigned to the WFOE at Party B’s discretion. Subject to the preceding sentence,
this Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the successors and permitted assigns of the Parties. Nothing
expressed or referred to in this Agreement will be construed to give any Person
other than the Parties to this Agreement any legal or equitable right, remedy,
or claim under or with respect to this Agreement or any provision of this
Agreement. This Agreement and all of its provisions and conditions are for the
sole and exclusive benefit of the Parties to this Agreement and their successors
and assigns. 

(g)     Notices. All notices, requests,
demands, claims, and other communications under this Agreement will be in
writing. Any Party may send any notice, request, demand, claim, or other
communication under this Agreement to the intended recipient at the address set
forth on the signature page of this Agreement by any means (including personal
delivery, expedited courier, messenger service, telecopy, telex, ordinary mail,
or electronic mail), but no such notice, request, demand, claim, or other
communication will be deemed to have been duly given unless and until it
actually is received by the intended recipient. Refusal by a Party to accept
notice that is validly given under this Agreement will be deemed to have been
received by such Party upon receipt. Any Party may change the address to which
notices, requests, demands, claims, and other communications under this
Agreement are to be delivered by giving the other Parties notice in the manner
herein set forth. Any notice, request, demand, claim, or other communication
under this Agreement will be addressed to the intended recipient as set forth on
the signature page hereto. 

(h)     Further Assurances. Each of the
Parties will use its best efforts to take all action and to do all things
necessary, proper, or advisable in order to consummate and make effective the
transactions contemplated by this Agreement. 

(i)     Governing Law. This Agreement will be
construed, and the rights and obligations under this Agreement determined, in
accordance with the laws of the PRC, without regard to the principles of
conflict of laws thereunder. 

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(j)     Amendment. This Agreement may not be amended,
altered or modified except by a subsequent written document signed by all
Parties. 

(k)     Language This Agreement is written in both
Chinese and English, and both versions are equally authentic.

(l)     Counterparts. This Agreement may be executed
in any number of counterparts. When each Party has signed and delivered to the
other Party at least one such counterpart, each of the counterparts will
constitute one and the same instrument.

[Signature Page Follows] 

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APPENDIX A 

Definitions 

For purposes of that certain Management Services Agreement to
which this is Appendix A, the following terms have the meanings set forth
below: 

“Affiliate” means, with respect to any Person,
any of (a) a director, officer or stockholder holding 5% or more of the equity
or capital stock (on a fully diluted basis) of such Person, (b) a spouse,
parent, sibling or descendant of such Person (or a spouse, parent, sibling or
descendant of any director or officer of such Person) and (c) any other Person
that, directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, another such Person. The term
“control” includes, without limitation, the possession, directly or indirectly,
of the power to direct the management and policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.

“Best Efforts” means the efforts that a
prudent Person desiring to achieve a particular result would use in order to
ensure that such result is achieved as expeditiously as possible. 

“Business” is defined in the Recitals. 

“Business Cooperation Agreements” means any other
agreements entered into between the Parties with respect to the operation of the
Business or the carrying out of the transactions contemplated by this
Agreement. 

“Company Bank Accounts” means all accounts
maintained or held in the name of Party A at or with any bank or other financial
institution, whether existing on the date of this Agreement or established in
the future. 

“Consent” means any approval, consent,
ratification, permission, waiver or authorization, including any of the
foregoing issued or granted by any Governmental Authority.

“Governmental Authority” means any nation or
government or any province or state any other political subdivision thereof; any
entity, authority or body exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, including
any government authority, agency, department, board, commission or
instrumentality of the People’s Republic of China or any political subdivision
thereof; any court, tribunal or arbitrator; and any self-regulatory
organization. 

“Intellectual Property” means any patent, patent
application, trademark (whether registered or unregistered and whether or not
relating to a published work), trademark application, trade name, fictitious
business name, service mark (whether registered or unregistered), service mark
application, copyright (whether registered or unregistered), copyright
application, maskwork, maskwork application, trade secret, know-how, franchise,
system, computer software, invention, design, blueprint, proprietary product,
technology, proprietary right, and improvement on or to any of the foregoing, or
any other other intellectual property right or intangible asset. 

“Law” means all applicable provisions of all (a)
constitutions, treaties, statutes, laws (including the common law), codes,
rules, regulations, ordinances or orders of any Governmental Authority, (b)
governmental approvals and (c) orders, decisions, injunctions, judgments, awards
and decrees of or agreements with any Governmental Authority. 

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“Legal Requirement” “means any national
(or federal), provincial, state, local, municipal, foreign or other
constitution, law, statute, legislation, constitution, principle of common law,
resolution, ordinance, code, edict, decree, proclamation, treaty, convention,
rule, regulation, ruling, directive, pronouncement, requirement, specification,
determination, decision, opinion or interpretation issued, enacted, adopted,
passed, approved, promulgated, made, implemented or otherwise put into effect by
or under the authority of any Governmental Authority. 

