##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 20-F
  o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR 12(G) OF THE SECURITIES EXCHANGE ACT
OF 1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2009.
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
 Date of event requiring this shell company report
 Commission file number: 001-33616
 E-HOUSE (CHINA) HOLDINGS LIMITED
  
 
 
 
 
 Securities registered or to be registered pursuant to Section 12(b) of the Act:
 Title of each class
    
    Name of exchange on which registeredAmerican Depositary Shares, each representing one 
ordinary share, par value $0.001 per share
    
    New York Stock Exchange
 Securities registered or to be registered pursuant to Section 12(g) of the Act:

None
(Title of Class)
 Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None
(Title of Class)
  Yes þ No o
 o þ
 þ o
 þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
  US GAAP þ
    
    International Financial Reporting Standards as issued
by the International Accounting Standards Board o
    
    Other o
  o o
 o þ
  Yes o No o




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##### 



TABLE OF CONTENTS
 INTRODUCTION
    
    
    3PART I
    
    
    4Item 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
    
    
    4Item 2. OFFER STATISTICS AND EXPECTED TIMETABLE
    
    
    4Item 3. KEY INFORMATION
    
    
    5Item 4. INFORMATION ON THE COMPANY
    
    
    27Item 4A. UNRESOLVED STAFF COMMENTS
    
    
    51Item 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
    
    
    51Item 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
    
    
    74Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
    
    
    85Item 8. FINANCIAL INFORMATION
    
    
    95Item 9. THE OFFER AND LISTING
    
    
    96Item 10. ADDITIONAL INFORMATION
    
    
    98Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    105Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
    
    
    106PART II
    
    
    108Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
    
    
    108Item 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS
    
    
    108Item 15. CONTROLS AND PROCEDURES
    
    
    108Item 16. AUDIT COMMITTEE FINANCIAL EXPERT
    
    
    109Item 16B. CODE OF ETHICS
    
    
    109Item 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    109Item 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES None
    
    
    109Item 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS
    
    
    110Item 16F. CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
    
    
    110Item 16G. CORPORATE GOVERNANCE
    
    
    110PART III
    
    
    110Item 17. FINANCIAL STATEMENTS
    
    
    110Item 18. FINANCIAL STATEMENTS
    
    
    110Item 19. EXHIBITS
    
    
    110Exhibit 4.5Exhibit 4.6Exhibit 4.9Exhibit 4.10Exhibit 4.13Exhibit 4.15Exhibit 4.16Exhibit 4.17Exhibit 4.18Exhibit 4.19Exhibit 4.20Exhibit 4.21Exhibit 4.22Exhibit 4.23Exhibit 4.24Exhibit 4.25Exhibit 4.26Exhibit 4.27Exhibit 4.28Exhibit 8.1Exhibit 12.1Exhibit 12.2Exhibit 13.1Exhibit 13.2Exhibit 15.1Exhibit 15.2
   2




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INTRODUCTION
  
    
    China or PRC refers to the Peoples Republic of China, excluding, for the
purpose of this annual report only, Taiwan, Hong Kong and Macau;
 
    
    CRIC system refers to our proprietary real
estate information database and analysis system;
 
    
    shares or ordinary shares refers to our ordinary shares, par value $0.001 per
share;
 
    
    ADSs refers to our American depositary shares, each of which represents one
ordinary share;
 
    
    primary real estate market refers to the market for newly constructed residential and
commercial real properties, primary real estate agency services refers to agency services provided for the primary real estate market,
secondary real estate market refers to the market for  existing residential and commercial
real properties, and secondary real estate brokerage services refers to brokerage services provided for
the secondary real estate market;
 
    
    The China Real Estate Top 10 Committee refers to a real estate market research
task force jointly organized by the China Real Estate Association, the Enterprise
Research Institute of Development Research Center of the State Council of PRC, the
Institute of Real Estate Studies of Tsinghua University and the China Index Academy;
and
 
    
    all references to RMB or Renminbi are to the legal currency of China; all
references to $, dollars, US$ and U.S. dollars are to the legal currency of the
United States; and all references to HKD and Hong Kong dollars are to the legal
currency of the Hong Kong Special Administrative Region.
  FORWARD-LOOKING STATEMENTS
   3




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
    
    our anticipated growth strategies;
 
    
    our future business development, results of operations and financial condition;
 
    
    expected changes in our revenues and certain cost or expense items;
 
    
    our ability to attract clients and further enhance our brand recognition; and
 
    
    trends and competition in the real estate services industry.
   
 PART I
 
 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
  
 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
   4




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ITEM 3. KEY INFORMATION
 Selected Financial Data
 Selected Consolidated Financial Data
    As of and for the Year Ended December 31,2005
    
    
    2006
    
    
    2007
    
    
    2008
    
    
    2009(in thousands of $, except share, per share and per ADS data)Consolidated Statement of Operations Data:Total revenues
    
    
    38,661
    
    
    
    55,999
    
    
    
    121,016
    
    
    
    154,487
    
    
    
    299,538Cost of revenues
    
    
    (10,818
    )
    
    
    (10,244
    )
    
    
    (23,510
    )
    
    
    (31,856
    )
    
    
    (70,343
    )Selling, general and administrative expenses
    
    
    (13,250
    )
    
    
    (21,322
    )
    
    
    (45,546
    )
    
    
    (77,197
    )
    
    
    (125,721
    )Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,101Income from operations
    
    
    14,593
    
    
    
    24,433
    
    
    
    51,960
    
    
    
    45,434
    
    
    
    105,575Net income
    
    
    11,416
    
    
    
    18,462
    
    
    
    43,750
    
    
    
    39,488
    
    
    
    117,382Net (income) loss attributable to non-controlling
interest
    
    
    (268
    )
    
    
    (355
    )
    
    
    (2,024
    )
    
    
    88
    
    
    
    (17,104
    )Net income attributable to E-House shareholders
    
    
    11,148
    
    
    
    18,107
    
    
    
    41,726
    
    
    
    39,576
    
    
    
    100,278Earnings per ordinary share and ADS(1):Basic
    
    $
    0.22
    
    
    $
    0.27
    
    
    $
    0.62
    
    
    $
    0.48
    
    
    $
    1.26Diluted
    
    $
    0.22
    
    
    $
    0.27
    
    
    $
    0.56
    
    
    $
    0.48
    
    
    $
    1.25Dividends per ordinary share:Basic
    
    
    0.07
    
    
    
    0.08
    
    
    
    
    
    
    
    
    
    
    
    Weighted average number of ordinary shares used
in per share calculations:Basic
    
    
    50,000,000
    
    
    
    50,000,000
    
    
    
    60,386,083
    
    
    
    81,818,972
    
    
    
    79,643,079Diluted
    
    
    50,000,000
    
    
    
    67,372,353
    
    
    
    74,555,709
    
    
    
    82,110,430
    
    
    
    80,456,210Consolidated Balance Sheet Data:Cash and cash equivalents
    
    
    12,712
    
    
    
    24,306
    
    
    
    101,148
    
    
    
    225,663
    
    
    
    548,062Total assets
    
    
    48,231
    
    
    
    89,430
    
    
    
    329,553
    
    
    
    519,913
    
    
    
    1,472,125Total current liabilities
    
    
    39,895
    
    
    
    28,751
    
    
    
    54,510
    
    
    
    108,672
    
    
    
    115,147Mezzanine equity
    
    
    
    
    
    
    24,828
    
    
    
    
    
    
    
    
    
    
    
    Total E-House shareholders equity
    
    
    5,242
    
    
    
    32,370
    
    
    
    271,173
    
    
    
    403,298
    
    
    
    857,766
 
 Note:
    
    (1) Each ADS represents one ordinary share.  5




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Exchange Rate Information
   Exchange RatePeriod
    
    Period End
    
    
    Average(1)
    
    
    Low
    
    
    High2005
    
    
    8.0702
    
    
    
    8.1826
    
    
    
    8.2765
    
    
    
    8.07022006
    
    
    7.8041
    
    
    
    7.9579
    
    
    
    8.0702
    
    
    
    7.80412007
    
    
    7.2946
    
    
    
    7.5806
    
    
    
    7.8127
    
    
    
    7.29462008
    
    
    6.8225
    
    
    
    6.9193
    
    
    
    7.2946
    
    
    
    6.78002009
    
    
    6.8259
    
    
    
    6.8295
    
    
    
    6.8470
    
    
    
    6.8176November
    
    
    6.8265
    
    
    
    6.8270
    
    
    
    6.8300
    
    
    
    6.8255December
    
    
    6.8259
    
    
    
    6.8275
    
    
    
    6.8299
    
    
    
    6.82442010January
    
    
    6.8268
    
    
    
    6.8269
    
    
    
    6.8295
    
    
    
    6.8258February
    
    
    6.8258
    
    
    
    6.8285
    
    
    
    6.8330
    
    
    
    6.8258March
    
    
    6.8269
    
    
    
    6.8262
    
    
    
    6.8270
    
    
    
    6.8254April (through April 16, 2010)
    
    
    6.8253
    
    
    
    6.8252
    
    
    
    6.8263
    
    
    
    6.8229
 
 Source:
Federal Reserve Statistical Release
 (1)
    
    Annual averages are calculated from month-end rates. Monthly averages are calculated using
the average of the daily rates during the relevant period.
 Capitalization and Indebtedness
  Reasons for the Offer and Use of Proceeds
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Risk Factors
 Risks Related to Our Business
 Our business is susceptible to fluctuations in the real estate market of China, especially in
certain areas of eastern China where a significant portion of our operations are concentrated,
which may adversely affect our revenues and results of operations.
    Our business may be materially and adversely affected by government measures aimed at Chinas real
estate industry.
     7




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
    
    Down payment for the first self-use housing unit purchased by a family with a
gross construction area of more than 90 square meters must be no less than 30% of
the purchase price;
 
    
    The minimum down payment for the second housing unit purchased by a family is
increased from 40% to 50% and the loan interest rate must be no less than 110% of benchmark
lending interest rate;
 
    
    Down payment for the third or more housing
unit purchased by any family and the loan interest rate must be further increased significantly
based on the rate for the first and second housing
units, as determined by commercial banks based on their assessment of the risks;
 
    
    In regions where commercial housing unit prices are
too high or have risen too fast or supply of housing units is insufficient, commercial banks
may suspend extending loans to families for their purchases of the third or more housing unit,
and may suspend extending loans to individuals for their purchase of housing units outside the
region where they reside if they cannot furnish evidence of their payment of tax or social
insurance premium for at least one year locally in the region where the subject housing units
are located; and
 
    
    Local governments are allowed to limit the total number of housing units one can
purchase in certain period in light of the local situation.
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Our business is sensitive to the current global economic crisis. A severe or prolonged downturn in
the global or Chinese economy could materially and adversely affect our business and our financial
condition.
  The real estate services industry in China is relatively new and rapidly evolving, and if this
industry does not develop or mature as quickly as we expect, the growth and success of our business
may be materially and adversely affected.
  Failure to maintain or enhance our brands or image could have a material adverse effect on our
business and results of operations.
  We may not be able to successfully execute our strategy of expanding into new geographical markets
in China, which could have a material adverse effect on our business and results of operations.
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If we cannot manage our growth effectively and efficiently, our operating results or profitability
could be adversely affected.
  If we fail to successfully execute the business plans for our strategic alliances and other new
business initiatives, our anticipated growth and prospects may be materially and adversely
affected.
     10




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We may lose our competitive advantage if we fail to obtain and maintain accurate, comprehensive and
reliable data in our CRIC system or prevent disruptions or failure in the performance of our CRIC
system.
  If we are unable to compete successfully, our financial condition and results of operations may be
harmed.
     11




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Our results of operations and cash flows may fluctuate due to seasonal variations in the real
estate market, the non-recurring nature of our primary real estate agency services, billing cycles,
unpredictable development cycles and advance cash deposits.
     Our reliance on a concentrated number of real estate developers may materially and adversely affect
us.
  We face long cycles to settle our accounts receivable, which could materially and adversely affect
our results of operations.
   12




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Our ability to successfully sell the properties we contract to sell may be materially and adversely
affected if our developer clients fail to make timely delivery of the properties or any of these
properties experience significant quality defects, negative publicity or other problems.
  If we fail to hire, train and retain qualified managerial and other employees, our business and
results of operations could be materially and adversely affected.
    13




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Any failure to protect our brand, trademarks and other intellectual property rights could have a
negative impact on our business.
    Copyright infringement and other intellectual property claims against us may adversely affect our
business and our ability to operate our CRIC system.
    14




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If we fail to obtain or keep licenses and permits applicable to the various real estate services we
provide, we may incur significant financial penalties and other government sanctions.
   We may be subject to liabilities in connection with real estate brokerage activities.
  Failure to achieve and maintain effective internal controls over financial reporting could cause us
to inaccurately report our financial result or fail to prevent fraud and have a material adverse
effect on our business, results of operations and the trading price of our ADSs.
    15




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Any natural or other disaster, including outbreaks of health epidemics, and other extraordinary
events could severely disrupt our business operations.
   Risks Related to Our Corporate Structure
 If the PRC government finds that the agreements that establish the structure for operating the
advertising services business and real estate Internet business in China do not comply with PRC
governmental restrictions on foreign investment in the advertising industry or the Internet
information services industry, we could be subject to severe penalties.
    16




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
    
    revoking the business and operating licenses of our PRC subsidiaries and affiliates;
 
    
    discontinuing or restricting our PRC subsidiaries and affiliates operations;
 
    
    imposing fines or confiscating the income of our PRC subsidiaries or affiliates;
 
    
    imposing conditions or requirements with which we or our PRC subsidiaries and
affiliates may not be able to comply;
 
    
    requiring us or our PRC subsidiaries and affiliates to restructure the relevant
ownership structure or operations; or
 
    
    taking other regulatory or enforcement actions that could be harmful to our
business.
   We rely on contractual arrangements with Tian Zhuo, Beijing  Leju and their
shareholders for a portion of our operations, which may not be as effective as direct ownership in
providing operational control.
   17




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Contractual
 arrangements we have entered into with Tian Zhuo  and Beijing  Leju
may be subject to scrutiny by the PRC tax authorities and a finding that we, Tian Zhuo
or Beijing  Leju owe additional taxes could reduce our net income and the value of your
investment.
  Risks Related to Doing Business in China
 Changes in PRC government policies could have a material adverse effect on overall economic growth
in China, which could adversely affect our business.
   18




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Uncertainties with respect to the Chinese legal system could adversely affect us.
  Governmental control of currency conversion may affect the value of your investment.
   19




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Fluctuation in the value of the RMB may have a material adverse effect on your investment.
   PRC regulations relating to the establishment of offshore special purpose companies by PRC
residents may subject our PRC resident beneficial owners or our PRC subsidiaries to liability or
penalties, limit our ability to inject capital into our PRC subsidiaries, limit our PRC
subsidiaries ability to increase their registered capital or distribute profits to us, or may
otherwise adversely affect us.
    20




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Failure to comply with PRC regulations regarding the registration requirements for employee stock
ownership plans or share option plans may subject the PRC plan participants or us to fines and
other legal or administrative sanctions.
  PRC regulations relating to acquisitions in China may subject us to requisite approval by the
Ministry of Commerce and the failure to obtain such approval could have a material adverse effect
on our business, operating results, reputation and trading price of our ADSs.
     21




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Our holding company relies principally on dividends and other distributions on equity paid by our
PRC subsidiaries to fund any cash and financing requirements it may have, and any limitation on the
ability of our PRC subsidiaries to make payments to our holding company could have a material
adverse effect on its ability to fund our operations, make investments or acquisitions, or pay
dividends.
  PRC regulation of loans and direct investment by offshore holding companies to PRC entities may
delay or prevent us from making loans or additional capital contributions to our PRC operating
subsidiaries.
   Our business benefits from tax-related government incentives and discretionary policies. Expiration
of, or changes to, these incentives or policies could have a material adverse effect on our
operating results.
   22




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Dividends payable to us by our PRC subsidiaries may be subject to PRC withholding taxes, or we may
be subject to PRC taxation on our worldwide income and dividends distributed to our investors may
be subject to PRC withholding taxes under the PRC Enterprise Income Tax Law.
      23




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Foreign ownership of the real estate agency and brokerage business in China is restricted under the
recent PRC regulation. This may limit our ability to establish our new PRC operating entities or to
increase registered capital of existing entities in the future.
  Risks Related to Our ADSs
 The market price for our ADSs has been and may continue to be volatile.
  
    
    actual or anticipated fluctuations in our quarterly operating results;
 
    
    changes in financial estimates by securities research analysts;
 
    
    conditions in the real estate industry in China;
 
    
    changes in the economic performance or market valuations of other real estate
services companies;
 
    
    announcements by us or our competitors of new products, acquisitions, strategic
partnerships, joint ventures or capital commitments;
 
    
    addition or departure of key personnel;
 
    
    fluctuations of exchange rates between the RMB and U.S. dollar or other foreign
currencies;
 
    
    sales or repurchases of our ADSs or ordinary shares; and
 
    
    general economic or political conditions in China.
   24




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Substantial future sales of our ADSs in the public market, or the perception that these sales could
occur, could cause the price of our ADSs to decline.
  You may not have the same voting rights as the holders of our ordinary shares and may not receive
voting materials in time to be able to exercise your right to vote.
  You may not be able to participate in rights offerings and may experience dilution of your holdings
as a result.
  You may be subject to limitations on transfer of your ADSs.
   25




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You may face difficulties in protecting your interests, and your ability to protect your rights
through the U.S. federal courts may be limited, because our holding company is incorporated under
Cayman Islands law, conduct substantially all of our operations in China and all of our officers
reside outside the United States.
    We may be classified as a passive foreign investment company, which could result in adverse United
States federal income tax consequences to U.S. Holders.
   26




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ITEM 4. INFORMATION ON THE COMPANY
 History and Development of the Company
     Business Overview
 Overview
   27




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Our Services
  
    
    primary real estate agency services,
 
    
    secondary real estate brokerage services,
 
    
    real estate information and
consulting services,
 
    
    real estate advertising services,
 
    
    real estate online services, and
 
    
    real estate investment fund management.
  Primary Real Estate Agency Services
  For the Year Ended December 31,2007
    
    
    2008
    
    
    2009Total GFA of new properties sold (thousands of square meters)
    
    
    3,985
    
    
    
    4,115
    
    
    
    11,098Total value of new properties sold (millions of $)
    
    
    3,929
    
    
    
    4,478
    
    
    
    12,732
   28




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Secondary Real Estate Brokerage Services
   29




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Real
Estate Information and Consulting Services
  Real Estate Information Services.
 
