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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December
31, 2010

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________
to _____________

Commission File No. 001-34134

CHINA TRANSINFO TECHNOLOGY CORP.(Exact name of registrant as specified in its charter)

|Nevada                                                             | 87-0616524                          
|------------------------------------------------------------------ | ------------------------------------
|(State or other jurisdiction
    of incorporation or organization) | (I.R.S.
Employer Identification No.)

9thFloor, Vision Building, No.
39 Xueyuanlu, Haidian District, Beijing, China 100191(Address of principal executive offices)

(86) 10-51691999(Registrants telephone
number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

|Title of each class            | Name of each exchange on which registered
|------------------------------ | -----------------------------------------
|Common Stock, Par Value $0.001 | NASDAQ GLOBAL MARKET                     

Securities registered pursuant to Section 12(g) of the Exchange
Act: None.

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [_]         No
[X]

Indicate by check mark if the registrant is not required to
file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [_]         No
[X]

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]         No [_]

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Website, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files)
Yes [_]         No [_]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrants knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. Yes [_]         No [_]

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Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act.

|Large Accelerated Filer [_]                                                        | Accelerated Filer [_]        
|---------------------------------------------------------------------------------- | -----------------------------
|                                                                                   |                              
|Non-Accelerated Filer [_] 
    (Do not check if a smaller
      reporting company) | Smaller reporting company [X]

Indicate by check mark whether registrant is a shell company
(as defined in Rule 12b-2 of the Act). Yes [_]         No [X]

As of June 30, 2010 (the last business day of the registrants
most recently completed second fiscal quarter), the aggregate market value of
the shares of the registrants common stock held by non-affiliates(based upon
the closing sale price of such shares as reported on the NASDAQ Global Market)
was approximately $72.4 million. Shares of the registrants common stock held by
each executive officer and director and each by each person who owns 10% or more
of the outstanding common stock have been excluded from the calculation in that
such persons may be deemed to be affiliates of the registrant. This
determination of affiliate status is not necessarily a conclusive determination
for other purposes.

There were a total of 25,270,069 shares of the registrants
common stock outstanding as of March 28, 2011.

DOCUMENTS INCORPORATED BY REFERENCE

None.

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|CHINA TRANSINFO TECHNOLOGY CORP.                 
|-------------------------------------------------
|                                                 
|Annual Report on FORM 10-K                       
|For the
      Fiscal Year Ended December 31, 2010
|                                                 
|TABLE OF CONTENTS                                

|PART I        
|--------------
|              
|ITEM 1.       
|ITEM 1A.      
|ITEM 1B.      
|ITEM 2.       
|ITEM 3.       
|ITEM 4.       
|              
|PART II       
|              
|ITEM 5.       
|ITEM 6.       
|ITEM 7.       
|ITEM 7A.      
|ITEM 8.       
|ITEM 9.       
|ITEM 9A.      
|ITEM 9B.      
|              
|PART
      III
|              
|ITEM 10.      
|ITEM 11.      
|ITEM 12.      
|ITEM 13.      
|ITEM 14.      
|              
|PART
      IV 
|              
|ITEM 15.      

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Special Note Regarding Forward Looking Statements

In addition to historical information, this report contains
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. We use words such as believe, expect, anticipate, project,
target, plan, optimistic, intend, aim or similar expressions which are
intended to identify forward-looking statements. Such statements include, among
others, those concerning market and industry segment growth and demand and
acceptance of new and existing products; any projections of sales, earnings,
revenue, margins or other financial items; any statements of the plans,
strategies and objectives of management for future operations; any statements
regarding future economic conditions or performance; uncertainties related to
conducting business in China, as well as all assumptions, expectations,
predictions, intentions or beliefs about future events. You are cautioned that
any such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties, including those identified in Item 1A, Risk
Factors included herein, as well as assumptions, which, if they were to ever
materialize or prove incorrect, could cause the results of the Company to differ
materially from those expressed or implied by such forward-looking
statements.

Although we believe the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
level of activity, performance, or achievements. Moreover, neither we nor any
other person assumes responsibility for the accuracy or completeness of any of
these forward-looking statements. You should not rely upon forward-looking
statements as predictions of future events. We are under no duty to update any
of these forward-looking statements after the date of this report to conform our
prior statements to actual results or revised expectations.

Use of Terms

Except where the context otherwise requires and for the
purposes of this report only:

- BVI refers to the British Virgin Islands;
- China TransInfo, the Company, we, us, and our refer to China
  TransInfo Technology Corp., its subsidiaries, and, in the context of
  describing our operations and business, and consolidated financial
  information, include our VIE Entities;
- China, Chinese and PRC refer to the Peoples Republic of China and
  do not include Taiwan and special administrative regions of Hong Kong and
  Macao;
- Exchange Act refers to the Securities Exchange Act of 1934, as amended;
- RMB refers to Renminbi, the legal currency of China;
- SEC refers to the United States Securities and Exchange Commission;
- Securities Act refers to the Securities Act of 1933, as amended;
- U.S. dollar, $ and US$ refer to the legal currency of the United
  States; and
- "VIE Entities" means our consolidated variable interest entities,
  including China TransInfo Technology Group Co., Ltd. and its subsidiaries as
  depicted in our organization chart on page 5 below.

2

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PART I

ITEM 1. BUSINESS.

Business Overview

We are a leading provider of end-to-end intelligent
transportation systems (ITS) and related comprehensive technology solutions
servicing the transportation industry in China. Our goal is to become the
largest provider of intelligent transportation system products and related
comprehensive technology solutions in China, as well as a major operator and
provider of value-added ITS and location based services (LBS) to commercial
clients and consumers in China. Substantially all of our operations are
conducted through our VIE Entities that are PRC domestic companies owned
principally or entirely by our PRC affiliates. Through our VIE Entities, we are
involved in developing multiple applications in highway ITS, urban ITS,
commercial vehicles ITS plus LBS, and in a lesser degree, in digital city, and
land and resource filling systems based on Geographic Information Systems
(GIS), technologies which are used to service both the public and private
sector.

Our main focus is on providing end-to-end ITS solutions and
related services to the transportation industry. Our major products and services
can be divided into three categories, which include:

Intelligent Transportation System

- Transportation Planning Information System
- Electronic Toll Collection(ETC)
- Passenger Flow Statistic, Detecting and Analysis System (TransPLE)
- Traffic Information Integration and Exchange Platform
- Traffic Emergency Command Center
- Transportation Hub Comprehensive Management Information System
- Intelligent Traffic Management Platform
- Intelligent Parking System
- Traffic Flow Surveying Solutions
- GIS-T (Transportation) Middleware
- Highway Electronics & Machinery (E&M) System Solution
- UNISITS Highway Lightening and Energy Saving Product (UNIS-LCS)
- UNISITS Weigh-in-Motion System

Commercial Vehicle ITS plus LBS

- Commercial Vehicles Monitoring and Public Service Platform
- Commercial Vehicles Comprehensive Information Service Operation Platform
- Commercial Vehicles Terminal Products
- Taxi LED Advertisement Dynamic Display System
- Taxi LED GPS Monitoring and Coordinating System

3

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Other Vehicle and Consumer ITS Applications

- Palmcity Telematics Service Platform
- Palmcity Real-time Traffic Information Terminal Software
- Palmcity Smart Phone Public Transport Information Service System
- Palmcity Website (http://www.palmcity.cn)
- Auto Energy-saving Analysis Service System
- D-TIPS Dynamic Transportation Information Processing and Prediction
  Service System

We also offer comprehensive solutions for transportation
oriented GIS (GIS-T), covering transportation planning, design, construction,
maintenance and operation.

History and Corporate Structure

Corporate History

We were originally incorporated in Nevada on August 3, 1998
under the name R & R Ranching, Inc. to breed bison. On December 10, 2003, we
executed an agreement and plan of reorganization (the Intra-Asia Agreement)
with Intra-Asia Entertainment Corporation, a Delaware corporation (Intra-Asia
Delaware), whereby Intra-Asia Delaware became our wholly-owned subsidiary and
we amended our articles of incorporation to change our name to Intra-Asia
Entertainment Corporation. From the first half of 2006 until May 14, 2007 when
we completed a reverse acquisition transaction with Cabowise International Ltd.
(Cabowise), a BVI company, we were a shell company and did not engage in
active business operations other than our search for, and evaluation of,
potential business opportunities for acquisition or participation.

On May 14, 2007, we acquired Cabowise through a share exchange
transaction pursuant to which we issued to the shareholders of Cabowise
10,841,492 shares of our common stock in exchange for all of the issued and
outstanding capital stock of Cabowise. Cabowise thereby became our wholly-owned
subsidiary and the former shareholders of Cabowise became our controlling
stockholders. On the same day, our indirect Chinese subsidiary, Oriental
Intra-Asia Entertainment (China) Limited (Oriental Intra-Asia), acquired 85%
equity interest in Beijing PKU Chinafront High Technology Co., Ltd. (PKU),
which commenced its businesses in October 2000. As a result, PKU became a
majority-owned subsidiary of Oriental Intra-Asia.

Current Chinese laws restrict companies with foreign ownership
to operate in three business areas that we recently entered into: online
services, taxi advertising, and security and surveillance related business. In
order to comply with applicable Chinese laws, we restructured our subsidiaries
and entered into a series of commercial arrangements to allow the Company to
operate in these restricted business areas.

On February 3, 2009, through our indirect Chinese subsidiaries,
Oriental Intra-Asia and PKU, we entered into a series of equity transfer
agreements with China TransInfo Technology Group Co., Ltd., a company formed
under Chinese law (the Group Company), pursuant to which we transferred all of
our indirect equity interests in PKU and PKUs subsidiaries to the Group
Company. In connection with the equity transfer, on February 3, 2009, we also
entered into a series of contractual arrangements with relevant parties, which
have given us contractual rights to control and manage the business of the Group
Company and the Group Companys subsidiaries (the Restructuring). As a result,
we transferred all of our indirect equity interests in PKU and PKUs
subsidiaries to the affiliated Group Company and accordingly, PKU and PKUs
subsidiaries became direct and indirect subsidiaries of the Group Company, which
is wholly or majority owned by the Group Company shareholders who are all
Chinese citizens. At the same time, through the contractual arrangements, we
maintain substantial control over the VIE Entities daily operations and
financial affairs, election of their senior executives and all matters requiring
shareholder approval. According to ASC 810, we are required to consolidate the
VIE Entities into our financial statements because the contractual arrangement
provides us with the risks and rewards associated with equity ownership, even
though we do not own any of the outstanding equity interests in any of the VIE
Entities. We are now able to engage in these three restricted business segments
through the VIE Entities and derive the economic benefits that we would
otherwise have as the owner of VIE Entities while still complying with PRC laws.

4

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The following chart reflects our organizational structure as of
the date of this report:



5

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On October 19, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Shiji Yingli Science and
Technology Co., Ltd. (Shiji Yingli) whereby Shiji Yingli agreed to contribute
RMB 9.6 million (approximately $1.4 million) in cash and RMB 44.6 million
(approximately $6.6 million) in intangible assets (mostly technology and
intellectual property owned by Shiji Yingli) into the Group Companys wholly
owned subsidiary, Beijing Zhangcheng in exchange for a 49% equity interest in
Beijing Zhangcheng. Pursuant to the approving procedure of Beijing
Administration for Industry & Commerce (BAIC), we expect that the
transaction will be completed by the end of March, 2011. Following this
transaction, the Group Company will retain a 51% majority ownership of Beijing
Zhangcheng while Shiji Yingli will own the rest 49% equity interest.

On October 21, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Marine Communication
& Information Co., Ltd. (Beijing Marine) and Zhongyuan Credit Guarantee
Co., Ltd.(Zhongyuan Credit) whereby Zhongyuan Credit agreed, to contribute RMB
30 million (approximately $4.38 million) in cash into the Group Companys
majority-owned subsidiary, China TranWiseway in exchange for a 30% equity
interest in China TranWiseway. Pursuant to the approving procedure of Beijing
Administration for Industry & Commerce (BAIC), we expect that the
transaction will be completed by the end of March, 2011. Following this
transaction, the Group Company will retain a 55% majority ownership of China
TranWiseway while Beijing Marine and Zhongyuan Credit will own 15% and 30%
equity interest in China TranWiseway, respectively.

Industry

Transportation in China

The Fast Development in Transportation Infrastructure

Over the past two decades, China has completed series of
large-scale highway infrastructure projects. As a result, according to the
Ministry of Transport of China, China now has the second largest highway network
in the world with a total length of approximately 74,100 kilometers at the end
of 2010 as per the National Economy and Society Development Statistic
Announcement 2010. In addition, China has approximately 70% of the worlds toll
highways according to the Highway Management Department of the Ministry of
Transport. According to CI Consulting, the total mileage of urban rapid transit
exceeded 813.7 kilometers as of 2009. According to the China International
Capital Corporation (CICC) report in 2010, the public spending in urban rapid
transit will exceed RMB 3 trillion in the next ten years. It is estimated that
the total mileage of urban rapid transit projects in China will reach 7,395
kilometers by 2020, with annual investment of nearly RMB 270 billion from 2009
to 2020.

The Ministry of Transport of China is the countrys top
transportation regulator. In December 2004, the Ministry of Transport announced
a development plan for the Chinese national highway system. Under this plan,
China will expand its highway network to 85,000 kilometers by 2020. After its
completion, the Chinese national highway network will connect all provincial
capitals and cities with population above five hundred thousand. Based on the
plan, the total public spending in the national highway network will be about
$294 billion from 2005 to 2020. From 2005 to 2010, the annual spending according
to the plan is expected to be approximately $21 billion, from 2010 to 2020, the
annual spending according to the plan is expected to be approximately $14.6
billion. According to the 11th 5-Year Economy and Society Development
Achievement Report-- Transportation industry, Chinas highway length is expected
to reach 100,000 kilometers by 2015 (more than the 2004 Ministry of Transport
expectation) and become the country with the largest highway network in the
world.

The Fast Increase in Commercial Vehicles

China commercial vehicles have experienced rapid growth in the
past five years. According to the National Statistic Yearbook 2009, the number
of commercial vehicles in China has reached approximately 10.87 million at the
end of 2009, increased from approximately 7.33 million at the end of 2005. Based
on National Economy and Society Development Statistic Announcement 2010, the
number of commercial vehicles has increased to approximately 12.63 million in
2010, of which about 80% are trucks and the rest are passenger vehicles. We
expect that the number of commercial vehicles will continue to grow steadily in
the future, with the annual growth rate of commercial vehicles correlated to the
countrys national GDP growth. The fast growth in number of commercial vehicles
on highway as well as the growing volume of logistics handled by the commercial
vehicles is increasingly a challenge in transportation safety and efficiency.
According to the Ministry of Transport of China, approximately 80% of serious
traffic accidents are caused by commercial vehicles and approximately 37% of commercial vehicles running on the
road are not loaded with carry-ons. From 2004 to 2009, the logistic cost
increased to above 10% annually.

6

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The Fast Increase in Consumer Vehicles

China has a population of about 1.33 billion, which accounts
for about 20% of the worlds population and makes it the most populous country
in the world. With rapid economic development and urbanization, car ownership
has increased dramatically, leading to unprecedented transportation challenges
in many cities of China. According to Chinas Traffic Management Bureau of the
Ministry of Public Security, China had roughly 199 million motor vehicles as of
September 2010. According to the National Economy and Society Development
Statistic Announcement 2010, the number of private vehicles has reached
approximately 65.39 million at the end of 2010, an increase of 25.3% over 2009.
Private vehicles are estimated to increase at least 10% year over year in the
next several years. In order to tackle the increasing traffic congestion, the
Chinese government plans to improve transportation management using advanced
information technology solutions. At the same time, motorists are also eager to
have access to real time traffic information. The strong demand from both the
private and public sectors is creating an unprecedented market opportunity for
our transportation information products and services.

The Intelligent Transportation Systems Industry in China

Intelligent Transportation Systems (ITS) provide information
and data tools for different types of transportation infrastructure by deploying
solutions such as communication, monitoring, tolling and planning. The
14th World Congress on ITS, defined ITS as comprehensive systems that
integrate and apply advanced information, communication, control, sensor, and
computer technology to effectively coordinate people, vehicles, and roads/rails
to realize real-time information transfer, as well as on-time, highly efficient,
safe, and energy-efficient transportation.

Chinas ITS industry is still at its early stage of
development. Although Chinas rapid economic growth over the past decade and
accelerating urbanization have already resulted in significant development of
its transportation infrastructure, China still has a big task to use nationwide
transportation networks more efficiently and effectively. China began its ITS
efforts in early 1990s with goals to enhance transportation management
efficiency, to improve network throughput, and to reduce the negative effect of
transportation bottleneck exerted on the economy and environment. Given that
China is ranked second in total highway length and first in total toll highway
mileage in the world, a larger-scale, more advanced ITS is needed. The
increasing urban and highway traffic density also drives continued development
of ITS applications in communication and planning. As more urban and highway ITS
gets deployed, the ITS market will start to see growing demand in the service
sector, focusing on specialized information solutions and value-added
information services that meet the needs from both businesses and consumers of
transportation. The urban ITS market is still at an initial development stage,
comparable to that of the highway ITS market 10 years ago. Overall, ITS is a
large but fragmented market with great growth potential.

The Growing and Steady Public Spending in ITS Implementation

Despite being at an early stage of development, the overall
demand for ITS products and services is very strong in China thanks to the rapid
development in transportation infrastructure and increasing needs for ITS
applications that manages transportation. The unique characteristics of Chinas
ITS industry mentioned above and the current low penetration level underscore
the large market potential. As a result of this as well as the support
promulgated by recent central government policies, investment in the ITS
industry has been and will be increased significantly. The Ministry of Transport
in November 2008 submitted its new budget to the Chinese central government,
with the total investments in the transportation sector set at about $730
billion for the next 3 to 5 years. Even though currently there is no breakdown
of ITS spending out of the $730 billion budget by the Ministry of Transport, we
estimated that it would not be less than 5% of the total spending.

The Growing Value-Added ITS Service Market

Along with the fast deployment of ITS in Chinas highway and
cities, the large user base of ITS in both public and private section has a
growing and large demand for a variety of value-added ITS applications and
services, including but not limited to: real-time traffic information and
dynamic navigation, intelligent parking, electronic toll collection, ITS plus
location based services (LBS) applications to enhance commercial vehicle safety
and fleet efficiency, traffic flow surveying, vehicle and pedestrian ITS plus
LBS allocations. It will create a very large value-added ITS service market in
China.

7

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Our Growth Strategy

Our goal is to become the largest provider of intelligent
transportation system products and related comprehensive technology solutions in
China, as well as a major operator and provider of value-added ITS and LBS to
commercial clients and consumers in China. Our strategy to achieve our
objectives includes the following key elements:

Expand geographic footprint to cover all major markets in
China

Based on our successful track record and reputation, we believe
there are significant opportunities to grow revenues from our existing clients
by winning follow-on contracts for subsequent phases of project implementation,
and by capitalizing on our first mover advantage and higher cost for customers
to switch to other vendors. In addition to our executive offices in Beijing, we
have offices established in Shanghai, Chongqing, Taiyuan (Shanxi Province),
Chengdu (Sichuan Province), Hangzhou (Zhejiang Province), Huhhot (Inner
Mongolia), Urumqi (Xinjiang) Shijiazhuang (Hebei Province), Changsha (Hunan
Province) and Guiyang (Guizhou Province) and Dalian (Liaoning Province). We
currently provide our products and services in over twenty provinces in China.
Our long-term plan is to manage our national operations through different
offices and identify potential expansion opportunities.

Strengthen R&D capability to enhance and expand core
products and further penetrate customer base

We expect to provide additional value-added services and
add-ins to our current platform through continuous research and development,
enhancement of our product and service offerings and maintenance of our
technological leadership position in our core areas of focus. We believe the
continuous refinement of our offerings will make the overall platform more
attractive to potential customers.

Continue to enhance our leadership position in the rapidly
growing transportation information technology market

We plan to leverage our strong brand recognition and maintain a
high contract bid/win ratio and follow on orders with our transportation
information products and services by expanding our sales channels, increasing
our product offerings and focusing on customer satisfaction and our other
competitive strengths to gain additional market shares.

Pursue strategic acquisitions to support strong growth

We will continue to use acquisitions in addition to organic
growth effort to enable our geographic expansion, enhance our technological
capabilities or competitive advantages, enrich product and service lines,
provide recurring revenue opportunities and propel our expansion into high
growth enterprise class markets.

Leverage existing capabilities

We plan to leverage our GIS-T strength with Beijing UNISITS
Technology Co., Ltd. (UNISITS), to extend our competitive advantage in the
highway ITS market. UNISITS is a leader in Chinas intelligent transportation
systems industry. UNISITS primarily provides traffic engineering E&M
(electronic & machinery) systems for highways in China. Presently, UNISITS
provides products and services in over 20 provinces with an accumulated coverage
of over 8,000 kilometers of highway in China. We intend to leverage UNISITS
technology and market channels to cover a larger addressable market. By
leveraging UNISITS large presence in Chinas highway market in addition to our
leadership in the urban transportation market, we expect to better penetrate
markets for our current products and services. We also expect that through
UNISITS we will be able to tap into Chinas highway real time traffic
information services market, in conjunction with the opportunity to offer LBS
provided to commercial vehicles.

Further penetrate the large China consumer market with new
real-time traffic data solutions

We believe the Chinese consumer market represents a large
growth opportunity for us. China has over 600 million cell phone users and over
180 million motor vehicles. The number of vehicles is expected to continue to
grow. As a result, traffic congestion is becoming a serious concern in many
Chinese cities. We provide real-time traffic information on our real-time
traffic website. Our real-time traffic software for mobile devices is
pre-installed in some cell phones and can also be downloaded from our website as
well as from the website of Chinas telecommunication companies. The increase of
motorists in China as well as 3G deployment will enable Chinese consumers to
make more use of their mobile devices and applications to obtain real-time
traffic data and services.

8

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Offering Value-Added ITS and LBS services to commercial
vehicles

We plan to offer value-added ITS and LBS services to commercial
vehicles, to enhance safety and fleet efficiency. By the end of 2009, there were
more than 10 million commercial vehicles in China. Over the past several years,
the number of commercial vehicles in China has been increasing at about 10%
annually, which is about the same pace as the national GDP growth. We expect
that Chinas GDP will grow steadily in the forthcoming years, as such, we expect
the number of commercial vehicles will increase steadily and creates a large
service market for our value-added ITS and LBS applications.

Our Products and Services

Our core business is to develop the ITS service to the
transportation industry utilizing GIS application software and technologies as
well as other information technologies, and develop ITS related value-added
applications and LBS applications to service the commercial and consumer sectors
of transportation. We also develop GIS applications in Digital City and Land and
Resource areas. When providing services to customers with GIS software
applications, some of our customers required us to purchase the necessary
hardware and provide system integration for them. Our major products and
services include the followings:

ITS

Transportation Planning Information System

Our transportation planning information system is a software
system utilized by traffic management authorities to plan roads and water
transportation, safety monitoring and conduct strategic planning. The system
enable comprehensive management of information and data required for traffic
planning such as national economic data, road and waterway data and digital
mapping data. The system provides planners with information on search tools,
statistical analysis and models to serve planning and organizing needs. We have
been providing this system to the Ministry of Transport of China for their
nationwide transportation planning and analysis purposes.

Electronic Toll Collection

ETC is a technology that allows for electronic payment of
tolls. An ETC system is able to determine if a car is registered in a toll
payment program, alert enforcers on toll payment violations, and debit the
participants account. With ETC, these transactions can be performed without the
need for vehicles to stop or slow down. Our ETC system is operational in seven
provinces as of the end of 2010.