“Lien” means any mortgage, pledge, deed of trust,
hypothecation, right of others, claim, security interest, encumbrance, burden,
title defect, title retention agreement, lease, sublease, license, occupancy
agreement, easement, covenant, condition, encroachment, voting trust agreement,
interest, option, right of first offer, negotiation or refusal, proxy, lien,
charge or other restrictions or limitations of any nature whatsoever, including
but not limited to such Liens as may arise under any contract. 

“Management Services” is defined in Section
1. 

“Management Services Fee” is defined in
Section 2. 

“Material Action” means any of the actions set
forth in Appendix C. 

“Net Losses” means the net losses of Party A,
calculated as follows: if the result of the calculation of Net Profit is a
negative number, that number will be the “Net Losses” of Party A. 

“Net Profit” means the net profit of Party A for
the period immediately preceding the date for calculation of Net Profit set out
in this Agreement, calculated as follows: (a) Revenue, less (b) Costs, Accrued
Expenses, Taxes accrued or paid, and Fixed Revenue. In addition, the following
terms have the meanings set forth below, each with reference to the same period:


(a)     “Revenue” means all the revenue or income
actually accrued by Party A arising out of or connected to the conduct of the
Business;

(b)     “Costs” means all costs required for the
conduct of the Business actually accrued by Party A;

(c)     “Accrued Expenses” means the amount which
must be accrued by Party A according to applicable Legal Requirements in
connection with employee health and welfare, mandatory development funds, and
the like;

(d)     “Taxes” is defined in this Appendix A;
and

(e)     “Fixed Revenue” means the amount which must
be paid by Party A to Sichuan International Studies University. 

“Person” means an individual, a corporation, a
partnership, an association, a trust or other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof.


“Reasonable Business Judgment” means a
judgment reached in good faith and in the exercise of reasonable care. 

“Shareholder” is defined in the Recitals. 

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“Taxes” means with respect to any Person, (a) all
income taxes (including any tax on or based upon net income, gross income,
income as specially defined, earnings, profits or selected items of income,
earnings or profits) and all gross receipts, sales, use, ad valorem, transfer,
franchise, license, withholding, payroll, employment, excise, severance, stamp,
occupation, premium, property or windfall profits taxes, alternative or add-on
minimum taxes, customs duties and other taxes, fees, assessments or charges of
any kind whatsoever, together with all interest and penalties, additions to tax
and other additional amounts imposed by any taxing authority (domestic or
foreign) on such Person (if any) and (b) any liability for the payment of any
amount of the type described in the clause (a) above as a result of being a
“transferee” of another entity or a member of an affiliated or combined group,
and “Tax” will have the correlative meaning. 

“Tax Return” means any return (including
any information return), report, statement, declaration, estimate, schedule,
notice, notification, form, election, certificate or other document or
information that is, has been or may in the future be filed with or submitted
to, or required to be filed with or submitted to, any Governmental Body in
connection with the determination, assessment, collection or payment of any Tax
or in connection with the administration, implementation or enforcement of or
compliance with any Legal Requirement relating to any Tax. 

“Term” is defined in Section 20. 

“Transfer” means directly or indirectly, to sell,
assign, transfer, pledge, bequeath, hypothecate, mortgage, grant any proxy with
respect to, or in any other way encumber or otherwise dispose of. 

“Transition” is defined in Section 13.

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APPENDIX B 

Management Services 

For purposes of that certain Management Services Agreement to
which this is Appendix B, “Management Services” means the following: 

General Management Services 

“Management Services” includes the following general management
services relating to the operation of the Business except for those compulsively
limited or prohibited by PRC laws and regulations otherwise: 

(a)     All aspects of the day-to-day operations of Party A,
including its relationships with its customers, its performance under agreements
or other arrangements with any other parties, its compliance with applicable
laws and regulations;

(b)     The appointment, hiring, compensation (including any
bonuses, non-monetary compensation, fringe and other benefits, and equity-based
compensation), firing and discipline of all employees, consultants, agents and
other representatives of Party A, including the Executive Director or the Board
of Directors of Party A and all other executive officers or employees of Party
A; 

(c)     Establishment, maintenance, termination or elimination of
any plan or other arrangement for the benefit of any employees, consultants,
agents, representatives or other personnel of Party A; 

(d)     Management, control and authority over all accounts
receivable, accounts payable and all funds and investments of Party A; 

(e)     Management, control and authority over Party A Bank
Accounts, in connection with which all seals and signatures will be those of
personnel appointed and confirmed by Party B; 

(f)     Any expenditure, including any capital expenditure, of
Party A; 

(g)     The entry into, amendment or modification, or termination
of any contract, agreement and/or other arrangement to which Party A is, was, or
would become a party;

(h)     The acquisition, lease or license by Party A of any assets,
supplies, real or personal property, or intellectual or other intangible
property; 

(i)     The acquisition of or entry into any joint venture or other
arrangement by Party A with any other Person; 