    
    Data Subscription Services.CRIC markets and sells, on a subscription basis, the use of
its CRIC system.
 
    
    Data Integration Services.In addition to basic subscriptions, CRIC also offers data
integration services by leveraging the information and data contained in the CRIC system
and its flexible design and analytical capabilities. These premium services include, in
addition to access to the CRIC system, periodic research reports and analysis that suit the
specific needs and requirements of individual clients.
  30




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Real Estate Consulting Services.
  31




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Real Estate Advertising Services
  Real Estate Online Services
    32




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33




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Real Estate Investment Fund Management
    The CRIC System
  
    
    data on developments in 75 cities across China, consisting of data on over
37,400 residential developments, over 5,100 office buildings, over 5,900 commercial
developments and over 39,700 parcels of land for development;
 
    
    over 15,400 research reports written by CRICs research staff and by the
researchers at the E-House Research and Training Institute;
 
    
    over 40 categories of statistics for China and each of 75 cities across China;
and
 
    
    over 32,500 real estaterelated news articles.
  34




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Marketing and Brand Promotion
  Advertisements.
 Seminars and Workshops.
 E-House Membership Club.
 Seasonality
  Competition
    35




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Employees and Training
     Facilities
  Legal Proceedings
   36




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Regulation
  Regulation of Real Estate Services Industry
  Regulation on the Establishment of Real Estate Services Companies
  Regulation of Real Estate Agency Companies and Agents
    37




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Regulation of Real Estate Consulting Business
  Regulation of Real Estate Intermediary Service Charges
    38




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Regulations on the Real Estate Market
   
    
    In transactions where first time homebuyers purchase units with floor areas of 90
square meters or less, the deed tax rate is reduced to 1%;
 
    
    all residential real estate transactions by individuals are exempt from stamp tax;
and
 
    
    all residential real estate transactions by individuals are exempt from land
appreciation tax.
   
    
    From January 1, 2009 to December 31, 2009,
 
    
    sales of ordinary housing units held by individuals for at least two years are
exempt from business tax;
 
    
    sales of ordinary housing units held by individuals for less than two years are
subject to business tax on the difference between the sales price and the purchase
price;
  39




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
    
    sales of non-ordinary housing units held by individuals for at least two years
are subject to business tax on the difference between the sales price and the
purchase price;
 
    
    sales of non-ordinary housing units held by individuals for less than two years
are subject to business tax on the sales price; and
 
    
    The urban real estate tax is abolished and domestic enterprises, foreign
enterprises, foreign-funded enterprises and individuals shall pay real estate tax in
accordance with the Interim Regulation on Real Estate Tax.
   
    
    while sales of ordinary housing units held by individuals for at least five
years are exempt from business tax, sales of ordinary housing units held by
individuals for less than five years are subject to business tax on the difference
between the sales price and the original purchase price;
 
    
    sales of non-ordinary housing units held by individuals for at least five years
are subject to business tax on the difference between the sales price and the
purchase price;
 
    
    sales of non-ordinary housing units held by individuals for less than five years
are subject to business tax on the sales price.
     40




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
    
    Down payment for the first self-use housing unit purchased by a family with a
gross construction area of more than 90 square meters must be no less than 30% of
the purchase price;
 
    
    Down payment for the second
housing unit purchased by a family is increased from 40% to 50% and the loan interest rate must be no less than 110% of benchmark lending
interest rate;
 
    
    Down payment for the third or more housing
unit purchased by any family and the loan interest rate must be further increased significantly
based on the rate for the first and second housing
units, as determined by commercial banks based on their assessment of the risks;
 
    
    In regions where commercial housing unit prices are
too high or have risen too fast or supply of housing units is insufficient, commercial banks
may suspend extending loans to families for their purchases of the third or more housing unit,
and may suspend extending loans to individuals for their purchase of housing units outside the
region where they reside if they cannot furnish evidence of their payment of tax or social
insurance premium for at least one year locally in the region where the subject housing units
are located; and
 
    
    Local governments are allowed to limit the total numbers of housing units one
can purchase in certain period in light of the local situation.
 Regulations on Internet Information Services
    41




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Limitations on Foreign Ownership in Internet Information Services Industry
    
    
    CRIC is able to exert effective control over Beijing Leju;
 
    
    a substantial portion of the economic benefits of Beijing Leju are
transferred to CRIC; and
 
    
    CRIC has an exclusive option to purchase all of the equity interests in Beijing
Leju to the extent permitted by PRC law.
   42




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##### Table of Contents



Information Security and Confidentiality of User Information
    Certain Licenses and Approvals Required for Internet-Based Businesses
  Internet Publishing
   43




---



##### Table of Contents



Online News Publishing
  Electronic Bulletin Board Services
  Online Transmission of Audio-Visual Programs
    44




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##### Table of Contents



Regulations on Advertising Services
 Limitations on Foreign Ownership in the Advertising Industry
   
    
    CRIC is able to exert effective control over Tian Zhuo and its
subsidiaries;
 
    
    a substantial portion of the economic benefits of Tian Zhuo and its
subsidiaries are transferred to CRIC; and
 
    
    CRIC has an exclusive option to purchase all of the equity interests in Tian Zhuo
to the extent permitted by PRC law.
     45




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##### Table of Contents



Advertising Services
  Advertising Content
  Operational Matters of the Advertising Business
  Regulations on Software Development Activities
   46




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##### Table of Contents



Regulations on Intellectual Property Rights
 Trademarks
  Copyrights
  Trade Secrets
   47




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Regulations on Foreign Currency Exchange
       48




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##### Table of Contents



Regulations on Loans to and Direct Investment in PRC Entities by Offshore Holding Companies
    Regulations on Employee Share Options
    49




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##### Table of Contents



Regulations on Dividend Distribution
  M&A Regulation
    50




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Organizational Structure
  
 
 (1)
    
    Tian Zhuo is a variable interest entity established in China in 2008 and is 90%
owned by Mr. Xin Zhou, our executive chairman, and 10% owned by Mr. Xudong Zhu. We effectively control
Tian Zhuo
through contractual arrangements. See Item 7. Major Shareholders and Related Party
TransactionsB. Related Party TransactionsContractual Agreements with Tian Zhuo.(2)
    
    Beijing Leju is a variable interest entity established in China in 2008 and is 80%
owned by Mr. Xudong Zhu and 20% owned by Mr. Jun Luo. We effectively control Beijing
Leju through contractual arrangements. See Item 7. Major Shareholders and Related Party
TransactionsB. Related Party TransactionsContractual Agreements with Beijing Leju. Property, Plants and Equipment
  
 ITEM 4A. UNRESOLVED STAFF COMMENTS
  
 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
 20-F
  51




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Operating Results
 Overview
   Factors Affecting Our Results of Operations
  Revenues .
 For The Year Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    %
    
    
    $
    
    
    %
    
    
    $
    
    
    %Revenues:Primary real estate agency services
    
    
    100,933
    
    
    
    83.4
    
    
    
    88,602
    
    
    
    57.4
    
    
    
    183,154
    
    
    
    61.2Secondary real estate brokerage services
    
    
    11,888
    
    
    
    9.8
    
    
    
    14,837
    
    
    
    9.6
    
    
    
    28,448
    
    
    
    9.5Real estate
information and consulting services
    
    
    8,195
    
    
    
    6.8
    
    
    
    49,116
    
    
    
    31.8
    
    
    
    61,707
    
    
    
    20.6Real estate advertising services
    
    
    
    
    
    
    
    
    
    
    932
    
    
    
    0.6
    
    
    
    11,400
    
    
    
    3.8Real estate online services
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,830
    
    
    
    4.6Real estate fund management
    
    
    
    
    
    
    
    
    
    
    1,000
    
    
    
    0.6
    
    
    
    1,000
    
    
    
    0.3Total revenues
    
    
    121,016
    
    
    
    100.0
    
    
    
    154,487
    
    
    
    100.0
    
    
    
    299,539
    
    
    
    100.0
  52




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Primary Real Estate Agency Services.
    
    
    total GFA of the properties we sell;
 
    
    total transaction value of the properties we sell; and
 
    
    commission rates.
   53




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Secondary Real Estate Brokerage Services.
  Real Estate Information and Consulting Services.
    54




---



##### Table of Contents



Real Estate Advertising Services.
 Real Estate Online Services.
 Real Estate Fund Management.
 Cost of Revenues.
  55




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##### Table of Contents



Selling, General and Administrative Expenses.
 Share-based Compensation Expenses.
  Options
 Number of OrdinaryShares UnderlyingGrant Date
    
    Options Granted
    
    
    Exercise PriceMarch 9, 2007
    
    
    300,000
    
    
    $
    5.50July 17, 2007
    
    
    640,833
    
    
    $
    5.37
    (1)July 23, 2007
    
    
    66,666
    
    
    $
    5.37
    (1)January 7, 2008
    
    
    412,166
    
    
    $
    5.37
    (1)January 10, 2008
    
    
    21,500
    
    
    $
    5.37
    (1)April 15, 2008
    
    
    702,000
    
    
    $
    5.37
    (1)June 12, 2008
    
    
    10,000
    
    
    $
    5.37
    (1)August 3, 2008
    
    
    100,000
    
    
    $
    5.37
    (1)
 
 (1)
    
    On November 7, 2008, our board of directors authorized the adjustment of the exercise price
of some previously granted options to $5.37 per ordinary share and authorized the amendment
and restatement of options granted pursuant to our share incentive plan. Modifications
subsequently made to selected granted options pursuant to this authorization did not affect
the manner in which we recognize share-based compensation expense. Restricted shares
 Number of RestrictedGrant Date
    
    Shares Granted
    
    
    Grant PriceMay 16, 2007
    
    
    436,364
    (1)
    
    $
    3.30December 21, 2009
    
    
    919,000
    
    
    $
    0
 
 (1)
    
    On May 16, 2007, options to purchase 436,364 ordinary shares granted earlier on November
28, 2006 were surrendered for cancellation in exchange for the same number of restricted shares
having the same vesting schedule and a purchase price equal to the original option exercise price.   56




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
    
    the nature of our business and the contracts and agreements relating to our
business;
 
    
    the global economic outlook in general and the specific economic and competitive
elements affecting our business;
 
    
    the nature and prospects of the real estate services industry in China;
 
    
    the growth of our operations; and
 
    
    our business risks.
    
    
    Weighted average costs of capital, or WACC, of 13.2% and 14.3%, respectively, was
used. This was the combined result of the changes in risk-free rate and industry
average beta and the decrease in our company-specific risks; and
 
    
    Discount for Lack of Marketability, or DLOM, of 6% was used for both valuations.
This took into consideration our proposed offering in several months.
    57




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Options
 Number of OrdinaryShares UnderlyingGrant Date
    
    Options Granted
    
    
    Exercise PriceJanuary 1, 2009
    
    
    5,114,914
    (1)
    
    $
    3.00July 15, 2009
    
    
    989,000
    
    
    $
    6.00July 30, 2009
    
    
    300,000
    
    
    $
    6.00September 24, 2009
    
    
    1,284,500
    
    
    $
    8.00
 
 (1)
    
    Options to purchase 756,000 ordinary shares granted on January 1, 2009 were later modified on
July 15, 2009. The number of these options was reduced to 251,500 and the vesting schedule was
shortened to one to two years from two to four year. Restricted shares
 Number of RestrictedGrant Date
    
    Shares Granted
    
    
    Grant PriceJuly 30, 2009
    
    
    250,000
    (1)
    
    $
    3.00July 30, 2009
    
    
    50,000
    (2)
    
    $
    6.00
 
 (1)
    
    On July 30, 2009, options to purchase 250,000 ordinary shares granted earlier on January 1,
2009 were surrendered for cancellation in exchange for the same number of restricted shares having
the same vesting schedule and a purchase price equal to the original option exercise price.(2)
    
    On July 30, 2009, options to purchase 50,000 ordinary shares granted earlier on July 15, 2009
were surrendered for cancellation in exchange for the same number of restricted shares having the
same vesting schedule and a purchase price equal to the original option exercise price.  Taxation
     58




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59




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Critical Accounting Policies
   Revenue Recognition
       60




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Variable Interest Entities
   61




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Share-Based Compensation
   Goodwill Valuation
    62




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##### Table of Contents



Income Taxes
  Results of Operations
  For the Year Ended December 31,2007
    
    
    2008
    
    
    2009(in thousands of $)Consolidated Statement of Operations Data:Revenues
    
    
    121,016
    
    
    
    154,487
    
    
    
    299,538Cost of revenues
    
    
    (23,510
    )
    
    
    (31,856
    )
    
    
    (70,343
    )Selling, general and administrative expenses
    
    
    (45,546
    )
    
    
    (77,197
    )
    
    
    (125,721
    )Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    2,101Income from operations
    
    
    51,960
    
    
    
    45,434
    
    
    
    105,575Interest expense
    
    
    (622
    )
    
    
    (2,420
    )
    
    
    (216
    )Interest income
    
    
    2,490
    
    
    
    3,063
    
    
    
    1,039Other income, net
    
    
    199
    
    
    
    1,970
    
    
    
    8,780Income before taxes, equity in affiliates and non-controlling interest
    
    
    54,027
    
    
    
    48,047
    
    
    
    115,178Income tax expenses
    
    
    (10,277
    )
    
    
    (8,713
    )
    
    
    (19,924
    )Income before equity in affiliates and non-controlling interest
    
    
    43,750
    
    
    
    39,334
    
    
    
    95,254Income from investment in affiliates
    
    
    
    
    
    
    154
    
    
    
    22,128Net income
    
    
    43,750
    
    
    
    39,488
    
    
    
    117,382Net (income)/loss attributable to non-controlling interest
    
    
    (2,024
    )
    
    
    88
    
    
    
    (17,104
    )Net income attributable to E-House shareholders
    
    
    41,726
    
    
    
    39,576
    
    
    
    100,278
  63




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Segment Information
   Real estatePrimary
    
    
    Secondary
    
    
    informationreal estate
    
    
    real estate
    
    
    and
    
    
    Real estate
    
    
    Real estateagency
    
    
    brokerage
    
    
    consulting
    
    
    advertising
    
    
    online
    
    
    Real estateservices
    
    
    service
    
    
    service
    
    
    service
    
    
    service
    
    
    fund
    
    
    Non-2009
    
    segment
    
    
    segment
    
    
    segment
    
    
    segment
    
    
    segment
    
    
    management
    
    
    allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues from external customers
    
    
    183,154,000
    
    
    
    28,447,714
    
    
    
    61,707,295
    
    
    
    11,399,710
    
    
    
    13,829,937
    
    
    
    1,000,000
    
    
    
    
    
    
    
    299,538,656Cost of revenues
    
    
    (55,655,737
    )
    
    
    (1,877,546
    )
    
    
    (1,865,697
    )
    
    
    (6,014,185
    )
    
    
    (4,930,280
    )
    
    
    
    
    
    
    
    
    
    
    (70,343,445
    )Selling general and administrative expenses
    
    
    (47,241,533
    )
    
    
    (26,123,163
    )
    
    
    (22,723,019
    )
    
    
    (5,690,497
    )
    
    
    (11,359,944
    )
    
    
    (647,754
    )
    
    
    (11,935,269
    )
    
    
    (125,721,179
    )Gain from settlement of preexisting relationship
    
    
    
    
    
    
    
    
    
    
    2,100,832
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,100,832Income (loss) from operations
    
    
    80,256,730
    
    
    
    447,005
    
    
    
    39,219,411
    
    
    
    (304,972
    )
    
    
    (2,460,287
    )
    
    
    352,246
    
    
    
    (11,935,269
    )
    
    
    105,574,864Interest expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (215,854
    )
    
    
    (215,854
    )Interest income
    
    
    591,772
    
    
    
    29,130
    
    
    
    166,521
    
    
    
    27,635
    
    
    
    23,722
    
    
    
    1,922
    
    
    
    198,087
    
    
    
    1,038,789Other income/(expense), net
    
    
    1,842,672
    
    
    
    279,030
    
    
    
    2,481,451
    
    
    
    
    
    
    
    5,814
    
    
    
    (1,810
    )
    
    
    4,173,213
    
    
    
