**Exhibit 4.1**

 

**CHINAEDUCORPORATION**

 

**EQUITYINCENTIVE PLAN**

 

**ARTICLE 1**

 

**PURPOSE**

 

The purpose of thisEquity Incentive Plan (the “Plan”) is to attract qualified personnel and to andretain their service with CHINAEDU Corporation (the “Company”) and its Subsidiaries(hereinafter defined), and to provide such persons with an ownership interestin the Company through the granting of stock options, restricted stock andrestricted stock units that will:

 

(a)                                  increase the interest of the employees,non-employee directors and consultants in the Company’s and its Subsidiaries’welfare;

(b)                                 furnish an incentive to those employees,non-employee directors and consultants to continue their services for theCompany; and

(c)                                  provide a means through which the Companyand its Subsidiaries may attract able persons to provide services to them.

 

**ARTICLE 2**

 

**DEFINITIONS**

 

For the purpose of thePlan, unless the context requires otherwise, the following terms shall have themeanings indicated:

 
| “Affiliate” |   | With respect to the  Company, any company or other trade or business that controls, is controlled  by or is under common control with the Company within the meaning of  Rule 405 of Regulation C under the Securities Act, including, without  limitation, any Subsidiary. For purposes of granting stock options, an entity  may not be considered an Affiliate unless the Company holds a “controlling  interest” in such entity, where the term “controlling interest” has the same  meaning as provided in Treasury Regulation 1.414(c)-2(b)(2)(i), provided that  the language “at least 50 percent” is used instead of “at least 80 percent”  and, provided further, that where granting of stock options is based upon a  legitimate business criteria, the language “at least 20 percent” is used  instead of “at least 80 percent” each place it appears in Treasury Regulation  1.414(c)-2(b)(2)(i) |
|-----------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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| “American Depositary  Receipts” or “ADRs” |   | A physical certificate  evidencing ownership in American Depositary Shares, issued by the Depositary  and listed on an established national or regional stock exchange or is  publicly traded on an established securities market in the United States                                                                                                                                               |
|---------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “American Depositary  Shares” or “ADSs”   |   | An equity right  representing the means an equity right representing one or more Shares of the  Company, or a fraction of a Share of the Company, held on deposit by the  Custodian, which carries the corporate and economic rights of the Shares of  the Company, subject to the terms specified on the American Depositary  Receipt                                                               |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Applicable Laws”                                   |   | The legal requirements  relating to the Plan and the Awards under applicable provisions of the  corporate, securities, tax and other laws, rules, regulations and government  orders, and the rules of any applicable stock exchange or national  market system, of any jurisdiction applicable to Awards granted to residents  therein                                                         |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Award”                                             |   | A grant of an Option,  Restricted Stock or Restricted Stock Unit under the Plan                                                                                                                                                                                                                                                                                                                      |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Award Agreement”                                   |   | The Agreement between  the Company and a Grantee that evidences and sets out the terms of a Grant                                                                                                                                                                                                                                                                                                    |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Benefit Arrangement”                               |   | Shall have the meaning  set forth in Article 27                                                                                                                                                                                                                                                                                                                                                 |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Board”                                             |   | The Board of Directors  of the Company                                                                                                                                                                                                                                                                                                                                                               |
|                                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                 |
| “Change of Control”                                 |   | (i) the  dissolution or liquidation of the Company or a merger, consolidation, or  reorganization of the Company with one or more other entities in which the  Company is not the surviving entity, (ii) a sale of substantially all of  the assets of the Company to another person or entity, or (iii) any  transaction (including without limitation a merger or reorganization in |

 

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|                                |   | which the Company is  the surviving entity) which results in any person or entity owning 50% or  more of the combined voting power of all classes of shares of the Company                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|-------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Code”                    |   | means the Internal  Revenue Code of 1986, as now in effect or as hereafter amended                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Company”                 |   | CHINAEDU Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Compensation  Committee” |   | The Compensation  Committee established in accordance with Article 2.8 of the Fourth  Amended and Restated Shareholders Agreement, which Compensation Committee  shall be comprised of independent directors in accordance with NASDAQ rules.                                                                                                                                                                                                                                                                                                                                                                       |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Custodian”               |   | Hong Kong &  Shanghai Bank Corporation Limited or such other bank appointed by the Company  to hold any ADSs on deposit upon or after a public offering of the Shares                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Grant Date”              |   | The date on which  Restricted Stock, Restricted Stock Units or an Option is granted by  resolutions of the Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Depositary”              |   | The Bank of New York or  such other U.S. bank appointed by the Company to issues any ADRs upon or  after a public offering of the Shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| “Disability”              |   | The Grantee is unable  to perform each of the essential duties of such Grantee’s position by reason  of a medically determinable physical or mental impairment which is  potentially permanent in character or which can be expected to last for a  continuous period of not less than 12 months; provided, however, that, with  respect to rules regarding expiration of an Incentive Stock Option  following termination of the Grantee’s Service, Disability shall mean the  Grantee is unable to engage in any substantial gainful activity by reason of  a medically determinable physical or mental |

 

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|                          |   | impairment which can be  expected to result in death or which has lasted or can be expected to last  for a continuous period of not less than 12 months                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|-------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| “Effective Date”    |   | November 20, 2007,  the date the Plan was approved and adopted by the Board                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| “Exchange Act”      |   | The Securities Exchange  Act of 1934, as now in effect or as hereafter amended                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| “Fair Market Value” |   | The value of a Share,  determined as follows: if on the Grant Date or other determination date the  Shares are listed on an established national or regional stock exchange, or  are publicly traded on an established securities market, the Fair Market  Value of a Share shall be the closing price of a Share on such exchange or in  such market (if there is more than one such exchange or market the  Compensation Committee shall determine the appropriate exchange or market) on  the Grant Date or such other determination date (or if there is no such  reported closing price, the Fair Market Value shall be the mean between the  highest bid and lowest asked prices or between the high and low sale prices  on such trading day) or, if no sale of Shares is reported for such trading  day, on the next preceding day on which any sale shall have been reported. If  the Shares are not listed on such an exchange, or traded on such a market,  Fair Market Value shall be the value of the Shares as determined by the  Compensation Committee by the reasonable application of a reasonable  valuation method in a manner consistent with Code Section 409A |
|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| “Grant”             |   | An award of an Option,  Restricted Stock or Restricted Stock Units under the Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| “Grant Date”        |   | As determined by the  Compensation Committee, the latest to occur of (i) the date as of which  the Compensation Committee approves a Grant, (ii) the date                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