Passenger Flow Statistic, Detecting and Analysis System

Our Passenger Flow Statistic, Detecting and Analysis System
(TransPLE) mainly consists of one to eight laser scanners, cameras,
statistics, detecting and analysis hosts. It provides seamless coverage and
multi-level detecting and tracking of passenger flow by utilizing distributed
multi-modal sensor networks that include several laser scanners and cameras. It
is also applied to rendering the statistics of passenger flows when the channel
width is over 10 meters. This product is often used by governmental agencies to
optimize pedestrian flow configurations in transportation centers such as bus
stations, metro stations, railway stations and airports and to improve public
safety management through crowd control, emergency response and anti-terrorism
activities. We have launched this system for commercial use and have been
awarded several contracts in 2010, including service contracts for Dongzhimen
Comprehensive Transport Hub Information Service Platform and passenger flow
statistic service for Beijing Sihui metro station and Fuxingmen subway station.

Traffic Information Integration and Exchange Platform

Our Traffic Information Integration and Exchange Platform is
based on GIS technology and establishes a unified standard information sharing
platform, including Transportation Management Intelligent Platform, 110
Comprehensive Command Center, Police Comprehensive Information System and
Digital City Management Information System. This platform provides full services
in industry management, government decision-making, transportation company
operations and public transportation and strengthening coordination among
various transportation information systems. It helps improve industrial
management and service quality. We provide this system to several municipal
transportation authorities for their local transportation management purposes.

9

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Traffic Emergency Command Center

Our Traffic Emergency Command Center integrates wireless and
wired communication, integrates files, audios, videos and images, realizes
information receiving, cases disposal, resources dispatching and comprehensive
commanding with rapid reaction and high efficiency. It performs emergency
information collection, information management, emergency response service,
emergency management, and application analysis. As of December 31, 2010, this
application was not yet launched.

Transportation Hub Comprehensive Management Information
System

Our Transportation Hub Comprehensive Management Information
System is the foundation for cargo and passenger transportation intelligent
management. This system can accurately collect, analyze, store and transfer
related information on a real time basis, such information includes information
on truck flow, passenger flow, organization management information, dispatching
information, loading and unloading information, transfer information and other
supporting information services. This system can also provide, on a real time
basis, information inquiry, retrieval, display and distribute for different
management organization authorities. As of December 31, 2010, this application
was not yet launched.

Intelligent Traffic Management Platform

Our intelligent traffic management platform is a comprehensive
GIS based traffic management platform specifically developed for urban traffic
command centers. This platform functions as an interface for all ITS subsystems
and is an integral element for our intelligent traffic management system. The
intelligent traffic management platform captures visual images from monitored
roads, provides evidence of traffic violations at monitored intersections and
records the number of vehicles passing through major urban entrances and exits,
among other things. In 2008, we successfully provided real time traffic
management solution based on the intelligent traffic management platform to
serve the 2008 Olympic Game in Beijing. Since 2008, the system has been
installed in other cities in China.

Intelligent Parking System

Our Intelligent Parking System (IPS), provides information of
available parking spaces to drivers. Our system guides drivers in congested
areas to the nearest parking facilities with available parking spaces and it
guides drivers within parking facilities to empty spaces. IPS reduces time and
fuel otherwise wasted while searching for empty spaces and helps the parking
facilities operate more efficiently. We are one of the first companies in China
deploying IPS to serve public and private sector clients.

Traffic Flow Surveying Solutions

We provide transportation management authorities at provincial
and municipal levels with traffic flow monitoring solutions. These solutions
include coil traffic flow detectors, microwave traffic flow detectors and video
traffic flow detectors for base stations as well as traffic flow intelligent
data centers. We have been selling this solution to multiple provinces in China.

GIS-T (Transportation) Middleware

Our GIS-T middleware is based on Chinas mainstream traffic GIS
platform. The user of our middleware can quickly establish its own application
systems without significant customization. This product has strong applications
in traffic information management, model analysis and visual expression. Our
product supports efficient integration of various traffic information models and
systems. GIS-T middleware has been widely utilized as technological foundation
of many of our transportation information solutions designed for public sector
clients.

Highway Electronics & Machinery (E&M) System
Solution

Our highway E&M system solution consists of a communication
system, a monitoring system and a toll fee system. The communication system is
mainly composed of an optical fiber transition system, an optical comprehensive
service access network system, and a digital programming control exchange
system. The monitoring system is mainly composed of an information collection
subsystem, a monitoring center and an information sub-system, that accurately
and quickly assesses transportation situations. The toll system is composed of a
toll center, a toll station and toll lanes. It enables accurate collection of
toll. We sell this solution to over 20 provinces in China.

10

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UNISITS Highway Lighting and Energy Saving Product
(UNIS-LCS)

The UNISITS Lighting and Energy Saving system consists of an
electric monitoring system, a blurry intelligent control system, power adjusting
system, manual-automatic interactive control system, long-term control system
and protection system. This system can automatically monitor voltage, detect
factors and transportation parameters which affect lighting system,
automatically adjust lighting output through advanced power electronic control,
fuzzy control and micro-electronics control technologies, to realize an accurate
and balanced adjustment for transportation lighting. We have been selling this
solution to multiple provinces in China.

UNISITS Weigh-in-Motion System

The UNISITS Weigh-in-Motion System integrates Automatic Vehicle
Identification (AVI) technology, Automatic Vehicle Classification (AVC)
technology, Weigh-in-Motion (WIM) technology, and Data Acquisition and
Processing (DAP) technology to realize the vehicle in motion identification
function, vehicles weigh-in-motion function and other accurate vehicles in
motion dynamic survey functions. The system has been applied to and integrated
into our highway solutions provided to various governmental agencies.

Commercial Vehicle ITS plus LBS

Commercial Vehicles Monitoring and Public Service Platform

Our Commercial Vehicles Monitoring and Public Service Platform
is designed to monitor, control, and manage passenger vehicles, freight vehicles
and vehicles carrying hazardous goods. The platform has the following functional
subsystems: the real-time monitoring and control subsystem, the accident alarm
and processing subsystem, the safety control information release subsystem, key
transportation data analysis subsystem, platform assessment and management
subsystem. This platform has been utilized in multiple provinces as of December
31, 2010.

Commercial Vehicles Comprehensive Information Service
Operation Platform

Our Commercial Vehicles Comprehensive Information Service
Operation Platform is designed to serve transportation businesses and
professional drivers. It consists of call center comprehensive service system,
value-added service system, mobile phone system. The functions and features
include vehicle navigation, vehicle status detecting, anti-theft, remote
inspection, driving assistant, emergency rescue. This platform is comprised of a
central hub and multiple local centers which are connected to each other. As of
December 31, 2010, this application was not yet launched.

Commercial Vehicles Terminal Product

The product is a hardware terminal designed for commercial
vehicles working with the Commercial Vehicles Monitoring and Public Service
Platform and Commercial Vehicles Comprehensive Information Service
Operation Platform.

It has functions of positioning, black box, driver ID
verification, communication, speeding alarm, fatigue driving alarm and terminal
error alert. The Terminal supports further upgrades in the future promulgated by
us for other value-added service function. As of December 31, 2010, this
application was not yet launched.

Taxi LED Advertisement Dynamic Display System

Our Taxi LED Advertisement Dynamic Display System is a highly
integrated technological system operated with wireless satellite communication
which can display the same advertisement content on LED screens through central
hub. The system is used in the cities of Urumqi and Huhhot as of December 31,
2010.

Taxi LED GPS Monitoring and Coordinating System

Our Taxi LED GPS Monitoring and Coordinating System is a highly
integrated technological system operated with wireless satellite communication.
The system can be used to increase safety and oversight in the taxi industry as
well as remote supervision and management of public transportation. The system
is composed of a GPS monitoring management center, imbedded GIS, an information
transmitting center and onboard monitoring terminal modules. The system platform
provides taxi authorities with basic information such as the location of
accidents, incident time and images from within a taxi. The system also allows for better coordination with
emergency services. The system is being used in the cities of Huhhot as of
December 31, 2010.

11

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Other Vehicle and Consumer ITS Applications

Palmcity Telematics Service Platform

The Palmcity Telematics Service Platform provides basic driving
and leisure information to passenger car users on a real time basis through the
wireless network and navigation terminals installed on the vehicles. As of
December 31, 2010, this application was not yet launched.

Palmcity Real-time Traffic Information Terminal Software

The product is a cell phone application to distribute real-time
traffic information. It is operated through our dynamic traffic information
system platform which integrates the traffic information engine with road maps.
This system has been widely downloaded for free from our website by users.

Palmcity Smart Phone Public Transport Information Service
System

The system is a platform which delivers dynamic public
transportation information service to users through smart phones. As of December
31, 2010, this application was not yet launched.

Palmcity Website (http://www.palmcity.cn)

Palmcity website offers real time traffic information to the
general public. Users could download the Palmcity cell phone traffic information
application. The Palmcity website was launched on August 8, 2009.

Auto Energy-Saving Analysis Service System

Our Auto Energy-Saving Analysis Service System provides dynamic
traffic information service and drivers behavior analysis services. The services
are delivered through our Call-Centers and Personal Navigation Devices (PND)
installed in the cars. The drivers behavior analysis service can help enhance
driver performance to save energy and reduce emission. We had not officially
launched the system and services to the market as of December 31, 2010.

D-TIPS Dynamic Transportation Information Processing and
Prediction Service System

Our D-TIPS Dynamic Transportation Information Processing and
Prediction Service System is based on floating car data collection technology.
It collects data including location, direction and speed from floating vehicles
which is equipped with GPS terminals, and processes those data to gather the
traffic information reflected by floating car travel speed and travel time. It
can also predict traffic information within next 2 hours. This system has been
widely applied and integrated into our Palmcity products.

The Markets for Our Products and Services

We have been marketing and selling our products and services to
the highway and urban intelligent transportation system markets within the
public sectors in China, and to a lesser degree, in Digital City and Land and
Resources. Having built a customer base over the years, our strategy in the
public sectors is to deliver high quality products and also to provide ongoing
services such as system maintenance and upgrades that may become necessary over
time. In addition, the massive deployment of ITS and a large public and private
user base will create a large service market for both commercial and consumer
applications. We continue to penetrate our existing markets and believe that we
can leverage our extensive experience to expand our product and service offering
in the business and consumer markets.

ITS-Highway

Our specially designed systems process and store national
highway network data and travelers information, such as highway information
management systems, which perform functions of archiving and retrieving highway
data and provide transportation analysis tools. Decision support, predictive
information, and performance monitoring are some of ITS applications enabled by
highway ITS information management systems. In addition, ITS information
management systems can assist in transportation planning, research, and safety
management. Our major clients in this area include the Ministry of Transport,
traffic management bureaus, highway management bureaus, and municipal
construction committees.

12

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ITS-Urban

Key ITS applications for urban traffic management include
incident management, signal control, traveler information, traffic surveillance,
and intelligent parking indication system. Urban ITS is a combination of basic
traffic data, electronic technology, wireless and wire communication
technologies, which relies on computer and communication technologies to improve
safety and efficiency of urban traffic networks. Traffic surveillance provides
monitoring functions in the urban ITS. Most metropolitan areas use loop
detectors for traffic surveillance, and many use closed circuit televisions.
There are also other types of surveillance tools, such as radar, lasers, or
video image processing equipments. The use of vehicles equipped with toll tags
or global positioning systems as probes, to determine travel times and
locations, is also growing in use. Incident management provides real time
incident reporting functions in urban ITS, and it is commonly used by traffic
management centers in large metropolitan areas and cities. In some large cities,
such as Los Angeles, traffic signal control is also centralized in the traffic
management center. In many situations, traffic signal control systems use
traffic responsive signals to manage the traffic within urban areas. Such
responsive signals can be single signals or a group of interconnected signals.
Urban traffic management centers utilize all traffic condition information
collected from their ITS to give feedbacks and suggestions to travelers. Such
information can be provided directly to the public or to organizations who
provide it to users through radio broadcast, internet, or other means. Some
major types of traveler information include pre-trip information, en-route
driver information, en-route transit information and route guidance.

Digital City

Digital City sector is designed to aid the Chinese governments
initiative to equip all major cities with broadband, wireless internet access,
and information technology infrastructure. Many cities in China, especially in
southern China, have experienced rapid economic developments since early 1990s.
However, the construction of information infrastructures in these cities does
not match their economy developments. We are one of the pioneers to develop the
Digital City concept in China. We provide full range digital services to many
cities in China with the model of Planning-Construction-Operation. We analyze
different requirements of different regions or cities and design specific
information technology systems based on unique requirements. Typical clients
include local governments, public service departments and enterprises.

Land and Resources

Land and resources systems cover planning, analysis, statistics
and construction management for mineral resources. In this business line, we
have developed a city geological information analysis system that provides tools
to analyze the geological environment based on the integration of a variety of
geological information, such as determining the underground structure for city
planning and construction. In addition, we have created a disaster forecast
system and a mineral resources assessment system that provide a platform to
assess the reserves and then help to make decisions regarding the development of
the mineral resources by setting up assessment models of mineral resources.

Our Intellectual Property

The following table illustrates the title of different
copyrights and patents that we own, their registration numbers, first
publication dates, issuance dates, and durations.

|                                                                                                                            |  |             |  |  |              |  |  | First           |  |  |            |  |  |            | 
|--------------------------------------------------------------------------------------------------------------------------- |  | ----------- |  |  | ------------ |  |  | --------------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                            |  | Certificate |  |  | Registration |  |  | **Publication** |  |  |            |  |  | Expiration | 
|Copyright Title                                                                                                             |  | Number      |  |  | Number       |  |  | Date            |  |  | Issue Date |  |  | Date       | 
|                                                                                                                            |  |             |  |  |              |  |  |                 |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate (JTLWeb V1.0)                                                      |  | 028661      |  |  | 2004SR10260  |  |  | 09.08.2004      |  |  | 10.21.2004 |  |  | 12.31.2054 | 
|                                                                                                                            |  |             |  |  |              |  |  |                 |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate (Land & Resources and House Affairs
      Information System V1.0) |  | 027924      |  |  | 2004SR09523  |  |  | 06.15.2004      |  |  | 09.29.2004 |  |  | 12.31.2054 | 

13

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|Computer Software Copyright Registered
      Certificate 
    (GeoPad V1.0)                                                                   |  | 002827  |  |  | 2002SR2827  |  |  | 09.01.2002 |  |  | 09.24.2002 |  |  | 12.31.2052 | 
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ----------- |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Command System of Meeting Urgent Need for Urban Public
      Emergencies V1.0) |  | 009303  |  |  | 2003SR4212  |  |  | 05.10.2003 |  |  | 06.9.2003  |  |  | 12.31.2053 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (GeoWeb V1.0)                                                                   |  | 006881  |  |  | 2003SR1790  |  |  | 09.05.2002 |  |  | 03.19.2003 |  |  | 12.31.2053 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (EnvMonitor 1.0)                                                                |  | 004358  |  |  | 2002SR4358  |  |  | 05.18.2002 |  |  | 12.6.2002  |  |  | 12.31.2052 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (TranPlan 1.0) V1.0                                                             |  | 003664  |  |  | 2002SR3664  |  |  | 06.18.2002 |  |  | 11.11.2002 |  |  | 12.31.2052 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (e-Gov.Suite 1.0) V 1.0                                                         |  | 000823  |  |  | 2002SR0823  |  |  | 05.23.2002 |  |  | 07.04.2002 |  |  | 12.31.2052 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Sm@rtOA 1.0) V 1.0                                                             |  | 000824  |  |  | 2002SR0824  |  |  | 09.28.2001 |  |  | 07.04.2002 |  |  | 12.31.2052 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (WebMap Engine) V 1.0                                                           |  | 0009123 |  |  | 2001SR2190  |  |  | 07.08.2001 |  |  | 07.30.2001 |  |  | 12.31.2051 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Environment Geo V 1.0)                                                         |  | 062877  |  |  | 2006SR15211 |  |  | 11.30.2005 |  |  | 10.31.2006 |  |  | 12.31.2056 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Environment Protection Emergency Conduct System V 1.0)                         |  | 062879  |  |  | 2006SR15213 |  |  | 11.30.2005 |  |  | 10.31.2006 |  |  | 12.31.2056 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Land and Resources Files Collection System V 1.0)                             |  | 063008  |  |  | 2006SR15342 |  |  | 06.30.2006 |  |  | 11.02.2006 |  |  | 12.31.2056 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Embed-3D-GIS V1.0)                                                             |  | 071603  |  |  | 2007SR05608 |  |  | 01.30.2007 |  |  | 04.17.2007 |  |  | 12.31.2057 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate
    (Environment Protection Emergency Conduct System V 1.0)                          |  | 063509  |  |  | 2006SR15843 |  |  | 04.30.2006 |  |  | 11.13.2006 |  |  | 12.31.2056 | 
|                                                                                                                                              |  |         |  |  |             |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright Registered
      Certificate 
    (Environment Information System V 1.0)                                          |  | 063510  |  |  | 2006SR15844 |  |  | 04.30.2006 |  |  | 11.13.2006 |  |  | 12.31.2056 | 

14

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|Computer Software Copyright
      Registered Certificate 
    (Land and Resources Information Management System V
      1.0)               |  | 063508  |  |  | 2006SR15842  |  |  | 06.30.2006 |  |  | 11.13.2006 |  |  | 12.31.2056 | 
|------------------------------------------------------------------------------------------------------------------------------------------ |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GeoWeb For Linux) V1.0                                                      |  | 086634  |  |  | 2007SR20639  |  |  | 05.10.2007 |  |  | 12.24.2007 |  |  | 12.31.2057 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Water Carriage Information System) V1.0                                     |  | BJ10658 |  |  | 2008SRBJ0352 |  |  | 06.25.2006 |  |  | 02.03.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Intelligent Parking Guide System) V1.0                                      |  | BJ10662 |  |  | 2008SRBJ0356 |  |  | 06.30.2007 |  |  | 02.03.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Urban Geological Information Management and
      Services System) V1.0     |  | BJ10679 |  |  | 2008SRBJ0373 |  |  | 10.10.2007 |  |  | 02.03.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Exploiter Navigation Software V1.0)                                         |  | BJ10485 |  |  | 2008SRBJ0179 |  |  | 11.20.2007 |  |  | 01.16.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Location Services Platform System V 1.0)                                    |  | 088919  |  |  | 2008SR01740  |  |  | 11.15.2007 |  |  | 01.24.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Taxi Security Alarm System Certificate  V1.0)                               |  | BJ16618 |  |  | 2008SRBJ6312 |  |  | 11.22.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (City One Card Solution Consumption Real Time
      Transaction System) V1.0 |  | BJ16638 |  |  | 2008SRBJ6332 |  |  | 09.12.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Taxi Monitoring Management System V1.0)                                     |  | BJ16626 |  |  | 2008SRBJ6320 |  |  | 11.18.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Taxi Calling System V1.0)                                                   |  | BJ16653 |  |  | 2008SRBJ6347 |  |  | 09.18.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Advertisement Contract Management System V1.0)                              |  | BJ16612 |  |  | 2008SRBJ6306 |  |  | 10.21.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Advertisement Business Information Processing
      System V1.0)            |  | BJ16639 |  |  | 2008SRBJ6333 |  |  | 09.26.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Media Call Center Business Management System V1.0)                          |  | BJ16620 |  |  | 2008SRBJ6314 |  |  | 10.27.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 

15

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|Computer Software Copyright
      Registered Certificate 
    (Real Time Information Broadcasting System V1.0)                |  | BJ16615 |  |  | 2008SRBJ6309 |  |  | 09.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|----------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Electronic Project Management System V1.0)                     |  | BJ16795 |  |  | 2008SRBJ6489 |  |  | 10.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Data Collection System V1.0)                                   |  | BJ16796 |  |  | 2008SRBJ6490 |  |  | 09.18.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Employee Information Management System V1.0)                   |  | BJ16809 |  |  | 2008SRBJ6503 |  |  | 11.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Digitalization Assets Management System V1.0)                  |  | BJ16797 |  |  | 2008SRBJ6491 |  |  | 06.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Logistics Information System V1.0)                             |  | BJ16793 |  |  | 2008SRBJ6487 |  |  | 01.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Students Archive Management System V1.0)                       |  | BJ16808 |  |  | 2008SRBJ6502 |  |  | 12.10.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Product Selling Monitoring System V1.0)                        |  | BJ16792 |  |  | 2008SRBJ6486 |  |  | 01.20.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (E-business Shopping System V1.0)                               |  | BJ16794 |  |  | 2008SRBJ6488 |  |  | 08.16.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Expressway ETC System V1.0)                                    |  | BJ16694 |  |  | 2008SRBJ6388 |  |  | 10.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GIS-T Expressway Equipment Management System V1.0)             |  | BJ16771 |  |  | 2008SRBJ6465 |  |  | 10.21.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Data Collection and Distribution System
      V1.0)    |  | BJ16770 |  |  | 2008SRBJ6464 |  |  | 10.29.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Transportation Indication System V1.0)                 |  | BJ16769 |  |  | 2008SRBJ6463 |  |  | 08.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                              |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Expressway Emergency Command and Monitoring System
      V1.0) |  | BJ16699 |  |  | 2008SRBJ6393 |  |  | 09.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 

16

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|Computer Software Copyright
      Registered Certificate 
    (Traffic Information Service System V1.0)                                    |  | BJ16751 |  |  | 2008SRBJ6445 |  |  | 10.22.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|------------------------------------------------------------------------------------------------------------------------------------------ |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Urban Intelligent Traffic Management System V1.0)                           |  | BJ16906 |  |  | 2008SRBJ6600 |  |  | 12.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Urban Traffic Information Decision-making and
      Analysis System V1.0)   |  | BJ16926 |  |  | 2008SRBJ6620 |  |  | 11.18.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Appropriative GIS V1.0)                                                     |  | BJ16928 |  |  | 2008SRBJ6622 |  |  | 12.10.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Information Total Solution and
      Decision-analysis System V1.0) |  | BJ16927 |  |  | 2008SRBJ6621 |  |  | 05.18.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Red Light Violation Snapshot System V1.0)                                   |  | BJ16905 |  |  | 2008SRBJ6599 |  |  | 09.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Vehicles Intelligent Testing and Recording
      System V1.0)       |  | BJ16876 |  |  | 2008SRBJ6570 |  |  | 11.20.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Public Sanitation Quality Monitoring and Alarm
      System V1.0)           |  | BJ16457 |  |  | 2008SRBJ6151 |  |  | 10.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Human Resource Management System V1.0)                                      |  | BJ16428 |  |  | 2008SRBJ6122 |  |  | 10.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Local Sanitation Information Platform V1.0)                                 |  | BJ16450 |  |  | 2008SRBJ6144 |  |  | 10.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Management Competition Imitation Platform V1.0)                             |  | BJ16424 |  |  | 2008SRBJ6118 |  |  | 10.14.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Disabled Association Job Information Management
      System V1.0)          |  | BJ16473 |  |  | 2008SRBJ6167 |  |  | 09.08.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Message Service Platform V1.0)                                              |  | BJ16423 |  |  | 2008SRBJ6117 |  |  | 09.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                           |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Telecom Value-added Service System V1.0)                                    |  | BJ16422 |  |  | 2008SRBJ6116 |  |  | 10.25.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 