    8,780,370Income (loss) before taxes and equity in an associate
    
    
    82,691,174
    
    
    
    755,165
    
    
    
    41,867,383
    
    
    
    (277,337
    )
    
    
    (2,430,751
    )
    
    
    352,358
    
    
    
    (7,779,823
    )
    
    
    115,178,169Income tax benefit (expense)
    
    
    (15,981,753
    )
    
    
    2,204,395
    
    
    
    (6,710,032
    )
    
    
    (553,666
    )
    
    
    957,085
    
    
    
    159,890
    
    
    
    
    
    
    
    (19,924,081
    )Income (loss) before equity in affiliates
    
    
    66,709,421
    
    
    
    2,959,560
    
    
    
    35,157,351
    
    
    
    (831,003
    )
    
    
    (1,473,666
    )
    
    
    512,248
    
    
    
    (7,779,823
    )
    
    
    95,254,088Income from investment in affiliates
    
    
    112,628
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,015,607
    
    
    
    
    
    
    
    
    
    
    
    22,128,235Net income (loss)
    
    
    66,822,049
    
    
    
    2,959,560
    
    
    
    35,157,351
    
    
    
    (831,003
    )
    
    
    20,541,941
    
    
    
    512,248
    
    
    
    (7,779,823
    )
    
    
    117,382,323
  64




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Real estateSecondary
    
    
    informationPrimary real
    
    
    real estate
    
    
    and
    
    
    Real estate
    
    
    Real estateestate agency
    
    
    brokerage
    
    
    consulting
    
    
    advertising
    
    
    fund2008
    
    services
    
    
    services
    
    
    services
    
    
    services
    
    
    management
    
    
    Non-allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues
    
    
    88,601,982
    
    
    
    14,836,943
    
    
    
    49,116,061
    
    
    
    932,469
    
    
    
    1,000,000
    
    
    
    
    
    
    
    154,487,455Cost of revenues
    
    
    (27,232,660
    )
    
    
    (1,725,941
    )
    
    
    (2,855,398
    )
    
    
    (41,849
    )
    
    
    
    
    
    
    
    
    
    
    (31,855,848
    )Selling, general and administrative expenses
    
    
    (34,075,314
    )
    
    
    (20,209,062
    )
    
    
    (13,776,504
    )
    
    
    (1,865,669
    )
    
    
    (463,351
    )
    
    
    (6,807,731
    )
    
    
    (77,197,631
    )Income (loss) from operations
    
    
    27,294,008
    
    
    
    (7,098,060
    )
    
    
    32,484,159
    
    
    
    (975,049
    )
    
    
    536,649
    
    
    
    (6,807,731
    )
    
    
    45,433,976Interest expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,420,468
    )
    
    
    (2,420,468
    )Interest income
    
    
    551,576
    
    
    
    30,475
    
    
    
    415,512
    
    
    
    3,779
    
    
    
    4,373
    
    
    
    2,056,798
    
    
    
    3,062,513Other income/(expense), net
    
    
    1,422,744
    
    
    
    22,483
    
    
    
    (1,323,858
    )
    
    
    
    
    
    
    
    
    
    
    1,849,112
    
    
    
    1,970,481Income (loss) before taxes and equity in an associate
    
    
    29,268,328
    
    
    
    (7,045,102
    )
    
    
    31,575,813
    
    
    
    (971,270
    )
    
    
    541,022
    
    
    
    (5,322,289
    )
    
    
    48,046,502Income tax benefit (expense)
    
    
    (4,153,861
    )
    
    
    52,535
    
    
    
    (4,917,503
    )
    
    
    196,488
    
    
    
    109,783
    
    
    
    
    
    
    
    (8,712,558
    )Income (loss) before equity in affiliates
    
    
    25,114,467
    
    
    
    (6,992,567
    )
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    650,805
    
    
    
    (5,322,289
    )
    
    
    39,333,944Income from investment in affiliates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    153,700
    
    
    
    153,700Net income/(loss)
    
    
    25,114,467
    
    
    
    (6,992,567
    )
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    650,805
    
    
    
    (5,168,589
    )
    
    
    39,487,644
 Real estateSecondary
    
    
    informationPrimary real
    
    
    real estate
    
    
    andestate agency
    
    
    brokerage
    
    
    consultingservice
    
    
    service
    
    
    service2007
    
    segment
    
    
    segment
    
    
    segment
    
    
    Non-allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues from external customers
    
    
    100,932,992
    
    
    
    11,888,443
    
    
    
    8,195,165
    
    
    
    
    
    
    
    121,016,600Cost of revenues
    
    
    (22,614,660
    )
    
    
    
    
    
    
    (895,405
    )
    
    
    
    
    
    
    (23,510,065
    )Selling, general and administrative expenses
    
    
    (23,195,466
    )
    
    
    (14,997,248
    )
    
    
    (4,985,048
    )
    
    
    (2,368,038
    )
    
    
    (45,545,800
    )Income/(loss) from operations
    
    
    55,122,866
    
    
    
    (3,108,805
    )
    
    
    2,314,712
    
    
    
    (2,368,038
    )
    
    
    51,960,735Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (621,903
    )
    
    
    (621,903
    )Interest income
    
    
    693,975
    
    
    
    36,274
    
    
    
    192,961
    
    
    
    1,566,458
    
    
    
    2,489,668Other income/(expense), net
    
    
    406,452
    
    
    
    96,372
    
    
    
    (156,825
    )
    
    
    (148,107
    )
    
    
    197,892Income (loss) before taxes
    
    
    56,223,293
    
    
    
    (2,976,159
    )
    
    
    2,350,848
    
    
    
    (1,571,590
    )
    
    
    54,026,392Income tax benefit (expense)
    
    
    (9,987,535
    )
    
    
    (4,506
    )
    
    
    (284,999
    )
    
    
    
    
    
    
    (10,277,040
    )Net income/(loss)
    
    
    46,235,758
    
    
    
    (2,980,665
    )
    
    
    2,065,849
    
    
    
    (1,571,590
    )
    
    
    43,749,352
  65




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Year Ended December 31, 2009 Compared to Year Ended December 31, 2008
 Revenues.
 
    
    Primary Real Estate Agency Services. Revenues from our primary real estate agency
services increased by 107% from $88.6 million in 2008 to $183.2 million in 2009. This
increase was primarily due to increases in total GFA and transaction value of new
properties sold by 170% and 184%, respectively, for the full year of 2009 compared to
2008, partially offset by a lower average commission rate of 1.4% for 2009 compared to
2.0% for 2008. The lower average commission rate in 2009 resulted from there being a
smaller portion of our total GFA for which a bonus commission is included in the
commission structure.
 
    
    Secondary Real Estate Brokerage Services. Revenues from our secondary real estate
brokerage services increased by 92% from $14.8 million in 2008 to $28.4 million in
2009. This increase was primarily due to higher total secondary real estate transaction
volume under improved market conditions, despite a slight decrease in the total number
of our secondary real estate brokerage stores from 115 as of December 31, 2008 to 109
as of December 31, 2009. The increase was also contributed by our brokerage
storefronts support of our sales effort in the primary real estate agency services
market primarily by promoting and selling any remaining unsold units of primary real
estate projects.
 
    
    Real Estate Information
and Consulting Services. Revenues from real estate
information and consulting services increased by 26% from $49.1 million in 2008 to
$61.7 million in 2009. The increase was primarily due to further expansion of the
coverage and marketing of the CRIC database as well as higher consulting revenues
resulting from increased numbers of consulting clients and projects in 2009.
 
    
    Real Estate Advertising Services. Revenues from real estate advertising services
increased substantially from $0.9 million in 2008 to $11.4 million in 2009. The
increase in revenues from real estate advertising services was attributable to wider
acceptance and brand recognition of CRICs advertising design services and our launch
of advertising resale services in 2009. We provide advertising resale services by
making wholesale purchases of advertising space in print and other media in Shanghai
and reselling it to developer clients.
 
    
    Real Estate Online Services. Revenues from real estate online services were $13.8
million in 2009. CRIC completed its acquisition of COHT concurrently with its initial
public offering in October 2009 and started reporting COHTs business as a new line of
business in the fourth quarter of 2009. COHT generates revenues through operating a
real estate Internet business in China that provides region-specific real estate news and information, property data and access to online
communities via local websites.
 Cost of Revenues.
  66




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Selling, General and Administrative Expenses.
 
    
    Primary Real Estate Agency Segment. Selling, general and administrative expenses for
our primary real estate agency segment increased by 39% from $34.1 million in 2008 to
$47.2 million in 2009. This increase was primarily due to an increase of $10.0 million
in bonuses tied to our companys performance in 2009 and an increase of $6.6 million in
allowance for doubtful accounts in 2009, partially offset by a decrease of $2.3 million
in marketing expenses in 2009.
 
    
    Secondary Real Estate Brokerage Service Segment. Selling, general and administrative
expenses for our secondary real estate brokerage service segment increased by 29% from
$20.2 million in 2008 to $26.1 million in 2009. This increase was primarily due to an
increase in staff salaries and commissions by $4.7 million as a result of our larger
number of staff and higher transaction volume and an increase by $1.4 million in
bonuses tied to our companys performance in 2009.
 
    
    Real Estate Information and Consulting Service Segment. Selling, general and
administrative expense for real estate information and consulting service segment
increased by 65% from $13.8 million in 2008 to $22.7 million in 2009, mainly due to
higher salaries and rental and office expenses associated with an expansion of our operations.
 
    
    Real Estate Advertising Service Segment.Selling, general and administrative
expenses for real estate advertising service segment increased by 205% from $1.9
million in 2008 to $5.7 million in 2009, mainly due to higher salaries and rental
expenses associated with increased personnel and office space.
 
    
    Real Estate Online Service Segment.CRIC acquired COHT, the entity which had
operated SINAs online real estate business, in October 2009. $11.4 million of our
selling, general and administrative expenses in 2009 was attributable to the acquired
online real estate business.
 Gain from Settlement of Pre-existing Relationship
 Income from Operations .
 Income from Investment in Affiliates
 Net Income
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Net Income Attributable to Non-controlling Interests
 Net Income Attributable to E-House Shareholders
 Income Tax Expenses.
 Year Ended December 31, 2008 Compared to Year Ended December 31, 2007
 Revenues.
 
    
    Primary Real Estate Agency Services. Revenues from our primary real estate agency
services decreased by 12% from $100.9 million in 2007 to $88.6 million in 2008. This
decrease was primarily due to a lower average commission rate of 2.0% in 2008, compared
to 2.6% in 2007. This was partially offset by increases in both the GFA and total
transaction value of new properties sold. The GFA of properties we sold increased from
approximately 4.0 million square meters in 2007 to approximately 4.1 million square
meters in 2008 and the total transaction value of the properties we sold increased from
$3.9 billion in 2007 to $4.5 billion in 2007.
 
    
    Secondary Real Estate Brokerage Services. Revenues from our secondary real estate
brokerage services increased by 25% from $11.9 million in 2007 to $14.8 million in
2008. Revenue growth was negatively affected by reduced secondary real estate
transaction volume in 2008 as a result of slower growth in Chinas economy and
deterioration of the demand for real estate purchases. As of December 31, 2008, we had
a total of 115 secondary real estate brokerage stores in five cities in China, compared
to 160 stores as of December 31, 2007, as a result of our decision to reduce the number
of stores in response to deteriorating market conditions and in an effort to decrease
operating expenses.
 
    
    Real Estate Information
and Consulting Services. Revenues from our real estate
information and consulting services increased by 499% from $8.2 million in 2007 to
$49.1 million in 2008. This growth was primarily due to substantial consulting revenues
derived from strategic arrangements we entered into with major developers covering
multiple cities and projects and an increase in the number and size of consulting
projects completed for other developers. The increase also resulted from the completion
of a number of consulting projects associated with land transfer in 2008.
 Cost of Revenues.
  68




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Selling, General and Administrative Expenses.
 
    
    Primary Real Estate Agency Segment. Selling, general and administrative expenses for
our primary real estate agency segment increased by 47% from $23.2 million in 2007 to
$34.1 million in 2008 primarily due to an increase in staff salaries for our management
employees by $2.7 million as a result of hiring additional staff and increases in
salaries, and an increase in marketing, consulting, rental and travel expenses by $5.8
million as a result of hiring new employees and expanding our operations.
 
    
    Secondary Real Estate Brokerage Service Segment. Selling, general and administrative
expenses for our secondary real estate brokerage service segment increased by 35% from
$15.0 million in 2007 to $20.2 million in 2008 primarily due to an increase in staff
salaries by $3.2 million as a result of a larger number of staff, and an increase in
rental and administrative expenses for our brokerage storefronts by $3.7 million as a
result of operating a higher average number of stores in 2008 than in 2007.
 
    
    Real Estate Information
and Consulting Service Segment. Selling, general and
administrative expense for our real estate information and consulting service segment
increased by 176% from $5.0 million in 2007 to $13.8 million in 2008 primarily due to
an increase in staff salaries for our management employees by $5.5 million as a result
of hiring additional staff and increases in salaries, and an increase in marketing,
consulting, rental, travel and other administrative expenses by $5.4 million as a
result of hiring new employees and expanding our operations.
 Income Tax Expenses.
 Net income (loss) Attributable to Non-controlling Interest.
 Net Income Attributable to E-House Shareholders.
 Liquidity and Capital Resources
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For the Year Ended December 31,2007
    
    
    2008
    
    
    2009(in thousands of $)Net cash (used in) provided by operating activities
    
    
    (81,273
    )
    
    
    77,973
    
    
    
    129,101Net cash (used in) provided by investing activities
    
    
    (4,169
    )
    
    
    (26,455
    )
    
    
    1,913Net cash provided by (used in) financing activities
    
    
    160,777
    
    
    
    70,037
    
    
    
    191,229Net increase (decrease) in cash and cash equivalents
    
    
    76,842
    
    
    
    124,515
    
    
    
    322,399Cash and cash equivalents at beginning of the period
    
    
    24,306
    
    
    
    101,148
    
    
    
    225,663Cash and cash equivalents at end of the period
    
    
    101,148
    
    
    
    225,663
    
    
    
    548,062
 Operating Activities
     Investing Activities
    70




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Financing Activities
        71




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##### Table of Contents



Research and Development, Patents and Licenses, etc.
 Research and Development
  Intellectual Property
  www.ehousechina.com www.1fang.com www.cityrehouse.com.cn www.yiju.org
 www.cric2009.com, www.leju.com,
www.dichan.com, fy.dichan.com www.winfang.com
  72




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##### Table of Contents



house.sina.com.cn jiaju.sina.com.cn
  Trend Information
  Off-Balance Sheet Arrangements
  Tabular Disclosure of Contractual Obligations
  Payment Due by PeriodLess than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 year
    
    
    1-3 year
    
    
    3-5 year
    
    
    5 years(in thousands of $)Operating lease obligations
    
    
    21,696
    
    
    
    8,196
    
    
    
    6,545
    
    
    
    1,541
    
    
    
    5,414
  Safe Harbor
   73




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##### Table of Contents



ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
 Directors and Senior Management
  Directors and Executive Officers
    
    Age
    
    Position/TitleXin Zhou
    
    
    42
    
    
    Executive ChairmanJianjun Zang
    
    
    42
    
    
    Director and Acting Chief Executive OfficerNeil Nanpeng Shen
    
    
    42
    
    
    DirectorBing Xiang
    
    
    47
    
    
    Independent DirectorHongchao Zhu
    
    
    50
    
    
    Independent DirectorMay Wu
    
    
    42
    
    
    Independent DirectorJeffrey Zhijie Zeng
    
    
    41
    
    
    Independent DirectorYunchang Gu
    
    
    66
    
    
    Independent DirectorCanhao Huang
    
    
    52
    
    
    Executive DirectorLi-Lan Cheng
    
    
    45
    
    
    Chief Financial OfficerZuyu Ding
    
    
    36
    
    
    Co-President of CRICJun Luo
    
    
    42
    
    
    Co-President of CRICBer Jen Ko
    
    
    46
    
    
    Head of Secondary Brokerage Service
 Mr. Xin Zhou
  74




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##### Table of Contents



Mr. Jianjun Zang
 Mr. Neil Nanpeng Shen
 Mr. Bing Xiang
 Mr. Hongchao Zhu
 Ms. May Wu
  75




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##### Table of Contents



Mr. Jeffrey Zhijie Zeng
 Mr. Yunchang Gu
 Mr. Canhao Huang
 Mr. Li-Lan Cheng
 Mr.
Zuyu Ding
 Mr. Jun Luo
 Mr. Ber Jen Ko
  76




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##### Table of Contents



Employment Agreements
   Compensation of Directors and Executive Officers
  E-House Share Incentive Plan
 E-House Share Incentive Plan.
  77




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##### Table of Contents



Ordinary SharesUnderlyingOptions/Restricted
    
    
    
    Exercise Price(2)
    
    
    Date of
    
    Date ofName
    
    Shares
    
    
    
    ($/Share)
    
    
    Grant
    
    ExpirationJianjun Zang
    
    
    40,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201880,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/ANeil Nanpeng Shen
    
    
    40,000
    
    
    
    5.50
    
    
    March 9, 2007
    
    March 8, 201720,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201810,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/ABing Xiang
    
    
    40,000
    
    
    
    5.50
    
    
    March 9, 2007
    
    March 8, 201720,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201810,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AHongchao Zhu
    
    
    40,000
    
    
    