 

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|                                   |   | on which the recipient  of a Grant first becomes eligible to receive a Grant or (iii) such other  date as may be specified by the Compensation Committee.                                                                      |
|----------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                   |   |                                                                                                                                                                                                                                |
| “Grantee”                    |   | Person who receives or  holds a Grant under the Plan                                                                                                                                                                                |
|                                   |   |                                                                                                                                                                                                                                |
| “Incentive Stock  Option”    |   | An “incentive stock  option” within the meaning of Section 422 of the Code, or the  corresponding provision of any subsequently enacted tax statute, as amended  from time to time                                   |
|                                   |   |                                                                                                                                                                                                                                |
| “IPO”                        |   | The initial sale to the  general public of the Shares pursuant to a registration statement filed with  and declared effective by the U.S. Securities and Exchange Commission                                                        |
|                                   |   |                                                                                                                                                                                                                                |
| “Nonqualified Stock  Option” |   | A stock option that is  not an Incentive Stock Option                                                                                                                                                                               |
|                                   |   |                                                                                                                                                                                                                                |
| “Option”                     |   | An option to purchase  one or more Shares pursuant to the Plan                                                                                                                                                                      |
|                                   |   |                                                                                                                                                                                                                                |
| “Option Period”              |   | The period that the  Option may be exercised as specified by the Compensation Committee                                                                                                                                             |
|                                   |   |                                                                                                                                                                                                                                |
| “Option Price”               |   | The price per Share  payable on the exercise of an Option, such price as from time to time  specified by resolutions of the Directors                                                                                               |
|                                   |   |                                                                                                                                                                                                                                |
| “Other Agreement”            |   | Shall have the meaning  set forth in Article 27                                                                                                                                                                                |
|                                   |   |                                                                                                                                                                                                                                |
| “Plan”                       |   | This CHINAEDU  Corporation Third Amended and Restated Stock Option Plan, in its present form  or as from time to time amended in accordance with the provisions hereof and  subject to the provisions of the Shareholders Agreement |
|                                   |   |                                                                                                                                                                                                                                |
| “Purchase Price”             |   | The purchase price for  each share of Stock pursuant to a grant of Restricted Stock or Restricted  Stock Unit                                                                                                                       |

 

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| “Reporting Person”        |   | A person who is  required to file reports under Section 16(a) of the Exchange Act                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Restricted Stock”        |   | Shares awarded to a  Grantee pursuant to this Plan, that are subject to restrictions and to a risk  of forfeiture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Restricted Stock Unit”   |   | A bookkeeping entry  representing the equivalent of one Share awarded to a Grantee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Securities Act”          |   | The Securities Act of  1933, as now in effect or as hereafter amended                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Service”                 |   | Service as an employee,  officer, director or other Service Provider of the Company or an Affiliate.  Unless otherwise stated in the applicable Award Agreement, a Grantee’s change  in position or duties shall not result in interrupted or terminated Service,  so long as such Grantee continues to be an employee, officer, director or  other Service Provider of the Company or an Affiliate. Subject to the  preceding sentence, whether a termination of Service shall have occurred for  purposes of the plan shall be determined by the Compensation Committee, which  determination shall be final, binding and conclusive |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Shareholders  Agreement” |   | The Fourth Amended and  Restated Shareholders Agreement entered into by and among the Company and  various shareholders of the Company on or about March 9, 2007                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Shares”                  |   | The ordinary shares,  $.01 par value per share, of the Company. Upon an IPO, “Shares” shall also  mean the ADSs to be issued by the Company in satisfaction of awards over  Shares granted under the Plan                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Subsidiary”              |   | Any corporation,  association or other business entity of which securities representing more  than fifty percent (50%) of the combined voting power of the total voting  stock (or in the case of an association or other business entity which                                                                                                                                                                                                                                                                                                                                                                                             |

 

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|                                 |   | is not a corporation,  more than fifty percent (50%) of the equity interest) is at the time owned or  controlled, directly or indirectly, by the Company or one or more  Subsidiaries of the Company or a combination thereof                                                                              |
|--------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                 |   |                                                                                                                                                                                                                                                                                                       |
| “Ten-Percent  Shareholder” |   | An individual who owns  more than ten percent (10%) of the total combined voting power of all classes  of outstanding shares of the Company, its parents or any of its Subsidiaries.  In determining share ownership, the attribution rules of Section 424(d) of  the Code shall be applied |
|                                 |   |                                                                                                                                                                                                                                                                                                       |
| “U.S. Grantee”             |   | Any Grantee who is or  becomes a taxpayer in the United States                                                                                                                                                                                                                                             |

 

**ARTICLE 3**

 

**ADMINISTRATION**

 

The Plan shall beadministered by the Compensation Committee. Each determination, interpretationor other action made or taken by the Compensation Committee pursuant to theprovisions of the Plan will be conclusive and binding for all purposes and onall persons.  In the event that the Plan, any Grant or any Award Agreemententered into hereunder provides for any action to be taken by or determinationto be made by the Compensation Committee, such action may be taken by or suchdetermination may be made by the full Board.  To the extent permitted bylaw, the Compensation Committee may upon resolution delegate some or all of itsauthority and powers with respect to the administration of the Plan to one ormore members of the Board pursuant to such conditions or limitations as theCompensation Committee may establish in such resolution

 

Any vacancy occurring inthe membership of the Compensation Committee may be filled by appointment bythe Board in accordance with Article 2.8 of the ShareholdersAgreement.  The Compensation Committee shall select one of its members toact as its Chairman and shall make such rules and regulations for itsoperation, as it deems appropriate. Not less than half the total numbers ofdirectors appointed to the Compensation Committee present shall constitute aquorum, and the act of a majority of the members of the Compensation Committeepresent at a meeting at which a quorum is present shall be the act of theCompensation Committee. The Compensation Committee shall determine anddesignate from time the employees to whom Awards will be granted (including thenumber of shares subject to each Award), interpret the Plan, prescribe, amend,and rescind any rules and regulations necessary or appropriate for theadministration of the Plan, and make such other determinations and take suchother action as it deems necessary or advisable. Any interpretation,determination, or other action made or taken by the Compensation Committeeshall be final, binding, and conclusive on all interested parties.