17

---

|Computer Software Copyright
      Registered Certificate 
    (Emergency Command and Prevention System V1.0)                                              |  | BJ16472 |  |  | 2008SRBJ6166 |  |  | 10.22.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Palmcity WebGIS Engine V1.0)                                                               |  | BJ16589 |  |  | 2008SRBJ6283 |  |  | 04.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Mobile Map Software V1.0)                                                                  |  | BJ16591 |  |  | 2008SRBJ6285 |  |  | 05.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Multiple-source Traffic Information Integration
      System V1.0)                         |  | BJ16629 |  |  | 2008SRBJ6323 |  |  | 08.26.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Palmcity Traffic information collection System
      V1.0)                                 |  | BJ16605 |  |  | 2008SRBJ6299 |  |  | 10.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (PalmCity Floating Car Data Processing System V1.0)                                         |  | BJ16628 |  |  | 2008SRBJ6322 |  |  | 05.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (PalmCity Information Exchange Platform V1.0)                                               |  | BJ16631 |  |  | 2008SRBJ6325 |  |  | 06.21.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (PalmCity In-car PND Comprehensive Information
      System V1.0)                           |  | BJ16617 |  |  | 2008SRBJ6311 |  |  | 10.31.2007 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Super GIS Data Comprehensive Integration System
      V1.0)                                |  | BJ16604 |  |  | 2008SRBJ6298 |  |  | 10.26.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Water Transportation Flow Investigation VTS System
      V1.0)                             |  | BJ16641 |  |  | 2008SRBJ6335 |  |  | 11.12.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Traffic Flow Investigation Data Center
      V1.0)                                 |  | BJ16507 |  |  | 2008SRBJ6201 |  |  | 09.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Traffic Flow GIS System V1.0)                                                      |  | BJ16476 |  |  | 2008SRBJ6170 |  |  | 10.27.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Traffic Flow Investigation Equipment
      Long-distance Monitoring Platform V1.0) |  | BJ16557 |  |  | 2008SRBJ6251 |  |  | 09.30.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                          |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Coil Traffic Flow Data Collection System V1.0)                                             |  | BJ16621 |  |  | 2008SRBJ6315 |  |  | 10.28.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 

18

---

|Computer Software Copyright
      Registered Certificate 
    (Video Traffic Flow Data Collection System V1.0)                                                  |  | BJ16643 |  |  | 2008SRBJ6337 |  |  | 11.20.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Video Traffic Flow Investigation - Digital Image
      Processing System V1.0)                   |  | BJ16622 |  |  | 2008SRBJ6316 |  |  | 11.06.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Video Traffic Flow Investigation Watching-dog
      System V1.0)                                 |  | BJ16627 |  |  | 2008SRBJ6321 |  |  | 10.10.2008 |  |  | 12.13.2008 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Yootu Real-Time Road Condition Information
      Processing and Releasing Software V1.0)         |  | 077504  |  |  | 2007SL11509  |  |  | 05.01.2007 |  |  | 08.01.2007 |  |  | 12.31.2057 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Portable Survey Instruments of Traffic Flow
      Management Software V1.0(Portable NC200 V1.0)) |  | BJ24485 |  |  | 2009SRBJ7479 |  |  | 09.21.2009 |  |  | 09.21.2009 |  |  | 12.31.2059 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (ETC RSU Control Software V1.0)                                                                   |  | BJ12307 |  |  | 2009SRBJ2001 |  |  | 11.10.2008 |  |  | 04.18.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (ETC OBU Control Software V1.0)                                                                   |  | BJ12625 |  |  | 2009SRBJ2319 |  |  | 12.20.2008 |  |  | 04.19.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Passenger Flow Statistics Analysis Core Software
      System V1.0)                              |  | 0145950 |  |  | 2009SR018951 |  |  | 07.05.2008 |  |  | 05.22.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (TransGIS Middleware System Software V6.0)                                                        |  | 0152607 |  |  | 2009SR025608 |  |  | 04.28.2009 |  |  | 06.30.2009 |  |  | 12.31.2059 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GPS Police Vehicles Positioning and Dispatching
      System V2.0)                               |  | 0145373 |  |  | 2009SR018374 |  |  | 09.25.2008 |  |  | 05.18.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Taxi GPS Monitoring and Dispatching Management
      System V3.0)                                |  | BJ22027 |  |  | 2009SRBJ5021 |  |  | 05.10.2007 |  |  | 08.12.2009 |  |  | 12.31.2057 | 
|                                                                                                                                                                |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GPS Monitoring and Dispatching Management System
      V2.0for Vehicles Carrying Goods)          |  | BJ22026 |  |  | 2009SRBJ5020 |  |  | 06.15.2008 |  |  | 08.24.2009 |  |  | 12.31.2058 | 

19

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|Computer Software Copyright
      Registered Certificate 
    (Passenger Vehicles GPS Monitoring and Dispatching
      Management System V5.0)                    |  | BJ22028 |  |  | 2009SRBJ5022 |  |  | 11.10.2007 |  |  | 08.24.2009 |  |  | 12.31.2057 | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GPS Monitoring and Dispatching Management System
      V2.0 for Vehicles Carrying Dangerous Goods) |  | BJ22030 |  |  | 2009SRBJ5019 |  |  | 09.25.2008 |  |  | 08.24.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Traffic Management Intelligent Platform Software
      V2.0)                                       |  | BJ14683 |  |  | 2009SRBJ4377 |  |  | 03.10.2009 |  |  | 07.21.2009 |  |  | 12.31.2059 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Multi-source Traffic Information Collection and
      Dynamic Navigation System V2.0)              |  | 0203602 |  |  | 2010SR015329 |  |  | 09.19.2008 |  |  | 04.08.2010 |  |  | 12.31.2058 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Palmcity Real-timeTraffic Information Software
      V2.0)                                         |  | BJ11636 |  |  | 2009SRBJ1330 |  |  | 12.18.2008 |  |  | 04.01.2009 |  |  | 12.31.2058 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Palmcity Public Transportation System V1.0)                                                        |  | BJ27498 |  |  | 2010SRBJ2115 |  |  | 3.10.2010  |  |  | 05.28.2010 |  |  | 12.31.2060 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Passenger Flow Statistics Analysis Core Software
      System V2.0)                                |  | BJ28704 |  |  | 2010SRBJ3321 |  |  | 09.21.2009 |  |  | 08.03.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Traffic Information Distribution System Software
      V3.0)                                       |  | BJ28705 |  |  | 2010SRBJ3322 |  |  | 10.19.2009 |  |  | 08.03.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Trucks GPS Monitoring and Dispatching Management
      System V3.0 )                               |  | BJ28706 |  |  | 2010SRBJ3323 |  |  | 06.15.2009 |  |  | 08.03.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Passenger Vehicles GPS Monitoring and Dispatching
      Management System V6.0)                    |  | BJ28707 |  |  | 2010SRBJ3324 |  |  | 11.10.2008 |  |  | 08.03.2010 |  |  | 12.31.2058 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (GPS Monitoring and Dispatching Management System
      V3.0 for Vehicles Carrying Dangerous Cargo) |  | BJ28708 |  |  | 2010SRBJ3325 |  |  | 09.25.2008 |  |  | 08.03.2010 |  |  | 12.31.2058 | 
|                                                                                                                                                                  |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Multi-source Traffic Information Collection and
      Distribution System V3.0)                    |  | BJ28709 |  |  | 2010SRBJ3326 |  |  | 09.19.2008 |  |  | 08.03.2010 |  |  | 12.31.2058 | 

20

---

|Computer Software Copyright
      Registered Certificate 
    (Taxies GPS Monitoring and Dispatching Management
      System V5.0)                          |  | BJ28717 |  |  | 2010SRBJ3334 |  |  | 09.10.2009 |  |  | 08.03.2010 |  |  | 12.31.2059 | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  |  | ------------ |  |  | ---------- |  |  | ---------- |  |  | ---------- | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (TransGIS Middleware System Software V7.0)                                                    |  | BJ28718 |  |  | 2010SRBJ3335 |  |  | 04.28.2009 |  |  | 08.03.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Pedestrian Detection and Analysis System V1.0)                                               |  | 0155974 |  |  | 2009SR028975 |  |  | 04.15.2009 |  |  | 06.20.2009 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Yootu FCD Data Sources Processing System Software
      V2.0)                                |  | 0195116 |  |  | 2010SR006843 |  |  | 10.09.2009 |  |  | 02.05.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Traffic Information Distribution System Software
      V2.0)                                 |  | 0195273 |  |  | 2010SR007000 |  |  | 10.19.2009 |  |  | 02.08.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (FCD Data Sources Receiving System Software V2.0)                                             |  | 0196808 |  |  | 2010SR008535 |  |  | 10.19.2009 |  |  | 02.23.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (FCD Data Sources and Fixed Point Data Traffic
      Information Fusion System Software V2.0) |  | 0196736 |  |  | 2010SR008463 |  |  | 10.19.2009 |  |  | 02.22.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Historical Data Products Software V2.0)                                                      |  | 0196810 |  |  | 2010SR008537 |  |  | 10.19.2009 |  |  | 02.23.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Traffic Information Emulation System Software
      V2.0)                                    |  | 0196809 |  |  | 2010SR008536 |  |  | 10.19.2009 |  |  | 02.23.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Traffic Information Forecast System Software V2.0)                                           |  | 0196811 |  |  | 2010SR008538 |  |  | 10.19.2009 |  |  | 02.23.2010 |  |  | 12.31.2059 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Intelligent Energy Saving Software V1.0)                                                     |  | 099887  |  |  | 2008SR12708  |  |  | 05.26.2008 |  |  | 07.04.2008 |  |  | 07.03.2013 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Tunnel Monitoring System V1.0)                                                               |  | BJ13492 |  |  | 2008SRBJ3186 |  |  | 08.10.2008 |  |  | 09.26.2008 |  |  | 09.25.2013 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Highway Trunk way Monitoring System V1.0)                                                    |  | BJ13504 |  |  | 2008SRBJ3198 |  |  | 03.28.2008 |  |  | 09.26.2008 |  |  | 09.25.2013 | 
|                                                                                                                                                            |  |         |  |  |              |  |  |            |  |  |            |  |  |            | 
|Computer Software Copyright
      Registered Certificate 
    (Bridge Physical Status Monitoring and Digital
      Maintenance Management System V1.0)      |  | BJ13732 |  |  | 2008SRBJ3426 |  |  | 09.10.2008 |  |  | 10.09.2008 |  |  | 10.08.2013 | 

21

---

Computer Software Copyright
      Registered Certificate 
    (Rail Transit Passenger Flow Analysis System)
    
    0160415
    
    
    2009SR033416
    
    
    08.02.2009
    
    
    08.20.2009
    
    
    08.19.2014Computer Software Copyright
      Registered Certificate 
    (Rail Transit Comprehensive Monitoring System)
    
    BJ23177
    
    
    2009SRBJ6171
    
    
    08.07.2009
    
    
    09.17.2009
    
    
    09.16.2014Computer Software Copyright
      Registered Certificate 
    (Rail Transit Automatic Fare Collection Machine
      System)
    
    BJ23157
    
    
    2009SRBJ6170
    
    
    08.07.2009
    
    
    09.17.2009
    
    
    09.16.2014Computer Software Copyright
      Registered Certificate 
    (Rail Transit Automatic Fare Collection System)
    
    BJ23176
    
    
    2009SRBJ6151
    
    
    08.07.2009
    
    
    09.17.2009
    
    
    09.16.2014Computer Software Copyright
      Registered Certificate 
    (Data Transmission System V1.0)
    
    0168450
    
    
    2009SR041451
    
    
    08.03.2009
    
    
    09.22.2009
    
    
    09.21.2014Computer Software Copyright
      Registered Certificate 
    (Video Online Monitoring System)
    
    0168441
    
    
    2009SR041442
    
    
    07.16.2009
    
    
    09.22.2009
    
    
    09.21.2014Computer Software Copyright
      Registered Certificate 
    (Data Collection System)
    
    0168490
    
    
    2009SR041491
    
    
    08.03.2009
    
    
    09.22.2009
    
    
    09.21.2014Computer Software Copyright
      Registered Certificate 
    (Optical Fiber Grating Based Train Axle Management
      System)
    
    0178497
    
    
    2009SR051498
    
    
    09.22.2009
    
    
    11.05.2009
    
    
    11.04.2014Computer Software Copyright
      Registered Certificate 
    (Highway Toll Collection System Software V1.0)
    
    0196678
    
    
    2010SR008405
    
    
    09.05.2009
    
    
    02.21.2010
    
    
    02.20.2015


|Patent Title                                                                                                         |  | Application Number |  |  | Patentee                                               |  |  | Type                       |  |  | ApplicationDate |  |  | Certificate Number |  |  | Authorization Announcement Date | 
|-------------------------------------------------------------------------------------------------------------------- |  | ------------------ |  |  | ------------------------------------------------------ |  |  | -------------------------- |  |  | --------------- |  |  | ------------------ |  |  | ------------------------------- | 
|                                                                                                                     |  |                    |  |  |                                                        |  |  |                            |  |  |                 |  |  |                    |  |  |                                 | 
|Computer Software Patent
      Registered (Multiple Patterns Transportation Information Distribution
      Terminal) |  | 200920110029.X     |  |  | Beijing PKU
      Chinafront High Technology Co., Ltd. |  |  | Utility Model
      Patent |  |  | 07.09.2009      |  |  | 1506633            |  |  | 08.18.2010                      | 
|                                                                                                                     |  |                    |  |  |                                                        |  |  |                            |  |  |                 |  |  |                    |  |  |                                 | 
|Computer Software Patent
      Registered (Multiple Patterns Transportation Information Distribution
      Terminal) |  | 200930127265.8     |  |  | Beijing PKU
      Chinafront High Technology Co., Ltd. |  |  | Design Patent              |  |  | 07.09.2009      |  |  | 1312330            |  |  | 08.11.2010                      | 
|                                                                                                                     |  |                    |  |  |                                                        |  |  |                            |  |  |                 |  |  |                    |  |  |                                 | 
|Computer Software Patent
      Registered (Passenger Flow Detecting and Analyzing Device)                            |  | 200920110658.2     |  |  | Beijing PKU
      Chinafront High Technology Co., Ltd. |  |  | Utility Model
      Patent |  |  | 08.06.2009      |  |  | 1408769            |  |  | 05.12.2010                      | 

22

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|Computer Software Patent
      Registered (Information Filtering Device)                                                                  |  | 200920222354.5      |  |  | China TranWisewayInformation Technology Co., Ltd.      |  |  | Utility Model
      Patent |  |  | 09.03.2009 |  |  | 1572959 |  |  | 11.03.2010 | 
|----------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------- |  |  | ------------------------------------------------------ |  |  | -------------------------- |  |  | ---------- |  |  | ------- |  |  | ---------- | 
|                                                                                                                                          |  |                     |  |  |                                                        |  |  |                            |  |  |            |  |  |         |  |  |            | 
|Computer Software Patent
      Registered (A Method and System Utilizing Natural Language Setting and
      Operating to Control Others ) |  | 200710121229.0      |  |  | Beijing PKU
      Chinafront High Technology Co., Ltd. |  |  | Invention Patent           |  |  | 08.31.2007 |  |  | 508906  |  |  | 06.10.2009 | 
|                                                                                                                                          |  |                     |  |  |                                                        |  |  |                            |  |  |            |  |  |         |  |  |            | 
|Computer Software Patent
      Registered (Pipe Leakage and Blockage Detecting System)                                                    |  | ZL 2009 2 0109073.9 |  |  | Beijing UNISITS
      Technology Co., Ltd.             |  |  | Utility Model
      Patent |  |  | 07.07.2009 |  |  | 1420232 |  |  | 05.12.2010 | 
|                                                                                                                                          |  |                     |  |  |                                                        |  |  |                            |  |  |            |  |  |         |  |  |            | 
|Computer Software Patent
      Registered                                                                                                 |  | ZL 2010 2 0000051.1 |  |  | Beijing UNISITS
      Technology Co., Ltd.             |  |  | Utility Model
      Patent |  |  | 01.05.2010 |  |  | 1584025 |  |  | 11.10.2010 | 

Research and Development

In 2010 and 2009, our research and development expenses
amounted to approximately $8.07 million and $3.80 million, respectively. These
expenses were mainly composed of staff costs and research and development
equipment expenses.

Our Research and Development (R&D) Department consists of
two teams, one is internal and the other is external. Our external team involves
in strategic relationship with the GeoSIS Laboratory at Peking University.

Internal R&D Department

Our internal R&D team consists of 479 researchers with
extensive experience in the GIS and transportation information industry. Many of
these researchers have worked at multinational corporations. The primary focus
of the internal R&D team is to analyze customer demands and develop
application software products, with the use of the most highly advanced software
development tools available today. Our internal R&D team is also responsible
for monitoring developments in the market for our services so that they can
develop new products or improve upon existing products by adopting new
technologies and skills. In addition, our internal team is responsible for
creating training and support manuals and creating new processes for
implementation of our software products.

Strategic R&D Partnership with Peking University

PKU was established in connection with the Peking Universitys
GeoSIS Laboratory in order to provide university researchers with real life
opportunities to test and implement the discoveries from the University. On
August 6, 2005, PKU entered into a cooperation agreement (the Cooperation
Agreement) with Earth and Space College of Peking University, pursuant to which
PKU obtained the access to the universitys GeoSIS Research Lab, which houses
over thirty PhDs and researchers to support PKUs research and development
initiatives. Under the Cooperation Agreement, we pay for all R&D expenses of
the GeoSIS Laboratory. The Cooperation Agreement has a three-year term that has
been automatically renewed for an additional three years.

Our Major Customers

The following table provides information on our most
significant clients in fiscal year 2010.

23

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TOP TEN CLIENTS IN 2010

Sales(in thousands
    
    Percentageof
    
    ofNo
    Name
    Description of Client
    US dollars)
    
    Total Sales1
    Zhejiang Huangqunan Highway
      Co., Ltd.
    A state-owned highway
      construction company
    9,030
    
    7.36%2
    Hunan Highway Construction
      & Development Corporation
    A state-owned highway
      construction company
    6,807
    
    5.55%3
    Hubei Mawu Highway Construction
      Project Department
    Local governmental
      transportation authority
    6,702
    
    5.46%4
    Shandong High-Speed Group Co.,
      Ltd.
    A state-owned highway
      construction company
    4,348
    
    3.54%5
    Chongqing Highway Group Co.,
      Ltd. Southeast Construction Branch Company
    A state-owned highway
      construction company
    4,316
    
    3.52%6
    Gansu Province High Grade Road
      Construction Co., Ltd.
    A provincial transportation
      authority owned road construction company
    4,286
    
    3.49%7
    Shandong High-Speed Group
      Sichuan Leyi Highway Co., Ltd.
    A state-owned highway
      construction company
    3,471
    
    2.83%8
    Construction and Transportation
      Committee of Shanghai Minhang District
    City-level governmental
      department
    2,988
    
    2.44%9
    Shandong High-Speed Group Xuhao
      Highway Co., Ltd.
    A state-owned highway
      construction company
    2,927
    
    2.39%10
    Highway Fees Collecting and
      Settling Center for Shandong Ministry of Transportation
    Local governmental
      transportation authority
    2,331
    
    1.90%TOTAL
    
    47,206
    
    38.47%


Regulation

Because our operating VIE Entities are located in the PRC, our
business is regulated by the national and local laws of the PRC. There are no
specific rules or regulations for a company engaged in software development
other than mapping which is highly regulated in China.

In addition, we and our PRC subsidiary, Oriental Intra-Asia,
are considered foreign persons or foreign-invested enterprises under PRC laws,
and therefore subject to foreign ownership restrictions in connection with our
online services, advertising in taxies, and security and surveillance related
businesses:

Online Service

On December 11, 2001, the State Council of China promulgated
the Regulations on the Administration of Foreign Invested Telecommunication
Enterprises (the FITE Regulations) , which became effective on
January 1, 2002. Under the FITE Regulations, a foreign entity is prohibited from
owning more than 50% of equity of a provider of value-added telecommunications
services in China, which include internet content provider. In addition, the
current Catalogue of Industries for Guiding Foreign Investment (Revised
2007) prohibits a foreign investor from investing in businesses such as
news websites and web streaming audio-visual services. As a result, if we had
invested directly in the value-added telecommunications services in China, we
could have at most 50% of the ownership of the business and thus only
consolidated no more than 50% of the revenues generated from such business.

Taxi Advertising

For an advertising business involving foreign investment, there
have been rigid overseas operational requirements on the foreign investors under
the current Chinese laws. Pursuant to the Provisions on Administration of
Foreign Invested Advertising Enterprises promulgated by the State
Administration for Industry & Commerce and the Ministry of Commerce of China on March 2, 2004, for a wholly foreign owned
advertising enterprise, the foreign investors must have at least three years of
direct operations in the advertising business outside of China. In case of a
joint venture, foreign investors must have at least two years of direct
operations in the advertising business outside of China. However, a domestic
company without direct foreign investment is not subject to any of these
restrictions.

24

---

Security and Surveillance Related Business

While there is no Chinese law or regulation specifically
prohibiting foreign investment in the security and surveillance related business
in China, the nature of this business implies that a vast majority of the
customers of this business are governmental entities. Maintaining
confidentiality of sensitive information about national security and other
various governmental affairs is one of the most important concerns of those
governmental entities. Therefore, as a practicable matter, governmental entities
are more willing to have business relations with purely domestic companies than
a company involving foreign investment where confidential governmental
information could be a concern.

In order to comply with these legal restrictions, on February
3, 2009, we conducted the Restructuring and entered into the contractual
arrangements with the VIE Entities. Such arrangements enabled us to operate
these restricted businesses through our VIE Entities in which we do not hold a
direct equity interest. For more information on the regulatory and other risks
associated with our contractual agreements related to our VIE Entities, please
see the discussion below Item 1A, Risk Factors.

We are also subject to PRCs foreign currency regulations. The
PRC government has controlled RMB reserves primarily through direct regulation
of the conversion of RMB into other foreign currencies. Although foreign
currencies, which are required for current account transactions, can be bought
freely at authorized PRC banks, the proper procedural requirements prescribed by
PRC law must be met. At the same time, PRC companies are also required to sell
their foreign exchange earnings to authorized PRC banks and the purchase of
foreign currencies for capital account transactions still requires prior
approval of the PRC government.

The Competition and Our Competitive Strength

Chinas transportation information industry is very fragmented.
Our major competitors consist of several foreign companies and many domestic
transportation information technology companies. While most international
competitors seek to provide component software for the industry, we focus on
developing application software and services for the Chinese government and
regulated sectors.

We believe that the following competitive strengths enable us
to compete effectively in Chinas transportation information industry:

Leading-Edge R&D Team- Our research and development
team has a strong and extensive technology background and was an early entrant
into the three-dimensional GIS market. The head of our research and development
team was the lead engineering architect of the first three-dimensional GIS
platform software in China, which won the Chinese Excellence Software Award in
1995.

R&D Affiliation with Peking University- Through our
early alliance with Peking University, we developed a strong and extensive
technology foundation. Under the cooperation agreement between PKU and Earth and
Space College of Peking University, we have access to the universitys GeoSIS
Research Lab and its team of over 30 scientists and researchers to support our
R&D initiatives. Peking University is a 3% owner of PKU.

Award Winning Technology- Since inception, we have won
nine product awards, including the National Transportation Planning System and
Digital City Program award. The awards demonstrate the technological leadership
of our ITS and give customers a sense of security that they are purchasing a
quality product.

Brand Image- We have built a valuable brand image
through our track record of successful execution of projects for customers in
various sectors. We provide products and services, including value-added
services to meet maintenance and technology upgrade requirements, to our
governmental and other customers. Our customers include central, provincial and
municipal government agencies, construction, real estate development and
high-tech companies. We plan to leverage our brand image to obtain new and
recurring business.

25

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Superior Management Team- Three members of our
executive management team were among the first GIS software developers in China.
Collectively, they have more than 34 years of experience with GIS, and each has
been with PKU since its early days. They are complemented by two executives with
extensive finance and corporate financial reporting experience.

Operational and Quality Management- We are ISO 9000
certified and conduct internal performance assessments three times per year.
Being in close proximity to two of Chinas top universities, we have a large
pool of qualified candidates to choose from for our hiring needs. We hire our
employees based on a rigorous review of their academic and technical skills. We
also screen each candidates background for potential conflicts of interest and
in order to avoid the possible appearance of impropriety in our dealings with
government agencies.