    5.50
    
    
    March 9, 2007
    
    March 8, 201720,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201810,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AMay Wu
    
    
    40,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201820,000
    
    
    
    5.37
    
    
    August 3, 2008
    
    August 2, 201815,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AJeffrey Zhijie Zeng
    
    
    40,000
    
    
    
    5.37
    
    
    August 3, 2008
    
    August 2, 201810,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AYunchang Gu
    
    
    40,000
    
    
    
    5.37
    
    
    August 3, 2008
    
    August 2, 201810,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/ACanhao Huang
    
    
    40,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201850,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/ALi-Lan Cheng
    
    
    436,364
    (1)
    
    
    3.30
    
    
    November 28, 2006
    
    N/A40,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201880,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AZuyu Ding
    
    
    100,000
    
    
    
    5.37
    
    
    July 17, 2007
    
    July 16, 201740,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 2018Ber Jen Ko
    
    
    80,000
    
    
    
    5.50
    
    
    March 9, 2007
    
    March 8, 201720,000
    
    
    
    5.37
    
    
    April 15, 2008
    
    April 14, 201830,000
    
    
    
    N/A
    
    
    December 21,2009
    
    N/AOther Individuals as a group
    
    
    2,187,165
    (2)(3)
    
    
    5.37 to 5.50
    
    
    March 9, 2007 to
    
    March 8, 2017 toDecember 21,2009
    
    August 2, 2018
 
 (1)
    
    These options were subsequently surrendered for cancellation in exchange for the
same number of restricted shares having the same vesting schedule and a purchase price equal
to the original option exercise price.(2)
    
    On November 7, 2008, our board of directors authorized the adjustment of the
exercise price of some previously granted options to $5.37 per ordinary share and authorized
the amendment of the terms of options granted pursuant to the E-House plan. Modifications
subsequently made to selected options pursuant to this authorization did not affect the manner
in which we recognize share-based compensation expense.(3)
    
    As of March 31, 2010, options and restricted shares representing an aggregate of
329,835 ordinary shares previously granted to various individuals have been cancelled.  E-House Plan Administration.
 Award
Agreement.
 Eligibility.
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##### Table of Contents



Acceleration of Awards upon Corporate Transactions.
 Term of the Awards.
 Vesting
Schedule.
 Transfer
Restrictions.
 Termination of the E-House Plan.
 CRIC Share Incentive Plan
 CRIC Share Incentive Plan.
  79




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##### Table of Contents



Ordinary Shares
    
    
    Exercise PriceName
    
    Underlying Options
    
    
    ($/Share)
    
    
    Date of Grant
    
    Date of ExpirationXin Zhou
    
    
    1,250,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 2018500,000
    
    
    
    0.65
    
    
    April 23, 2009
    
    April 22, 2015Jianjun Zang
    
    
    25,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 201850,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Neil Nanpeng Shen
    
    
    40,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Bing Xiang
    
    
    20,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Hongchao Zhu
    
    
    20,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019May Wu
    
    
    30,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Jeffrey Zhijie Zeng
    
    
    20,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Yunchang Gu
    
    
    20,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Canhao Huang
    
    
    25,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 201850,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Li-Lan Cheng
    
    
    250,000
    (1)
    
    
    3.00
    
    
    January 1, 2009
    
    N/A50,000
    (1)
    
    
    6.00
    
    
    July 15, 2009
    
    N/AZuyu Ding
    
    
    1,000,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 2018Jun Luo
    
    
    50,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 20181,000,000
    
    
    
    0.64
    
    
    September 6,2008
    
    September 5,2014Ber Jen Ko
    
    
    10,000
    
    
    
    3.00
    
    
    January 1, 2009
    
    December 31, 201820,000
    
    
    
    8.00
    
    
    September 24, 2009
    
    September 23, 2019Other Individuals as a group
    
    
    7,154,294
    
    
    
    0.64 to 8.00
    
    
    September 6, 2008
    
    September 5, 2014September 24, 2009
    
    September 23, 2019
 (1)
    
    These options were subsequently surrendered for cancellation in exchange for the
same number of restricted shares having the same vesting schedule and a purchase price equal
to the original option exercise price.  Board Practices
   Committees of the Board of Directors
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##### Table of Contents



Audit Committee.
 
    
    appointing the independent auditors and pre-approving all audit and non-audit
services permitted to be performed by the independent auditors;
 
    
    reviewing with the independent auditors any audit problems or difficulties and
managements response;
 
    
    reviewing and approving all proposed related party transactions, as defined in Item
404 of Regulation S-K under the Securities Act;
 
    
    discussing the annual audited financial statements with management and the
independent auditors;
 
    
    reviewing major issues as to the adequacy of our internal controls and any special
audit steps adopted in light of material control deficiencies; and
 
    
    meeting separately and periodically with management and the independent auditors.
  Compensation Committee.
 
    
    reviewing and evaluating at least annually and, if necessary, revising the
compensation policies adopted by our management;
 
    
    reviewing and evaluating at least annually the performance, and determining the
compensation, of our chief executive officer;
 
    
    reviewing and approving our chief executive officers employment agreement and
amendments thereto, and severance arrangement, if any;
 
    
    reviewing all annual bonus, long-term incentive compensation, share option, employee
pension and welfare benefit plans; and
 
    
    reviewing and approving director and executive officer indemnification and insurance
matters, and any employee loans in an amount equal to or greater than $60,000.
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##### Table of Contents



Nominating and Corporate Governance Committee.
 
    
    recommending to our board of directors for nomination or appointment by the board
such candidates as the committee has found to be well qualified and willing and ready
to be elected or reelected to serve as our members of our board or its committees or to
fill any vacancies on our board or its committees, respectively;
 
    
    reviewing annually the composition of our board of directors and its committees in
light of the characteristics of independence, qualification, experience and
availability of the board members;
 
    
    developing and recommending to our board of directors a set of corporate governance
guidelines and principles applicable to our company; and
 
    
    monitoring of compliance with our code of business conduct and ethics, including
reviewing the adequacy and effectiveness of our internal rules and procedures to ensure
compliance with applicable laws and regulations.
  Duties of Directors
  Terms of Directors and Officers
   82




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Employees
  Number of
    
    
    Percentage ofEmployees
    
    
    EmployeesCorporate Offices
    
    
    1,118
    
    
    
    15.6
    %Research Department
    
    
    1,190
    
    
    
    16.7
    %Sales Staff
    
    
    4,844
    
    
    
    67.7
    %Total
    
    
    7,152
    
    
    
    100.0
    %
  Share Ownership
  
    
    each of our directors and executive officers; and
 
    
    each person known to us to own beneficially more than 5.0% of our ordinary shares.
  Shares Beneficially OwnedImmediatelyNumber
    
    
    %Directors and Executive Officers:(1)Xin Zhou(2)()
    
    
    20,272,100
    
    
    
    25.27Jianjun Zang(3) ()
    
    
    2,731,149
    
    
    
    3.40Neil Nanpeng Shen(4)
    
    
    6,103,330
    
    
    
    7.60Bing Xiang
    
    
    *
    
    
    
    *Hongchao Zhu
    
    
    *
    
    
    
    *May Wu
    
    
    *
    
    
    
    *Jeffrey Zhijie Zeng
    
    
    *
    
    
    
    *Yunchang Gu
    
    
    *
    
    
    
    *Canhao Huang ()
    
    
    *
    
    
    
    *Li-Lan Cheng
    
    
    *
    
    
    
    *Zuyu Ding ()
    
    
    *
    
    
    
    *Jun Luo
    
    
    
    
    
    
    Ber Jen Ko
    
    
    *
    
    
    
    *All Directors and Executive Officers as a Group()
    
    
    26,928,148
    
    
    
    33.43Principal Shareholders:Orbis Investment Management (B.V.I) Limited and affiliates(5)
    
    
    14,430,921
    
    
    
    17.99On Chance Inc.(6) ()
    
    
    10,294,800
    
    
    
    12.83Jun Heng Investment Limited(7) ()
    
    
    9,977,300
    
    
    
    12.44CHF Investment Limited (8)
    
    
    5,474,343
    
    
    
    6.82Smart Create Group Limited(9)
    
    
    5,250,000
    
    
    
    6.54
  83




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##### Table of Contents



*
    
    Less than 1% of our total outstanding shares.
    
    Each of these directors and executive officers is a beneficial owner of our shares through On
Chance Inc., Jun Heng Investment Limited or both, as the case may be. On Chance Inc. is also a
shareholder of Jun Heng Investment Limited.(1)
    
    Except where otherwise disclosed in the footnotes below, the business address of each of our
directors and executive officers is 17/F, Merchandise Harvest Building (East), No. 333 North
Chengdu Road, Shanghai, PRC 200041, Peoples Republic of China.(2)
    
    Includes 10,294,800 ordinary shares and 9,977,300 ordinary shares respectively held by On
Chance Inc. and Jun Heng Investment Limited. Each of On Chance Inc. and Jun Heng Investment
Limited is a company incorporated in British Virgin Islands and controlled by Mr. Zhou. As a
result, Mr. Zhou is deemed to be the beneficial owner of 20,272,100 ordinary shares of our
company. Mr. Zhou disclaims beneficial ownership of these 20,272,100 ordinary shares except to
the extent of his pecuniary interest therein.(3)
    
    Represents 2,717,816 ordinary shares held by Jun Heng Investment Limited that is
approximately 27.24% owned by Mr. Zang and 13,333 ordinary shares issuable upon exercise of
options held by Mr. Zang within 60 days from March 31, 2010.(4)
    
    Includes 5,250,000 ordinary shares directly held by Smart Create Group Limited, a British
Virgin Islands company that is controlled by Mr. Shen, 800,000 ordinary shares directly held
by Smart Master International Limited, a British Virgin Islands company solely owned and
controlled by Mr. Shen, and 53,330 ordinary shares that Mr. Shen has the right to acquire upon
exercise of options within 60 days after March 31, 2010. Mr. Shen, a shareholder of Smart
Create Group Limited, has been granted a voting proxy by the other shareholders of Smart
Create Group Limited to vote on their behalf. Mr. Shen disclaims beneficial ownership of these
5,250,000 ordinary shares except to the extent of his pecuniary interest therein. The business
address of Mr. Shen is Suite 2215, 22/F, Two Pacific Place, 88 Queensway Road, Hong Kong.(5)
    
    Based on Schedule 13G filed by Orbis Investment Management (B.V.I.) Limited, Orbis Investment
Management Limited and Orbis Asset Management Limited on February 12, 2010. Orbis Investment
Management (B.V.I.) Limited is a company organized under the laws of the British Virgin
Islands. Orbis Investment Management Limited and Orbis Asset Management Limited are companies
organized under the laws of Bermuda. The address of their principal business office is 25
Front Street Hamilton, Bermuda HM11.(6)
    
    On Chance Inc. is a company incorporated in British Virgin Islands and 95% owned by Xin Zhou.
The registered address of On Chance Inc. is Sea Meadow House, Blackburne Highway, Road Town,
Tortola, British Virgin Islands.(7)
    
    Jun Heng Investment Limited is a company incorporated in British Virgin Islands and
controlled by Xin Zhou. The registered address of Jun Heng Investment Limited is Beaufort
House, P.O. Box 438, Road Town, Tortola, British Virgin Islands.(8)
    
    Based on Schedule 13G filed by CHF Investment Limited on February 10, 2010, a British Virgin
Islands company, with the registered address at Kingston Chambers, P.O. Box 173, Road Town,
Tortola, British Virgin Islands. Voting and investment power of shares beneficially held by
CHF Investment Limited is exercised by a committee which consists of Mark Qiu, Hung Shih, Li
Zhenzhi, Charles Pieper and Nicole Arnaboldi. The address for these committee members is c/o
China Renaissance Capital Investment, L.P., M&C Corporate Services Limited, P.O. Box 309GT,
Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands. Such persons
disclaim beneficial ownership of these 4,909,541 ordinary shares except to the extent of their
pecuniary interest therein.(9)
    
    Smart Create Group Limited is a company incorporated in British Virgin Islands and controlled
by Neil Nanpeng Shen. The registered address of Smart Create Group Limited is P.O. Box 957,
Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands.  84




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##### Table of Contents



ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
 Major Shareholders
  Related Party Transactions
 Agreements with CRIC
   Master Transaction Agreement
   85




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##### Table of Contents



Offshore Transitional Services Agreement
  
    
    general finance and accounting support;
 
    
    human resources management support;
 
    
    administrative support;
 
    
    internal control and internal audit support;
  86




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##### Table of Contents




    
    operational management support;
 
    
    legal support; and
 
    
    information technology support.
      Onshore Transitional Services Agreement
   87




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##### Table of Contents



Non-competition Agreement
    Consulting and Services Agreement
   88




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##### Table of Contents



Onshore Cooperation Agreement
   Agreements with CRIC and SINA
  Shareholders Agreement
 Voting requirements with respect to board composition.
  89




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##### Table of Contents



Restrictions on transfer.
 Registration Rights Agreement
 Demand registration rights.
 Piggyback registration rights.
  90




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##### Table of Contents



Loan Guarantee
  Transactions with Certain Related Customer, Shareholders, Directors and Affiliates
 Transactions
with a Related Customer
  Transactions with Management
    Transactions with Affiliates
      91




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##### Table of Contents



Real Estate Investment Fund Management
   Contractual Agreements with Tian Zhuo
   92




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##### Table of Contents



Agreements that Provide Effective Control over Tian Zhuo
 Equity Pledge Agreement
 Exclusive Call Option Agreement
 Loan Agreements
     93




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##### Table of Contents



Shareholder Voting Rights Proxy Agreement.
 Agreements that Transfer Economic Benefits to CRIC
 Consultancy Service Agreement.
 Contractual Agreements with Beijing  Leju
  Agreements that will Provide Effective Control over Beijing  Leju
 Equity Pledge Agreement.
 Exclusive Call Option Agreement.
  94




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##### Table of Contents



Loan Agreement.
 Shareholder Voting Rights Proxy Agreement.
 Agreement that Transfers Economic Benefits of Beijing  Leju to CRIC
 Exclusive Technical Support Agreement
 Share Options
  Interests of Experts and Counsel
  
 ITEM 8. FINANCIAL INFORMATION
 Consolidated Statements and Other Financial Information
   95




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##### Table of Contents



Legal Proceedings
  Dividend Policy
    Significant Changes
  
 ITEM 9. THE OFFER AND LISTING
 Offering and Listing Details
   96




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##### Table of Contents



Sales Price ($)High
    
    
    Low2007 (from August 9)
    
    
    36.45
    
    
    
    12.262008
    
    
    28.09
    
    
    
    4.00First quarter
    
    
    28.09
    
    
    
    10.05Second quarter
    
    
    18.38
    
    
    
    10.32Third quarter
    
    
    11.75
    
    
    
    6.69Fourth quarter
    
    
    8.87
    
    
    
    4.002009
    
    
    24.39
    
    
    
    5.60First quarter
    
    
    8.80
    
    
    
    5.60Second quarter
    
    
    16.98
    
    
    
    7.65Third quarter
    
    
    24.39
    
    
    
    13.51Fourth quarter
    
    
    23.94
    
    
    
    16.70October
    
    
    23.94
    
    
    
    16.76November
    
    
    21.40
    
    
    
    16.70December
    
    
    22.15
    
    
    
    17.872010First quarter
    
    
    20.53
    
    
    
    15.49January
    
    
    19.49
    
    
    
    15.49February
    
    
    18.22
    
    
    
    15.65March
    
    
    20.53
    
    
    
    18.08April
(through April 22)
    
    
    20.40
    
    
    
    17.11
 Plan of Distribution
  Markets
  Selling Shareholders
  Dilution
   97




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##### Table of Contents



Expenses of the Issue
  
 ITEM 10. ADDITIONAL INFORMATION
 Share Capital
  Memorandum and Articles of Association
  Material Contracts
  Exchange Controls
  Taxation
  Cayman Islands Taxation
   98




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##### Table of Contents



Peoples Republic of China Taxation
  United States Federal Income Taxation
   
    
    banks;
 
    
    insurance companies;
 
    
    regulated investment companies;
 
    
    real estate investment trusts;
 
    
    broker-dealers;
 
    
    traders that elect to mark-to-market;
 
    
    U.S. expatriates;
 
    
    tax-exempt entities;
 
    
    persons liable for alternative minimum tax;
  99




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
    
    persons holding an ADS or ordinary share as part of a straddle, hedging, conversion
or integrated transaction;
 
    
    persons that actually or constructively own 10% or more of the total combined voting
power of all classes of our voting stock;
 
    
    persons who acquired ADSs or ordinary shares pursuant to the exercise of any
employee share option or otherwise as compensation; or
 
    
    persons holding ADSs or ordinary shares through partnerships or other pass-through
entities.
 HOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS ABOUT THE APPLICATION OF THE U.S. FEDERAL TAX
RULES TO THEIR PARTICULAR CIRCUMSTANCES AS WELL AS THE STATE AND LOCAL, FOREIGN AND OTHER TAX
CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF ADSs OR ORDINARY SHARES.
  
    
    an individual who is a citizen or resident of the United States;
 
    
    a corporation (or other entity taxable as a corporation) organized under the laws of
the United States, any State thereof or the District of Columbia;
 
    
    an estate, the income of which is subject to U.S. federal income taxation regardless
of its source; or
 
    
    a trust that (1) is subject to the primary supervision of a court within the United
States and the control of one or more U.S. persons for all substantial decisions or (2)
has a valid election in effect under applicable U.S. Treasury regulations to be treated
as a U.S. person.
     100