 

Furthermore, if theCompany is required to prepare an accounting restatement due to the materialnoncompliance of the Company, as a result of misconduct, with any financialreporting requirement

 

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under the securitieslaws, the individuals subject to automatic forfeiture under Section 304 ofthe Sarbanes-Oxley Act of 2002 and any Grantee who knowingly engaged in themisconduct, was grossly negligent in engaging in the misconduct, knowinglyfailed to prevent the misconduct or was grossly negligent in failing to preventthe misconduct, shall reimburse the Company the amount of any payment insettlement of an Award earned or accrued during the twelve (12) month periodfollowing the first public issuance or filing with the United States Securitiesand Exchange Commission (whichever first occurred) of the financial documentthat contained such material noncompliance.

 

In order to assure theviability of Awards granted to Grantees employed in various jurisdictions, theCompensation Committee may provide for such special terms as it may considernecessary or appropriate to accommodate differences in local law, tax policy,or custom applicable in the jurisdiction in which the Grantee resides or isemployed.  Moreover, the Compensation Committee may approve such supplementsto, or amendments, restatements, or alternative versions of, the Plan as it mayconsider necessary or appropriate for such purposes without thereby affectingthe terms of the Plan in effect for any other purpose; *provided, however*, that no such supplements,amendments, restatements, or alternative versions shall increase the sharelimitations contained in Article 5 of the Plan.  Notwithstanding theforegoing, the Compensation Committee may not take any actions hereunder, andno Awards shall be granted, that would violate any Applicable Laws.

 

**Authority of the CompensationCommittee**

 

Subjectto the provisions of the Plan, the Compensation Committee shall have the fullauthority, in its sole discretion, to take any actions it deems necessary oradvisable for the administration of the Plan. Such actions shall include:

 

(i) selectingParticipants who are to receive Awards under the Plan;

 

(ii) determiningthe exercise price for any Options and the Fair Market Value;

 

(iii) determiningthe type, number, Grant Date, vesting requirements, duration and other featuresand conditions of such Awards;

 

(iv) approvingthe forms of agreements to be used under the Plan;

 

(v) amendingor modifying any outstanding Awards, but only in ways that will not be adverseto the award/option holder, including, without limitation, the repricing of anOption by reduction of the exercise price of an Option or thereplacement of an Option with cash or other award type that would betreated as a repricing under the rules of the stock exchange on which theShares are listed;

 

(vi) acceleratingthe vesting, or extending the post-termination exercise term, of Awards at anytime and under such terms and conditions as it deems appropriate;

 

(vii) interpretingthe Plan and any Award Agreement;

 

(viii) correctingany defect, supplying any omission or reconciling any inconsistency in the Planor any Award Agreement;

 

(ix) adoptingsuch rules or guidelines as it deems appropriate to implement the Plan;

 

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(x) authorizingany person to execute on behalf of the Company any instrument required toeffect the grant of an Award previously authorized by the Committee;

 

(xi) makingall other decisions relating to the operation of the Plan; and

 

(xii) adoptingsuch plans or subplans as may be deemed necessary or appropriate to comply withthe laws of certain countries, allow for tax-preferred treatment of the Awardsor otherwise provide for the participation by Participants who reside in suchcountries.

 

The CompensationCommittee’s determinations under the Plan shall be final and binding on allpersons.

 

**ARTICLE 4**

 

**ELIGIBILITY**

 

Any employee andnon-employee director of the Company or any of its Subsidiaries, as well as anyconsultant who performs Services for the Company or any of its Subsidiaries,whose judgment, initiative and efforts contributed or may be expected tocontribute to a successful performance of the Company or any of theSubsidiaries of the Company is eligible to participate in the Plan. However, An Incentive Stock Option may only be granted to employees and aNonqualified Stock Option may be granted to employees, non-employee directorsand consultants.

 

**ARTICLE5**

 

**SHARESSUBJECT TO PLAN**

 

Not more than 12,846,621Shares may be issued under this Plan (subject to this paragraph and Article 20(b) below),provided however that there shall be an annual increase to be added on January 1st each year in an amount equal to twopercent (2%) of the total number of shares of Shares of the Company outstandingon December 31st of the preceding calendar year (rounded down to thenearest whole share). The number of Shares that are subject to Options at anytime under this Plan shall not exceed the number of Shares that then remainavailable for issuance under this Plan.  The Company, during the term ofthe Plan, shall at all times reserve and keep available sufficient Shares tosatisfy the requirements of this Plan.  Shares offered under this Plan maybe authorized but unissued Shares or treasury Shares.  In the event thatShares previously issued under the Plan are reacquired by the Company, suchShares shall be added to the number of Shares then available for issuance underthis Plan.  In the event that an outstanding Option for any reason expiresor is canceled, the Shares allocable to the unexercised portion of such Optionshall be added to the number of Shares then available for issuance under thisPlan.

 

**ARTICLE6**

 

**STOCKOWNERSHIP LIMITATION**

 

No Incentive Stock Optionmay be granted under this Plan which would result in the aggregate number

 

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of Shares issued orissuable or which may be issuable under this Plan to exceed ten per cent (10%)of the issued share capital of the Company at the time of granting of theOption (excluding any shares to be issued upon exercise of the Options; *provided, however,* that this limitationwill not apply if the exercise price is at least 110% of the fair market valueof the Share on the Grant Date and the Option Period is not greater than fiveyears from the Grant Date).

 

Nonqualified StockOptions are not subject to the restrictions set forth in this Article.

 

**ARTICLE7**

 

**LIMITATIONON CERTAIN TERMS OF OPTIONS**

 

Subject to the terms ofthe Plan, the Compensation Committee shall determine the provisions, terms, andconditions of each Option including, but not limited to, the Option vestingschedule, forfeiture provisions, form of payment upon settlement of the Option,payment contingencies, and satisfaction of any performance criteria, *provided*, *however*; that unless approved by theCompensation Committee (i) no Option vesting schedule shall be less thanthree (3) years and (ii) no acceleration for Option vesting scheduleshall be permitted.  The performance criteria established by theCompensation Committee may be based on any one of, or combination of, increasein share price, earnings per share, total shareholder return, return on equity,return on assets, return on investment, net operating income, cash flow,revenue, economic value added, personal management objectives, or other measureof performance selected by the Compensation Committee.

 

**ARTICLE 8**

 

** ALLOTMENTOF SHARES**

 

The grant of an Option toa Grantee shall not be deemed either to entitle the Grantee to, or to disqualifythe Grantee from, participation in any other grant of Options under the Plan.