We experience competition from both foreign and domestic
Chinese competitors. The following is a description of some of our major
competitors:

Foreign Competitors

- Image Sensing System, Inc. (ISS) - ISS is headquartered in St. Paul,
  Minnesota, a technology company focused in infrastructure productivity
  improvement through the development of software-based detection solutions for
  the ITS sector and adjacent overlapping markets. ISSs industry leading
  computer-enabled detection (CED) products combine embedded software signal
  processing with sensing technologies for use in transportation, environmental
  and safety/surveillance management. With more than 90,000 instances sold in
  over 60 countries worldwide, its products are well positioned to the traffic,
  security and environmental management markets.
- Satellic Traffic Management GmbH - Satellic Traffic Management GmbH
  (Satellic) is a global technology service provider for the setup and operation
  of progressive toll and traffic management systems. Satellic is a wholly-owned
  subsidiary of T-Systems, the business customers segment of Deutsche Telekom.
  The company, which was founded in 2005, has its headquarters in Berlin.
  Satellic advises governments, companies and associations and is working with
  industrial partners, in the implementation of traffic infrastructure projects.
  The company develops new concepts (public and private partnerships) for
  financing, traffic management and for emissions protection.
- Vehicle Information and Communication System Center - Vehicle Information
  and Communication System Center, founded in 1995 in Tokyo, Japan, is involving
  in the business of systematical gathering, processing, and editing road
  traffic information, and managing and operating traffic information system by
  using communication and broadcasting media, and in turn transmitting accurate
  traffic information to drivers via in-vehicle navigation devices.
- Organization for Road System Enhancement - Organization for Road System
  Enhancement (ORSE), was founded in 1999 in Japan. ORSE is in the business of
  ETC system in Japanese market including establishing standard for data
  security in ETC systems, establishing processed data for other ETC systems and
  develop ETC related technologies.
- Navteq - Navteq is a world leader in premium-quality digital map data. Its
  data has been widely applied in vehicle navigation systems in North America
  and Europe. Founded in California in 1985, this company has been acquired by
  Nokia in 2008. Currently, Navteq has more than 4,000 employees worldwide
  located with 196 offices in 36 countries.

The products offered by our foreign competitors are generally
priced higher than our products. In addition, their software cannot be applied
in China without significant modification due to differing industry standards
and background. For these reasons, we do not foresee much competition from these
international competitors in the area of transportation information application
software.

Domestic Chinese Competitors

- Beijing E-Hualu Info Technology Co., Ltd. (E-Hualu) - Founded in 2001,
  based in Beijing, E-Hualu is involved in the business of design and
  construction of intelligent traffic projects, and the urban traffic command
  center software development and system integration technology. E-Hualu has
  developed a series of traffic management application software and hardware systems with
      independent intellectual property and cooperated with police departments
      for urban public security and traffic command center constructions.

26

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| | Beijing Rhytech Co., Ltd. (Rhytech) - Based in Beijing,
      Rhytech focuses on intelligent traffic sector including inter-city
      intelligent traffic management system, police intelligent traffic
      management system, railway and tunnel intelligent traffic management
      system and other value-added intelligent traffic service. Currently, the
      company has 3 offices throughout China.                                                                                                                                                                                                                                                                              
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | BOCO Inter-Telecom Holding Co., Ltd. (BOCO Inter-Telecom)
      - BOCO Inter-Telecom has been listed in Shanghai stock market of A-Share
      with ticker 600289 since 2000. Affiliated with Beijing University of Posts
      and Telecommunications, BOCO Inter-Telecoms main business includes
      telecom operation support systems, information security systems and
      intelligent traffic systems. Its intelligent traffic systems are mainly
      highway management systems, highway maintenance systems and electronic
      toll collection systems.                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Qingdao Hisense TransTech Co., Ltd. (QHNTC) - QHNTC was
      founded in October 1998. It is a subsidiary of Hisense Co., Ltd. QHNTC is
      in the business of development and service of ITS. Focusing on urban
      traffic, public transport, logistics and commercial service, the company
      has developed several proprietary rights in traffic light control systems
      and urban public security and traffic comprehensive information platforms
      and other public transportation systems.                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Beijing Stone Intelligent Transportation System
      Integration Co., Ltd. - Beijing Stone focuses on ITS, traffic engineering
      technical system, traffic information system and other serial traffic
      products.                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Guangzhou Heartly Teamgo Information System Engineering
      Co., Ltd. (Heartly Teamgo) - Based in Guangzhou, Guangdong Province,
      founded in 1997, Heartly Teamgo is engaged in the business of intelligent
      traffic products development, solution and system integration. Mainly
      operate in Guangdong Province, this company has developed city intelligent
      public transportation system, public media information display system,
      electronic bulletin boards and GPS in-car platform. The company has
      completed Guangzhou parking systems, public transportation sensor dispatch
      system and related projects.                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | CenNavi Technologies Co., Ltd. (CenNavi) - Founded in
      2005, CenNavi collects, processes, distributes and optimizes dynamic
      traffic information technologies. This company provides real-time traffic
      information services for vehicle terminals, PND terminals, mobiles phones
      and internets as well as supports traffic information display and optimal
      route query to above terminals. Acquired by China's largest navigable
      e-map manufacturerNavInfo, this companys products are mainly sold in the
      vehicle market currently.                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Shenzhen GENVICT Technologies Co., Ltd. (GENVICT) -
      GENVICT is a high-tech corporation specialized in developing, designing,
      manufacturing, supplying and providing technical services for Intelligent
      Transportation System (ITS) devices, IC card readers, embedded intelligent
      terminals and related hardware products. The company is headquartered in
      Shenzhen, with major customers such as expressway, public security,
      traffic control, finance, urban traffic authorities.                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | NAVINFO - NavInfo is a company in Chinas vehicle
      navigation and mapping market. It provides products and services in
      portable navigation, (location based services) LBS and internetbased
      location services and traffic information services. Currently, NavInfo map
      data have been mainly applied in vehicle navigation market and portable
      navigation market, as well as used by Internet-based location service
      providers and mobile phone operators in China.                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | AUTONAVI- AutoNavi is a provider of digital map content
      and navigation and location-based solutions in China. At the core of its
      business is a comprehensive nationwide digital map database that covers
      approximately 3.1 million kilometers of roadway and over 13 million points
      of interest across China. Through its digital map database, AutoNavi provides comprehensive, integrated
      navigation and location-based solutions optimized for the Chinese market
      and users, including automotive navigation solutions, public sector and
      enterprise applications, wireless location-based solutions and Internet
      location-based solutions.

Raw Materials

27

---

Since we are in the business of developing software
applications and providing related services, we do not utilize any significant
amount of raw materials. All of the raw materials needed for our business are
readily available from several different suppliers and at market driven prices.
We only purchase computers and other software in order to provide our services
and software applications to customers.

Employees

As of December 31, 2010, we employed a total of 725 full-time
employees. The following table sets forth the number of our employees by
function as of December 31, 2010.

|                           |  | Number of | 
|-------------------------- |  | --------- | 
|Department                 |  | Employees | 
|Software Development (R&D) |  | 479       | 
|Quality Control            |  | 16        | 
|Sales and Marketing        |  | 98        | 
|Administration             |  | 70        | 
|Human Resources            |  | 24        | 
|Finance                    |  | 38        | 
|Total                      |  | 725       | 

Our employees are not represented by a labor organization or
covered by a collective bargaining agreement. We have not experienced any work
stoppages. In addition, we are required by the PRC law to cover employees in
China with various types of social insurance. We believe that we are in
compliance with the relevant PRC laws.

We believe that we maintain a satisfactory working relationship
with our employees and we have not experienced any significant labor disputes or
any difficulty in recruiting staff for our operations.

Insurance

We do not have any business liability, interruption or
litigation insurance coverage for our operations in China. Insurance companies
in China offer limited business insurance products. While business interruption
insurance is available to a limited extent in China, we have determined that the
risks of interruption, cost of such insurance and the difficulties associated
with acquiring such insurance on commercially reasonable terms make it
impractical for us to have such insurance. Therefore, we are subject to business
and product liability exposure. See Item 1A, Risk Factors  Our inability to
protect our trademarks, patent and trade secrets may prevent us from
successfully marketing our products and competing effectively.

Available Information

We maintain an internet website at www.ctfo.com. Our Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form
8-K, including exhibits and amendments to those reports filed or furnished
pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as
amended, are available on our website at www.ctfo.com, free of charge, as soon
as reasonably practicable after the electronic filing of these reports with, or
furnishing of these reports to, the SEC. Any materials we file with the SEC are
available at the SECs Public Reference Room at 100 F Street, NE, Washington, DC
20549. Additional information about the operation of the Public Reference Room
can also be obtained by calling the SEC at 1-800-SEC-0330. In addition, the SEC
maintains a website at www.sec.gov that contains reports, proxy and information
statements, and other information regarding issuers that file electronically
with the SEC, including us.

ITEM 1A. RISK FACTORS.

The shares of our common stock are highly speculative in
nature, involve a high degree of risk and should be purchased only by persons
who can afford to lose the entire amount invested in the common stock. Before
purchasing any of the shares of common stock, you should carefully consider the
following factors relating to our business and prospects. You should pay
particular attention to the fact that we conduct all of our operations in China
and are governed by a legal and regulatory environment that in some respects
differs significantly from the environment that may prevail in the U.S. and other countries. If any of the following risks actually
occurs, our business, financial condition or operating results will suffer, the
trading price of our common stock could decline, and you may lose all or part of
your investment.

28

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RISKS RELATED TO OUR BUSINESS

In order to comply with PRC regulatory requirements, we
operate our businesses through companies with which we have contractual
relationships but in which we do not have controlling ownership. If the PRC
government determines that our agreements with these companies are not in
compliance with applicable regulations, our business in the PRC could be
materially adversely affected.

The Chinese government restricts foreign investment in certain
business segments including online services, taxi advertising, and security and
surveillance related businesses. Accordingly we transferred all of our indirect
equity interests in PKU and PKUs subsidiaries to the affiliated Group Company
and as a result, PKU and PKUs subsidiaries became direct and indirect
subsidiaries of the Group Company, which is wholly owned by the Group Company
Shareholders who are all Chinese citizens. At the same time, we are able to
control these VIE Entities and operate these businesses through contractual
arrangements with the respective companies and their individual owners, but we
have no equity control over these companies.

Although we believe the Restructuring and our current business
operations are in compliance with the current laws in China, we cannot be sure
that the PRC government would view our operating arrangements to be in
compliance with PRC regulations that may be adopted in the future. If we are
determined not to be in compliance, the PRC government could levy fines, revoke
our business and operating licenses, require us to discontinue or restrict our
operations, restrict our right to collect revenues, require us to restructure
our business, corporate structure or operations, impose additional conditions or
requirements with which we may not be able to comply, impose restrictions on our
business operations or on our customers, or take other regulatory or enforcement
actions against us that could be harmful to our business. As a result, our
business in the PRC could be materially adversely affected.

We rely on contractual arrangements with our VIE Entities
for our operations, which may not be as effective in providing control over
these entities as direct ownership.

Our operations are dependent on our VIE Entities in which we
have no equity ownership interest and must rely on contractual arrangements to
control and operate the businesses of the VIE Entities. These contractual
arrangements may not be as effective in providing control over these entities as
direct ownership. For example, the VIE Entities may be unwilling or unable to
perform their obligations under our commercial agreements with them, including
payment of annual development and consulting fees as they become due, we will
not be able to conduct our operations in the manner currently planned. In
addition, the VIE Entities may seek to renew their agreements on terms that are
disadvantageous to us. Although we have entered into a series of agreements that
provide us with substantial ability to control the VIE Entities, we may not
succeed in enforcing our rights under them by relying on legal remedies under
Chinese law, which may not be adequate. In addition, if we are unable to renew
these agreements on favorable terms when these agreements expire, or to enter
into similar agreements with other parties, our business may not be able to
operate or expand, and our operating expenses may significantly increase.

The shareholders of the Group Company may have potential
conflicts of interests with us, which may adversely affect our business.

We operate our businesses in China through the Group Company,
which is wholly owned by our four Chinese affiliates: Shudong Xia, our Chairman,
CEO and President and the beneficial owner of approximately 70.70% of the Group
Companys outstanding capital stock, Zhiping Zhang, our Vice President of
Research and Development, Zhibin Lai, our Vice President and Wei Gao, the
designee of SAIF Partners III L.P. (SAIF Partners), who in aggregate own
29.30% of the Group Company. Conflicts of interests between their duties to us
and to the Group Company and its subsidiaries may arise. We cannot assure you
that when conflicts of interest arise, any or all of these persons will act in
the best interests of our company or that any conflict of interest will be
resolved in our favor. These conflicts may result in management decisions that
could negatively affect our operations and potentially result in the loss of
opportunities.

Our arrangements with the VIE Entities and its
shareholders may be subject to a transfer pricing adjustment by the PRC tax
authorities which could have an adverse effect on our income and
expenses.

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We could face material and adverse tax consequences if the PRC
tax authorities determine that our contracts with the VIE Entities and its
shareholders were not entered into based on arms length negotiations. Although
our contractual arrangements are similar to other companies conducting similar
operations in China, if the PRC tax authorities determine that these contracts
were not entered into on an arms length basis, they may adjust our income and
expenses for PRC tax purposes in the form of a transfer pricing adjustment. Such
an adjustment may require that we pay additional PRC taxes plus applicable
penalties and interest, if any.

The exercise of our option to purchase part or all of the
equity interests in the VIE Entities under the Option Agreement might be subject
to approval by the PRC government and foreign ownership restrictions on the VIE
Entities current businesses under PRC laws. Our failure to purchase the equity
of the VIE Entities without discontinuing the current businesses and operations
of the VIE Entities may impair our ability to substantially control the VIE
Entities and could result in actions by VIE Entities that conflict with our
interests.

Our Option Agreement with the VIE Entities gives our Chinese
subsidiary, Oriental Intra-Asia, the option to purchase all or part of the
equity interests in the VIE Entities, however, the option may not be exercised
by Oriental Intra-Asia if the exercise would violate any applicable laws and
regulations in China or cause any license or permit held by, and necessary for
the operation of the VIE Entities, to be cancelled or invalidated. Under the
laws of China, if a foreign entity, through a foreign investment company that it
invests in, acquires a domestic related company, Chinas regulations regarding
mergers and acquisitions would technically apply to the transaction. Application
of these regulations requires an examination and approval of the transaction by
Chinas Ministry of Commerce (MOFCOM), or its local counterparts. Also, an
appraisal of the equity or assets to be acquired is mandatory. However, our
local PRC counsel has advised us that Beijing and other local counterparts of
MOFCOM hold the view that such a transaction would not require their approval.
Therefore, we do not believe at this time that an approval and an appraisal are
required for Oriental Intra-Asia to exercise its option to acquire the VIE
Entities in Beijing. In light of the different views on this issue, however, it
is possible that the central MOFCOM office in Beijing will issue a standardized
opinion imposing the approval and appraisal requirement. In addition, even if we
successfully acquire the equity interests in the VIE Entities through exercising
our option, we may not be able to continue the current operations and businesses
of the VIE Entities as, under the current PRC laws, we are subject to foreign
ownership restrictions in connection with the online services, advertising in
taxies, and security and surveillance related businesses, as described under the
heading of "Regulation" above. If we are not able to purchase the equity of the
VIE Entities without discontinuing the current businesses and operations of the
VIE entities, then we will lose a substantial portion of our ability to control
the VIE Entities and our ability to ensure that the VIE Entities will act in our
interests.

We are highly dependent on the ITS industry which is
characterized by rapid technological change.

Our financial performance is dependent upon the continuing
growth of the ITS industry which has historically been characterized by rapid
technological change, evolving industry standards and changing customer needs.
We cannot guarantee that we will be able to continue to anticipate and respond
to future industry demands in a timely manner. New services or technologies may
render our existing services or technologies less competitive or even obsolete.
If we fail to anticipate and respond to technological advancements and
developments in the ITS industry in the future in a timely manner, our results
of operations may be materially and adversely affected. We are also subject to
the risks generally associated with new technology introductions and
applications, including the lack of market acceptance, delays in new application
development and failure of applications to operate properly.

A termination of our relationship with Peking University
could have a negative impact on our future operating results.

PKU has historically been able to successfully leverage the
marketability and resources offered by its strategic partner and investor,
Peking University. PKUs affiliation with Peking University helps to create
brand awareness for its products and services and also provides access to the
universitys GeoGIS Laboratory, which houses over thirty PhDs and researchers to
support PKUs research and development initiatives. A termination of the
relationship/strategic partnership with Peking University could have a negative
impact on our future operating results.

We rely heavily on sales to the Chinese government and a
significant decline in overall government expenditures or a delay in the payment
of our invoices by the government could have a negative impact on our future
operating results.

Historically, substantially all of our sales of our products
have been to the Chinese government entities at both central and local levels.
We believe that the success and growth of our business for the foreseeable
future will continue to depend on our ability to win government contracts. Many
of our government customers are subject to budgetary constraints and our
continued performance under these contracts, or award of additional contracts
from these agencies, could be jeopardized by spending reductions or budget cutbacks at these agencies. Our
operating results may also be negatively impacted by other developments that
affect these government programs generally, including the following:

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- adoption of new laws or regulations relating to government contracting or
  changes to existing laws or regulations;
- delays or changes in the government appropriations process; and
- delays in the payment of our invoices by government payment offices.

We have experienced significant growth in the past, and
we may not be able to maintain such growth in the future.

During the past years, we significantly increased the scope of
our operations and increased our revenues from $11.9 million in 2007 to $122.7
million in 2010. Part of this growth was due to the acquisition of certain PRC
companies, which made material contributions to our overall revenues and profits
during the relevant period. Our growth may not be sustained in the future if we
do not continue to expand the scope of our operations. In addition,
contributions to our rapid growth by acquisitions may not be sustainable in the
future to the extent that we are not able to identify and execute suitable
acquisitions. The expansion of our business has, and will continue to, put
pressure on our managerial, financial, operational and other resources. We also
need to enhance financial and quality controls and recruit and train additional
staff in order to keep pace with our growth. We may need to increase employee
compensation levels in order to retain our existing executives and staff and
attract the additional personnel we expect we may require. We cannot assure you
that we will be able to manage our future expansion effectively. If we are
unable to effectively manage our expanding operations and control increasing
labor costs, our profitability may be materially and adversely affected.

We face risks associated with potential acquisitions,
investments, strategic partnership or other ventures.

For expansion purposes, we may acquire or make investments in
complementary businesses, facilities or services or products, or enter into
strategic partnerships with parties who can provide access to such assets, if
appropriate opportunities arise. We may not be able to identify suitable
acquisition, investment or strategic partnership candidates, which may place us
at a disadvantage if our competitors are able to grow their market share through
acquisitions. If we do identify suitable candidates, we may not be able to
obtain necessary funding or be able to complete those transactions on
commercially acceptable terms or at all. If we acquire another company, we may
have difficulty in integrating that companys personnel, products and
operations. In addition, the key personnel of the acquired company may decline
to work for us. These difficulties could disrupt our ongoing business, distract
our management and employees and increase our expenses.

We rely on our management to understand and react to our
rapidly evolving and highly competitive GIS software development and application
total solution industry and our failure to react to such changes or to introduce
new products and product enhancements could adversely affect our
business.

The Chinese GIS industry is nascent and rapidly evolving.
Therefore, it is critical that our management is able to understand industry
trends and make good strategic business decisions. If our management is unable
to identify industry trends and act in response to such trends in a way that is
beneficial to us, our business will suffer.

In addition, we expect that a significant portion of our future
revenue will be derived from sales of newly-introduced products. The market for
our products is characterized by rapidly changing technology, evolving industry
standards and changes in customer needs. If we fail to introduce new products or
to modify or improve our existing products in response to changes in technology,
industry standards or customer needs, our products could rapidly become less
competitive or obsolete. We must continue to make significant investments in
research and development in order to continue to develop new products, enhance
existing products and achieve market acceptance for such products. However,
there can be no assurance that development stage products will be successfully
completed or, if developed, will achieve significant customer acceptance.

If we are unable to successfully develop and introduce
competitive new products and enhance our existing products, our future results
of operations would be adversely affected. Our pursuit of necessary technology
may require substantial time and expense. We may need to license new
technologies to respond to technological change. These licenses may not be
available to us on terms that we can accept or may materially change the gross
profits that we are able to obtain on our products. We may not succeed in
adapting our products to new technologies as they emerge. Development and
manufacturing schedules for technology products are difficult to predict and
there can be no assurance that we will achieve timely initial customer shipments
of new products. The timely availability of these products in volume and their
acceptance by customers are important to our future success. Any future delays,
whether due to product development delays, manufacturing delays, lack of market acceptance, delays in
regulatory approval, or otherwise, could have a material adverse effect on our
results of operations.

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We may not be able to adequately protect our proprietary
intellectual property and technology, which may harm our competitive position
and result in increased expenses incurred to enforce our rights.

We rely on a combination of copyright, trade secret laws,
non-disclosure agreements and other confidentiality procedures and contractual
provisions to establish, protect and maintain our proprietary intellectual
property and technology and other confidential information. Some of these
technologies are important to our business and are not protected by patents.
Despite our efforts, the steps we have taken to protect our proprietary
intellectual property and technology and other confidential information may not
be adequate to preclude misappropriation of our proprietary information or
infringement of our intellectual property rights. Protecting against the
unauthorized use of our products and other proprietary rights is also expensive,
difficult and, in some cases, impossible. Litigation may be necessary in the
future to enforce or defend our intellectual property rights, to protect our
trade secrets or to determine the validity and scope of the proprietary rights
of others. Such litigation could result in substantial costs and diversion of
management resources, either of which could harm our business, operating results
and financial condition.

Product branding is important to us and if our brands are
misappropriated such that our reputation could be harmed, this could result in
lower sales having a negative impact on our financial results.

We rely upon a combination of licensing and contractual
covenants to establish and protect the brand names of our products. In many
market segments, our reputation is closely related to our brand names.
Monitoring unauthorized use of our brand names is difficult and we cannot be
certain that the steps we have taken will prevent their unauthorized use,
particularly in foreign countries where the laws may not protect our proprietary
rights as fully as in the United States. Our brand names may be misappropriated
or utilized without our consent and such actions may have a material adverse
effect on our reputation and on the results of our operations.

If we are unable to compete effectively with existing or
new competitors, our resulting loss of competitive position could result in
price reductions, fewer customer orders, reduced margins and loss of market
share.

The markets for our products are highly competitive and we
expect competition to increase in the future. Some of our competitors have
significantly greater financial, technical and marketing resources than we do.
These competitors may be able to respond more rapidly to new or emerging
technologies or changes in customer requirements. They may also be able to
devote greater resources to the development, promotion and sale of their
products. Increased competition could result in price reductions, fewer customer
orders, reduced margins and loss of market share. Our failure to compete
successfully against current or future competitors could seriously harm our
business, financial condition and results of operations.

Our products are complex and errors or defects could
result in the rejection of our products and damage to our reputation, as well as
lost revenues and increased costs.

Products as sophisticated as ours are likely to contain
undetected errors or defects, especially when first introduced or when new
models or versions are released. Our products may not be free from errors or
defects after commercial shipments have begun, which could result in the
rejection of our products, damage to our reputation, lost revenues, diverted
development resources and increased customer service and support costs and
warranty claims. Any of these results could harm our business.

We do not carry any business interruption insurance,
product liability or recall insurance or third-party liability insurance.

Operation of our business and facilities involves many risks,
including equipment failures, natural disasters, industrial accidents, labor
disturbances, business interruptions, property damage, and product liability. We
do not carry any business interruption insurance or third-party liability
insurance for our business to cover claims in respect of product liability,
personal injury or property damage arising from accidents on our property or
relating to our operations. As a result, we may be required to pay for financial
and other losses, damages and liabilities, including those caused by natural
disasters and other events beyond our control, out of our own funds, which could
have a material adverse effect on our business, financial condition and results
of operations.