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##### Table of Contents



Taxation of Dividends and Other Distributions on the ADSs or Ordinary Shares
    Taxation of Disposition of the ADSs or Ordinary Shares
   101




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##### Table of Contents



Passive Foreign Investment Company
  
    
    at least 75% of its gross income for such year is passive income, or
 
    
    at least 50% of the value of its assets (based on an average of the quarterly values
of the assets) during such year is attributable to assets that produce passive income
or are held for the production of passive income (the asset test).
    
    
    the excess distribution or gain will be allocated ratably over your holding period
for the ADSs or ordinary shares,
 
    
    the amount allocated to the current taxable year, and any taxable years in your
holding period prior to the first taxable year in which we were a PFIC, will be treated
as ordinary income, and
  102




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
    
    the amount allocated to each other year will be subject to the highest tax rate in
effect for individuals or corporations, as applicable, for each such year and the
interest charge generally applicable to underpayments of tax will be imposed on the
resulting tax attributable to each such year.
       103




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Information Reporting and Backup Withholding
   Dividends and Paying Agents
  Statement by Experts
  Documents on Display
 www.sec.gov
  104




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##### Table of Contents



www.ehousechina.com
    Subsidiary Information
  
 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Interest Rate Risk
  Foreign Exchange Risk
   105




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Inflation
  
 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
 Debt Securities
  Warrants and Rights
  Other Securities
  American Depositary Shares
 Fees and Charges Our ADS holders May Have to Pay
   106




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##### Table of Contents




    
    a fee of $1.50 per ADS or ADSs for transfers of certificated or direct registration
ADSs;
 
    
    a fee of up to $0.05 per ADS (or portion thereof) for any cash distribution made
pursuant to the deposit agreement;
 
    
    an aggregate fee of up to $0.05 per ADS (or portion thereof) per calendar year for
services performed by the depositary in administering the ADSs (which fee may be charged on
a periodic basis during each calendar year and shall be assessed against holders of our
ADSs as of the record date or record dates set by the depositary during each calendar year
and shall be payable at the sole discretion of the depositary by billing these holders or
by deducting the charges from one or more cash dividends or other cash distributions);
 
    
    any other charge payable by the depositary or any of the depositarys agents, including,
without limitation, the custodian, or the agents of the depositarys agents in connection
with the servicing of our ordinary shares or other deposited securities (which charge shall
be assessed against registered holders of our ADSs as of the record date or dates set by
the depositary and shall be payable at the sole discretion of the depositary by billing
such registered holders or by deducting such charge from one or more cash dividends or
other cash distributions);
 
    
    a fee for the distribution of securities (or the sale of securities in connection with a
distribution), such fee being in an amount equal to the fee for the execution and delivery
of ADSs which would have been charged as a result of the deposit of such securities
(treating all such securities as if they were shares) but which securities or the net cash
proceeds from the sale thereof are instead distributed by the depositary to those holders
entitled thereto;
 
    
    stock transfer or other taxes and other governmental charges;
 
    
    cable, telex and facsimile transmission and delivery charges incurred at your request;
 
    
    transfer or registration fees for the registration of transfer of deposited securities
on any applicable register in connection with the deposit or withdrawal of deposited
securities;
 
    
    expenses of the depositary in connection with the conversion of foreign currency into
U.S. dollars; and
 
    
    such fees and expenses as are incurred by the depositary (including without limitation
expenses incurred in connection with compliance with foreign exchange control regulations
or any law or regulation relating to foreign investment) in delivery of deposited
securities or otherwise in connection with the depositarys or its custodians compliance
with applicable laws, rules or regulations.
  Fees and Other Payments Made by the Depositary to Us
   107




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PART II
 
 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
  
 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
  
 ITEM 15. CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
  Managements Annual Report on Internal Control over Financial Reporting
    Changes in Internal Control over Financial Reporting
   108




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ITEM
16. AUDIT COMMITTEE FINANCIAL EXPERT
  
 ITEM
16B. CODE OF ETHICS
  
 ITEM
16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  For the Year Ended December 31,2008
    
    
    2009Audit fees(1)
    
    
    1,020,648
    
    
    
    1,024,737Audit-related fees(2)
    
    
    374,073
    
    
    
    969,927Tax fees(3)
    
    
    22,219
    
    
    
    
 
 (1)
    
    Audit fees means the aggregate fees billed for professional services rendered by our
principal auditors for the audit of our annual financial statements and the review of our
comparative interim financial statements.(2)
    
    Audit related fees represents aggregate fees billed for professional services rendered by
our principal auditors for the assurance and related services. The audit-related fees in 2008
were billed for professional services rendered for the issuance of the audit and review of
financial statements and other assurance services rendered in connection with our initial
public offering in 2007 and expenses incurred during 2007 for our subsequent follow-on
offering in January 2008. The audit-related fees in 2009 were billed for the professional
services rendered for the issuance of the audit and review of financial statements and other
assurance services rendered in connection with CRICs initial public offering in 2009.(3)
    
    Tax fees represents aggregate fees billed for professional services rendered by our
principal auditors for tax compliance, tax advice and tax planning. de minimis
 
 ITEM
16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
   109




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##### Table of Contents



ITEM
16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  Total Number of Shares
    
    
    Approximate DollarPurchased as Part of
    
    
    Value of Shares thatTotal Number of Shares
    
    
    Average Price Paid Per
    
    
    Publicly Announced
    
    
    may Yet Be PurchasedPeriod
    
    Purchased
    
    
    Share
    
    
    Plans
    
    
    Under the PlansJanuary 14-21
    
    
    158,274
    
    
    $
    5.97
    
    
    
    158,274
    
    
    
    0
 
 ITEM
16F. CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
  
 ITEM
16G. CORPORATE GOVERNANCE
  
 PART III
 
 ITEM
17. FINANCIAL STATEMENTS
  
 ITEM
18. FINANCIAL STATEMENTS
  
 ITEM
19. EXHIBITS
 Exhibit Number
    
    Description of Document1.1
    
    
    Amended and Restated Memorandum and Articles of Association (incorporated
by reference to Exhibit 3.2 from our F-1 registration statement (File No.
333-148729), as amended, initially filed with the Commission on January
17, 2008)4.1
    
    
    E-House Share Incentive Plan, as amended and restated on October 16, 2008
(incorporated by reference to Exhibit 10.1 from our S-8 registration
statement (File No. 333-148058), filed with the Commission on December 23,
2008)4.2
    
    
    CRIC Share Incentive Plan adopted as of September 9, 2008 (incorporated by
reference to Exhibit 4.2 from our annual report on Form 20-F (File No.
001-33616), filed with the Commission on May 4, 2009)4.3
    
    
    Form of Indemnification Agreement with the Registrants directors
(incorporated by reference to Exhibit 10.2 from our F-1 registration
statement (File No. 333-148729), as amended, initially filed with the
Commission on January 17, 2008)
  110




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Exhibit Number
    
    Description of Document4.4
    
    
    Form of Employment Agreement with the Registrants senior executives
(incorporated by reference to Exhibit 10.3 from our F-1 registration
statement (File No. 333-148729), as amended, initially filed with the
Commission on January 17, 2008)4.5
    *
    
    English translation of Equity Pledge Agreement, dated July 20, 2009,
between Shanghai CRIC Information Technology Co., Ltd., Shanghai Tian
Zhuo Advertising Co., Ltd., Xin Zhou and Xudong Zhu.4.6
    *
    
    English translation of Exclusive Call Option Agreement dated July 20, 2009
between Shanghai CRIC Information Technology Co., Ltd., Shanghai Tian
Zhuo Advertising Co., Ltd., Xin Zhou and Xudong Zhu.4.7
    
    
    English translation of Loan Agreement, dated April 1, 2008, between
Shanghai CRIC Information Technology Co., Ltd. and Xin Zhou. (incorporated
by reference to Exhibit 4.8 from our annual report on Form 20-F (File No.
001-33616), filed with the Commission on May 4, 2009)4.8
    
    
    English translation of Loan Agreement, dated September 8, 2008, between
Shanghai CRIC Information Technology Co., Ltd. and Xin Zhou. (incorporated
by reference to Exhibit 4.10 from our annual report on Form 20-F (File No.
001-33616), filed with the Commission on May 4, 2009)4.9
    *
    
    English translation of Loan Agreement, dated July 20, 2009, between
Shanghai CRIC Information Technology Co., Ltd. and Xin Zhou.4.10
    *
    
    English translation of Loan Agreement, dated July 20, 2009, between
Shanghai CRIC Information Technology Co., Ltd., Xin Zhou and Xudong Zhu.4.11
    
    
    English translation of Loan Agreement, dated April 1, 2008, between
Shanghai Tian Zhuo Advertising Co., Ltd. and Xin Zhou. (incorporated by
reference to Exhibit 4.9 from our annual report on Form 20-F (File No.
001-33616), filed with the Commission on May 4, 2009)4.12
    
    
    English translation of Loan Agreement, dated September 8, 2008, between
Shanghai Tian Zhuo Advertising Co., Ltd. and Xin Zhou. (incorporated by
reference to Exhibit 4.11 from our annual report on
Form 20-F (File No. 001-33616),
filed with the Commission on May 4, 2009)4.13
    *
    
    English translation of Shareholder Voting Rights Proxy Agreement, dated
July 20, 2009, between Shanghai CRIC Information Technology Co., Ltd.,
Shanghai Tian Zhuo Advertising Co., Ltd., Xin Zhou and Xudong Zhu.4.14
    
    
    English translation of Consultancy Service Agreement, dated April 1, 2008,
between Shanghai CRIC Information Technology Co., Ltd. and Shanghai Tian
Zhuo Advertising Co., Ltd. (incorporated by reference to Exhibit 4.13 from
our annual report on Form 20-F (File No. 001-33616), filed with the
Commission on May 4, 2009)4.15
    *
    
    English translation of Exclusive Call Option Agreement dated September 29,
2009 between Shanghai SINA Leju Information Technology Co., Ltd.,
Beijing Visheng Leju Information Services Co., Ltd., Xudong Zhu and Jun Luo.4.16
    *
    
    English translation of Loan Agreement dated September 29, 2009 between
Shanghai SINA Leju Information Technology Co., Ltd., Xudong Zhu and Jun
Luo.
  111




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##### Table of Contents



Exhibit Number
    
    Description of Document4.17
    *
    
    English translation of Shareholder Voting Rights Proxy Agreement dated
September 29, 2009 between Shanghai SINA Leju Information Technology Co.,
Ltd., Beijing Visheng Leju Information Services Co., Ltd., Xudong Zhu and
Jun Luo.4.18
    *
    
    English translation of Equity Pledge Agreement dated September 29, 2009
between Shanghai SINA Leju Information Technology Co., Ltd., Beijing
Visheng Leju Information Services Co., Ltd., Xudong Zhu and Jun Luo.4.19
    *
    
    English translation of Exclusive Technical Support Agreement dated May 8,
2008 between Shanghai SINA Leju Information Technology Co., Ltd. and
Beijing Visheng Leju Information Services Co., Ltd.4.20
    *
    
    Share Purchase Agreement, dated as of July 23, 2009, and Amendment
Agreement to the Share Purchase Agreement, dated September 29, 2009,
between the Registrant and SINA Corporation.4.21*
    
    
    Shareholders Agreement, dated as of October 21, 2009, by and among the
Registrant, E-House (China) Holdings Limited and SINA Corporation.4.22*
    
    
    Registration Rights Agreement, dated as of October 21, 2009, by and among
the Registrant, E-House (China) Holdings Limited and SINA Corporation
..4.23
    *
    
    Master Transaction Agreement, dated as of July 27, 2009, between the
Registrant and E-House (China) Holdings Limited.4.24
    *
    
    Offshore Transitional Services Agreement, dated as of July 27, 2009,
between the Registrant and E-House (China) Holdings Limited.4.25
    *
    
    English translation of Onshore Transitional Services Agreement, dated as
of July 27, 2009, between Shanghai CRIC Information Technology Co., Ltd.
and Shanghai Real Estate Sales (Group) Co., Ltd.4.26
    *
    
    Non-Competition Agreement, dated as of July 27, 2009, between the
Registrant and E-House (China) Holdings Limited.4.27
    *
    
    English translation of Consulting and Services Agreement, dated as of June
30, 2009, between Shanghai CRIC Information Technology Co., Ltd. and
Shanghai Real Estate Sales (Group) Co., Ltd.4.28
    *
    
    English translation of Onshore Cooperation Agreement, dated as of August
31, 2009, among Shanghai Real Estate Sales (Group) Co., Ltd., Shanghai
CRIC Information Technology Co., Ltd. and Shanghai Tian Zhuo Advertising Co., Ltd.
  112




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Exhibit Number
    
    Description of Document8.1
    *
    
    Subsidiaries of the Registrant11.1
    
    
    Code of Business Conduct and Ethics of the Registrant (incorporated by
reference to Exhibit 99.1 from our F-1 registration statement (File No.
333-144451), as amended, initially filed with the Commission on July 10,
2007)12.1
    *
    
    CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 200212.2
    *
    
    CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 200213.1
    *
    
    CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 200213.2
    *
    
    CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 200215.1
    *
    
    Consent of Deloitte Touche Tohmatsu CPA Ltd.15.2
    *
    
    Consent of Fangda Partners
 
 *
    
    Filed with this Annual Report on Form 20-F.  113




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##### Table of Contents



SIGNATURES
  E-HOUSE (CHINA) HOLDINGS LIMITEDBy:

/s/ Xin ZhouName:
    Xin ZhouTitle:
    Executive Chairman of the Board of Directors   114




---



##### 



E-HOUSE (CHINA) HOLDINGS LIMITED
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2007, 2008 AND 2009
 Reports of Independent Registered Public Accounting Firm
    
    
    F-2Consolidated Balance Sheets as of December 31, 2008 and 2009
    
    
    F-4Consolidated Statements of Operations for the Years Ended December 31, 2007, 2008 and 2009
    
    
    F-5Consolidated Statements of Changes in Equity and Comprehensive Income for the Years Ended
December 31, 2007, 2008, and 2009
    
    
    F-6Consolidated Statements of Cash Flows for the Years Ended December 31, 2007, 2008 and 2009
    
    
    F-7Notes to Consolidated Financial Statements for the Years Ended December 31, 2007, 2008 and 2009
    
    
    F-8




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
       
  F-2




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
        
  F-3




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##### Table of Contents



E-HOUSE (CHINA) HOLDINGS LIMITED
 
 CONSOLIDATED BALANCE SHEETS
(In U.S. dollar except for share data)
 December 31,2008
    
    
    2009$
    
    
    $ASSETSCurrent assets:Cash and cash equivalents
    
    
    225,663,324
    
    
    
    548,061,884Restricted cash
    
    
    23,930,951
    
    
    
    8,056,527Marketable securities
    
    
    8,096,038
    
    
    
    Customer deposits, net of allowance for
doubtful accounts of $438,942 and
$523,196 at December 31, 2008 and 2009,
respectively
    
    
    71,855,522
    
    
    
    38,958,140Unbilled accounts receivable, net of
allowance for doubtful accounts of
$1,628,326 and $12,113,824 at December
31, 2008 and 2009, respectively
    
    
    83,617,483
    
    
    
    120,020,485Accounts receivable, net of allowance
for doubtful accounts of $1,330,631 and
$1,162,900 at December 31, 2008 and
2009, respectively
    
    
    36,667,535
    
    
    
    33,452,323Properties held for sale
    
    
    1,064,789
    
    
    
    3,064,810Advance payment for properties, current
    
    
    7,718,169
    
    
    
    8,108,299Deferred tax assets
    
    
    3,815,688
    
    
    
    13,337,020Prepaid expenses and other current assets
    
    
    17,752,283
    
    
    
    18,697,780Amounts due from related parties
    
    
    749,074
    
    
    
    1,042,303Total current assets
    
    
    480,930,856
    
    
    
    792,799,571Property and equipment, net
    
    
    9,622,486
    
    
    
    16,218,641Intangible assets, net
    
    
    3,433,205
    
    
    
    202,694,693Investment in affiliates
    
    
    5,062,394
    
    
    
    398,396Goodwill
    
    
    7,457,763
    
    
    
    452,659,692Deferred tax assets, non-current
    
    
    1,435,262
    
    
    
    1,847,245Customer deposits, non-current
    
    
    1,285,954
    
    
    
    981,222Other non-current assets
    
    
    10,685,625
    
    
    
    4,525,320TOTAL ASSETS
    
    
    519,913,545
    
    
    
    1,472,124,780LIABILITIES AND EQUITYCurrent liabilities:Short-term borrowings
    
    
    21,947,100
    
    
    
    Accounts payable
    
    
    1,492,242
    
    
    
    9,864,773Accrued payroll and welfare expenses
    
    
    11,628,750
    
    
    
    31,418,709Income tax payable
    
    
    17,560,407
    
    
    
    38,225,826Other tax payable
    
    
    6,638,047
    
    
    
    12,072,447Deposits payable
    
    
    39,212,152
    
    
    
    Amounts due to related parties
    
    
    621,518
    
    
    
    1,050,000Advance from property buyers
    
    
    1,166,342
    
    
    
    6,587,093Other current liabilities
    
    
    8,406,075
    
    
    