 

**ARTICLE9**

 

**GRANTOF OPTIONS**

 

All Options under thePlan shall be granted by the Compensation Committee.  The grant of Optionsshall be evidenced by stock option agreements setting forth the total number ofshares subject to the Option, the exercise price, the term of the Option, theGrant Date, and such other terms and provisions as are approved by theCompensation Committee.  Options may be granted in different classes. TheCompany shall execute appropriate stock option agreements with the Granteesafter approval of the issuance of stock option grants.

 

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**ARTICLE10**

 

**EXERCISEPRICE**

 

The exercise price for anOption shall not be less than 100% of the Fair Market Value per share of theShare on the Grant Date. The Compensation Committee shall determine the FairMarket Value of the Share on the Grant Date and shall set forth thedetermination in its minutes.

 

**ARTICLE11**

 

**OPTIONPERIOD**

 

Each Option shallterminate upon the expiration of ten years from the Grant Date, or under suchcircumstances and on such date prior thereto as is set forth in the Plan or asmay be fixed by the Compensation Committee and stated in the Award Agreementrelating to such Option; provided, however, that in the event that the Granteeis a Ten-Percent Shareholder, an Option granted to such Grantee that isintended to be an Incentive Stock Option shall not be exercisable after theexpiration of five years from its Grant Date.  No Option granted under thePlan may be exercised at any time after the Option Period.

 

**ARTICLE12**

 

**TERMINATIONOF EMPLOYMENT, DIRECTORSHIP**

**ORCONSULTANCY SERVICES**

 

In the event a Granteeshall cease to provide Services to the Company or its Subsidiaries, suchGrantee’s Options shall be terminated as follows:

 

(a)          ***Death.***In the event of death while the Granteesare providing services, the Option may be exercised, for a period of one (1) yearafter the Grantee’s death or until expiration of the Option Period (if sooner)to the extent of the shares with respect to which the Option could have beenexercised by the Grantee on the date of the Grantee’s death; such Option mayonly be exercised by the personal representative of the Grantee’s estate or bythe person who acquired the right to exercise the Option by bequest orinheritance or by reason of the Grantee’s death.

 

(b)         ***Disability.***  In the event of termination ofservices due to Disability, the Option may be exercised by the Grantee or hisor her guardian for a period of one (1) year after such termination oruntil expiration of the Option Period (if sooner), to the extent of the shareswith respect to which the Option could have been exercised by the Grantee onthe date of such termination.

 

(c)          ***Termination forOther Reasons.*** In the event of termination of services for reasons other than as set forth insubparagraphs (a) and (b) above, the Option may be exercised byGrantee for a period of 90 days after the Grantee’s termination or untilexpiration of the Option Period (if sooner), to the extent of the shares withrespect to which the Option could have been vested by the Grantee on the dateof termination.

 

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Notwithstanding theforegoing, the Compensation Committee may grant Options not subject to thetermination provisions in the Articles.  In addition, the CompensationCommittee may waive the requirements set forth in this Article withrespect to any Grantee.

 

**ARTICLE13**

 

**EXERCISE OF OPTIONS**

 

Options granted under thePlan may be exercised during the Option Period, at such times and in suchamounts, in accordance with the terms and conditions and subject to suchrestrictions as are set forth in the applicable Agreements.  Subject to Article 7hereof, if the Compensation Committee imposes conditions upon exercise, thensubsequent to the Grant Date the Compensation Committee may, also in its solediscretion, accelerate the date on which all or any portion of the Options maybe exercised.

 

**ARTICLE14**

 

**NON-ASSIGNABILITY**

 

An Option granted to aGrantee may not be transferred or assigned other than by will or by the laws ofdescent and distribution.  If the Grantee attempts to alienate, assign,pledge, hypothecate or otherwise dispose of his Option or any right thereunder,except as provided for in this Plan or the stock option agreement, or in theevent of any levy, attachment, execution or similar process upon the right orinterest conferred by this Plan or the stock option agreement, the CompensationCommittee may terminate the Grantee’s Option by notice to him, and it shallthereupon become null and void.

 

**ARTICLE15**

 

**RESTRICTEDSTOCK AND RESTRICTED STOCK UNITS**

 

(a)                 The Compensation Committee may from timeto time grant Restricted Stock and Restricted Stock Units to Grantees, subjectto such restrictions, conditions and other terms as the Compensation Committeemay determine.

 

(b)                At the time an award of Restricted Stockor Restricted Stock Units is made under this Plan, the Compensation Committeeshall establish a restriction period applicable to such Award.  Each Grantof Restricted Stock or Restricted Stock Units may be subject to a differentrestriction period.  The Compensation Committee may, in its solediscretion, at the time a Grant of Restricted Stock or Restricted Stock Unitsis made, prescribe conditions that must be satisfied prior to the expiration ofthe restriction period, including the satisfaction of corporate or individualperformance objectives or the continued provision of Service, in order that allor any portion of the Award shall vest.

 

The CompensationCommittee also may, in its sole discretion, shorten or terminate therestriction period or waive any of the conditions applicable to all or aportion of the Restricted Stock or Restricted Stock Units.  The RestrictedStock and Restricted Stock Units may not be sold, transferred, assigned,pledged or otherwise encumbered or disposed of during the restriction period orprior to the satisfaction of any other conditions prescribed by theCompensation Committee with respect to such Restricted Stock or RestrictedStock Units.

 

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(c)                 The Company shall issue, in the name ofeach Grantee to whom Restricted Stock or Restricted Stock Units has beengranted, share certificates representing the total number of shares ofRestricted Stock granted to the Grantee, as soon as reasonably practicableafter the Grant Date.  The Compensation Committee may provide in the AwardAgreement that either (i) the Secretary of the Company shall hold suchcertificates for the Grantee’s benefit until such time as the Restricted Stockis forfeited to the Company, or the restrictions lapse, or (ii) suchcertificates shall be delivered to the Grantee, provided, however, that suchcertificates shall bear a legend or legends that complies with the applicablesecurities laws and regulations and makes appropriate reference to therestrictions imposed under the Plan and the Award Agreement.

 

(d)                Unless the Compensation Committeeotherwise provides in an Award Agreement, holders of Restricted Stock shallhave the right to vote such Shares and the right to receive any dividendsdeclared or paid with respect to such Shares.  The Compensation Committeemay provide that any dividends paid on Restricted Stock must be reinvested inShares, which may or may not be subject to the same vesting conditions andrestrictions applicable to such Restricted Stock.  All distributions, ifany, received by a Grantee with respect to Restricted Stock as a result of anystock split, stock dividend, combination of shares, or other similartransaction shall be subject to the restrictions applicable to the originalGrant.