We may be exposed to potential risks relating to our
internal control over financial reporting.

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To implement Section 404 of the Sarbanes-Oxley Act of 2002, the
SEC adopted rules requiring public companies to include a report of management
on the companys internal control over financial reporting in their annual
reports on Form 10-K. Under current law, we are subject to the requirement that
we maintain internal controls and that management perform periodic evaluation of
the effectiveness of the internal controls, assuming our filing status remains
as a smaller reporting company. A report of our management is included under
Item 9A of this Annual Report on Form 10-K. Our management has concluded that
our internal control over financial reporting was effective at the reasonable
assurance level for the fiscal year ended December 31, 2010. However, in the
future, our management may conclude that our internal controls over financial
reporting are not effective, if one or more material weaknesses are identified.
In the event we identify significant deficiencies or material weaknesses in our
internal controls that we cannot remediate in a timely manner, investors and
others may lose confidence in the reliability of our financial statements.

We may be exposed to liabilities under the Foreign
Corrupt Practices Act, and any determination that we violated the Foreign
Corrupt Practices Act could have a material adverse effect on our
business.

We are subject to the Foreign Corrupt Practice Act (the
FCPA), and other laws that prohibit improper payments or offers of payments to
foreign governments and their officials and political parties by U.S. persons
and issuers as defined by the statute for the purpose of obtaining or retaining
business. We have operations, agreements with third parties and make sales in
China, which may experience corruption. Our activities in China create the risk
of unauthorized payments or offers of payments by one of the employees,
consultants, sales agents or distributors of our company, because these parties
are not always subject to our control. It is our policy to implement safeguards
to discourage these practices by our employees. Also, our existing safeguards
and any future improvements may prove to be less than effective, and the
employees, consultants, sales agents or distributors of our Company may engage
in conduct for which we might be held responsible. Violations of the FCPA may
result in severe criminal or civil sanctions, and we may be subject to other
liabilities, which could negatively affect our business, operating results and
financial condition. In addition, the government may seek to hold our Company
liable for successor liability FCPA violations committed by companies in which
we invest or that we acquire.

Since we depend heavily on key personnel, turnover of key
employees and senior management could harm our business.

Our future business and results of operations depend in
significant part upon the continued contributions of our key technical and
senior management personnel, including Shudong Xia, our chief executive officer
and president, our chief financial officer, Rong Zhang and our vice presidents,
Zhibin Lai, Zhiping Zhang, Shan Qu and Danxia Huang. We also depend in significant part
upon our ability to attract and retain additional qualified management,
technical, marketing and sales and support personnel for our operations. If we
lose a key employee, or if a key employee fails to perform his or her current
position, or if we are not able to attract and retain skilled employees as
needed, our business could suffer. Significant turnover in our senior management
could significantly deplete our institutional knowledge held by our existing
senior management team. We depend on the skills and abilities of these key
employees in managing the manufacturing, technical, marketing and sales aspects
of our business, any part of which could be harmed by further turnover.

RISKS RELATED TO DOING BUSINESS IN CHINA

Adverse changes in political and economic policies of the
PRC government could impede the overall economic growth of China, which could
reduce the demand for our products and damage our business.

We conduct substantially all of our operations and generate
most of our revenue in China. Accordingly, our business, financial condition,
results of operations and prospects are affected significantly by economic,
political and legal developments in China. The PRC economy differs from the
economies of most developed countries in many respects, including:

- a higher level of government involvement;
- an early stage of development of the market-oriented sector of the
  economy;
- a rapid growth rate;
- a higher level of control over foreign exchange; and
- the allocation of resources.

As the PRC economy has been transitioning from a planned
economy to a more market-oriented economy, the PRC government has implemented
various measures to encourage economic growth and guide the allocation of
resources. While these measures may benefit the overall PRC economy, they may
also have a negative effect on us.

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Although the PRC government has in recent years implemented
measures emphasizing the utilization of market forces for economic reform, the
PRC government continues to exercise significant control over economic growth in
China through the allocation of resources, controlling the payment of foreign
currency-denominated obligations, setting monetary policy and imposing policies
that impact particular industries or companies in different ways.

Any adverse change in economic conditions or government
policies in China could have a material adverse effect on the overall economic
growth in China, which in turn could lead to a reduction in demand for our
services and consequently have a material adverse effect on our business and
prospects.

Uncertainties with respect to the PRC legal system could
limit the legal protections available to you and us.

We conduct substantially all of our business through our VIE
Entities in the PRC and they are subject to laws and regulations in China. The
PRC legal system is based on written statutes, and prior court decisions may be
cited for reference but have limited precedential value. Since 1979, a series of
new PRC laws and regulations have significantly enhanced the protections
afforded to various forms of foreign investments in China. However, since the
PRC legal system continues to rapidly evolve, the interpretations of many laws,
regulations and rules are not always uniform and enforcement of these laws,
regulations and rules involve uncertainties, which may limit legal protections
available to you and us. In addition, any litigation in China may be protracted
and result in substantial costs and diversion of resources and management
attention. In addition, all of our executive officers and all of our directors
are residents of China and not of the United States, and substantially all the
assets of these persons are located outside the United States. As a result, it
could be difficult for investors to affect service of process in the United
States or to enforce a judgment obtained in the United States against our
Chinese operations.

If we are found to have failed to comply with applicable
laws, we may incur additional expenditures or be subject to significant fines
and penalties.

Our operations are subject to PRC laws and regulations
applicable to us. However, many PRC laws and regulations are uncertain in their
scope, and the implementation of such laws and regulations in different
localities could have significant differences. In certain instances, local
implementation rules and/or the actual implementation are not necessarily
consistent with the regulations at the national level. Although we strive to
comply with all the applicable PRC laws and regulations, we cannot assure you
that the relevant PRC government authorities will not later determine that we
have not been in compliance with certain laws or regulations. Our failure to
comply with applicable PRC laws and regulations could subject us to
administrative penalties and injunctive relief, as well as civil remedies,
including fines, injunctions and recalls of our products. It is possible that
changes to such laws or more rigorous enforcement of such laws or with respect
to our current or past practices could have a material adverse effect on our
business, operating results and financial condition.

The PRC government exerts substantial influence over the
manner in which we must conduct our business activities.

The PRC government has exercised and continues to exercise
substantial control over virtually every sector of the Chinese economy through
regulation and state ownership. Our ability to operate in China may be harmed by
changes in its laws and regulations, including those relating to taxation,
import and export tariffs, environmental regulations, land use rights, property
and other matters. We believe that our operations in China are in material
compliance with all applicable legal and regulatory requirements. However, the
central or local governments of the jurisdictions in which we operate may impose
new, stricter regulations or interpretations of existing regulations that would
require additional expenditures and efforts on our part to ensure our compliance
with such regulations or interpretations.

Accordingly, government actions in the future, including any
decision not to continue to support recent economic reforms and to return to a
more centrally planned economy or regional or local variations in the
implementation of economic policies, could have a significant effect on economic
conditions in China or particular regions thereof and could require us to divest
ourselves of any interest we then hold in Chinese properties or joint ventures.

Restrictions on currency exchange may limit our ability
to receive and use our sales revenue effectively.

All our sales revenue and expenses are denominated in RMB.
Under PRC law, the RMB is currently convertible under the current account,
which includes dividends and trade and service-related foreign exchange
transactions, but not under the capital account, which includes foreign direct
investment and loans. Currently, Oriental Intra-Asia may purchase foreign
currencies for settlement of current account transactions, including payments of
dividends to us, without the approval of the State Administration of Foreign Exchange (SAFE), by complying
with certain procedural requirements. However, the relevant PRC government
authorities may limit or eliminate our ability to purchase foreign currencies in
the future. Since a significant amount of our future revenue will be denominated
in RMB, any existing and future restrictions on currency exchange may limit our
ability to utilize revenue generated in RMB to fund our business activities
outside China that are denominated in foreign currencies.

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Foreign exchange transactions by our PRC VIE Entities under the
capital account continue to be subject to significant foreign exchange controls
and require the approval of or need to register with PRC government authorities,
including SAFE. In particular, if Oriental Intra-Asia borrows foreign currency
through loans from us or other foreign lenders, these loans must be registered
with SAFE, and if we finance the subsidiaries by means of additional capital
contributions, these capital contributions must be approved by certain
government authorities, including MOFCOM, or their respective local
counterparts. These limitations could affect their ability to obtain foreign
exchange through debt or equity financing.

Fluctuations in exchange rates could adversely affect our
business and the value of our securities.

The value of our common stock will be indirectly affected by
the foreign exchange rate between U.S. dollars and RMB and between those
currencies and other currencies in which our sales may be denominated.
Appreciation or depreciation in the value of the RMB relative to the U.S. dollar
would affect our financial results reported in U.S. dollar terms without giving
effect to any underlying change in our business or results of operations.
Fluctuations in the exchange rate will also affect the relative value of any
dividend we issue in the future as well as earnings from, and the value of, any
U.S. dollar-denominated investments we make in the future.

Since July 2005, the RMB has no longer been pegged to the U.S.
dollar. Although the Peoples Bank of China regularly intervenes in the foreign
exchange market to prevent significant short-term fluctuations in the exchange
rate, the RMB may appreciate or depreciate significantly in value against the
U.S. dollar in the medium to long term. Moreover, it is possible that in the
future PRC authorities may lift restrictions on fluctuations in the RMB exchange
rate and lessen intervention in the foreign exchange market.

Very limited hedging transactions are available in China to
reduce our exposure to exchange rate fluctuations. To date, we have not entered
into any hedging transactions. While we may enter into hedging transactions in
the future, the availability and effectiveness of these transactions may be
limited, and we may not be able to successfully hedge our exposure at all. In
addition, our foreign currency exchange losses may be magnified by PRC exchange
control regulations that restrict our ability to convert RMB into foreign
currencies.

Restrictions under PRC law on our PRC subsidiarys
ability to make dividends and other distributions could materially and adversely
affect our ability to grow, make investments or acquisitions that could benefit
our business, pay dividends to you, and otherwise fund and conduct our
businesses.

Substantially all of our revenues are generated from our
indirect PRC subsidiary, Oriental Intra-Asia, after it receives payments from
our VIE Entities under various services and other arrangements. However, PRC
regulations restrict the ability of Oriental Intra-Asia to make dividends and
other payments to its offshore parent company. PRC legal restrictions permit
payments of dividend by Oriental Intra-Asia only out of its accumulated
after-tax profits, if any, determined in accordance with PRC accounting
standards and regulations. Oriental Intra-Asia is also required under PRC laws
and regulations to allocate at least 10% of our annual after-tax profits
determined in accordance with PRC GAAP to a statutory general reserve fund until
the amounts in said fund reaches 50% of our registered capital. Allocations to
these statutory reserve funds can only be used for specific purposes and are not
transferable to us in the form of loans, advances or cash dividends. Any
limitations on the ability of Oriental Intra-Asia to transfer funds to us could
materially and adversely limit our ability to grow, make investments or
acquisitions that could be beneficial to our business, pay dividends and
otherwise fund and conduct our business.

Future inflation in China may inhibit our ability to
conduct business profitably in China.

In recent years, the Chinese economy has experienced periods of
rapid expansion and highly fluctuating rates of inflation. During the periods of
high inflation, the Chinese government, from time to time, adopted various
corrective measures designed to restrict the availability of credit or regulate
growth and contain inflation. High inflation may in the future cause the Chinese
government to impose controls on credit and/or prices, or to take other action,
which could inhibit economic activity in China, and thereby harm the market for
our products and our company.

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

As a result of our holding company structure, we rely
substantially on dividend payments from our indirect PRC subsidiary, Oriental
Intra-Asia, after it receives payments from our VIE Entities under various
services and other arrangement. Under the PRC tax laws effective prior to
January 1, 2008, dividends paid to foreign investors by foreign-invested
enterprises, such as dividends paid to us by Oriental Intra-Asia, were exempt
from PRC withholding tax. Under the PRC Enterprise Income Tax Law and its
implementation rules effective on January 1, 2008, all domestic and
foreign-invested companies in China are subject to a uniform enterprise income
tax at the rate of 25% and dividends from a PRC subsidiary to its foreign parent
company are subject to a withholding tax at the rate of 10%, unless such foreign
parent companys jurisdiction of incorporation has a tax treaty with China that
provides for a reduced rate of withholding tax, or the tax is otherwise exempted
or reduced pursuant to the PRC tax laws.

Under the PRC Enterprise Income Tax Law, enterprises organized
under the laws of jurisdictions outside China with their de facto management
bodies located within China are considered PRC resident enterprises and
therefore are subject to PRC enterprise income tax at the rate of 25% on their
worldwide income. Under the implementation rules of the PRC Enterprise Income
Tax Law, de facto management bodies is defined as the bodies that have
material and overall management and control over the manufacturing and business
operations, personnel and human resources, finances and treasury, and
acquisition and disposition of properties and other assets of an enterprise. In
addition, a recent circular issued by the State Administration of Taxation on
April 22, 2009 provides that a foreign enterprise controlled by a PRC company or
a PRC company group will be classified as a resident enterprise with its de
facto management bodies located within China if the following requirements are
satisfied: (i) the senior management and core management departments in charge
of its daily operations function mainly in the PRC; (ii) its financial and human
resources decisions are subject to determination or approval by persons or
bodies in the PRC; (iii) its major assets, accounting books, company seals, and
minutes and files of its board and stockholders meetings are located or kept in
the PRC; and (iv) more than half of the enterprises directors or senior
management with voting rights reside in the PRC.

The PRC Enterprise Income Tax Law and its implementation rules
are relatively new and ambiguities exist with respect to the interpretation of
the provisions relating to resident enterprise issues. Although our offshore
holding companies are not controlled by any PRC company or company group, we
cannot assure you that we will not be deemed to be a PRC resident enterprise
under the PRC Enterprise Income Tax Law and its implementation rules. If we are
deemed to be a PRC resident enterprise, we will be subject to PRC enterprise
income tax at the rate of 25% on our worldwide income. In that case, however,
dividend income we receive from Oriental Intra-Asia may be exempt from PRC
enterprise income tax because the PRC Enterprise Income Tax Law and its
implementation rules generally provide that dividends received by a PRC resident
enterprise from its directly invested entity that is also a PRC resident
enterprise is exempt from enterprise income tax. However, as there is still
uncertainty as to how the PRC Enterprise Income Tax Law and its implementation
rules will be interpreted and implemented, we cannot assure you that we are
eligible for such PRC enterprise income tax exemptions or reductions.

In addition, the PRC Enterprise Income Tax Law and its
implementation rules are relatively new and ambiguities exist with respect to
the interpretation of the provisions relating to identification of PRC-sourced
income. If we are deemed to be a PRC resident enterprise, dividends distributed
to our non-PRC entity investors by us, or the gain our non-PRC entity investors
may realize from the transfer of our ordinary shares, may be treated as
PRC-sourced income and therefore be subject to a 10% PRC withholding tax
pursuant to the PRC Enterprise Income Tax Law.

If we became a PRC resident enterprise under the new PRC tax
system and received income other than dividends, our profitability and cash
flows would be adversely affected due to our worldwide income being taxed in
China under the PRC Enterprise Income Tax Law. Additionally, we would incur an
incremental PRC dividend withholding tax cost if we distributed our profits to
our ultimate stockholders. There is however not necessarily an incremental PRC
dividend withholding tax on the piece of the profits distributed from our PRC
subsidiaries, since they would have been subject to PRC dividend withholding tax
even if we were not a PRC tax resident.

Our holding company structure may restrict our ability to
receive dividends from, or transfer funds to, our PRC subsidiary and our VIE
Entities, which could restrict our ability to act in response to changing market
conditions and reallocate funds among our Chinese entities timely.

36

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We are a holding company and conduct substantially all of our
operations through our PRC subsidiary and VIE Entities. Any funds we transfer to
our PRC subsidiary and VIE Entities, either as a loan or as an increase in
registered capital, is subject to registration or approval of PRC governmental
authorities, including the relevant administration of foreign exchange and/or
the relevant examining and approval authority. Our PRC subsidiary and VIE
Entities are prohibited by PRC law to directly lend money to each other. These
limitations on the free flow of funds between us and our PRC companies could
restrict our ability to act in response to changing market conditions and
reallocate funds among our PRC companies on a timely basis. Moreover, according
to a circular jointly issued by the Ministry of Finance and the State
Administration of Taxation on September 19, 2008, the debt-to-equity ratio of a
non-financial institution may not exceed 2:1 unless the shareholder loan in
question can meet certain conditions. Although there is uncertainty at this time
as to how the circular will be interpreted and implemented, such circular may
have a negative impact on our PRC subsidiarys abilities to obtain loans from
its shareholders.

We may be subject to fines and legal sanctions if we or
our Chinese employees fail to comply with PRC regulations relating to employee
stock options granted by overseas listed companies to PRC citizens.

On December 25, 2006, the Peoples Bank of China issued the
Administrative Measures on Individual Foreign Exchange Control, and its
Implementation Rules were issued by the SAFE, on January 5, 2007. Both took
effect on February 1, 2007. Under these regulations, all foreign exchange
matters involved in an employee stock holding plan, stock option plan or similar
plan of an overseas publicly-listed company in which PRC citizens participation
requires approval from the SAFE or its authorized branch. On March 28, 2007, the
SAFE issued the Application Procedure for Foreign Exchange Administration for
Domestic Individuals Participating in Employee Stock Holding Plans or Stock
Option Plans of Overseas Listed Companies (Notice 78). Under Notice 78, PRC
individuals who participate in an employee stock option holding plan or a stock
option plan of an overseas listed company are required, through a PRC domestic
agent or PRC subsidiary of the overseas listed company, to register with the
SAFE and complete certain other procedures. We and our Chinese employees who
have been granted restricted shares or stock options pursuant to the China
TransInfo Technology Corp. Equity Incentive Plan 2009 (the Plan), are subject
to Notice 78. However, in practice, there are significant uncertainties with
regard to the interpretation and implementation of Notice 78. We are committed
to complying with the requirements of Notice 78. However, we cannot provide any
assurance that we or our Chinese employees will be able to qualify for or obtain
any registration required by Notice 78. In particular, if we and/or our Chinese
employees fail to comply with the provisions of Notice 78, we and/or our Chinese
employees may be subject to fines and legal sanctions imposed by the SAFE or
other PRC government authorities, as a result of which our business operations
and the implementation of the Plan could be materially and adversely affected.

The discontinuation or reduction of any preferential tax
treatments currently available to us in the PRC may have a negative impact on
our results of operations.

Our PRC companies, including the PRC subsidiary and VIE
Entities, are subject to PRC income tax. Under the new corporate income tax law
effective January 1, 2008, both foreign-invested enterprises and domestic
enterprises are subject to a unified 25% income tax rate. Several of our VIE
Entities, including PKU, China TranWiseway, Shanghai Yootu, UNISITS, Beijing
Tian Hao and Beijing Zhangcheng, currently enjoy certain reduced income tax
rates or income tax exemption. For the years ended December 31, 2010 and 2009,
our effective tax rate was 9.8% and 4.4%, respectively. If there is any
discontinuation or reduction of the existing preferential tax treatments, our
business, financial condition and results of operations could be materially and
adversely affected.

The M&A Rule establishes more complex procedures for
some acquisitions of Chinese companies by foreign investors, which could make it
more difficult for us to pursue growth through acquisitions in China.

On August 8, 2006, six PRC regulatory agencies, including the
China Securities Regulatory Commission, or CSRC, promulgated the Provisions
Regarding Mergers and Acquisitions of Domestic Enterprises by Foreign Investors
(the M&A Rule), which became effective on September 8, 2006. The M&A
Rule establishes additional procedures and requirements that could make some
acquisitions of Chinese companies by foreign investors more time-consuming and
complex, including requirements in some instances that the PRC Ministry of
Commerce be notified in advance of any change-of-control transaction and in some
situations, require approval of the PRC Ministry of Commerce when a foreign
investor takes control of a Chinese domestic enterprise. In the future, we may
grow our business in part by acquiring complementary businesses, although we do
not have any plans to do so at this time. The M&A Rule also requires PRC
Ministry of Commerce anti-trust review of any change-of-control transactions
involving certain types of foreign acquirers. Complying with the requirements of
the M&A Rule to complete such transactions could be time-consuming, and any
required approval processes, including obtaining approval from the PRC Ministry
of Commerce, may delay or inhibit our ability to complete such transactions, which could adversely
affect our ability to expand our business or maintain our market share.

37

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You may have difficulty enforcing judgments against
us.

We are a Nevada holding company and most of our assets are
located outside of the United States. Most of our current operations are
conducted in the PRC. In addition, most of our directors and officers are
nationals and residents of countries other than the United States. A substantial
portion of the assets of these persons is located outside the United States. As
a result, it may be difficult for you to effect service of process within the
United States upon these persons. It may also be difficult for you to enforce in
U.S. courts judgments on the civil liability provisions of the U.S. federal
securities laws against us and our officers and directors, most of whom are not
residents in the United States and the substantial majority of whose assets are
located outside of the United States. In addition, there is uncertainty as to
whether the courts of the PRC would recognize or enforce judgments of U.S.
courts. Courts in China may recognize and enforce foreign judgments in
accordance with the requirements of the PRC Civil Procedures Law based on
treaties between China and the country where the judgment is made or on
reciprocity between jurisdictions. China does not have any treaties or other
arrangements that provide for the reciprocal recognition and enforcement of
foreign judgments with the United States.

In addition, according to the PRC Civil Procedures Law, courts
in the PRC will not enforce a foreign judgment against us or our directors and
officers if they decide that the judgment violates basic principles of PRC law
or national sovereignty, security or the public interest. So it is uncertain
whether a PRC court would enforce a judgment rendered by a court in the United
States.

RISKS RELATED TO THE MARKET FOR OUR STOCK GENERALLY

The market price of our common stock is volatile, leading
to the possibility of its value being depressed at a time when you want to sell
your holdings.

The market price of our common stock is volatile, and this
volatility may continue. For instance, between January 1, 2010 and December 31,
2010, the closing price of our common stock, as reported on the markets on which
our securities have traded, ranged between $4.28 and $9.72. Numerous factors,
many of which are beyond our control, may cause the market price of our common
stock to fluctuate significantly. These factors include:

- our earnings releases, actual or anticipated changes in our earnings,
  fluctuations in our operating results or our failure to meet the expectations
  of financial market analysts and investors;
- changes in financial estimates by us or by any securities analysts who
  might cover our stock;
- speculation about our business in the press or the investment community;
- significant developments relating to our relationships with our customers
  or suppliers;
- stock market price and volume fluctuations of other publicly traded
  companies and, in particular, those that are in the transportation information
  systems industries;
- customer demand for our products;
- investor perceptions of the transportation information systems industries
  in general and our company in particular;
- the operating and stock performance of comparable companies;
- general economic conditions and trends;
- major catastrophic events;
- announcements by us or our competitors of new products, significant
  acquisitions, strategic partnerships or divestitures;
- changes in accounting standards, policies, guidance, interpretation or
  principles;
- loss of external funding sources;
- sales of our common stock, including sales by our directors, officers or
  significant stockholders; and
- additions or departures of key personnel.

Securities class action litigation is often instituted against
companies following periods of volatility in their stock price. This type of
litigation could result in substantial costs to us and divert our managements
attention and resources. Moreover, securities markets may from time to time
experience significant price and volume fluctuations for reasons unrelated to
operating performance of particular companies. For example, since mid-2008, the
securities markets in the United States have experienced a significant decline
in share prices. These market fluctuations may adversely affect the price of our
common stock and other interests in our company at a time when you want to sell
your interest in us.