    15,928,381Total current liabilities
    
    
    108,672,633
    
    
    
    115,147,229Deferred tax liabilities
    
    
    705,980
    
    
    
    42,326,523Other non-current liabilities
    
    
    3,544,927
    
    
    
    1,331,323Total liabilities
    
    
    112,923,540
    
    
    
    158,805,075Commitments and contingencies (Note 22)Equity:Ordinary shares ($0.001 par value): 1,000,000,000
and 1,000,000,000 shares
authorized, 79,769,481 and 80,145,869
shares issued and outstanding, as of
December 31, 2008 and 2009, respectively
    
    
    79,770
    
    
    
    80,146Additional paid-in capital
    
    
    301,812,186
    
    
    
    656,592,898Retained earnings
    
    
    85,296,056
    
    
    
    184,749,251Accumulated other comprehensive income
    
    
    16,110,460
    
    
    
    16,344,294Total E-House equity
    
    
    403,298,472
    
    
    
    857,766,589Non-controlling interests
    
    
    3,691,533
    
    
    
    455,553,116Total equity
    
    
    406,990,005
    
    
    
    1,313,319,705TOTAL LIABILITIES AND EQUITY
    
    
    519,913,545
    
    
    
    1,472,124,780
   F-4




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##### Table of Contents



E-HOUSE (CHINA) HOLDINGS LIMITED
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
(In U.S. dollar except for share data)
 Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Total revenues
    
    
    121,016,600
    
    
    
    154,487,455
    
    
    
    299,538,656Cost of revenues
    
    
    (23,510,065
    )
    
    
    (31,855,848
    )
    
    
    (70,343,445
    )Selling, general and administrative expenses
    
    
    (45,545,800
    )
    
    
    (77,197,631
    )
    
    
    (125,721,179
    )Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    2,100,832Income from operations
    
    
    51,960,735
    
    
    
    45,433,976
    
    
    
    105,574,864Interest expense
    
    
    (621,903
    )
    
    
    (2,420,468
    )
    
    
    (215,854
    )Interest income
    
    
    2,489,668
    
    
    
    3,062,513
    
    
    
    1,038,789Other income, net
    
    
    197,892
    
    
    
    1,970,481
    
    
    
    8,780,370Income before taxes and equity in affiliates
    
    
    54,026,392
    
    
    
    48,046,502
    
    
    
    115,178,169Income tax expense
    
    
    (10,277,040
    )
    
    
    (8,712,558
    )
    
    
    (19,924,081
    )Income before equity in affiliates
    
    
    43,749,352
    
    
    
    39,333,944
    
    
    
    95,254,088Income from equity in affiliates
    
    
    
    
    
    
    153,700
    
    
    
    22,128,235Net income
    
    
    43,749,352
    
    
    
    39,487,644
    
    
    
    117,382,323Less: Net
income (loss) attributable to non-controlling interests
    
    
    2,023,537
    
    
    
    (88,380
    )
    
    
    17,104,023Net income attributable to E-House shareholders
    
    
    41,725,815
    
    
    
    39,576,024
    
    
    
    100,278,300Earnings per share:Basic
    
    $
    0.62
    
    
    $
    0.48
    
    
    $
    1.26Diluted
    
    $
    0.56
    
    
    $
    0.48
    
    
    $
    1.25Shares used in computation:Basic
    
    
    60,386,083
    
    
    
    81,818,972
    
    
    
    79,643,079Diluted
    
    
    74,555,709
    
    
    
    82,110,430
    
    
    
    80,456,210
   F-5




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##### Table of Contents



E-HOUSE (CHINA) HOLDINGS LIMITED
 
 CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
AND COMPREHENSIVE INCOME
(In U.S. dollar)
 Retained
    
    
    AccumulatedAdditional
    
    
    Earnings
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    TotalOrdinary
    
    
    Paid-in
    
    
    (Accumulated
    
    
    Comprehensive
    
    
    Non-controlling
    
    
    Total
    
    
    ComprehensiveShares
    
    
    Capital
    
    
    Deficit)
    
    
    Income
    
    
    Interests
    
    
    Equity
    
    
    IncomeNumber
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Balance at January 1, 2007
    
    
    50,000,000
    
    
    
    50,000
    
    
    
    18,399,306
    
    
    
    12,979,130
    
    
    
    941,755
    
    
    
    2,328,394
    
    
    
    34,698,585Series A redeemable convertible preferred shares
converted into ordinary shares
    
    
    13,157,895
    
    
    
    13,158
    
    
    
    24,815,254
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24,828,412
    
    
    
    Issuance of ordinary shares, net of issuance costs
    
    
    13,167,500
    
    
    
    13,168
    
    
    
    165,249,586
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    165,262,754
    
    
    
    Vesting of restricted shares
    
    
    148,364
    
    
    
    148
    
    
    
    489,453
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    489,601
    
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,725,815
    
    
    
    
    
    
    
    2,023,537
    
    
    
    43,749,352
    
    
    
    43,749,352Dividends to
non-controlling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (845,268
    )
    
    
    (845,268
    )
    
    
    Capital
contribution by non-controlling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    224,550
    
    
    
    224,550
    
    
    
    Non-controlling interest recognized in connection
with business acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    219,791
    
    
    
    219,791
    
    
    
    Purchase
from non-controlling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,218,583
    )
    
    
    (1,218,583
    )
    
    
    Adoption of ASC 740 uncertain tax positions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (200,000
    )
    
    
    
    
    
    
    
    
    
    
    (200,000
    )
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    952,889
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    952,889
    
    
    
    Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,743,358
    
    
    
    186,179
    
    
    
    5,929,537
    
    
    
    5,929,537Balance at December 31, 2007
    
    
    76,473,759
    
    
    
    76,474
    
    
    
    209,906,488
    
    
    
    54,504,945
    
    
    
    6,685,113
    
    
    
    2,918,600
    
    
    
    274,091,620
    
    
    
    49,678,889Issuance of ordinary shares, net of issuance costs
    
    
    6,000,000
    
    
    
    6,000
    
    
    
    97,392,482
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,398,482
    
    
    
    Repurchase of shares
    
    
    (2,848,278
    )
    
    
    (2,848
    )
    
    
    (10,563,338
    )
    
    
    (8,784,913
    )
    
    
    
    
    
    
    
    
    
    
    (19,351,099
    )
    
    
    Vesting of restricted shares
    
    
    144,000
    
    
    
    144
    
    
    
    475,056
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    475,200
    
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39,576,024
    
    
    
    
    
    
    
    (88,380
    )
    
    
    39,487,644
    
    
    
    39,487,644Dividends to
non-controlling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (346,939
    )
    
    
    (346,939
    )
    
    
    Non-controlling interest recognized in connection
with business acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,173,582
    
    
    
    1,173,582
    
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    4,601,498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,601,498
    
    
    
    Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,425,347
    
    
    
    34,670
    
    
    
    9,460,017
    
    
    
    9,460,017Balance at December 31, 2008
    
    
    79,769,481
    
    
    
    79,770
    
    
    
    301,812,186
    
    
    
    85,296,056
    
    
    
    16,110,460
    
    
    
    3,691,533
    
    
    
    406,990,005
    
    
    
    48,947,661Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    100,278,300
    
    
    
    
    
    
    
    17,104,023
    
    
    
    117,382,323
    
    
    
    117,382,323Repurchase of shares
    
    
    (277,174
    )
    
    
    (277
    )
    
    
    (1,048,703
    )
    
    
    (825,105
    )
    
    
    
    
    
    
    
    
    
    
    (1,874,085
    )
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    10,185,511
    
    
    
    
    
    
    
    
    
    
    
    1,735,043
    
    
    
    11,920,554
    
    
    
    Excise of share options
    
    
    509,562
    
    
    
    509
    
    
    
    2,753,597
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,754,106
    
    
    
    Vesting of restricted shares
    
    
    144,000
    
    
    
    144
    
    
    
    434,586
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    434,730
    
    
    
    Replacement of COHT share options
    
    
    
    
    
    
    
    
    
    
    7,486,795
    
    
    
    
    
    
    
    
    
    
    
    7,474,001
    
    
    
    14,960,796
    
    
    
    Capital
injection and non-controlling interest
recognized in connection with business
acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,260,780
    
    
    
    1,260,780
    
    
    
    Purchase
from non-controlling interest
    
    
    
    
    
    
    
    
    
    
    (17,446,572
    )
    
    
    
    
    
    
    77,597
    
    
    
    (19,880,354
    )
    
    
    (37,249,329
    )
    
    
    Recognition of change in E-Houses economic
interests in CRIC
    
    
    
    
    
    
    
    
    
    
    352,415,498
    
    
    
    
    
    
    
    
    
    
    
    444,287,620
    
    
    
    796,703,118
    
    
    
    Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    156,237
    
    
    
    (119,530
    )
    
    
    36,707
    
    
    
    36,707Balance at December 31, 2009
    
    
    80,145,869
    
    
    
    80,146
    
    
    
    656,592,898
    
    
    
    184,749,251
    
    
    
    16,344,294
    
    
    
    455,553,116
    
    
    
    1,313,319,705
    
    
    
    117,419,030
   F-6




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##### Table of Contents



E-HOUSE (CHINA) HOLDINGS LIMITED
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. dollar)
 Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Operating activities:Net income
    
    
    43,749,352
    
    
    
    39,487,644
    
    
    
    117,382,323Adjustments to reconcile net income to net cash
provided by (used in) operating activities:Depreciation and amortization
    
    
    2,328,527
    
    
    
    4,114,761
    
    
    
    10,162,437Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    (2,100,832
    )Income from equity in affiliates
    
    
    
    
    
    
    (153,700
    )
    
    
    (22,128,235
    )Allowance for doubtful accounts
    
    
    2,359,752
    
    
    
    2,583,853
    
    
    
    13,937,173Share-based compensation
    
    
    952,889
    
    
    
    4,601,498
    
    
    
    11,920,554Others
    
    
    196,084
    
    
    
    237,895
    
    
    
    1,030,759Changes in operating assets and liabilities:Restricted cash
    
    
    (829,127
    )
    
    
    1,887,622
    
    
    
    (6,852,856
    )Customer deposits
    
    
    (121,452,918
    )
    
    
    56,359,296
    
    
    
    32,813,578Accounts receivable
    
    
    (31,388,959
    )
    
    
    (57,191,210
    )
    
    
    (37,823,690
    )Marketable securities
    
    
    
    
    
    
    (8,096,038
    )
    
    
    8,096,038Amounts due from related parties
    
    
    (1,900,060
    )
    
    
    2,024,914
    
    
    
    731,809Deferred taxes
    
    
    (2,941,810
    )
    
    
    (2,119,638
    )
    
    
    (9,933,315
    )Prepaid expenses and other current assets
    
    
    2,190,645
    
    
    
    (5,610,975
    )
    
    
    5,752,434Other non-current assets
    
    
    (1,026,750
    )
    
    
    2,308,366
    
    
    
    3,180,863Accounts payable
    
    
    277,021
    
    
    
    (155,316
    )
    
    
    (4,188,599
    )Accrued payroll and welfare expenses
    
    
    8,532,783
    
    
    
    (1,108,809
    )
    
    
    19,538,868Income tax payable
    
    
    10,834,505
    
    
    
    (325,654
    )
    
    
    20,534,956Other tax payable
    
    
    2,951,409
    
    
    
    1,076,658
    
    
    
    5,434,026Amounts due to related parties
    
    
    1,621,999
    
    
    
    (1,475,685
    )
    
    
    (146,075
    )Deposits payable
    
    
    
    
    
    
    39,212,152
    
    
    
    (39,212,152
    )Other current liabilities
    
    
    2,271,595
    
    
    
    315,506
    
    
    
    1,473,279Other non-current liabilities
    
    
    
    
    
    
    
    
    
    
    (502,102
    )Net cash provided by (used in) operating activities
    
    
    (81,273,063
    )
    
    
    77,973,140
    
    
    
    129,101,241Investing activities:Deposit for and purchase of property and equipment
    
    
    (4,287,825
    )
    
    
    (5,136,016
    )
    
    
    (6,315,343
    )Advance payment for properties
    
    
    
    
    
    
    (15,620,751
    )
    
    
    Purchase of subsidiaries, net of cash acquired
    
    
    (568,640
    )
    
    
    (2,399,326
    )
    
    
    3,243,113Prepayment for acquisition
    
    
    
    
    
    
    (1,594,823
    )
    
    
    Investment in affiliates
    
    
    
    
    
    
    (2,500,000
    )
    
    
    (329,468
    )Proceeds from sale of property held for sale
    
    
    627,027
    
    
    
    749,999
    
    
    
    5,080,606Proceeds from disposal of property and equipment
    
    
    16,597
    
    
    
    46,193
    
    
    
    233,968Collection of loans from related parties
    
    
    43,885
    
    
    
    
    
    
    
    Net cash provided by (used in) investing activities
    
    
    (4,168,956
    )
    
    
    (26,454,724
    )
    
    
    1,912,876Financing activities:Net proceeds from short-term borrowings
    
    
    
    
    
    
    42,482,100
    
    
    
    Purchases of
non-controlling interests
    
    
    (1,331,400
    )
    
    
    (65,999
    )
    
    
    (37,290,289
    )Repayment of short-term borrowings
    
    
    (4,233,916
    )
    
    
    (27,380,000
    )
    
    
    (21,947,100
    )Restricted cash-pledged accounts
    
    
    
    
    
    
    (22,727,280
    )
    
    
    22,727,280Advance from a related party
    
    
    1,440,001
    
    
    
    
    
    
    
    1,050,000Contribution
from non-controlling interests
    
    
    
    
    
    
    
    
    
    
    1,175,244Proceeds from exercise of options
    
    
    
    
    
    
    
    
    
    
    2,754,106Proceeds from issuance of ordinary shares, net of paid
issuance costs for 2007 and 2008 of $16,106,695 and
$4,488,986, respectively
    
    
    165,612,754
    
    
    
    97,505,014
    
    
    
    Proceeds from issuance of ordinary shares of CRIC upon
initial public offering, net of paid issuance costs of $23,548,949
    
    
    
    
    
    
    
    
    
    
    224,851,051Payment of E-Houses offering costs
    
    
    
    
    
    
    (220,804
    )
    
    
    (74,629
    )Repurchase of shares
    
    
    
    
    
    
    (19,208,685
    )
    
    
    (2,016,499
    )Dividends to
non-controlling interests
    
    
    (644,194
    )
    
    
    (346,937
    )
    
    
    Loans from related parties
    
    
    1,264,698
    
    
    
    
    
    
    
    Repayment of loans from related parties
    
    
    (1,331,797
    )
    
    
    
    
    
    
    Net cash provided by financing activities
    
    
    160,776,146
    
    
    
    70,037,409
    
    
    
    191,229,164Effect of exchange rate changes
    
    
    1,507,415
    
    
    
    2,959,952
    
    
    
    155,279Net increase in cash and cash equivalents
    
    
    76,841,542
    
    
    
    124,515,777
    
    
    
    322,398,560Cash and cash equivalents at the beginning of the year
    
    
    24,306,005
    
    
    
    101,147,547
    
    
    
    225,663,324Cash and cash equivalents at the end of the year
    
    
    101,147,547
    
    
    
    225,663,324
    
    
    
    548,061,884Supplemental disclosure of cash flow information:Interest paid
    
    
    621,903
    
    
    
    2,396,514
    
    
    
    252,481Income taxes paid
    
    
    3,559,865
    
    
    
    12,466,793
    
    
    
    9,398,214Non-cash investing and financing activities:Acquisition of property held for sale  Accounts receivable
    
    
    859,850
    
    
    
    183,839
    
    
    
    3,471,273Advance payment for property held for sale  Accounts
receivable
    
    
    
    
    
    
    1,098,721
    
    
    
    Issuance of ordinary shares for business acquisition
    
    
    
    
    
    
    
    
    
    
    572,000,004Offering cost to be paid
    
    
    350,000
    
    
    
    235,728
    
    
    
    146,451Replacement of share option for combination
    
    
    
    
    
    
    
    
    
    
    14,960,796Capitalization of costs for repurchase of shares  other
current liabilities
    
    
    
    
    
    
    142,414
    
    
    
    Provision for ASC 740 uncertain tax positions
    
    
    200,000
    
    
    
    
    
    
    
    Non-controlling interest recognized in connection with
business acquisition
    
    
    
    
    
    
    
    
    
    
    85,536
   F-7




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##### Table of Contents



E-HOUSE (CHINA) HOLDINGS LIMITED
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2007, 2008 AND 2009
(In U.S. dollar)
 1. Organization and Principal Activities
      Date of
    
    
    Place of
    
    
    Percentage ofincorporation
    
    
    incorporation
    
    
    OwnershipShanghai
Real Estate Sales (Group) Co., Limited
    
    15-Aug-00
    
    PRC
    
    
    100
    %Shanghai City Rehouse Agent Consultants Co., Ltd.
    
    17-May-02
    
    PRC
    
    
    85
    %E-House Real Estate Asset Management Co., Ltd.
    
    22-Aug-06
    
    Cayman
    
    
    51
    %China Real Estate Information Corporation
    
    21-Aug-08
    
    Cayman
    
    
    52
    %Shanghai Tian Zhuo Advertising Co., Ltd.
    
    27-Feb-08
    
    PRC
    
    
    VIEBeijing
Visheng Leju Information Services Co., Ltd.
    