 

(e)                 Holders of Restricted Stock Units shallhave no rights as shareholders of the Company.  The Compensation Committeemay provide in an Award Agreement evidencing a grant of Restricted Stock Unitsthat the holder of such Restricted Stock Units shall be entitled to receive,upon the Company’s payment of a cash dividend on its outstanding Shares, a cashpayment for each Restricted Stock Unit held equal to the per-share dividendpaid on the Share.   Such Award Agreement may also provide that suchcash payment will be deemed reinvested in additional Restricted Stock Units ata price per unit equal to the Fair Market Value of a Share on the date thatsuch dividend is paid.  A holder of Restricted Stock Units shall have noright other than those of a general creditor of the Company.  RestrictedStock Units represent an unfounded and unsecured obligation of the Company,subject to the terms and conditions of the applicable Award Agreement.

 

(f)                   Unless otherwise provided by the CompensationCommittee in the applicable Award Agreement, upon the termination of a Grantee’sprovision of Service to the Company or an affiliate of the Company, any sharesof Restricted Stock or Restricted Stock Units held by such Grantee that havenot vested, or with respect to which all applicable restrictions and conditionshave not lapsed, shall immediately be deemed forfeited.  Upon forfeiture of Restricted Stock orRestricted Stock Units, the Grantee shall have no further rights with respectto such Grant, including but not limited to any right to vote Restricted Stockor any right to receive dividends with respect to shares of Restricted Stock orRestricted Stock Units.

 

(f)                   The Grantee shall be required to purchasethe Restricted Stock and Restricted Stock Units from the Company at a PurchasePrice equal to the greater of (i) the aggregate par value of the shares ofStock represented by such Restricted Stock or Restricted Stock Units or (ii) thePurchase Price, if any, specified in the Award Agreement relating to suchRestricted Stock or Restricted Stock Units.  The Purchase Price shall bepayable in the form of cash or cash equivalents acceptable to the Company or,in the discretion of the Compensation Committee, in consideration for pastServices rendered to the Company or an affiliate of the Company.

 

Upon the expiration ortermination of the restriction period and the satisfaction of any otherconditions prescribed by the Compensation Committee, having properly paid thePurchase Price,

 

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the restrictionsapplicable to shares of Restricted Stock and Restricted Stock Units shalllapse, and, unless otherwise provided in the Award Agreement, a stockcertificate for such Shares shall be delivered, free of all such restrictions,to the Grantee or the Grantee’s beneficiary or estate, as the case may be.

 

**ARTICLE16**

 

**PAYMENTAND REPURCHASE**

 

No Shares may be issueduntil full payment of the Option Price or Purchase Price therefor has beenmade, and a Grantee will have none of the rights of a shareholder until Sharesare issued to him.

 

The CompensationCommittee shall determine the methods by which the exercise price of an Optionmay be paid, the form of payment, including, without limitation (i) cashor check denominated in U.S. Dollars, (ii) to the extent permissible underApplicable Laws, cash or check in Chinese Renminbi, (iii) cash or checkdenominated in any other local currency as approved by the CompensationCommittee, (iv) Shares held for such period of time as may be required bythe Compensation Committee in order to avoid adverse financial accountingconsequences and having a Fair Market Value on the date of delivery equal tothe aggregate Exercise Price of the Option or exercised portion thereof, (v) afteran IPO the delivery of a notice that the Grantee has placed a market sell orderwith a broker with respect to Shares then issuable upon exercise of the Option,and that the broker has been directed to pay a sufficient portion of the netproceeds of the sale to the Company in satisfaction of the Exercise Price;*provided* that payment of such proceeds isthen made to the Company upon settlement of such sale, (vi) other propertyacceptable to the Compensation Committee with a Fair Market Value equal to theexercise price, (vii) cashless exercise (as set forth below); or (viii) anycombination of the foregoing.  Notwithstanding any other provision of thePlan to the contrary, no Grantee who is a member of the Board or an “executiveofficer” of the Company within the meaning of Section 13(k) of theExchange Act shall be permitted to pay the Exercise Price in any method whichwould violate Section 13(k) of the Exchange Act.

 

The CompensationCommittee may, at the time it grants Options, grant to the Grantees rights toexercise their Options without cash, provided that the Shares or any securitiesrepresenting the Shares are publicly traded.  After the Company’s Sharesor securities representing the Shares are publicly traded, Grantees who areeligible to exercise their Options without cash may give a cashless exercisenotice to the Company, specifying the number of shares to be sold and thedesired selling prices for such shares, and the Company will designate a brokerto sell such Options on behalf of the Grantees.  The amounts representingthe difference between the Option Prices and the prices at which the underlyingShares for such Options are sold will be used as follows: (i) the amountswill first be used to pay all expenses, including the brokerage commission andother selling expenses, (ii) the Company will then deduct from the amountsapplicable taxes in accordance with Article 26 below, and (iii) theremaining amounts will be paid to the Grantee exercising such Options.

 

Notwithstanding anythingin the Plan to the contrary and in accordance with Article 3 of the Plan,if you are resident for tax purposes in the Peoples Republic of China, aGrantee may exercise an Option only by placing a market sell order with abroker with respect to Shares then issuable upon exercise.

 

The CompensationCommittee may provide for exercise of Options immediately or in installmentsand upon such other terms, conditions and restrictions as it may determine,including granting the

 

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Company the right torepurchase shares issued upon exercise of Options.  If the Shares arelisted on an established national or regional stock exchange or is publiclytraded in an established securities market, the Company’s repurchase rightsshall terminate as of the first date that the Shares are so listed, quoted orpublicly traded.

 

A Grantee may be requiredto provide evidence that any currency used to pay the exercise price of anyAward were acquired and taken out of the jurisdiction in which the Granteeresides in accordance with Applicable Laws, including foreign exchange controllaws and regulations.  In the event the Exercise Price or Purchase Pricefor an Award is paid in Chinese Renminbi or other foreign currency, aspermitted by the Compensation Committee, the amount payable will be determinedby conversion from U.S. Dollars at the official rate promulgated by the People’sBank of China for Chinese Renminbi, or for jurisdictions other than the PeoplesRepublic of China, the exchange rate as selected by the Compensation Committeeon the date of exercise.