(j)     Any borrowing or assumption by Party A of any liability or
obligation of any nature, or the subjection of any asset of Party A to any Lien;


(k)     Any sale, lease, license or other disposition of any asset
owned, beneficially owned or controlled by Party A; 

(l)     Applying for, renewing, and taking any action to maintain
in effect, any permits, licenses or other authorizations and approvals necessary
for the operation of Party A’s business; 

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(m)     The commencement, prosecution or settlement by Party A of
any litigation or other dispute with any other Person, through mediation,
arbitration, lawsuit or appeal; 

(n)     The declaration or payment of any dividend or other
distribution of profits of Party A; 

(o)     The preparation and filing of all Tax Returns, the payment
or settlement of any and all Taxes, and the conduct of any proceedings with any
Governmental Authority with respect to any Taxes; and 

(p)     The carrying out of the Transition, as defined in
Section 13. 

Specific Services 

“Management Services” also includes the following specific
services relating to the operation of the Business: 

	 	(a) 	
      Marketing and Public Relationship

	 	 	 
	 		
      Service Content: Party B will be in charge
      of, including but not limited to, engag- ing in publicizing Party A’s
      brand so as to broaden Party A’s influence; dealing the cooperation issues
      with the qualified third party for Party A’s interests.

	 	 	 
	 	(b) 	
      Establishment, Maintenance and Property Management of
      Fixed Assets and Equipments

	 	 	 
	 		
      Service Content: Party B provides the
      services of establishment, maintenance and management for buildings owned
      and/or used by Party A; establishment, repair, maintenance, operation and
      management for the public equipments, devices owned and/or used by Party
      A; Party A’s public environment sanitation, includ- ing buildings and
      public sites; management for traffic and order of vehicles stop;
      maintenance for the public order, including security monitor, patrol,
      guard, guard at gate; energy services (use of power, water and gas);
      maintenance for telecom and grib; storage and maintenance machineries,
      vehicles, furniture and other equipments; other property management
      services.

	 	 	 
	 		
      Special
Agreement:




	 	(1) 	
      Party B charges the customer directly for the services
      hereunder;

	 	 	 
	 	(2) 	
      The services management expenses will be charged to the
      customer solely and timely according to the actual expenses;

	 	 	 
	 	(3) 	
      For the services hereunder, Party A covenants, unless
      otherwise con- sented by Party B in writing, Party A will not cooperate or
      reach a coop- eration agreement with any third party (whatever in writing
      or in oral).




	 	(c) 	
      Future Investment and Expansion



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      Party A will consult Party B and seek its prior written
      permission concerning any and all of its future investment or expansion
      plan. In the case that the then effec- tive PRC laws and regulations
      permit, any and all of such investment and expan- sion will be made
      directly through Party B.

	 	 	 
	 	(d) 	
      Others



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APPENDIX C 

Material Actions 

For purposes of that certain Management Services Agreement to
which this is Appendix C, “Material Actions” means any of the following: 

(a)     Any change to the organic or charter documents of Party
A;

(b)     Any issuance of new equity in Party A, including any
securities convertible into equity of Party A, or the acceptance by Party A of
any equity investment, or the repurchase or redemption of any equity of Party
A;

(c)     Any hiring, firing, or discipline of any person who is an
executive employee or director of Party A; 

(d)     The purchase of any material asset by Party A; 

(e)     The sale, conveyance, licensing or pledge of a material
asset of Party A, including, without limitation, any material intellectual
property of Party A;

(f)     Entering into, amending, supplementing, terminating or
otherwise modifying any agreement, contract or other arrangement to which Party
A is or could become a party, having a value or impact on Party A, individually
or in the aggregate, in excess of RMB 100,000;

(g)     Incurring any indebtedness or similar obligation to third
parties or subjecting of any of the equity or assets of Party A to any Lien;

(h)     Investing in, incorporating or otherwise creating any
affiliate or joint venture or purchasing or otherwise acquiring any stock or any
equity interest in any entity or business, in one or a series of related
transactions, or disposing of any of the foregoing; 

(i)     Any change to the compensation of any executive employee,
consultant or other representative of Party A; 

(j)     Any transaction, action or agreement by any of Party A
other than in the ordinary course of business;

(k)     Any transaction, contract or agreement between Party A and
the Shareholder;

(l)     Declaring or paying dividends on, or making any
distributions to any capital stock, except in accordance with the instruments
defining the rights of any such capital stock or securities; 

(m)   The initiation or settlement of any litigation or
arbitration involving Party A;

(n)    Approving the annual budget and multi-year business plan
for Party A;

(o)    Approving Party A’s final audits of Party A’s annual
consolidated financial statements and tax returns to be filed by Party A with
any taxing authority; 

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(p)    Any material change in Party A’s accounting or tax policies
or a change of Party A’s independent auditor; and 

(q)    Any change in the number of directors of Party A, except as
a result of the operation of any other provisions of this Agreement. 

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