    13-Feb-08
    
    PRC
    
    
    VIE
  F-8




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##### Table of Contents



2. Summary of Principal Accounting Policies
 (a) Basis of presentation
  (b) Basis of consolidation
       F-9




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##### Table of Contents



As of December 31, 2009$Total assets
    
    
    15,367,010Total liabilities
    
    
    13,584,892
   As of December 31, 2009$Total assets
    
    
    4,697,532Total liabilities
    
    
    6,703,036
 (c) Use of estimates
  (d) Fair value of financial instruments
   F-10




---



##### Table of Contents



(e) Business combinations
  (f) Cash and cash equivalents
  (g) Restricted
cash
   F-11




---



##### Table of Contents



(h) Marketable securities
  (i) Customer deposits
    (j) Unbilled accounts receivable
  (k) Properties held for sale
  (l) Investment in affiliates
   F-12




---



##### Table of Contents



(m) Property and equipment, net
  Leasehold improvements
    
    Over the shorter of the lease term or their estimated useful livesBuildings
    
    30 yearsFurniture, fixtures and equipment
    
    5 yearsMotor vehicles
    
    5 years
  (n) Intangible assets, net
  (o) Impairment of long-lived assets
  (p) Impairment of goodwill and indefinite lived intangible assets
   F-13




---



##### Table of Contents



(q) Income taxes
   (r) Share-based compensation
  (s) Revenue recognition
     F-14




---



##### Table of Contents



F-15




---



##### Table of Contents



(t) Cost of revenue
  (u) Advertising expenses
  (v) Foreign currency translation
    F-16




---



##### Table of Contents



(w) Government subsidies
  (x) Concentration of credit risk
    2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Balance as of January 1,
    
    
    52,551
    
    
    
    2,441,796
    
    
    
    3,397,899Provisions for doubtful accounts
    
    
    2,359,752
    
    
    
    2,583,853
    
    
    
    13,739,796Business acquisition
    
    
    
    
    
    
    
    
    
    
    2,440,358Write offs
    
    
    
    
    
    
    (1,691,021
    )
    
    
    (5,787,424
    )Changes due to foreign exchange
    
    
    29,493
    
    
    
    63,271
    
    
    
    9,291Balance as of December 31,
    
    
    2,441,796
    
    
    
    3,397,899
    
    
    
    13,799,920
  (y) Earnings
per share
   F-17




---



##### Table of Contents



Years Ended December 31,2007
    
    
    2008
    
    
    2009Net income attributable to E-House ordinary
shareholders  basic
    
    $
    37,263,701
    
    
    $
    39,576,024
    
    
    $
    100,278,300Incremental income from CRIC*
    
    
    
    
    
    
    
    
    
    $
    750,308Amount allocated to Series A Shares for
participating rights to dividends
    
    $
    4,462,114
    
    
    $
    
    
    
    $
    Net income attributable to E-House ordinary
shareholders  diluted
    
    $
    41,725,815
    
    
    $
    39,576,024
    
    
    $
    101,028,608Weighted average ordinary shares outstanding
    
    
    60,386,083
    
    
    
    81,818,972
    
    
    
    79,643,079Share options
    
    
    397,393
    
    
    
    291,458
    
    
    
    813,131Series A preferred shares
    
    
    13,772,233
    
    
    
    
    
    
    
    Weighted average number of ordinary shares
outstanding  diluted
    
    
    74,555,709
    
    
    
    82,110,430
    
    
    
    80,456,210Basic earnings per share
    
    $
    0.62
    
    
    $
    0.48
    
    
    $
    1.26Diluted earnings per share
    
    $
    0.56
    
    
    $
    0.48
    
    
    $
    1.25
 *
    
    In calculating diluted earnings per share, the amount of CRICs net income included in net
income attributable to E-Houses ordinary shareholders is calculated by multiplying CRICs diluted
EPS by the weighted average number of CRIC shares held by E-Houses during the period, which may
result in net income attributable to E-House ordinary shareholders, for purposes of computing
diluted earnings per share, being different from that actually recorded in the consolidated
statements of operations. This difference is presented as incremental income from CRIC.
  F-18




---



##### Table of Contents



(z) Non-controlling interest
    2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Net income attributable to E-House
    
    
    41,725,815
    
    
    
    39,576,024
    
    
    
    100,278,300Transfers
(to) from the non-controlling interest:Increase in E-Houses additional paid-in
capital for sale of 71,400,000 CRIC common
shares
    
    
    
    
    
    
    
    
    
    
    352,415,498Decrease in E-Houses additional paid-in
capital for purchase of 3,033,333 CRIC common
shares
    
    
    
    
    
    
    
    
    
    
    (17,446,572
    )Net
transfers (to) from non-controlling interest
    
    
    
    
    
    
    
    
    
    
    334,968,926Change from net income attributable to E-House
and transfers (to) from non-controlling interest
    
    
    41,725,815
    
    
    
    39,576,024
    
    
    
    435,247,226
 (aa) Comprehensive income
  (ab) Recently issued accounting pronouncements
   F-19




---



##### Table of Contents



F-20




---



##### Table of Contents



3. Properties Held for Sale
    F-21




---



##### Table of Contents



4. Advance
Payment for Properties
  5. Prepaid
Expenses and Other Current Assets
  As of December 312008
    
    
    2009$
    
    
    $Advance payment for advertising placement
    
    
    7,654,577
    
    
    
    1,400,862Prepaid expenses
    
    
    1,987,959
    
    
    
    3,717,377Other receivable from developers
    
    
    
    
    
    
    6,730,444Others
    
    
    8,109,747
    
    
    
    6,849,097Total
    
    
    17,752,283
    
    
    
    18,697,780
   6. Investments in Affiliated Companies
   F-22




---



##### Table of Contents



Allocated
    
    
    AmortizationValue
    
    
    Period$Cash acquired
    
    
    1,700,000Intangible
assets:Advertising rights
    
    
    2,162,972
    
    
    10 yearsCustomer contract backlog
    
    
    252,607
    
    
    6 monthsLicense to CRIC database
    
    
    793,115
    
    
    10 yearsTotal
    
    
    4,908,694
   7. Acquisitions
of Subsidiaries and Non-controlling Interest
   Amount$Fair value of CRICs shares issued*
    
    
    572,000,004Replacement of COHT share options
    
    
    14,960,796Consideration
    
    
    586,960,800Fair value of the CRICs investment in COHT held before the business combination**
    
    
    27,078,000Total value to be allocated in purchase accounting
    
    
    614,038,800
 *
    
    The fair value of the 47,666,667 ordinary shares issued by the CRIC was based on the IPO
offering price of CRICs ADS.**
    
    As a result of the Company obtaining control over COHT, the Companys previously held
equity interest was remeasured to fair value of $27,078,000, with the excess of fair value over
the carrying amount recognized as a gain of $21,453,221.
  F-23




---



##### Table of Contents



Allocated Value
    
    
    Amortization Period$Total tangible assets acquired
    
    
    26,703,269Liabilities assumed
    
    
    (17,432,772
    )Intangible assets acquired: License agreements with SINA
    
    
    80,660,000
    
    
    10 years Real estate advertising agency agreement with SINA
    
    
    106,790,000
    
    
    10 years CRIC database license agreement
    
    
    8,300,000
    
    
    9 years Customer relationship
    
    
    5,580,000
    
    
    10 years Contract backlog
    
    
    110,000
    
    
    1 yearGoodwill
    
    
    444,885,665Deferred tax liabilities
    
    
    (41,557,362
    )Total
    
    
    614,038,800
      F-24




---



##### Table of Contents



Allocated Value
    
    
    Amortization Period$Cash
    
    
    1,265,772Other current assets
    
    
    1,463,529Liabilities assumed
    
    
    (4,390,507
    )Leasehold improvement
    
    
    2,077,479
    
    
    5-20 yearsPrepaid rent
    
    
    4,348,647
    
    
    20 yearsFavorable lease term
    
    
    2,428,110
    
    
    20 yearsTotal
    
    
    7,193,030
   Allocated Value
    
    
    Amortization Period$Cash acquired
    
    
    1,759,968Intangible assetsCustomer advertising designing contracts
    
    
    130,924
    
    
    3 monthsNon-compete agreement
    
    
    145,720
    
    
    5 yearsGoodwill
    
    
    674,847Deferred tax liabilities
    
    
    (32,731
    )Total
    
    
    2,678,728
   Allocated Value
    
    
    Amortization Period$Tangible assets acquired
    
    
    1,217,304Liabilities assumed
    
    
    (1,434,594
    )Intangible assetsNon-compete agreement
    
    
    853,192
    
    
    5 yearsGoodwill
    
    
    4,028,514Deferred tax liabilities
    
    
    (213,298
    )Total
    
    
    4,451,118
   F-25




---



##### Table of Contents



Year ended December 312008
    
    
    2009$
    
    
    $Revenue
    
    
    188,794,455
    
    
    
    324,343,683Net income
    
    
    29,260,101
    
    
    
    94,508,704Earnings per share:Basic
    
    
    0.36
    
    
    
    1.19Diluted
    
    
    0.36
    
    
    
    0.96
 8. Property and Equipment, Net
  As of December 312008
    
    
    2009$
    
    
    $Leasehold improvements
    
    
    4,815,820
    
    
    
    9,215,325Buildings
    
    
    1,124,993
    
    
    
    3,755,633Furniture, fixtures and equipment
    
    
    6,493,426
    
    
    
    9,374,457Motor vehicles
    
    
    4,130,132
    
    
    
    4,068,224Total
    
    
    16,564,371
    
    
    
    26,413,639Less: Accumulated depreciation
    
    
    (6,941,885
    )
    
    
    (10,194,998
    )Property and equipment, net
    
    
    9,622,486
    
    
    
    16,218,641
   F-26




---



##### Table of Contents



9. Intangible Assets, Net
 As of December 31,2008
    
    
    2009$
    
    
    $Intangible assets not subject to amortization
are comprised of the following:Trademark
    
    
    698,133
    
    
    
    698,787Intangible assets subject to amortization are
comprised of the following:Customer contracts
    
    
    5,192,903
    
    
    
    3,353,240Non-compete agreements
    
    
    998,912
    
    
    
    1,612,112Computer software licenses
    
    
    850,976
    
    
    
    2,027,248License agreements with SINA
    
    
    
    
    
    
    80,660,000Advertising agency agreement
    
    
    
    
    
    
    106,790,000Database license
    
    
    
    
    
    
    8,300,000Customer relationship
    
    
    
    
    
    
    5,788,603Favorable lease term
    
    
    
    
    
    
    2,428,1107,042,791
    
    
    
    210,959,313Less: Accumulated amortizationCustomer contracts
    
    
    (3,951,845
    )
    
    
    (2,903,452
    )Non-compete agreements
    
    
    
    
    
    
    (388,634
    )Computer software licenses
    
    
    (355,874
    )
    
    
    (661,625
    )License agreements with SINA
    
    
    
    
    
    
    (2,016,500
    )Advertising agency agreement
    
    
    
    
    
    
    (2,617,402
    )Database license
    
    
    
    
    
    
    (244,118
    )Customer relationship
    
    
    
    
    
    
    (40,622
    )Favorable lease term
    
    
    
    
    
    
    (91,054
    )Intangible assets subject to amortization, net
    
    
    2,735,072
    
    
    
    201,995,906Total intangible assets, net
    
    
    3,433,205
    
    
    
    202,694,693
   F-27




---



##### Table of Contents



10. Goodwill
  Primary
    
    
    Secondary
    
    
    Real estatereal estate
    
    
    real estate
    
    
    information
    
    
    Real estate
    
    
    Real estateagency
    
    
    brokerage
    
    
    and consulting
    
    
    advertising
    
    
    onlineservices
    
    
    services
    
    
    services
    
    
    services
    
    
    servicessegment
    
    
    segment
    
    
    segment
    
    
    segment
    
    
    segment
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Balance as of January 1, 2008
    
    
    2,481,073
    
    
    
    68,325
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,549,398Goodwill recognized upon
acquisition
    
    
    
    
    
    
    
    
    
    
    4,028,514
    
    
    
    674,847
    
    
    
    
    
    
    
    4,703,361Exchange rate translation
    
    
    200,305
    
    
    
    4,699
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    205,004Balance as of December 31, 2008
    
    
    2,681,378
    
    
    
    73,024
    
    
    
    4,028,514
    
    
    
    674,847
    
    
    
    
    
    
    
    7,457,763Goodwill recognized upon
acquisition
    
    
    
    
    
    
    
    
    
    
    322,275
    
    
    
    
    
    
    
    444,885,665
    
    
    
    445,207,940Exchange rate translation
    
    
    2,511
    
    
    
    68
    
    
    
    
    
    
    
    (8,590
    )
    
    
    
    
    
    
    (6,011
    )Balance as of December 31, 2009
    
    
    2,683,889
    
    
    
    73,092
    
    
    
    4,350,789
    
    
    
    666,257
    
    
    
    444,885,665
    
    
    
    452,659,692
  F-28




---



##### Table of Contents



11.
Other Non-Current Assets
  As of December 312008
    
    
    2009$
    
    
    $Advance payment for advertising placement, non-current
portion (note 5)
    
    
    2,889,702
    
    
    
    Advance payment for properties, non-current portion (note 4)
    
    
    7,791,586
    
    
    
    Other non-current assets
    
    
    4,337
    
    
    
    4,525,320Total
    
    
    10,685,625
    
    
    
    4,525,320
  12. Short-Term Borrowing
    13. Redeemable Convertible Preferred Shares
   Dividends
   F-29




---



##### Table of Contents



Redemption
  Conversion
  Voting rights
  Liquidation preference
  14. Repurchase of Shares
   F-30




---



##### Table of Contents



15. Other Income
 Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Gain from sale of marketable securities
    
    
    525,220
    
    
    
    405,781
    
    
    
    3,436,713Project management fees
    
    
    339,181
    
    
    
    
    
    
    
    Government subsidies
    
    
    
    
    
    
    1,247,468
    
    
    
    4,759,411Reimbursement income from depository agent
    
    
    
    
    
    
    778,196
    
    
    
    626,888Loss from sales of property
    
    
    
    
    
    
    
    
    
    
    (121,639
    )Foreign exchange gain (loss)
    
    
    (666,509
    )
    
    
    (460,964
    )
    
    
    78,997Total other income
    
    
    197,892
    
    
    
    1,970,481
    
    
    
    8,780,370
  16. Income Tax
  Years Ended December 312007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Current TaxPRC
    
    
    13,127,387
    
    
    
    9,328,732
    
    
    
    29,967,894Other
    
    
    
    
    
    
    1,549,525
    
    
    
    48,96113,127,387
    
    
    
    10,878,257
    
    
    
    30,016,855Deferred TaxPRC
    
    
    (2,850,347
    )
    
    
    (2,165,699
    )
    
    
    (10,092,774
    )Other
    
    
    
    
    
    
    
    
    
    
    (2,850,347
    )
    
    
    (2,165,699
    )
    
    
    (10,092,774
    )Income tax expense
    
    
    10,277,040
    
    
    
    8,712,558
    
    
    
    19,924,081
  F-31




---



##### Table of Contents



F-32




---



##### Table of Contents



As of December 312008
    
    
    2009$
    
    
    $Deferred tax assets:Accrued salary expenses
    
    
    1,682,580
    
    
    
    7,099,622Bad debt provision
    
    
    740,439
    
    
    
    4,374,469Net operating loss carryforwards
    
    
    5,537,472
    
    
    
    3,553,681Other
    
    
    497,831
    
    
    
    313,578Gross deferred tax assets
    
    
    8,458,322
    
    
    
    15,341,350Valuation allowance
    
    
    (3,207,372
    )
    
    
    (157,085
    )Total deferred tax assets
    
    
    5,250,950
    
    
    
    15,184,265Analysis as:Current
    
    
    3,815,688
    
    
    
    13,337,020
  F-33




---



##### Table of Contents



As of December 312008
    
    
    2009$
    
    
    $Non-current
    
    
    1,435,262
    
    
    
    1,847,245Deferred tax liabilities:Amortization of intangible and other assets
    
    
    705,980
    
    
    
    42,326,523Total deferred tax liabilities
    
    
    705,980
    
    
    
    42,326,523Analysis as:Current
    
    
    
    
    
    
    Non-current
    
    
    705,980
    
    
    
    42,326,523
  2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Balance as of January 1,
    
    
    994,564
    
    
    
    2,015,366
    
    
    
    3,207,372Additions
    
    
    1,005,463
    
    
    
    1,847,356
    
    
    
    28,273Business acquisition
    
    
    
    
    
    
    
    
    
    
    292,638Releases
    
    
    (91,077
    )
    
    
    (827,828
    )
    
    
    (3,372,782
    )Changes due to foreign exchange
    
    
    106,416
    
    
    
    172,478
    
    
    
    1,584Balance as of December 31,
    
    
    2,015,366
    
    
    
    3,207,372
    
    
    
    157,085
   Year Ended December 31,2007
    
    
    2008
    
    
    2009PRC income tax rate
    
    
    33.00
    %
    
    
    25.00
    %
    
    
    25.00
    %Expenses not deductible for tax purposes
    
    
    1.08
    %
    
    
    0.48
    %
    
    
    0.31
    %Tax exemption granted to group
    
    
    (1.66
    %)
    
    
    
    
    