 

**ARTICLE17**

 

**AMENDMENTOR DISCONTINUANCE**

 

Subject to provisions inthe Shareholders Agreement or the Second Amended and Restated Articles ofAssociation, the Plan may be amended or discontinued by the Board without theapproval of the shareholders of the Company.  No amendment may adverselyaffect an outstanding Award without the consent of the Grantee.

 

**ARTICLE18**

 

**EFFECTOF THE PLAN**

 

Neither the adoption ofthis Plan nor any action of the Board or the Compensation Committee shall bedeemed to give any officer or employee any right to be granted an Option topurchase Shares of the Company or any other rights except as may be evidencedby an Award Agreement, or any amendment thereto, duly authorized by theCompensation Committee and executed on behalf of the Company and then only tothe extent and upon the terms and conditions expressly set forth therein.

 

**ARTICLE19**

 

**TERM**

 

Unless sooner terminatedby action of the Board, the Plan will terminate on November 20, 2017, butAwards granted before the date will continue to be effective in accordance withtheir terms and conditions.

 

**ARTICLE20**

 

**RECAPITALIZATION,MERGER AND CONSOLIDATION**

 

(a)                The existence of this Plan and Awards grantedhereunder shall not affect in any way the right or power of the Company or itsshareholders to make or authorize any or all adjustments,

 

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recapitalizations,reorganizations or other changes in the Company’s capital structure and itsbusiness, or any merger or consolidation of the Company, or any issue of bonds,debentures, preferred or preference stocks ranking prior to or otherwiseaffecting the Shares or the rights thereof (or any rights, options or warrantsto purchase same), or the dissolution or liquidation of the Company, or anysale or transfer of all or any part of its assets or business, or any othercorporate act or proceeding, whether of a similar character or otherwise.

 

(b)               The number of Shares available under the Plandescribed in Article 5, the number of Shares that may be issued pursuantto Awards granted under the Plan, and the consideration payable per Share uponexercise, shall be proportionately adjusted by the Compensation Committee forany increase or decrease in the number of issued Shares resulting from asubdivision or consolidation of Shares or other capital adjustment, or thepayment of a stock dividend or other increase or decrease in such Shares,effected without receipt of consideration by the Company; provided, however,that any fractional Shares resulting from any such adjustment shall beeliminated for the purposes of such adjustment.

 

(c)                Subject to any required action by theshareholders, if the Company shall be the surviving or resulting corporation inany merger or consolidation, any Award granted hereunder shall pertain to andapply to the securities or rights (including cash, property or assets) to whicha holder of such Grant would have been entitled.

 

(d)               In the event of any merger or consolidation pursuantto which the Company is not the surviving or resulting corporation, there shallbe substituted for each share of Restricted Stock, Restricted Stock Units orShares subject to the unexercised portions of such outstanding Options, thatnumber of shares of each class of stock or other securities or that amount ofcash, property or assets of the surviving or consolidated company which weredistributed or distributable to the shareholders of the Company in respect toShares held by them, such outstanding Options to be thereafter exercisable(subject to appropriate adjustment, if appropriate, as to the per shareexercise prices for such stock, securities, cash or property, as determinedunder subsection b above) in accordance with their terms.  Subject to anycontrary language in an Award Agreement evidencing a Grant of Restricted Stockor Restricted Stock Units, any restriction applicable to such Grant shall applyas well to any replacement shares received by the Grantee as a result of themerger or consolidation.  Notwithstanding the foregoing, however, allOptions may be canceled by the Company as of the effective date of any suchreorganization, merger or consolidation or of any dissolution or liquidation ofthe Company by giving notice to each holder thereof or his personalrepresentative of its intention to do so and by permitting the purchase duringthe thirty (30) day period next preceding such effective date of all of theshares subject to such outstanding options.  The Compensation Committeemay elect, in its sole discretion, to cancel any outstanding Awards and pay ordeliver, or cause to be paid or delivered, to the holder thereof an amount incash or securities having a value (as determined by the Compensation Committeeacting in good faith), in the case of Restricted Stock or Restricted StockUnits, equal to the formula or fixed price per share paid to shareholders and,in the case of Options, equal to the product of the number of Shares subject tothe Option (the “Award Shares”) multiplied by the amount, if any, by which (I) theformula or fixed price per share paid to shareholders pursuant to suchtransaction exceeds (II) the Option Price applicable to such Award Shares.

 

(e)               In the event that either sufficientShares are purchased, or any tender, exchange or similar offer is commencedwhich would, if successful (i) result in the events that will materiallyalter the structure or business of the Company, then, notwithstanding any otherprovision in its Plan to the

 

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contrary, all unmaturedinstallments of Options outstanding shall thereupon automatically beaccelerated and exercisable in full and any right the Company may have torepurchase shares issued upon exercise of Options shall terminate.  Allunvested Restricted Stock and Restricted Stock Units shall fully andimmediately vest.  The determination of the Compensation Committee thatany of the foregoing conditions has been met shall be binding and conclusive onall parties.

 

(f)                 Except as hereinbefore expresslyprovided, the issue by the Company of shares of stock of any class, orsecurities convertible into shares of stock of any class, for cash or property,or for labor or services either upon direct sale or upon the exercise of rightsor warrants to subscribe therefor, or upon conversion of shares or obligationsof the Company convertible into such shares or other securities, shall notaffect, and no adjustment by reason thereof shall be made with respect to, thenumber or price of Restricted Stock, Restricted Stock Units or Shares subjectto Options granted pursuant to this Plan.

 

(g)              Upon the occurrence of each eventrequiring an adjustment of the price or the number of shares purchasablepursuant to Options granted pursuant to the terms of this Plan, the Companyshall mail forthwith to each Grantee a copy of its computation of suchadjustment, which shall be conclusive and shall be binding upon each suchGrantee.

 

**ARTICLE 21**

 

**LIQUIDATIONOR DISSOLUTION**

 

In case the Companyshall, at any time while any Award under this Plan shall be in force and remainunexpired, (i) sell all or substantially all its property, or (ii) dissolve,liquidate, or wind up its affairs, then each Grantee may thereafter receiveupon exercise hereof (in lieu of each Share of the Company which such Granteewould have been entitled to receive) the same kind and amount of any securitiesor assets as may be issuable, distributable or payable upon any such sale,dissolution, liquidation, or winding up with respect to each Share of theCompany.  If the Company shall, at any time prior to the expiration of anyAward, make any partial distribution of its assets, in the nature of a partialliquidation, whether payable in cash or in kind (but excluding the distributionof a cash dividend payable out of earned surplus and designated as such) thenin such event each Option Price or Purchase Price shall be reduced, on thepayment date of such distribution, in proportion to the percentage reduction inthe tangible book value of the Shares (determined in accordance with generallyaccepted accounting principles) resulting by reason of such distribution.