38

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Although publicly traded, the trading market in our
common stock has been substantially less liquid than the average trading market
for a stock traded on the Nasdaq Stock Market and this low trading volume may
adversely affect the price of our common stock.

Our common stock started trading on the Nasdaq Global Market
under the symbol CTFO in July 2009. The trading market in our common stock has
been less liquid than the average trading market for companies traded on the
Nasdaq stock market. Limited trading volume will subject our shares of common
stock to greater price volatility and may make it difficult for you to sell your
shares of common stock at a price that is attractive to you.

We may be subject to penny stock regulations and
restrictions and you may have difficulty selling shares of our common
stock.

The SEC has adopted regulations which generally define
so-called penny stocks to be an equity security that has a market price less
than $5.00 per share or an exercise price of less than $5.00 per share, subject
to certain exemptions. If our common stock becomes a penny stock, we may
become subject to Rule 15g-9 under the Exchange Act (the Penny Stock Rule).
This rule imposes additional sales practice requirements on broker-dealers that
sell such securities to persons other than established customers and accredited
investors (generally, individuals with a net worth in excess of $1,000,000 or
annual incomes exceeding $200,000, or $300,000 together with their spouses). For
transactions covered by Rule 15g-9, a broker-dealer must make a special
suitability determination for the purchaser and have received the purchasers
written consent to the transaction prior to sale. As a result, this rule may
affect the ability of broker-dealers to sell our securities and may affect the
ability of purchasers to sell any of our securities in the secondary market.

For any transaction involving a penny stock, unless exempt, the
rules require delivery, prior to any transaction in penny stock, of a disclosure
schedule prepared by the SEC relating to the penny stock market. Disclosure is
also required to be made about sales commissions payable to both the
broker-dealer and the registered representative and current quotations for the
securities. Finally, monthly statements are required to be sent disclosing
recent price information for the penny stock held in the account and information
on the limited market in penny stock.

There can be no assurance that our common stock will qualify
for exemption from the Penny Stock Rule. In any event, even if our common stock
were exempt from the Penny Stock Rule, we would remain subject to Section
15(b)(6) of the Exchange Act, which gives the SEC the authority to restrict any
person from participating in a distribution of penny stock, if the SEC finds
that such a restriction would be in the public interest.

Certain of our stockholders hold a significant percentage
of our outstanding voting securities and accordingly may make decisions
regarding our daily operations, significant corporate transactions and other
matters that other stockholders may believe are not in their best
interests.

Shudong Xia, our chief executive officer and president, is the
beneficial owner of approximately 24.71% of our outstanding voting
securities. As a result, he possesses significant influence over the election of
our board of directors and significant corporate transactions. His ownership may
also have the effect of delaying or preventing a future change in control,
impeding a merger, consolidation, takeover or other business combination or
discourage a potential acquirer from making a tender offer. Other stockholders
may believe that these future decisions made by Mr. Xia are not in their best
interests.

Certain provisions of our Articles of Incorporation may
make it more difficult for a third party to effect a change-of-control.

Our Articles of Incorporation authorizes our board of directors
to issue up to 10,000,000 shares of preferred stock. The preferred stock may be
issued in one or more series, the terms of which may be determined at the time
of issuance by the board of directors without further action by the
stockholders. These terms may include preferences as to dividends and
liquidation, conversion rights, redemption rights and sinking fund provisions.
The issuance of any preferred stock could diminish the rights of holders of our
common stock, and therefore could reduce the value of such common stock. In
addition, specific rights granted to future holders of preferred stock could be
used to restrict our ability to merge with, or sell assets to, a third party.
The ability of our board of directors to issue preferred stock could make it
more difficult, delay, discourage, prevent or make it more costly to acquire or
effect a change-in-control, which in turn could prevent our stockholders from
recognizing a gain in the event that a favorable offer is extended and could
materially and negatively affect the market price of our common stock.

39

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We do not intend to pay dividends on shares of our common
stock for the foreseeable future.

We have never declared or paid any cash dividends on shares of
our common stock. We intend to retain any future earnings to fund the operation
and expansion of our business and, therefore, we do not anticipate paying cash
dividends on shares of our common stock in the foreseeable future.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

Not Applicable.

ITEM 2. PROPERTIES.

All land in China is owned by the State or collectives.
Individuals and companies are permitted to acquire land use rights for general
or specific purposes. In the case when land is used for industrial purposes, the
land use rights are granted for a period of 50 years. The rights may be renewed
at the expiration of the initial and any subsequent terms according to the
relevant Chinese laws. Granted land use rights are transferable and may be used
as security for borrowings and other obligations.

We have entered into a lease agreement to lease office spaces
at the 8th and 9th floors of Vision Building, No. 39
Xueyuanlu, Haidian District, Beijing China. Pursuant to this lease, we have the
right to use the office space of 5,311 square meters in the Vision Building from
November 1, 2009. We pay a monthly rent (including a monthly property management
fee of RMB 258,460) of RMB 605,765 (approximately $88,800) for this facility. We
are entitled to one free month rental of RMB 476,535 (approximately $69,855) per
year. This lease expires on October 31, 2012. We expect to renew the lease on
similar terms prior to its expiration. UNISITS, one of the Companys VIE
Entities, also entered into a lease agreement to lease office spaces at the
12th floor of Vision Building. Pursuant to this lease, UNISITS has
the right to use the office space of 1,175.22 square meters in the Vision
Building from February 15, 2010. UNISITS pays a monthly rent (including a
monthly property management fee of RMB 28,597) of RMB 142,985 (approximately
$20,935) for this facility. UNISITS is entitled to a two-month free rental of RMB
228,776 (approximately $33,496) for the first two months. This lease expires on
February 28, 2013. We believe that our properties
have been adequately maintained, are generally in good condition, and are
suitable and adequate for our business.

ITEM 3. LEGAL PROCEEDINGS.

From time to time, we may become involved in various lawsuits
and legal proceedings which arise in the ordinary course of business. However,
litigation is subject to inherent uncertainties, and an adverse result in these
or other matters may arise from time to time that may harm our business. We are
currently not aware of any such legal proceedings or claims that we believe will
have a material adverse affect on our business, financial condition or operating
results.

ITEM 4. [REMOVED AND RESERVED]

40

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PART II

ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information

Our common stock is listed on the Nasdaq Global Market under
the symbol CTFO. Prior to July 31, 2008, our common stock was quoted on the
Over-the-Counter Bulletin Board under the symbol CTFO.OB.

The following table sets forth, for the quarters indicated, the
range of closing high and low bid prices of our common stock as reported These
prices reported by the Nasdaq do not include retail markup, markdown or
commission and may not represent actual transactions.

|                             |   | **Closing Prices(1)** | 
|---------------------------- | - | --------------------- | 
|                             |   | High                  | 
|Year Ended December 31, 2010 |   |                       | 
|1stQuarter                   | $ | 9.72                  | 
|2ndQuarter                   |   | 7.78                  | 
|3rdQuarter                   |   | 7.85                  | 
|4thQuarter                   |   | 6.43                  | 
|                             |   |                       | 
|Year Ended December 31, 2009 |   |                       | 
|1stQuarter                   | $ | 3.44                  | 
|2ndQuarter                   |   | 5.36                  | 
|3rdQuarter                   |   | 8.42                  | 
|4thQuarter                   |   | 12.00                 | 

(1)The above tables set forth the
range of high and low closing prices per share of our common stock as reported
by www.quotemedia.com for the periods indicated.

Approximate Number of Holders of Our Common Stock

As of March 28, 2011, there were approximately 82 holders of
record of our common stock. This number excludes the shares of our common stock
owned by stockholders holding stock under nominee security position listings.

Dividends

We have never declared or paid a cash dividend. Any future
decisions regarding dividends will be made by our board of directors. We
currently intend to retain and use any future earnings for the development and
expansion of our business and do not anticipate paying any cash dividends in the
foreseeable future. Our board of directors has complete discretion on whether to
pay dividends. Even if our board of directors decides to pay dividends, the
form, frequency and amount will depend upon our future operations and earnings,
capital requirements and surplus, general financial condition, contractual
restrictions and other factors that the board of directors may deem relevant.

Securities Authorized for Issuance Under Equity Compensation
Plans

See Item 12, Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters  Securities Authorized for
Issuance Under Equity Compensation Plans.

Recent Sales of Unregistered Securities

We have not sold any equity securities during the fiscal year
ended December 31, 2010 that were not previously disclosed in a quarterly report
on Form 10-Q or a current report on Form 8-K that was filed during the 2010
fiscal year.

Purchases of Equity Securities

No repurchases of our common stock were made during the year of
2010.

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ITEM 6. SELECTED FINANCIAL DATA.

Not Applicable.

ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

The following managements discussion and analysis should be
read in conjunction with our financial statements and the notes thereto and the
other financial information appearing elsewhere in this report. In addition to
historical information, the following discussion contains certain
forward-looking information. See Special Note Regarding Forward Looking
Statements above for certain information concerning those forward looking
statements.

Our Company

We are a leading provider of end-to-end ITS and related
comprehensive technology solutions servicing the transportation sector in China.
Our goal is to become the largest provider of intelligent transportation system
products and related comprehensive technology solutions in China, as well as a
major operator and provider of value-added ITS and LBS to commercial clients and
consumers in China. Substantially all of our operations are conducted through
our VIE Entities that are PRC domestic companies owned principally or entirely
by our PRC affiliates. Through our VIE Entities, we are involved in developing
multiple applications in transportation, digital city, and land and resource
filling systems based on GIS technologies which are used to service the public
sector.

Historically, our core business is developing the ITS servicing
the public transportation industry utilizing GIS application software and
technologies as well as other information technologies, and developing ITS
related value-added applications and LBS applications to service the commercial
and consumer sector of transportation. We also develop GIS applications in
digital city and land and resource areas. Due to the substantial market demand
for transportation information products in China, we have decided to devote more
energy and resources to our transportation business since late 2007, and
expected that this line of business will become a major driver of our future
development. Historically, our transportation products and solutions are
targeted for transportation management authorities under the oversight of the
Ministry of Transport. Going forward, we also plan to provide services to
commercial users and the general public.

Industry Wide Factors that are Relevant to Our Business

The transportation information industry in China is in the
process of rapid and continuous development. We believe that the trend in
Chinas transportation information industry is toward a continuous increase of
the Chinese governments and publics demand for advanced transportation
information products and services to support more effective and efficient
transportation networks in China. One result of this trend is the growing amount
of governmental spending in the sector of transportation. We believe that
further development of Chinas highway and urban transportation infrastructure
will impact favorably on the demand for our transportation information products
and services. In addition, the large and growing user base of the transportation
infrastructure will create a large consumer market for our value-added ITS
application and services.

The development of transportation information products and
solutions that are Made in China has grown rapidly since 2000. As a leading
company in the transportation information products and solutions in China, the
industry growth impacts favorably to our business. We believe that the industry
growth will continue to impact favorably on our business growth in the future.

One main factor that management considers when estimating our
future growth is the potential revenue from larger government projects in the
transportation sector of the Chinese government based on annual budget reports
issued by relevant governmental sectors at both central and local levels. We
expect that these potential new projects will generate revenues from new
transportation information product sales and services. We expect to bid on large
projects in the transportation sector going forward.

The growing use of GPS and location-based service in China also
has a material impact on our industry. The Chinese economy is developing at a
rapid pace. As a result, there is a growing consumer market that is developing
in China. We believe that we are well positioned to provide state-of-art
transportation information products and services to the commercial and consumer
clients.

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Taxation

United States

China TransInfo Technology Corp. is subject to United States
tax at a tax rate of 34%. No provision for income taxes in the United States has
been made as China TransInfo Technology Corp. had no U.S. taxable income in 2010
and 2009.

British Virgin Islands

Our wholly owned subsidiary Cabowise was incorporated in the
BVI. Under the current law of the BVI, Cabowise is not subject to income or
capital gains tax. In addition, dividend payments are not subject to withholding
tax and income tax in the BVI.

Delaware, Hong Kong and Samoa

Our wholly owned subsidiary Intra-Asia Entertainment
Corporation (Delaware) was incorporated in Delaware. No provision for state
income taxes in Delaware has been made as Intra-Asia Entertainment Corporation
(Delaware) had no Delaware taxable income in 2010 and 2009. Our wholly owned
subsidiary Oriental Intra-Asia Entertainment (China) Limited (Hong Kong) was
incorporated in Hong Kong and, under the current laws of Hong Kong, is not
subject to income taxes. Our wholly owned subsidiary Intra-Asia Entertainment
(Asia-Pacific) Limited (Samoa) was incorporated in Samoa and, under the current
laws of Samoa, is not subject to income taxes.

PRC

Certain of our Chinese operating subsidiaries used to enjoy
certain special or preferential tax treatments regarding foreign enterprise
income tax in accordance with the Income Tax Law of the PRC for Enterprises
with Foreign Investment and Foreign Enterprises and its implementing rules.
However, on March 16, 2007, the National Peoples Congress of China passed the
new Enterprise Income Tax Law (EIT Law), and on November 28, 2007, the State
Council of China passed the Implementing Rules for the EIT Law (Implementing
Rules), which took effect on January 1, 2008. The EIT Law and Implementing
Rules impose a unified EIT of 25.0% on all domestic-invested enterprises and
FIEs, unless they qualify under certain limited exceptions. Therefore, nearly
all FIEs are subject to the new tax rate alongside other domestic businesses
rather than benefiting from the FEIT, and its associated preferential tax
treatments, beginning January 1, 2008.

In addition to the changes to the current tax structure, under
the EIT Law, an enterprise established outside of China with de facto
management bodies within China is considered a resident enterprise and will
normally be subject to an EIT of 25.0% on its global income. The Implementing
Rules define the term de facto management bodies as an establishment that
exercises, in substance, overall management and control over the production,
business, personnel, accounting, etc., of a Chinese enterprise. If the PRC tax
authorities subsequently determine that we should be classified as a resident
enterprise, then the organizations global income will be subject to PRC income
tax of 25.0% . For the year ended December 31, 2010, the above tax rules did not
have any material financial impact on the Company because we did not have
material income from outside of the PRC in 2010.

Hebei TranWiseway, Hunan TranWiseway, Guizhou TranWiseway, PKU
Chengdu Branch, PKU Shanxi Branch, Chongqing PKU, Shanghai PKU, Chongqing
Jiaokai, Qianfang Hongxin, Xinjiang Zhangcheng, and Dajian Zhitong are subject
to a tax rate of 25% on the taxable income for PRC income tax purposes under the
new EIT Law in 2010. PKU, China TranWiseway, UNISITS, Beijing UNISITS, and
Hangzhou UNISITS, are qualify as new or high-technology enterprises and
subject to a tax rate of 15% on the taxable income for PRC income tax purposes
in 2010. Beijing Tian Hao, Beijing Zhangcheng and Shanghai Yootu, Beijing
Zhangcheng Media and the Group Company qualify as software enterprises located
in Beijing and Shanghai, and are entitled to tax exemptions or preferential tax
rates on the taxable income for PRC income tax purposes in 2010. Henan UNISITS
are subject to a special rate of 2.5% for its taxable revenue in 2010.

Results of Operations

For the year ended December 31, 2010, our revenues increased to
$122.70 million, an increase of 92.71% over 2009. Gross profit was up 67.28%
from the previous year, increasing from $25.38 million to $42.45 million, and
operating income reached $19.97 million, an increase of 45.66% . Finally, the
Companys net income for the year increased 19.23% to $15.47 million from $12.97
million in 2009.

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As these results show, the Company had a successful year of
significant growth in 2010. It was the third successful year for the Company as
we evolved from a Geo-GIS custom software producer to a comprehensive
transportation information solutions provider. As a result, transportation
products and solutions have continued to comprise an increasingly larger portion
of our revenue throughout the year. For 2010, revenue from this area accounted
for 92.99%, growing from 85.95% in 2009. Our digital city and land resources
urban planning software accounted for the remainder.

In 2010 we continued to expand our ITS business in more markets
through UNISITS market coverage. Especially, our ITS in highway markets was
expanded to more than 20 provinces of China.

Year Ended December 31, 2010 Compared to Year Ended
December 31, 2009

The following tables set forth key components of our results of
operations for the periods indicated, in dollars and percentage of revenues and
key components of our revenue for the periods indicated in dollars.

|                                                                                                |   | Years Ended December 31, |  
|----------------------------------------------------------------------------------------------- | - | ------------------------ | -
|                                                                                                |   | 2010                     |  
|                                                                                                |   |                          |  
|                                                                                                |   | Amount                   |  
|                                                                                                |   |                          |  
|Revenues                                                                                        | $ | 122,727,958              |  
|Cost of sales                                                                                   |   | 80,279,465               |  
|                                                                                                |   |                          |  
|Gross profit                                                                                    |   | 42,448,493               |  
|                                                                                                |   |                          |  
|Selling, general and administrative expenses                                                    |   | 22,481,758               |  
|                                                                                                |   |                          |  
|Income from operation                                                                           |   | 19,966,735               |  
|                                                                                                |   |                          |  
|Other income and (expenses)                                                                     |   |                          |  
|Interest income                                                                                 |   | 127,468                  |  
|Interest expense                                                                                |   | (470,711                 | )
|Subsidy income                                                                                  |   | 1,574,928                |  
|Other income                                                                                    |   | (54,443                  | )
|                                                                                                |   | 1,177,242                |  
|Income before income taxes, noncontrolling interests, and
      equity investments              |   | 21,143,977               |  
|                                                                                                |   |                          |  
|Income tax expenses                                                                             |   | 2,074,187                |  
|Net income before noncontrolling interests
      and gain on equity investments in affiliates   |   | 19,069,790               |  
|Gain on investments in affiliates due to proportional
      shares of the affiliates net income |   | 1,307,679                |  
|Net income before noncontrolling interests                                                      |   | 20,377,469               |  
|Noncontrolling interests in net income of subsidiary                                            |   | 4,908,311                |  
|Net income  controlling interests                                                              | $ | 15,469,158               |  

Revenues. Revenues increased approximately 59.04
million, or 92.71% to approximately $122.73 million for the year ended December
31, 2010, from approximately $63.69 million in 2009. Approximately 100.58% of
this increase is attributable to the increase of our Transportation business in
2010, which had approximately 108.50% increase year over year comparing to 2009.
Such an increase mainly resulted from the successful execution of the Companys
major business since it started shifting to the Transportation business in late
2007 and the rapidly developing market opportunities in the transportation
information sector in China, as well as our consolidation of the financial
results of UNISITS for the full year of 2010. However, our Digital City and Land
and Resource businesses in total experienced about 18.9% decrease compared to
the same period of 2009. We believe Digital City and Land and Resource
businesses are still experiencing healthy development and growth in China and we
will continue to operate in these markets. In addition, we believe that the overall sales increase in 2010 is also a result of the growing
recognition of our brand name and technology. During 2010, the Company had been
constantly offering new products and solutions to the market and was able to
secure more contracts from recurring clients.

44

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The following table illustrates the revenues from the Chinese
government sectors and regulated industries in which we sell our products and
services for the periods indicated. The table also provides the percentage of
total revenues represented by each listed sector.

|                   |   | Year Ended   |  |  | Percentage of |  |   | Year Ended   |  |  | Percentage of | 
|------------------ | - | ------------ |  |  | ------------- |  | - | ------------ |  |  | ------------- | 
|                   |   | December 31, |  |  | Total         |  |   | December 31, |  |  | Total         | 
|                   |   | 2010         |  |  | Revenues      |  |   | 2009         |  |  | Revenues      | 
|Transportation     | $ | 114,121,205  |  |  | 92.99%        |  | $ | 54,735,455   |  |  | 85.95%        | 
|Digital City       |   | 6,805,112    |  |  | 5.54%         |  |   | 6,898,472    |  |  | 10.83%        | 
|Land and Resources |   | 19,873       |  |  | 0.02%         |  |   | 1,517,908    |  |  | 2.38%         | 
|Other              |   | 1,781,768    |  |  | 1.45%         |  |   | 534,286      |  |  | 0.84%         | 
|Total              | $ | 122,727,958  |  |  | 100.00%       |  | $ | 63,686,121   |  |  | 100.00%       | 

As the table above indicates, the Transportation and Digital
City sectors accounted for an aggregate of 98.53% and 96.78% of our sales for
the years ended December 31, 2010 and 2009, respectively. Sales in Land and
Resources account for 0.02% and 2.38% of total sales for each of the periods
indicated above, respectively.

Cost of Sales. Our cost of goods sold increased
approximately $41.97 million, or 109.55%, to approximately $80.28 million for
the year ended December 31, 2010, from approximately $38.31 million in 2009.
This increase was mainly due to the increase in the costs in line with the
increase in our sales. As a percentage of revenues, the cost of sales increased
to 65.41% during the year ended December 31, 2010 from 60.15% in 2009. The
increase of our cost of sales as a percentage of revenue was mainly attributable
to the fact that we have expanded into more ITS markets through UNISITS and
resulted in a relatively lower gross margin on average than that of the
Companys in 2009.

The following table illustrates in detail the items
constituting our costs of goods sold.

|                  |   | Years ended December 31, | 
|----------------- | - | ------------------------ | 
|Cost Item         |   | 2010                     | 
|Salary            | $ | 1,272,081                | 
|Hardware          |   | 56,645,728               | 
|Software licenses |   | 3,316,863                | 
|Outsourcing       |   | 12,600,523               | 
|Others            |   | 6,444,270                | 
|Total             | $ | 80,279,465               | 

Gross Profit. Our gross profit increased approximately
$17.07 million, or 67.28%, to approximately $42.45 million for the year ended
December 31, 2010, from approximately $25.38 million in 2009. Gross profit as a
percentage of revenues was 34.59% for the year ended December 31, 2010, a
decrease of 5.26% from 39.85% in 2009. Our gross profit decrease was mainly
attributable to the fact that we have expanded into more ITS markets through
UNISITS and resulted in a relatively lower margin on average than that of the
Companys in 2009.

Selling, General and Administrative Expenses.Majority
of our services and products are sold to the domestic Chinese market through
contracts commissioned by the Chinese government. Various government entities
and agencies either invite us to bid for a specific contract or award a contract
to us on a non-bid basis. We are often invited to bid on contracts through our
professional relationships and are awarded recurring businesses. Historically,
we did not incur high cost in our sales and marketing activities. We promoted
our products by developing relationships through Peking University, professional
relationships with various agencies and municipalities and through participation
in industry trade exhibitions.

45

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Our marketing expenses therefore were relatively low in
comparison to our competitors who do not have a record of performance and brand
recognition or well-established government contacts. In 2010, we have enhanced
our marketing efforts by organizing various industry trade exhibitions and
conferences in order to further promote our corporate image and brand
recognition within the transportation information industry in China.

Our selling expenses including sales representative
commissions, promotion fees and marketing expenses, increased approximately
$1.20 million, or 60.91%, to $3.17 million for the year ended December 31, 2010,
from $1.97 million in 2009. The increase of selling expenses was mainly
attributable to our expanded operations and sales volume as well as the enhanced
marketing activities for the year ended December 31, 2010.

Our general and administrative expenses were approximately
$19.31 million (15.74% of total sales) and approximately $9.70 million (15.22%
of total sales) for the years ended December 31, 2010 and 2009, respectively.
The increase of administrative expenses was mainly attributable to our expanded
operations, the increase of 71 employees, and enhanced research and development
efforts.

Income Taxes.For the year ended December 31, 2010, we
recognized income tax expense of $2.07 million and effective tax rate of 9.81%
while in 2009, we recognized an income tax expense of $0.68 million at an
effective tax rate of 4.40% . The increase in the income tax expense is mainly
resulted from our increased sales and profit, as well as the inclusion of
UNISITS result for the whole year of 2010. Some of our operating VIE Entities in
China enjoy tax breaks from the local government to promote high technology and
new technology businesses within a promotional periods. UNISITSs effective tax
rate in 2010 was 14.02% and 8.76% for 2009.