    
    Effect of lower rates in certain domestic locations
    
    
    (14.35
    %)
    
    
    (9.13
    %)
    
    
    (6.79
    %)Effect of different tax rate of subsidiary
operation in other jurisdiction
    
    
    (0.46
    %)
    
    
    (0.37
    %)
    
    
    1.68
    %Effect of new income tax law
    
    
    (0.70
    %)
    
    
    Valuation allowance movement
    
    
    2.11
    %
    
    
    2.23
    %
    
    
    (2.90
    %)19.02
    %
    
    
    18.21
    %
    
    
    17.30
    %
  F-34




---



##### Table of Contents



Year Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $The aggregate dollar effect
    
    
    633,549
    
    
    
    
    
    
    
    1,433,584Per share effect basic
    
    
    0.01
    
    
    
    
    
    
    
    0.02Per share effectdiluted
    
    
    0.01
    
    
    
    
    
    
    
    0.02
   17. Share-Based Compensation
   Share Options:
   F-35




---



##### Table of Contents



2007
    
    
    2008Average risk-free rate of return
    
    
    4.76
    %
    
    
    3.98
    %Contractual life of option
    
    10 years
    
    
    10 yearsAverage estimated volatility rate
    
    
    62.7
    %
    
    
    59.3
    %Average dividend yield
    
    
    0.00
    %
    
    
    0.00
    %
      WeightedWeighted
    
    
    averageaverage
    
    
    remaining
    
    
    AggregateNumber of
    
    
    exercise
    
    
    contractual
    
    
    intrinsicoptions
    
    
    price
    
    
    term
    
    
    value of options$
    
    
    
    
    
    
    $Outstanding, as of January 1, 2009
    
    
    2,314,166
    
    
    
    5.39Granted
    
    
    Exercised
    
    
    (509,562
    )
    
    
    5.40Forfeited
    
    
    (45,167
    )
    
    
    5.37Cancelled
    
    
    Outstanding, as of December 31, 2009
    
    
    1,759,437
    
    
    
    5.38
    
    
    
    8.0
    
    
    
    22,411,580Vested and expected to vest as of
December 31, 2009
    
    
    1,654,984
    
    
    
    5.38
    
    
    
    7.9
    
    
    
    21,079,810Exercisable as of December 31, 2009
    
    
    602,605
    
    
    
    5.38
    
    
    
    7.9
    
    
    
    7,674,968
  F-36




---



##### Table of Contents



Restricted Shares:
   No. of
    
    
    Weighted averagerestricted shares
    
    
    grant-date fair value$Unvested as of January 1, 2009
    
    
    144,000
    
    
    
    1.39Granted
    
    
    931,000
    
    
    
    16.40Vested
    
    
    (144,000
    )
    
    
    1.39Forfeited
    
    
    
    
    
    
    Unvested as of December 31, 2009
    
    
    931,000
    
    
    
    16.40
       F-37




---



##### Table of Contents



Share Options:
   2009Average risk-free rate of return
    
    
    3.22
    %Contractual life of option
    
    10 yearsAverage estimated volatility rate
    
    
    71.79
    %Average dividend yield
    
    
    0.00
    %
    Replacement
of COHTs option with CRIC options (Options Replacement Program
   F-38




---



##### Table of Contents



2009Average risk-free rate of return
    
    
    2.47
    %Contractual life of option
    
    5.2 yearsAverage estimated volatility rate
    
    
    63.18
    %Average dividend yield
    
    
    0.00
    %
   WeightedWeighted
    
    
    averageaverage
    
    
    remaining
    
    
    AggregateNumber of
    
    
    exercise
    
    
    contractual
    
    
    intrinsicoptions
    
    
    price
    
    
    term
    
    
    value of options$
    
    
    
    
    
    
    $Outstanding, as of January 1, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Granted
    
    
    8,692,000
    
    
    
    4.23Replacement under the Options
Replacement Program
    
    
    3,609,000
    
    
    
    0.64Exercised
    
    
    Forfeited
    
    
    (154,500
    )
    
    
    4.43Modified
    
    
    (504,500
    )
    
    
    3.00Cancelled
    
    
    (300,000
    )
    
    
    3.50Outstanding, as of December 31, 2009
    
    
    11,342,000
    
    
    
    3.16
    
    
    
    7.86
    
    
    
    88,649,505Vested and expected to vest as of
December 31, 2009
    
    
    10,681,370
    
    
    
    3.16
    
    
    
    7.86
    
    
    
    83,485,999Exercisable as of December 31, 2009
    
    
    615,469
    
    
    
    0.64
    
    
    
    4.97
    
    
    
    6,361,154
   F-39




---



##### Table of Contents



Restricted Shares:
  No. of
    
    
    Weighted averagerestricted shares
    
    
    grant-date fair value$Unvested as of January 1, 2009
    
    
    
    
    
    
    Granted
    
    
    300,000
    
    
    
    2.59Vested
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    Unvested as of December 31, 2009
    
    
    300,000
    
    
    
    2.59
   18. Employee Benefit Plans
  19. Distribution of Profits
     F-40




---



##### Table of Contents



20. Segment Information
       F-41




---



##### Table of Contents



Secondary real
    
    
    Real estatePrimary real
    
    
    estate
    
    
    information
    
    
    Real estate
    
    
    Real estateestate agency
    
    
    brokerage
    
    
    and consulting
    
    
    advertising
    
    
    online
    
    
    Real estate fund2009
    
    services
    
    
    services
    
    
    services
    
    
    services
    
    
    services
    
    
    management
    
    
    Non-allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues from external customers
    
    
    183,154,000
    
    
    
    28,447,714
    
    
    
    61,707,295
    
    
    
    11,399,710
    
    
    
    13,829,937
    
    
    
    1,000,000
    
    
    
    
    
    
    
    299,538,656Cost of revenues
    
    
    (55,655,737
    )
    
    
    (1,877,546
    )
    
    
    (1,865,697
    )
    
    
    (6,014,185
    )
    
    
    (4,930,280
    )
    
    
    
    
    
    
    
    
    
    
    (70,343,445
    )Selling, general and administrative expenses
    
    
    (47,241,533
    )
    
    
    (26,123,163
    )
    
    
    (22,723,019
    )
    
    
    (5,690,497
    )
    
    
    (11,359,944
    )
    
    
    (647,754
    )
    
    
    (11,935,269
    )
    
    
    (125,721,179
    )Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    2,100,832
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,100,832Income (loss) from operations
    
    
    80,256,730
    
    
    
    447,005
    
    
    
    39,219,411
    
    
    
    (304,972
    )
    
    
    (2,460,287
    )
    
    
    352,246
    
    
    
    (11,935,269
    )
    
    
    105,574,864Interest expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (215,854
    )
    
    
    (215,854
    )Interest income
    
    
    591,772
    
    
    
    29,130
    
    
    
    166,521
    
    
    
    27,635
    
    
    
    23,722
    
    
    
    1,922
    
    
    
    198,087
    
    
    
    1,038,789Other income(expense), net
    
    
    1,842,672
    
    
    
    279,030
    
    
    
    2,481,451
    
    
    
    
    
    
    
    5,814
    
    
    
    (1,810
    )
    
    
    4,173,213
    
    
    
    8,780,370Income (loss) before taxes and equity in an associate
    
    
    82,691,174
    
    
    
    755,165
    
    
    
    41,867,383
    
    
    
    (277,337
    )
    
    
    (2,430,751
    )
    
    
    352,358
    
    
    
    (7,779, 823
    )
    
    
    115,178,169Income tax benefit (expense)
    
    
    (15,981,753
    )
    
    
    2,204,395
    
    
    
    (6,710,032
    )
    
    
    (553,666
    )
    
    
    957,085
    
    
    
    159,890
    
    
    
    
    
    
    
    (19,924,081
    )Income (loss) before equity in affiliates
    
    
    66,709,421
    
    
    
    2,959,560
    
    
    
    35,157,351
    
    
    
    (831,003
    )
    
    
    (1,473,666
    )
    
    
    512, 248
    
    
    
    (7,779, 823
    )
    
    
    95,254,088Income from investment in affiliates
    
    
    112,628
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,015,607
    
    
    
    
    
    
    
    
    
    
    
    22,128,235Net income (loss)
    
    
    66,822,049
    
    
    
    2,959,560
    
    
    
    35,157,351
    
    
    
    (831,003
    )
    
    
    20,541,941
    
    
    
    512, 248
    
    
    
    (7,779,823
    )
    
    
    117,382,323
  F-42




---



##### Table of Contents



Secondary
    
    
    Real estate
    
    
    
    
    
    
    Real estatePrimary real
    
    
    real estate
    
    
    information
    
    
    Real estate
    
    
    fundestate agency
    
    
    brokerage
    
    
    and consulting
    
    
    advertising
    
    
    management2008

    

    services
    
    

    services
    
    

    services
    
    

    services
    
    

    and others
    
    

    Non-allocated
    
    

    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues
    
    
    88,601,982
    
    
    
    14,836,943
    
    
    
    49,116,061
    
    
    
    932,469
    
    
    
    1,000,000
    
    
    
    
    
    
    
    154,487,455Cost of revenues
    
    
    (27,232,660
    )
    
    
    (1,725,941
    )
    
    
    (2,855,398
    )
    
    
    (41,849
    )
    
    
    
    
    
    
    
    
    
    
    (31,855,848
    )Selling, general and
administrative expenses
    
    
    (34,075,314
    )
    
    
    (20,209,062
    )
    
    
    (13,776,504
    )
    
    
    (1,865,669
    )
    
    
    (463,351
    )
    
    
    (6,807,731
    )
    
    
    (77,197,631
    )Income (loss) from operations
    
    
    27,294,008
    
    
    
    (7,098,060
    )
    
    
    32,484,159
    
    
    
    (975,049
    )
    
    
    536,649
    
    
    
    (6,807,731
    )
    
    
    45,433,976Interest expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,420,468
    )
    
    
    (2,420,468
    )Interest income
    
    
    551,576
    
    
    
    30,475
    
    
    
    415,512
    
    
    
    3,779
    
    
    
    4,373
    
    
    
    2,056,798
    
    
    
    3,062,513Other income (expense), net
    
    
    1,422,744
    
    
    
    22,483
    
    
    
    (1,323,858
    )
    
    
    
    
    
    
    
    
    
    
    1,849,112
    
    
    
    1,970,481Income (loss) before taxes
and equity in an associate
    
    
    29,268,328
    
    
    
    (7,045,102
    )
    
    
    31,575,813
    
    
    
    (971,270
    )
    
    
    541,022
    
    
    
    (5,322,289
    )
    
    
    48,046,502Income tax benefit (expense)
    
    
    (4,153,861
    )
    
    
    52,535
    
    
    
    (4,917,503
    )
    
    
    196,488
    
    
    
    109,783
    
    
    
    
    
    
    
    (8,712,558
    )Income (loss) before equity in affiliates
    
    
    25,114,467
    
    
    
    (6,992,567
    )
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    650,805
    
    
    
    (5,322,289
    )
    
    
    39,333,944Income from investment in affiliates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    153,700
    
    
    
    153,700Net income (loss)
    
    
    25,114,467
    
    
    
    (6,992,567
    )
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    650,805
    
    
    
    (5,168,589
    )
    
    
    39,487,644
  F-43




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##### Table of Contents



Secondary
    
    
    Real estatePrimary real
    
    
    real estate
    
    
    informationestate agency
    
    
    brokerage
    
    
    and consulting2007
    
    services
    
    
    services
    
    
    services
    
    
    Non-allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues from
external customers
    
    
    100,932,992
    
    
    
    11,888,443
    
    
    
    8,195,165
    
    
    
    
    
    
    
    121,016,600Cost of revenues
    
    
    (22,614,660
    )
    
    
    
    
    
    
    (895,405
    )
    
    
    
    
    
    
    (23,510,065
    )Selling, general
and administrative
expenses
    
    
    (23,195,466
    )
    
    
    (14,997,248
    )
    
    
    (4,985,048
    )
    
    
    (2,368,038
    )
    
    
    (45,545,800
    )Income (loss) from
operations
    
    
    55,122,866
    
    
    
    (3,108,805
    )
    
    
    2,314,712
    
    
    
    (2,368,038
    )
    
    
    51,960,735Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (621,903
    )
    
    
    (621,903
    )Interest income
    
    
    693,975
    
    
    
    36,274
    
    
    
    192,961
    
    
    
    1,566,458
    
    
    
    2,489,668Other income
(expense), net
    
    
    406,452
    
    
    
    96,372
    
    
    
    (156,825
    )
    
    
    (148,107
    )
    
    
    197,892Income (loss)
before taxes
    
    
    56,223,293
    
    
    
    (2,976,159
    )
    
    
    2,350,848
    
    
    
    (1,571,590
    )
    
    
    54,026,392Income tax benefit
(expense)
    
    
    (9,987,535
    )
    
    
    (4,506
    )
    
    
    (284,999
    )
    
    
    
    
    
    
    (10,277,040
    )Net income (loss)
    
    
    46,235,758
    
    
    
    (2,980,665
    )
    
    
    2,065,849
    
    
    
    (1,571,590
    )
    
    
    43,749,352
 Geographic
  Major customers
  Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Customer A
    
    
    *
    
    
    
    32,498,047
    
    
    
    70,541,996Customer B
    
    
    25,478,208
    
    
    
    *
    
    
    
    *Customer C
    
    
    17,710,007
    
    
    
    *
    
    
    
    *
 *
    
    Indicates the revenue from these customers was less than 10% in the stated periods.  F-44




---



##### Table of Contents



Years Ended December 31,2008
    
    
    2009$
    
    
    $Customer B
    
    
    20,533,748
    
    
    
    19,021,127
 *
    
    Indicates the accounts receivable from the customer was less than 10% as at the stated year end.  Years Ended December 31,2008
    
    
    2009$
    
    
    $Customer F
    
    
    *
    
    
    
    13,912,841Customer G
    
    
    *
    
    
    
    7,322,550Customer H
    
    
    *
    
    
    
    7,322,550Customer I
    
    
    *
    
    
    
    4,393,530Customer A
    
    
    29,262,800
    
    
    
    *Customer D
    
    
    14,631,400
    
    
    
    *Customer E
    
    
    9,949,352
    
    
    
    *
 *
    
    Indicates the customer deposits from customers was less than 10% as at the stated year end. 21. Related Party Balances and Transactions
  As of December 31,2008
    
    
    2009$
    
    
    $Customer and supplier
    
    
    386,857
    
    
    
    17,146Other
    
    
    362,217
    
    
    
    1,025,157Total amounts due from related parties
    
    
    749,074
    
    
    
    1,042,303
  F-45




---



##### Table of Contents



As of December 31,2008
    
    
    2009$
    
    
    $Management
    
    
    (475,204
    )
    
    
    (1,050,000
    )Other
    
    
    (146,314
    )
    
    
    Total amounts due to related parties
    
    
    (621,518
    )
    
    
    (1,050,000
    )
 (a) Customer and supplier
  Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Revenue  Shanghai
Yueshun Real Estate
Development Co.,
Ltd.
    
    
    2,801,505
    
    
    
    321
    
    
    
    102,708
 As of December 31,2008
    
    
    2009$
    
    
    $Accounts receivable  Shanghai Yueshun Real Estate Development Co., Ltd.
    
    
    386,857
    
    
    
    17,146
  (b) Management
  (c) Affiliates
 As of December 312008
    
    
    2009$
    
    
    $E-House
China Real Estate Investment Fund I, L.P. (1)
    
    
    
    
    
    
    1,025,157E-House Property Investment 1 (China) Limited (2)
    
    
    362,217
    
    
    
    Total amounts due from other related parties
    
    
    362,217
    
    
    
    1,025,157Shanghai Jin Yue Real Estate Development Co., Ltd. (3)
    
    
    (146,314
    )
    
    
    Total amounts payable to other related parties
    
    
    (146,314
    )
    
    
    
  F-46




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##### Table of Contents



Notes:(1)
    
    Entity is partially owned by Xin Zhou and Neil Nanpeng Shen, directors
of the Company (note (d) below). The amount receivable represents
payment made on behalf of E-House China Real Estate Investment Fund
I, L.P.. The amount is unsecured, interest
free and has no fixed repayment term. The amount was repaid in March
2010.(2)
    
    Entity is partially owned by Xin Zhou and Neil Nanpeng Shen, directors
of the Company. In connection with a primary real estate project, the
entity contributed 50% of the customer deposit paid to the developer
client and is entitled to 50% of the projects profits. For the years
ended December 31, 2007, E-House Property Investment 1 (China) Limited
had earned $1,621,998 from the project, all of which was recorded as
cost of sales and was payable as of December 31, 2007. The Company was
entitled to $339,181 in fund management fees from the project, all of
which was recorded as other income and as a receivable as of December
31, 2007.(3)
    
    Xin Zhou is a director of the entity. The amount payable represents a
loan to the Company. The amount is unsecured, interest free and has no
fixed repayment term. (d) Real Estate Investment Fund Management
   (e) Other related party transactions
  22. Commitments
and Contingencies
 (a) Operating lease commitments
   F-47




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##### Table of Contents



Year ending December 31
    
    $2010
    
    
    8,195,9732011
    
    
    4,316,5992012
    
    
    2,228,0612013
    
    
    1,009,9782014
    
    
    530,809Total
    
    
    16,281,420
 (b) Contingencies
   23. Subsequent Events
     F-48