 

**ARTICLE22**

 

**AWARDSIN SUBSTITUTION FOR**

**STOCK OPTIONSGRANTED BY OTHER CORPORATIONS**

 

Awards may be grantedunder the Plan from time to time in substitution for such options, restrictedstock, or restricted stock units held by employees of a corporation who becomeor are about to become employees of the Company or its Subsidiaries as theresult of a merger or consolidation of the employing entity with the Company orthe acquisition by the Company of stock of the employing

 

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entity.  The termsand conditions of the substitute Awards so granted may vary from the terms andconditions set forth in this Plan to such extent as the Compensation Committeeat the time of grant may deem appropriate to conform, in whole or in part, tothe provisions of the options in substitution for which they are granted.

 

**ARTICLE23**

 

**INVESTMENTINTENT**

 

The Company may requirethat there be presented to and filed with it by any Grantee under the Plan,such evidence as it may deem necessary to establish that the Shares underlyingthe Awards to be purchased or transferred are being acquired for investment andnot with a view to their distribution.

 

**ARTICLE 24**

 

**NORIGHT TO CONTINUE EMPLOYMENT**

 

No provision in the Planor in any Grant or Award Agreement shall be construed to confer upon anyindividual the right to remain in the employ or service of the Company or anyAffiliate, or to interfere in any way with any contractual or other right orauthority of the Company either to increase or decrease the compensation orother payments to any individual at any time, or to terminate any employment orother relationship between any individual and the Company or anyAffiliate.  The obligation of the Company to pay any benefits pursuant tothis Plan shall be interpreted as a contractual obligation to pay only thoseamounts described herein, in the manner and under conditions prescribedherein.  The Plan shall in no way be interpreted to require the Company totransfer any amounts to a third party trustee or otherwise hold any amounts intrust or escrow for payment to any participant or beneficiary under the termsof the Plan.

 

**ARTICLE25**

 

**INDEMNIFICATIONOF BOARD AND COMMITTEE**

 

No member of the Board orthe Compensation Committee, nor any officer or employee of the Company actingon behalf of the Board or the Compensation Committee, shall be personallyliable for any action, determination, or interpretation taken or made in goodfaith with respect to the Plan, and all members of the Board or theCompensation Committee and each and any officer or employee of the Companyacting on their behalf shall, to the extent permitted by law, be fullyindemnified and protected by the Company in respect of any such action,determination or interpretation.  This obligation shall survive anytermination of this Plan.

 

**ARTICLE26**

 

**TAXREQUIREMENTS**

 

No Shares will bedelivered under the Plan to any Grantee until such Grantee has madearrangements

 

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acceptable to theCompensation Committee for the satisfaction of any income and employment taxwithholding obligations under Applicable Laws.  The Company shall have theauthority and the right to deduct or withhold, or require a Grantee to remit tothe Company, an amount sufficient to satisfy federal, state, local and foreigntaxes (including the Grantee’s payroll tax obligations) required or permittedby law to be withheld with respect to any taxable event concerning a Granteearising as a result of this Plan.  The employee receiving Shares issuedupon the grant of Restricted Stock, Restricted Stock Units or the exercise ofany Option shall be required to pay the Company the amount of any taxes, whichthe Company is required to withhold with respect to such Shares.  Suchpayment may be made in cash, by check, or through the delivery of Shares ownedby the employee (which may be effected by the actual delivery of Shares by theemployee or by the Company’s withholding a number of Shares to be issued uponthe exercise of the Option), which Shares have an aggregate Fair Market Valueequal to the required withholding payment, or any combination thereof. Notwithstanding any other provision of the Plan, the number of Shares which maybe withheld with respect to the issuance, vesting, exercise or payment of anyAward (or which may be repurchased from the Grantee of such Award after suchShares were acquired by the Grantee from the Company) in order to satisfy theGrantee’s federal, state, local and foreign income and payroll tax liabilitieswith respect to the issuance, vesting, exercise or payment of the Award shall,unless specifically approved by the Compensation Committee, be limited to thenumber of Shares which have a Fair Market Value on the date of withholding orrepurchase equal to the aggregate amount of such liabilities based on theminimum statutory withholding rates for federal, state, local and foreignincome tax and payroll tax purposes that are applicable to such supplementaltaxable income.

 

**ARTICLE27**

 

**PARACHUTELIMITATIONS**

 

Notwithstanding any otherprovision of this Plan, unless an agreement, contract or understandingheretofore or hereafter entered into by a U.S. Grantee with the Company on anyAffiliate (an “Other Agreement”) directly or indirectly modifies or excludesapplication of this paragraph, including by specifically addressing Section 280Gof the Code and/or the treatment with respect to any payment or benefit to theU.S. Grantee that could be considered a “parachute payment” within the meaningof Section 280G(b)(2) of the Code as then in effect (a “ParachutePayment”), if the U.S. Grantee is a “disqualified individual.” As defined in Section 280G(c) ofthe Code, any Grants held by that U.S. Grantee and any right to receive anypayment or other benefit under this Plan shall not become exercisable or vested(i) to the extent that such right to exercise, vesting, payment, or benefit,taking into account all other rights, payments, or benefits to or for the U.S.Grantee under this Plan, all Other Agreements, and any formal or informal planor other arrangement for the direct or indirect provision of compensation tothe U.S. Grantee (including groups or classes of participants or beneficiariesof which the U.S. Grantee is a member), whether or not such compensation isdeferred, is in cash, or is in the form of a benefit to or for the U.S. Grantee(a “Benefit Arrangement”), would cause any payment or benefit to the U.S.Grantee under this Plan to be considered a Parachute Payment and (ii), if, as aresult of receiving a Parachute Payment, the aggregate after-tax amountsreceived by the U.S. Grantee from the Company under this Plan, all OtherAgreements, and all Benefit Arrangements would be less than the maximumafter-tax amount that could be received by the U.S. Grantee without causing anysuch payment or benefit to be considered a Parachute Payment.  In theevent that the receipt of any such right to exercise, vesting, payment, orbenefit under this Plan in conjunction with all other rights, payments, orbenefits to or for the U.S. Grantee under any Other Agreement or any BenefitArrangement would cause the U.S. Grantee to be considered to have received aParachute Payment

 

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under this Plan thatwould have the effect of decreasing the after-tax amount received by the U.S.Grantee as described in clause (ii) of the preceding sentence, then theU.S. Grantee shall have the right, in the U.S. Grantee’s sole discretion, todesignate those rights, payments, or benefits under this Plan, any OtherAgreements, and any Benefit Arrangements that should be reduced or eliminatedso as to avoid having the payment or benefit to the U.S. Grantee under thisPlan be deemed to be a Parachute Payment.