Liquidity and Capital Resources

As of December 31, 2010, we had cash and cash equivalents
(excluding restricted cash) of approximately $43.92 million and restricted cash
of approximately $3.13 million. The following table provides detailed
information about our net cash flow for all financial statements periods
presented in this report.

Cash Flow

|                                                    |   | Years Ended December 31, |  
|--------------------------------------------------- | - | ------------------------ | -
|                                                    |   | 2010                     |  
|Net cash provided by operating activities           | $ | 3,866,303                |  
|Net cash provided by (used in) investing activities |   | (4,073,547               | )
|Net cash provided by financing activities           |   | 15,389,585               |  
|Net cash inflow                                     |   | 16,516,177               |  

Operating Activities

Net cash provided by operating activities was approximately
$3.87 million in fiscal year ended December 31, 2010, which was a decrease of
approximately $4.95 million from approximately $8.82 million net cash provided
by operating activities in fiscal year ended December 31, 2009. Such decrease of
net cash provided by operating activities was primarily attributable to the
increase in accounts receivables as a result of the increase in our sales in
2010, the increase of prepaid expenses in 2010 as a result of more material
procurement for projects, offset by an increase in net profit in 2010, increase
in accounts payable in 2010 as a result of our expanded operations which
required more material procurement for projects, increase in net billings in
2010, that is, the difference between the billings in excess of costs and
estimated earnings on uncompleted projects (when we receive payments from
clients ahead of cost and earnings realization) and costs and estimated earnings
in excess of billings of uncompleted projects (when our work was performed ahead
of customer payments in some of our contracts per the contract payment terms).

Investing Activities

Our main uses of cash for investing activities are payments
relating to the acquisitions of property and equipment, such as machinery and
equipment, transportation equipment for Company operation, and intangible assets
for further research and development.

Net cash used in investing activities was approximately $4.07
million in fiscal year 2010, a decrease of $5.74 million from the $1.67 million
net cash provided by investing activities in fiscal year 2009. Such decrease of
net cash provided by investing activities was primarily attributable to the
acquisition of UNISITS which contributed a onetime net cash increase of $5.67
million to the Company in 2009.

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Financing Activities

Net cash provided by financing activities for the fiscal year
ended December 31, 2010 was approximately $15.39 million, while in the same
period of 2009 we had approximately $1.13 million of net cash provided by
financing activities. Such change was mainly attributable to the facts that we
raised $10 million in the private placement transaction in February 2010 and the
Company increased short term borrowing by about $6 million in 2010.

Financing Agreements

On June 17, 2008, we entered into a short-term loan agreement
with Beijing Bank, Youyi Branch (Youyi Branch), pursuant to which Youyi Branch
has agreed to loan to us RMB 20 million (approximately $2.93 million) for
working capital purposes. The loan had an initial annual interest rate of 8.96%,
which was floating based on interest rates determined by the Peoples Bank of
China from time to time. Interest is payable on a quarterly basis commencing
from September 20, 2008. The loan expired on June 17, 2009 and was renewed on
June 22, 2009 for one more year with an initial interest rate of 5.31% per
annum, which is also floating based on interest rates determined by the Peoples
Bank of China from time to time. Under the terms of the loan agreement, we are
subject to customary affirmative and negative covenants. The loan may be
accelerated and Youyi Branch may demand immediate payment of the principal and
accrued interests upon the occurrence of an event of default which includes,
among other things, a failure to make principal or interest payments, a failure
to comply with other covenants and certain events of bankruptcy. On June 21,
2010, the total amount of the loan was paid off.

On September 29, 2009, PKU entered into a one-year short-term
loan agreement with Huaxia Bank, Zhichunlu Branch (Huaxia Bank), pursuant to
which Huaxia Bank agreed to loan to PKU RMB 30 million (approximately $4.55
million) for working capital purposes. The loan had an initial annual interest
rate of 5.31%, which was floating based on interest rates determined by the
Peoples Bank of China from time to time. Interest is payable on a monthly basis
commencing October 20, 2009. The term of the loan was extended on September 15,
2010 for six more months. Under the terms of the loan agreement, we are subject
to customary affirmative and negative covenants. The loan may be accelerated and
Huaxia Bank may demand immediate payment of the principal and accrued interests
upon the occurrence of an event of default which includes, among other things, a
failure to make principal or interest payments, a failure to comply with other
covenants and certain events of bankruptcy. As of December 31, 2010, principal
amount of approximately $4.55 million was outstanding.

On February 24, 2010, the Company issued and sold a total of
1,564,945 shares of common stock to SAIF Partners for an aggregate purchase
price of $10 million.

On June 21, 2010, PKU, entered into a short-term loan agreement
with Bank of Beijing, Zhongguancun Branch (Zhongguancun Branch), pursuant to
which Zhongguancun Branch agreed to loan to PKU RMB 30 million (approximately
$4.55 million) as working capital. The loan has an annual interest rate based on
the benchmark interest rate as of the date of the first withdrawal of the
principal and the interests must be paid on a quarterly basis. The loan expires
within 12 months after the date of the first withdrawal but can be renewed upon
the written consent by Zhongguancun Branch. Under the terms of the loan
agreement, PKU is subject to customary affirmative and negative covenants. The
loan may be accelerated and Zhongguancun Branch may demand immediate payment of
the principal and accrued interests upon the occurrence of an event of default
which includes, among other things, a failure to make principal or interest
payments, a failure to comply with other covenants and certain events of
liquidation or bankruptcy. As of December 31, 2010, principal amount of
approximately $4.55 million was outstanding.

On November 29, 2010, China TranWiseway entered into a
short-term loan agreement with Zhongguancun Haidianyuan Branch of Bank of
Beijing Co., Ltd. ("Haidianyuan Branch "), pursuant to which Haidianyuan Branch
agreed to loan to China TranWiseway RMB 30 million (approximately $4.55
million). The loan has an annual interest rate equal to 10% above the benchmark
interest rate as of the date of the first withdrawal of the principal and the
interests must be paid on a quarterly basis. The loan expires within 12 months
after the date of the first withdrawal but can be renewed upon the written
consent by Haidianyuan Branch. Under the terms of the loan agreement, China
TranWiseway is subject to customary affirmative and negative covenants. The loan
may be accelerated and Haidianyuan Branch may demand immediate payment of the
principal and accrued interests upon the occurrence of an event of default which
includes, among other things, a failure to make principal or interest payments
timely, material breach of representations and warranties by China TranWiseway, and certain events of liquidation or
bankruptcy. As of December 31, 2010, principal amount of approximately $4.55
million was outstanding.

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Future Capital Requirements

We believe that our current cash and cash equivalents and
anticipated cash flow from operations will be sufficient to meet our anticipated
cash needs, including our cash needs for working capital and capital
expenditures for at least the next 12 months. We may, however, require
additional cash due to changing business conditions or other future
developments, including any investments or acquisitions we may decide to pursue.
In addition, because substantially all of our revenues are generated from our
indirect PRC subsidiary, Oriental Intra-Asia, after it receives payments from
our VIE Entities under various services and other arrangements, the ability of
Oriental Intra-Asia to make dividends and other payments to us is subject to the
PRC dividend restrictions. Current PRC law permits payments of dividend by
Oriental Intra-Asia only out of its accumulated after-tax profits, if any,
determined in accordance with PRC accounting standards and regulations. Oriental
Intra-Asia is also required under PRC laws and regulations to allocate at least
10% of its annual after-tax profits determined in accordance with PRC GAAP to a
statutory general reserve fund until the amounts in said fund reaches 50% of
Oriental Intra-Asias registered capital. Allocations to the statutory reserve
fund can only be used for specific purposes and are not transferable to us in
the form of loans, advances or cash dividends. As a result, if our existing cash
and amount available under existing bank loans insufficient to meet our
requirements, we may seek to sell additional equity securities, debt securities
or borrow additional funds from lending institutions. We can make no assurances
that financing will be available in the amounts we need or on terms acceptable
to us, if at all. The sale of additional equity securities, including
convertible debt securities, would dilute the interests of our current
shareholders. The incurrence of debt would divert cash for working capital and
capital expenditures to service debt obligations and could result in operating
and financial covenants that restrict our operations and our ability to pay
dividends to our shareholders. If we are unable to obtain additional equity or
debt financing as required, our business operations and prospects may suffer. As
of December 31, 2010 and 2009, our working capital was $73,750,644 and
$44,358,761, respectively.

Contractual Obligation and Capital Commitments

We have entered into a lease agreement to lease office spaces
at the 8thand 9thfloors of Vision Building, No. 39
Xueyuanlu, Haidian District, Beijing China. Pursuant to this lease, we have the
right to use the office space of 5,311 square meters in the Vision Building from
November 1, 2009. We pay a monthly rent (including a monthly property management
fee of RMB 258,460) of RMB 605,765 (approximately $88,800) for this facility. We
are entitled for one free month rental of RMB 476,535 (approximately $69,855)
per year. This lease expires on October 31, 2012. We expect that we will be able
to renew the lease on similar terms prior to its expiration. UNISITS, one of the
Companys VIE Entities, has also entered a lease agreement to lease office
spaces at the 12thfloor of Vision Building. Pursuant to this lease,
UNISITS has the right to use the office space of 1,175.22 square meters in the
Vision Building from February 15, 2010. UNISITS pays a monthly rent (including a
monthly property management fee of RMB 28,597) of RMB 142,985 (approximately
$20,935) for this facility. UNISITS is entitled to a two-month free rental of RMB
228,776 (approximately $33,496) for the first two months. This lease expires on
February 28, 2013.

The aggregate future minimum payments under these lease
agreements over one year are as follows:

|                                          |  | Less than 1 Year |  |  | 1-3 Years | 
|----------------------------------------- |  | ---------------- |  |  | --------- | 
|Long-term debt, including current portion |  | 13,728,850       |  |  |           | 
|Operating leases                          |  |                  |  |  | 2,925,022 | 
|Total                                     |  | 13,728,850       |  |  | 2,925,022 | 

Effects of Inflation

Inflation and changing prices have not had a material effect on
our business and we do not expect that inflation or changing prices will
materially affect our business in the foreseeable future. However, our
management will closely monitor the price change and continually maintain
effective cost control in operations.

Off Balance Sheet Arrangements

We do not have any off balance sheet arrangements that have or
are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity or capital expenditures or capital resources that is
material to an investor in our securities.

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Seasonality

Our results of operations are affected by seasonality and we
typically see lower sales during the first half than the second half of a year.
Such seasonality is mainly caused by governmental seasonal budgeting activities
and behaviors.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires our
management to make assumptions, estimates and judgments that affect the amounts
reported in the financial statements, including the notes thereto, and related
disclosures of commitments and contingencies, if any. We consider our critical
accounting policies to be those that require the more significant judgments and
estimates in the preparation of financial statements, including the following:

Principles of ConsolidationThe consolidated
financial statements include the accounts of the Company, its wholly owned
subsidiaries Oriental Intra-Asia Entertainment (Asia Pacific) Limited,
Intra-Asia Entertainment (China) Limited and Cabowise, its indirectly owned
subsidiaries Oriental Intra-Asia, and the Companys variable interest entities,
or the VIE Entities, including the Group Company, PKU, Beijing Tian Hao ,
Beijing Zhangcheng, Xinjiang Zhangcheng, Zhangcheng Media, China TranWiseway,
Hunan TranWiseway, Hebei TranWiseway, Guizhou TranWiseway, Dajian Zhitong,
Shanghai Yootu, UNISITS, Hangzhou Ziguang Jietong Technology Co., Ltd., Hangzhou
UNISITS, Henan Ziguang Jietong Technology Co., Ltd. (Henan UNISITS), and
Beijing Ziguang Jinzhidun Information Technology Co., Ltd.(Beijing UNISITS).
All material intercompany accounts, transactions, and profits have been
eliminated in consolidation.

On February 3, 2009, the Company, through its indirect Chinese
subsidiaries, Oriental Intra-Asia and PKU, entered into a series of equity
transfer agreements with the Group Company, a company incorporated under Chinese
law, pursuant to which the Company transferred all of its indirect equity
interests in PKU and PKU's subsidiaries to the Group Company. The main purpose
of this restructuring is to allow the Company to engage in online services, taxi
advertising, and security and surveillance related business in China in which
companies with foreign ownership, like the Company and its subsidiaries, are
either prohibited or restricted from operating under the current applicable
Chinese laws and regulations. Through the contractual or variable interest
entity, or VIE, arrangements, the Company maintains substantial control over the
VIE Entities daily operations and financial affairs, election of their senior
executives and all matters requiring shareholder approval. Furthermore, as the
primary beneficiary of the VIE Entities, the Company is entitled to consolidate
the financial results of the VIE Entities in its own consolidated financial
statements under ACS 810.

The consolidated financial statements include the accounts of
VIE and VIEs majority owned subsidiaries, which approximates 3% to 70% is owned
by noncontrolling interests. All intercompany accounts, transactions, and
profits have been eliminated upon consolidation.

Use of EstimatesThe preparation of financial
statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Significant estimates include accrued warranty costs, as well as revenue and
costs recorded under the percentage-of-completion method. Actual results could
materially differ from those estimates.

Segment InformationASC 280 requires companies to
report information about operating segment in interim and annual financial
statements. It also requires segment disclosures about products and services
geographic and major customers. The Company has determined that it does not have
any separately reportable operating segments.

Cash EquivalentsThe Company classifies all
highly liquid investments purchased with a maturity of three months or less as
cash equivalents.

Accounts ReceivableAccounts receivable are
carried at original invoice amount less the allowance for doubtful accounts
based on a review of all outstanding amounts at year end. Management determines
the allowance for doubtful accounts by using historical experience applied to an
aging of accounts. Trade receivables are written off when deemed uncollectible.

Long-Term InvestmentThe Company classifies its
investments as available-for-sale in accordance with ASC 320 Debt and Equity
Securities, Investments  Debt and Equity Securities, and are reported at fair
value. Unrealized gains and losses as a result of changes in the fair value of the
available-for-sale investments are recorded as a separate component within
accumulated other comprehensive income in the accompanying consolidated balance
sheets.

49

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The Company uses the cost method of accounting for investments
in companies that do not have a readily determinable fair value in which it
holds an interest of less than 20% and over which it does not have the ability
to exercise significant influence. For entities in which the Company holds an
interest of greater than 20% or in which the Company does have the ability to
exercise significant influence, the Company uses the equity method.

The Companys investments also include privately-held companies
where quoted market prices are not available and as a result, the cost method,
combined with other intrinsic information, is used to assess the fair value of
the investment. If the carrying value is below the fair value of an investment
at the end of any period, the investment is considered for impairment.
Investments are considered to be impaired when a decline in fair value is judged
to be other-than-temporary. Once a decline in fair value is determined to be
other-than-temporary, an impairment charge is recorded and a new cost basis in
the investment is established.

Property and EquipmentProperty and equipment are
recorded at cost, less accumulated depreciation. Depreciation is provided for
using straight-line methods over the estimated useful lives of the respective
assets. Amortization of leasehold improvements is over the lesser of the lease
term or useful life of the improvement.

|                         |  | Useful Lives (Years) | 
|------------------------ |  | -------------------- | 
|Automobiles              |  | 5 -10                | 
|Machinery and equipments |  | 4 -7                 | 
|Furniture and fixtures   |  | 3 -5                 | 

Amortization of Intangible AssetsIntangible
assets primarily include the costs of capitalized R&D costs, costs for
purchased intangibles and intangibles result from acquisitions. Purchased
intangible costs are amortized on a straight-line basis over the estimated
useful lives of the assets, which approximate 10 years. Intangible assets result
from acquisitions and include developed technology, customer-related
intangibles, trade names and other identifiable intangible assets with finite
lives. With the exception of developed technology, these intangible assets are
amortized using the straight-line method. Developed technology is amortized over
the greater of (1) the amount calculated using the ratio of current quarter
revenues to the total of current quarter and anticipated future revenues over
the estimated useful life of the developed technology, and (2) the straight-line
method over each developed technologys remaining useful life. Amortization of
developed technology is recorded within cost of revenues. Amortization of
customer-related intangibles, trade names and other identifiable intangible
assets is recorded within operating expenses.

Intangible asset capitalized For the years ended 2010
and 2009, the intangible asset capitalized but not yet amortized were $1,510,823
and $ 2,126,399, respectively.

Purchased assets from third parties for further research
and development The Company purchased software from third parties for
further research and development for total cash consideration of $986,050 and
$1,184,057 for the years ended 2010 and 2009, respectively.

Intangible asset capitalized through
internal R&D or through acquisition and amortizedFor the years
ended December 31, 2010 and 2009, the intangible asset capitalized through
internal R&D or through acquisition and amortized were $4,000,047 and
$711,028, and the amortization expenses for these assets were $211,237 and
$74,380, respectively.

The company completed the annual impairment testing
for indefinite-lived intangible assets during the twelve months ended December
31, 2010 and 2009, and the Company determined that there was no impairment in
any of these years. The Company performs its annual impairment test as of the
last day of the fiscal year. These impairment tests must be performed more
frequently if there are triggering events.

Revenue RecognitionThe Company recognizes
revenue in accordance with ASC 605, Revenue Recognition, when persuasive
evidence of an arrangement exists, the price is fixed or determinable,
collection is reasonably assured and delivery of products has occurred or
services have been rendered.

The Companys revenue of service fees are primarily fixed price
contracts. Revenue on eligible fixed price contracts is recognized on the basis
of the estimated percentage-of-completion within the scope of ASC 605 and is
consistently applied for all fixed price contracts. Such contracts include
services provided for software development projects, IT outsourcing and solutions, system integration, and network integration
services at fixed price arrangements with its customers. Progress towards
completion is typically measured based on achievement of specified contract
milestones, or other measures of progress when available, or based on costs
incurred as a proportion of estimated total costs. Profit in a given period is
reported at the expected profit margin to be achieved on the overall contract.
This method can result in the recognition of unbilled receivables or the
deferral of costs or profit on these contracts. The company did not incur any
deferred costs for the years ended December 31, 2010 and 2009. Management
regularly reviews project profitability and underlying estimates. Revisions to
the estimates at completion are reflected in results of operations as a change
in accounting estimate in the period in which the facts that give rise to the
revision become known by management. Provisions for estimated losses, if any,
are recognized in the period in which the loss becomes evident. The provision
includes estimated costs in excess of estimated revenue and any profit margin
previously recognized. Any advance payments received from its customers prior to
recognition of revenue is classified as a current liability as billings in
excess of costs and estimated earnings on incompleted contracts.

50

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For taxi media advertising revenue, the Company recognizes
deferred revenue when cash is received, but the revenue has not yet been earned.
The Company recognizes taxi media advertising revenue ratably over the period in
which the advertisement is to be published.

The Company has very limited system maintenance and technology
upgrade services for the systems/platforms we have built for clients. In most
cases, such service revenue was secured on separate contracts basis. Such
service revenues are recognized ratably over the service periods.

Research and DevelopmentResearch and
development expenses include payroll, employee benefits, and other
headcount-related expenses associated with product development. Such costs
related to product development costs are included in research and development
expense until the point that technological feasibility is reached, which for the
Company's products, is generally shortly before the products are released for
the commercial use. Once technological feasibility is reached, such costs are
capitalized and amortized to cost of revenue over the estimated useful lives of
the products. As of December 31, 2010 and 2009, research and development
expenses were capitalized in the amount of $4,776,643 and $2,126,399 and were
included in intangible assets in the Company's consolidated balance sheet.

Stock-Based CompensationThe Company accounts for
stock-based compensation in accordance with ASC topic 718, Compensation  Stock
Compensation (formerly SFAS No. 123 (revised 2004), Share-Based Payment), which
requires the application of a fair-value-based measurement method in accounting
for share-based payment transactions with employees. During 2010, we granted
stock options as part of our key performer stock-based compensation program.
During 2009, we granted stock options as part of our key performer stock-based
compensation program, as well as stock options or restricted stock units to
management and directors. The vesting of stock option grants may be based on
time, performance, market conditions, or a combination of performance and market
conditions. In the future, we may grant stock awards, options, or other
equity-based instruments allowed by our stock-based compensation plans, or a
combination thereof, as part of our overall compensation strategy.

The fair values of restricted stock awards with time-based
vesting, including restricted stock and restricted stock units, are generally
based on the market price of the stock awards at the date of grant. As permitted
under ASC topic 718, we generally use the Black-Scholes option pricing model to
estimate the fair value of stock option grants. The Black-Scholes model relies
on a number of key assumptions to calculate estimated fair values. Our assumed
dividend yield of zero is based on the fact that we have never paid cash
dividends and have no present intention to pay cash dividends. Our expected
stock-price volatility assumption is based on recent (six to twelve months
trailing) implied volatility calculations. These calculations are performed on
exchange-traded options of our common stock. We believe that using a
forward-looking market-driven volatility assumption will result in the best
estimate of expected volatility. The assumed risk-free interest rate is the U.S.
Treasury security rate with a term equal to the expected life of the option. The
assumed expected life is based on company-specific historical experience. With
regard to the estimate of the expected life, we consider the exercise behavior
of past grants and model the pattern of aggregate exercises.

We estimate forfeiture rates at the time awards are made based
on historical and estimated future turnover rates and apply these rates in the
calculation of estimated compensation cost. The estimation of forfeiture rates
includes a quarterly review of historical turnover rates and an update of the
estimated forfeiture rates to be applied to employee classes for the calculation
of stock-based compensation. During 2010, forfeiture rates for the calculation
of stock-based compensation were estimated and applied based on three classes,
non-employee directors, executive management staff and other employees. At
December 31, 2010, our annualized estimated forfeiture rates were 0% for
non-employee director awards and 45-55% for both executive management staff and
other employee awards. Then-current estimated forfeiture rates are also applied quarterly to all outstanding stock options and
non-vested restricted stock awards, which may result in a revised estimate of
compensation costs related to these stock-based grants.

51

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If factors change and we employ different assumptions for
estimating stock-based compensation expense in future periods, or if we decide
to use a different valuation model, the stock-based compensation expense we
recognize in future periods may differ significantly from what we have recorded
in the current period and could materially affect our operating income, net
income and earnings per share. It may also result in a lack of comparability
with other companies that use different models, methods and assumptions. See
Note to our Consolidated Financial Statements in Item 11 for further information
regarding stock-based compensation.

Income TaxesThe Company accounts for income
taxes in accordance with ASC 740, Income Taxes, which requires that the Company
recognize deferred tax liabilities and assets based on the differences between
the financial statement carrying amounts and the tax basis of assets and
liabilities, using enacted tax rates in effect in the years the differences are
expected to reverse. Deferred income tax benefit (expense) results from the
change in net deferred tax assets or deferred tax liabilities. A valuation
allowance is recorded when, in the opinion of management, it is more likely than
not that some or all of any deferred tax assets will not be realized.

The Company adopted ASC 740-10-25, Income
TaxesOverall-Recognition, on January 1, 2007, which provides criteria for the
recognition, measurement, presentation and disclosure of uncertain tax position.
The Company must recognize the tax benefit from an uncertain tax position only
if it is more likely than not that the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the
position. The tax benefits recognized in the financial statements from such a
position are measured based on the largest benefit that has a greater than 50%
likelihood of being realized upon ultimate resolution. The Company did not
recognize any additional liabilities for uncertain tax positions as a result of
the implementation of ASC 740-10-25.

GoodwillThe Company performs an annual goodwill
impairment test as of December 31 each year in accordance with ASC subtopic
350-20, Goodwill (formerly SFAS No. 142), and updates the test between annual
tests if events or circumstances occur that would more likely than not reduce
the fair value of a reporting unit below its carrying value. The Company
performs the annual review for goodwill impairments.