 

**ARTICLE28**

 

**REQUIREMENTSOF LAW**

 

The Company shall not berequired to sell or issue any Shares under any Grant if the sale or issuance ofsuch Shares would constitute a violation by the Grantee, any other individualexercising a right emanating from such Grant, or the Company of any provisionof any law or regulation of any governmental authority, including withoutlimitation any federal or state securities laws or regulations.  If at anytime the Company shall determine, in its discretion, that the listing,registration or qualification of any shares subject to a Grant upon anysecurities exchange or under any governmental regulatory body is necessary or desirableas a condition or of in connection with, the issuance or purchase of shareshereunder, no Shares may be issued or sold to the Grantee or any otherindividual exercising an Option pursuant to such Grant unless such listing,registration, qualification, consent or approval shall been effected orobtained free of any conditions not acceptable to the Company, and any delaycaused thereby shall in no way affect the date of termination of theGrant.  Specifically, in connection with the Securities Act, upon theexercise of any right emanating from such Grant, unless a registrationstatement under the Securities Act is in effect with respect to the Sharescovered by such Grant, the Company shall not be required to sell or issue suchshares unless the Compensation Committee has received evidence satisfactory toit that the Grantee or any other individual exercising an Option or the vestingof Restricted Stock or Restricted Stock Units may acquire such Shares pursuantto the Plan to comply with any law or regulation of any governmentalauthority.  As to any jurisdiction that expressly imposes the requirementthat an Option shall not be exercisable or Restricted Stock or Restricted StockUnits shall not vest until the Shares covered by such Option, Restricted Stockor Restricted Stock Units are registered or are exempt from registration, theexercise of such Option or the vesting of such Restricted Stock or RestrictedStock Units (under circumstances in which the laws of such jurisdiction apply)shall be deemed conditioned upon the effectiveness of such registration or theavailability of such an exemption.

 

During any time when theCompany has a class of equity security registered under Section 12 of theExchange Act, it is the intent of the Company that Grants pursuant to the Planand the exercise of Options and the vesting of Restricted Stock and RestrictedStock Units granted hereunder will qualify for the exemption provided by Rule 16b-3under the Exchange Act.  To the extent that any provision of the Plan oraction by the Compensation Committee does not comply with the requirements of Section 16b-3,it shall deemed inoperative to the extent permitted by law and deemed advisableby the Compensation Committee, and shall not affect the validity of thePlan.  In the event that Rule 16b-3 is revised or replaced, theCompensation Committee may exercise its discretion to modify the plan in anyrespect necessary to satisfy the requirements of, or to take advantage of anyfeatures of, the revised exemption or its replacement.

 

To the extent required byapplicable law, not less often than annually, the Company shall furnish toGrantees summary financial information including a balance sheet regarding theCompany’s financial

 

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condition and results ofoperations, unless such Grantees have duties with the Company that assure themaccess to equivalent information.  Such financial statements need not beaudited.

 

**ARTICLE29**

 

**NONEXCLUSIVITYOF THE PLAN**

 

Neither the adoption ofthe Plan nor submission of the Plan to the shareholders of the Company forapproval shall be construed as creating any limitations upon the right andauthority of the Compensation Committee to adopt such other incentivecompensation arrangements (which arrangements may be applicable eithergenerally to a class or classes of individuals or specifically to a particularindividual or particular individuals) as the Compensation Committee in itsdiscretion determines desirable, including, without limitation, the granting ofstock options otherwise than under the Plan.

 

**ARTICLE30**

 

**CAPTIONS**

 

The use of captions inthis Plan or any Award Agreement s for the convenience of reference only andshall not affect the meaning of any provision of the Plan or such AwardAgreement.

 

**ARTICLE31**

 

**OTHERAWARD AGREEMENT PROVISIONS**

 

Each Grant awarded underthe Plan may contain such other terms and conditions not inconsistent with thePlan as may be determined by the Compensation Committee, in its solediscretion.

 

**ARTICLE32**

 

**NUMBERAND GENDER**

 

With respect to wordsused in this Plan, the singular form shall include the plural form, themasculine gender shall include the feminine gender, etc., as the contextrequires.

 

**ARTICLE33**

 

**SEVERABILITY**

 

If any provision of thePlan or any Award Agreement shall be determined to be illegal or unenforceableby any court of law in any jurisdiction, the remaining provisions hereof andthereof shall be severable and enforceable in accordance with their terms, andall provisions shall remain enforceable in any other jurisdiction.

 

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**ARTICLE34**

 

**GOVERNINGLAW**

 

The Plan and all Awardsgranted hereunder shall be governed by and construed in accordance with thelaws of the Cayman Islands.

 

**ARTICLE35**

 

**CODESECTION 409A**

 

The CompensationCommittee intends to comply with Section 409A of the Code, or an exemptionto Section 409A of the Code, with regard to Grants to U.S. Granteeshereunder that constitute nonqualified deferred compensation within the meaningof Section 409A of the Code.  To the extent that the CompensationCommittee determines that the U.S. Grantee would be subject to the additional20% tax imposed on certain nonqualified deferred compensation plans pursuant toSection 409A of the Code as a result of any provision of any Grant grantedunder this Plan, such provision shall be deemed amended to the minimum extentnecessary to avoid application of the additional tax.  The nature of anysuch amendment shall be determined by the Compensation Committee.

 

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**INWITNESS WHEREOF**,the Company has caused this instrument to be executed as of the effective date,by its Chief Executive Officer pursuant to prior action taken by the Board.

 

 
|   | Signature |                    |
|--------|-----------|-------------------------|
|   | By:       | Julia Huang             |
|   | Title:    | Chief Executive Officer |

 

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