The annual test of the potential impairment of goodwill
requires a two step process. Step one of the impairment test involves comparing
the estimated fair values of reporting units with their aggregate carrying
values, including goodwill. If the carrying amount of a reporting unit exceeds
the reporting units fair value, step two must be performed to determine the
amount, if any, of the goodwill impairment loss. If the carrying amount is less
than fair value, further testing of goodwill impairment is not performed.

Step two of the goodwill impairment test involves comparing the
implied fair value of the reporting units goodwill against the carrying value
of the goodwill. Under step two, determining the implied fair value of goodwill
requires the valuation of a reporting units identifiable tangible and
intangible assets and liabilities as if the reporting unit had been acquired in
a business combination on the testing date. The difference between the fair
value of the entire reporting unit as determined in step one and the net fair
value of all identifiable assets and liabilities represents the implied fair
value of goodwill. The goodwill impairment charge, if any, would be the
difference between the carrying amount of goodwill and the implied fair value of
goodwill upon the completion of step two.

For purposes of the step one analyses, determination of
reporting units fair value is typically based on the income approach, which
estimates the fair value of the Companys reporting units based on discounted
future cash flows.

The Company recorded $983,345, $189,748, $1,921,924, and
$6,884,614 in goodwill in connection with its acquisitions (see Note 9) of
equity of China TranWiseway, Dajian Zhitong, Shanghai Yootu, and UNISITS,
respectively. As of December 31, 2010, the Company believed no goodwill was
subject to the risk of impairment. In the disclosure of acquisitions, the
Company uses the year-end exchange rate of the year when the acquisition
occurred.

Impairment of Long-Lived AssetsThe Company
accounts for the impairment and disposition of long-lived assets in accordance
with ASC 360, Property, Plant and Equipment. The Company periodically evaluates
long-lived assets for impairment whenever events or changes in circumstances
indicate that the carrying value of an asset may not be recoverable. If the
estimated future cash flows (undiscounted and without interest charges) from the
use of an asset were less than the carrying value, a write-down would be
recorded to reduce the related asset to its estimated fair value.

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The assumptions used by management in determining the future
cash flows are critical. In the event these expected cash flows are not
realized, future impairment losses may be recorded. Management has determined
that no impairments of long-lived assets currently exist.

Concentrations of Credit RiskFinancial
instruments that subject the Company to credit risk consist primarily of
accounts receivable, which are concentrated in a small number of customers in
the Chinese governments. The Company performs ongoing credit evaluations of its
customers. For the years ended December 31, 2010 and 2009, bad debt expenses
totaled $54,540 and $5,767, respectively.

Translation AdjustmentThe Company financial
statements are presented in the U.S. dollar ($), which is the Companys
reporting currency, while its functional currency is Renminbi (RMB).
Transactions in foreign currencies are initially recorded at the functional
currency rate ruling at the date of transaction. Any differences between the
initially recorded amount and the settlement amount are recorded as a gain or
loss on foreign currency transaction in the consolidated statements of income.
Monetary assets and liabilities denominated in foreign currency are translated
at the functional currency rate of exchange ruling at the balance sheet date.
Any differences are taken to profit or loss as a gain or loss on foreign
currency translation in the statements of income.

In accordance with ASC 830, Foreign Currency Matters, the
Company translates the assets and liabilities into U.S. dollar ($) using the
exchange rate on the balance sheet date and the statements of operations and
cash flows are translated at an average rate during the reporting period.
Adjustments resulting from the translation from RMB into U.S. dollar are
recorded in stockholders equity as part of accumulated other comprehensive
income. The exchange rates used for interim financial statements in accordance
with ASC 830, Foreign Currency Matters, are as follows:

|                         |  | Average Rate for the year | 
|------------------------ |  | ------------------------- | 
|December 31,             |  | 2010                      | 
|Renminbi (RMB)           |  | 1.00                      | 
|United States dollar ($) |  | 0.14794                   | 

|December 31,             |  | 2010   |  |  | 2009   | 
|------------------------ |  | ------ |  |  | ------ | 
|Renminbi (RMB)           |  | 1.00   |  |  | 1.00   | 
|United States dollar ($) |  | 0.1517 |  |  | 0.1467 | 

Comprehensive IncomeComprehensive income
includes accumulated foreign currency translation gains and losses. The Company
has reported the components of comprehensive income on its statements of
stockholders equity.

Fair Value MeasurementsEffective January 1,
2008, the Company adopted ASC 820, Fair Value Measurement and Disclosures, for
its financial assets and liabilities that are re-measured and reported at fair
value at each reporting period, and non-financial assets and liabilities that
are re-measured and reported at fair value at least annually. The adoption of
ASC 820, Fair Value Measurements and Disclosures, to the Companys financial
assets and liabilities and non-financial assets and liabilities that are
re-measured and reported at fair value at least annually did not have an impact
on the Companys financial results. The following table presents information
about the Companys assets and liabilities that are measure at fair value on
recurring basis as of December 31, 2010, and indicates the fair value hierarchy
of the valuation techniques the Company utilized to determine such fair value.
In general, fair values determined by Level 1 inputs utilize quoted prices
(adjusted) in active markets for identical assets or liabilities. Fair values
determined by Level 2 inputs utilize data points that are observable such as
quoted prices in markets that are not active, interest rates and yield curves.
Fair values determined by Level 3 inputs are unobservable data points for the
asset or liability, and includes situations where there is little, if any,
market activity for the asset or liability:

Financial assets at fair value as of December 31, 2010:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2010         |  |   | (Level 1)        |  |   | (Level 2)   |  |   | (Level 3)    | 
|Cash and cash equivalents | $ | 43,916,597   |  | $ | 43,916,597       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 3,131,660    |  |   | 3,131,660        |  |   | -           |  |   | -            | 
|Total                     | $ | 47,048,257   |  | $ | 47,048,257       |  | $ | -           |  | $ | -            | 

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Financial assets at fair value as of December 31, 2009:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2009         |  |   | (Level 1)        |  |   | (Level 2)   |  |   | (Level 3)    | 
|Cash and cash equivalents | $ | 27,400,420   |  | $ | 27,400,420       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 1,591,076    |  |   | 1,591,076        |  |   | -           |  |   | -            | 
|Total                     | $ | 28,991,496   |  | $ | 28,991,496       |  | $ | -           |  | $ | -            | 

The fair values of the Companys cash and cash equivalents and
restricted cash are determined through market, observable and corroborated
sources. The fair values of the Companys long-term investments are unobservable
data points and include situations where there is little, if any, market
activity. The carrying amounts reflected in the consolidated balance sheets for
other current assets, accounts payable, accrued expenses, long-term debt
approximate fair value due to their short-term maturities.

Recent Accounting Pronouncements

In December 2010, the FASB amended the guidance related to
application of the goodwill impairment model when a reporting unit has a
carrying amount that is zero or a negative value. The guidance clarifies that
when this is the case, a goodwill impairment test should be performed if
qualitative factors indicate that it is more likely than not that goodwill
impairment exists. The Company does not expect the adoption of this guidance to
have a material effect on its consolidated financial statements.

In April 2010 the FASB reached a consensus on the Milestone
Method of Revenue Recognition which provides guidance on the criteria that
should be met for determining whether the milestone method of revenue
recognition is appropriate. A vendor can recognize consideration that is
contingent upon the achievement of a milestone in its entirety as revenue in the
period in which the milestone is achieved only if the milestone meets all
criteria to be considered substantive. The updated guidance is effective on a
prospective basis for milestones achieved in fiscal years, and interim periods
within those years beginning on or after June 15, 2010, with early adoption
permitted. The Company is currently evaluating the potential impact, if any, of
the new accounting guidance on its consolidated financial statements.

In January 2010, the FASB amended the guidance related to fair
value disclosures. This amended guidance requires disclosures about inputs and
valuation techniques used to measure fair value as well as disclosures about
significant transfers, beginning in the first quarter of 2010. Additionally,
this guidance requires presentation of disaggregated activity within the
reconciliation for fair value measurements using significant unobservable inputs
(Level 3), beginning in the first quarter of 2011. The adoption of this guidance
did not have a material impact on the Companys financial position or results of
operations and the Company does not believe that it will have subsequent impact
after the 2011 adoption of the guidance around fair value measurements using
unobservable inputs.

In October 2009, the FASB updated the guidance related to
Multiple Element Arrangements. This guidance relates to the final consensus
reached by FASB on a new revenue recognition guidance regarding revenue
arrangements with multiple deliverables. The new accounting guidance addresses
how to determine whether an arrangement involving multiple deliverables contains
more than one unit of accounting, and how the arrangement consideration should
be allocated among the separate units of accounting. The new accounting guidance
is effective for fiscal years beginning after June 15, 2010 and may be applied
retrospectively or prospectively for new or materially modified arrangements. In
addition, early adoption is permitted. The Company is currently evaluating the
potential impact, if any, of the new accounting guidance on its consolidated
financial statements.

In June 2009, the FASB issued ASC 810-10-30, Variable Interest
Entities (formerly FASB 167), regarding when and how to determine, or
re-determine, whether an entity is a variable interest entity. In addition, FASB
No. 167 replaces FIN 46Rs quantitative approach for determining who has a
controlling financial interest in a variable interest entity with a qualitative
approach. Furthermore, ASC 810-10-30 requires ongoing assessments of whether an
entity is the primary beneficiary of a variable interest entity. ASC 810-10-30
is effective beginning January 1, 2010 and the adoption did not to have a
material impact on the Companys consolidated financial statements.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK.

Not Applicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The full text of our audited consolidated financial statements
as of December 31, 2010 and 2009 begins on page F-1 of this annual report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

ITEM 9A. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in
Rule 13a-15(e) under the Exchange Act) that are designed to ensure that
information that would be required to be disclosed in Exchange Act reports is
recorded, processed, summarized and reported within the time period specified in
the SECs rules and forms, and that such information is accumulated and
communicated to our management, including to our Chief Executive Officer and
Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosure.

Our management, including the Chief Executive Officer and Chief
Financial Officer, do not expect that disclosure controls can or will prevent or
detect all errors and all fraud, if any. A control system, no matter how well
designed and operated, can provide only reasonable, not absolute, assurance that
the objectives of the control system are met. Our disclosure controls and
procedures are designed to provide such reasonable assurance of achieving their
objectives. Also, the projection of any evaluation of the disclosure controls
and procedures to future periods is subject to the risk that the disclosure
controls and procedures may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may
deteriorate. As required by Rule 13a-15 under the Exchange Act, our management,
including our Chief Executive Officer and Chief Financial Officer, evaluated the
effectiveness of the design and operation of our disclosure controls and
procedures as of December 31, 2010. Based on that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that as of December 31,
2010, our disclosure controls and procedures were effective at the reasonable
assurance level.

Managements Annual Report on Internal Control Over
Financial Reporting

Our management is responsible for establishing and maintaining
adequate internal control over financial reporting as defined in Rules 13a-15(f)
and 15d-15(f) under the Exchange Act. The Exchange Act defines internal control
over financial reporting as a process designed by, or under the supervision of,
our principal executive and principal financial officers and effected by our
board of directors, management and other personnel, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with accounting
principles generally accepted in the United States of America and includes those
policies and procedures that:

- Pertain to the maintenance of records that in reasonable detail accurately
  and fairly reflect the transactions and dispositions of the assets of the
  Company;
- Provide reasonable assurance that transactions are recorded as necessary
  to permit preparation of financial statements in accordance with accounting
  principles generally accepted in the United States of America, and that our
  receipts and expenditures are being made only in accordance with
  authorizations of our management and directors; and
- Provide reasonable assurance regarding prevention or timely detection of
  unauthorized acquisition, use or disposition of our assets that could have a
  material effect on our financial statements.

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All internal control systems, no matter how well designed, have
inherent limitations. Therefore, even those systems determined to be effective
can provide only reasonable assurance with respect to financial statement
preparation and presentation. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control
over financial reporting as of December 31, 2010. In making this assessment,
management used the framework set forth in the report entitled Internal Control
- Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission, or COSO. The COSO framework summarizes each of the
components of a companys internal control system, including (i) the control
environment, (ii) risk assessment, (iii) control activities, (iv) information
and communication, and (v) monitoring. Based on our assessment we determined
that, as of December 31, 2010, our internal control over financial reporting is
effective based on those criteria.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over
financial reporting during the fourth quarter of fiscal year 2010 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

This annual report on Form 10-K does not include an attestation
report of our registered public accounting firm regarding internal control over
financial reporting. Managements report was not subject to attestation by our
registered public accounting firm pursuant to rules of the Securities and
Exchange Commission that permit us to provide only managements report in this
annual report on Form 10-K.

ITEM 9B. OTHER INFORMATION.

We have no information to disclose that was required to be
disclosed in a report on Form 8-K during fourth quarter of fiscal year 2010, but
was not reported.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE.

Directors and Executive Officers

The following sets forth information about our directors and
executive officers as of the date of this report:

|Name                | Age | Position                                                  
|------------------- | --- | ----------------------------------------------------------
|Shudong Xia         | 38  | Chairman, CEO, President and
      Secretary              
|Zhibin Lai          | 37  | Vice President                                            
|Zhiping Zhang       | 41  | Vice President of Research and
      Development          
|Danxia Huang        | 38  | Vice President of Operations, Treasurer and
      Director
|Shan Qu             | 42  | Vice President                                            
|Rong Zhang          | 50  | Chief Financial Officer                                   
|Jay Trien           | 70  | Director                                                  
|Zhongsu Chen        | 47  | Director                                                  
|Dan Liu             | 69  | Director                                                  
|Brandon Ho-Ping Lin | 39  | Director                                                  
|Xingming Zhang      | 38  | Director                                                  

SHUDONG XIA. Mr. Xia has been our Chief Executive
Officer, President, Secretary and Chairman since May 14, 2007. Mr. Xia also
serves on several government advisory committees for the development of GIS
services for urban planning. Mr. Xia founded our affiliate, PKU in 2000. From
2002, Mr. Xia, while with PKU, was involved with the GIS-based digital
city-services system study and demonstration, one of the key projects of China
863-Plan. Prior to his involvement with PKU, Mr. Xia, from 1998 was involved in
several research projects at Peking University. Specifically, he was a key team
member of the Study on the Key Technology of Information Release via the Super
Media Network, a key technology study project of the China 9th 5-year Plan
and was instrumental in the compilation of How to Digitize a City and Digital
City-Theory, Method and Application. Mr. Xia received his PhD in Remote Sensing
from the GIS Institute of Peking University in 2003.

ZHIBIN LAI. Mr. Lai has been our Vice President of
Technology since May 14, 2007. Mr. Lai is in charge of GIS application service
for the Transportation sector. From 2000, Mr. Lai was Vice President of PKU,
where he was in charge of the GIS application service for the transportation
sector. Mr. Lai has extensive experiences in system planning, analysis and
project management and is involved in a variety of comprehensive software
development projects at PKU. From 1988, Mr. Lai was head of the Software
Department of Fangda Century Group (Beijing) where he was in charge of the GIS
Study Center in City and Environment Department at Peking University. From 1996,
Mr. Lai was head of the China teams software department at GEOBasic, a
Japan-based GIS company. Mr. Lai received his PhD in Remote Sensing from GIS
Institute at Peking University.

ZHIPING ZHANG. Mr. Zhang has been our Vice President of
Research and Development since May 14, 2007. Mr. Zhang is in charge of the
R&D and GIS application service in our Land and Resources sector. Since
2001, Mr. Zhang has been Vice President of PKU, where he is in charge of the
R&D and GIS application service in Land and Resources sector. From July 1995
to 2001, Mr. Zhang was a professor of Remote Sensing at the Geography
Information Institute of Peking University. From August 1997 Mr. Zhang was the lead expert and
head of software department in Basic Engineering for GeoBasic, a Japanese GIS
company. From 1995, Mr. Zhang led the development of the first Geo-info system
software-Citystar, which was awarded the Excellence Product Awards in the
first Domestic GIS Software Assessment. During his tenure at GeoBasic, Mr.
Zhang led the development of the first GIS platform software-GeoBasic in Japan,
which has won a 20% market share in the Japanese market. Mr. Zhang has a
Masters degree in Remote Sensing from the Geography Information Institute of
Peking University.

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DANXIA HUANG. Ms. Huang became our Vice President of
Operations and Treasurer on May 14, 2007 and became our Director on May 27,
2007. Currently, Ms. Huang is Vice President of Operations in charge of our
strategic development and business administration management. Since November
2006, Ms. Huang has been Vice President of PKU, where she is in charge of
strategic development, business administration management and finance. From
April 2005 to November 2006, Ms. Huang was the Vice President of First City
Investment Inc. of Hong Kong. From April 2001 to April 2005, Ms Huang worked at
Beijing Business Travel Holiday Net-Tech Co., Ltd., an internet company, as
Chief Executive Officer. Ms. Huang has a Masters degree in Business
Administration in Finance from Murdoch University of Australia.

SHAN QU.Mr Qu became our Vice President on January 26,
2011. Mr. Qu has served as the General Manager of UNISITS since November 2002.
From September 1995 to November 2002, he served as the general manager in the
intelligent transportation and engineering control department of Tsinghua
Unisplendour Corporation Limited., a company engaged in the business of
transportation. Mr. Qu is an associate professor and senior engineer at Tsinghua
University. He holds an MBA from Business School of Economics and Management of
Tsinghua University and a Bachelor of Science in electrical appliance from
Shenyang University of Technology.

RONG ZHANG. Mr. Zhang has been our Chief Financial
Officer since January 1, 2011. Mr. Zhang has extensive experience in finance,
accounting, management, and internal control. Prior to joining us, from July
2009 to December 2010, Mr. Zhang worked in Beijing as the Chief Financial
Officer of China Vocational Training Holdings Co., Ltd., the largest automotive
technician training school chain in China. Since August 2008, Mr. Zhang has
served as a non-employee director of SVTeck, Inc., a silicon valley start-up in
online reputation grading/search business using advanced dynamic programming as
well as artificial intelligence and of OKIKI Education Management Co., Ltd., a
preschool education chain aiming at expansion in China. From August 2007 to
August 2008, Mr. Zhang worked as the Chief Financial Officer of Taizinai Group,
a major company in Chinas beverage market. From July 2005 to July 2007, Mr.
Zhang was the Asia Pacific Controller of DraftFCB as well as the Asia Pacific
Lead Area Controller of Interpublic Group of Companies, Inc. (DraftFCB's parent
company), one of the worlds largest advertising and marketing services
companies. From January 2004 to July 2005, Mr. Zhang was a Senior Analyst and
Project Leader at MCI, Inc., now a telecommunications subsidiary of Verizon
Communications Inc., a global broadband and telecommunications company. From
July 1997 to January 2004, Mr. Zhang worked in several finance and accounting
positions in the United States, including as a Senior Analyst in Atlanta at ACSI
Network Technologies, a telecommunications company that specialized in fiber
optic broadband services; Senior Auditor at Union Camp Corporation and
International Paper, an American pulp and paper company and as a Staff Auditor
at Deloitte & Touche's Atlanta, Georgia office. Mr. Zhang holds an MBA in
accounting from J. Mack Robinson School of Business, Georgia State University,
and Master of Arts in Economics from Georgia State University, and Master of
Sciences in Environmental Science from East China Normal University in Shanghai.
He is a U.S. Certified Public Accountant.

JAY TRIEN. Mr. Trien has been our director since May 1,
2008. Since April 1989, Mr. Trien has been a senior partner at Trien Rosenberg
Weinberg Ciullo & Fazzari LLP., a certified public accounting and business
consulting firm with offices in Morristown, New Jersey and New York City. He
oversees the firms financial and accounting service groups and also directs its
M&A and capital finance departments. Mr. Trien has published several
articles on accounting issues in American Venture Magazine, Capital Growths
Guide to Entrepreneurial Venture Financing, NJBIZ and the Journal of the Family
Firm Institute. Mr. Trien is the president of the Venture Association of New
Jersey as well as the New Media Association of New Jersey and is a member of the
American Institute of Certified Public Accountants, New Jersey Bar Association,
New Jersey Society of Certified Public Accountants, New York State Society of
Certified Public Accountants, the National Litigation Support Services
Association and the Alliance of Merger & Acquisition Advisors. Mr. Trien is
a Certified Public Accountant, holds a Bachelors of Science in Economics from
The Wharton School of the University of Pennsylvania and a Juris Doctor degree
from Rutgers Law School. Mr. Trien has the relevant experiences and expertise to
serve as a director for the company.

ZHONGSU CHEN. Dr. Chen has been our director since May
1, 2008. Dr. Chen has more than 20 years of experience in information
technology, including nine years in Wall Street firms such as DLJ, Standard
& Poors, New York Life and Ambac Financial Group. Since May 2005, Dr. Chen
has been the managing director of Time Innovation Ventures, a venture capital company. He also serves on the board of
directors for Beijing Ahelios Consulting, an IT consulting company and Beijing
Xiakexing Network Technologies, a Chinese company producing animation products.
From 2001 to 2005, Dr. Chen worked as the deputy chief technology officer at the
Shanghai Stock Exchange. From 2003 to 2004, he led Chinas National Financial
Standardization Securities Trading Protocol Working Group, which defined Chinas
Securities Trading Exchange Protocol technology standard, and served as an
advisor for the Shenzhen Stock Exchange Technology Development Strategy
Committee. In 2006, Dr. Chen was appointed by the Chinese government as a member
of the Working Group for the Foundation of Chinas Futures Exchange. Dr. Chen
holds a Bachelors degree in mathematics/computer science from Pace University,
a Masters degree in mathematical sciences from The Johns Hopkins University and
a PhD degree in computer science/operations research from Stevens Institute of
Technology. Mr. Chen has the relevant experiences and expertise to serve as a
director for the company.

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DAN LIU. Mr. Liu has been our director since May 1,
2008. Mr. Liu has over 40 years of experience in the electronics and information
sectors. Mr. Liu held several management positions at China Electronics Import
and Export Corporation for more than ten years and was vice president of China
Electronics Corporation from 1990 to 1991. From 1991 to 1997, Mr. Liu was
chairman of the board of Intel (China), a semiconductor manufacturer. Mr. Liu
was also senior advisor to Motorola (China), a provider of mobile devices and
broad band communication and enterprise mobility solutions, from 1994 to 1998.
From 1991 to 2000, Mr. Liu was the president of China Tongda Networking
Corporation, a communication system integration company. From 2001 to 2002, Mr.
Liu was the Vice General Manager of China Electronics Corporation. Mr. Liu is
currently a councilor at Chinese Association of Electronics, China Software
Industry Association, China News Technology Association, and China Public
Relations Association. Mr. Liu holds a Bachelors degree in Communication
Engineering from Harbin Engineering University. Mr. Liu has the relevant
experiences and expertise to serve as a director for the company.

BRANDON HO-PING LIN. Mr. Lin has been our director since
September 28, 2008. Mr. Lin is a partner at SAIF Partners, which is one of the
largest and most successful growth venture capital funds focused on China. Prior
to joining SAIF Partners in 2001, Mr. Lin was a Vice President in investment
banking with Credit Suisse/Donaldson, Lufkin & Jenrette (DLJ) in New York
from 1997 to 2001 where he executed mergers & acquisitions, high yield debt
and initial public offering transactions for leveraged buy-outs and technology
companies. From 1994 to 1997, Mr. Lin worked as an associate with Sullivan &
Cromwell LLP. Mr. Lin is also a director of several SAIF Partners portfolio
companies, which include NVC Lighting Holding Limited, Jiangxi Runtian Beverage
LLC, Vienna Hotel Group Limited and Best Elite International Limited. Mr. Lin
holds a Bachelors degree in Economics from Stanford University and a Juris
Doctor degree from Harvard Law School. Mr. Lin has the relevant experiences and
expertise to serve as a director for the company.

XINGMING ZHANG. Mr. Zhang has been our director since
June 11, 2010. Mr. Zhang has severed as an executive director of investment
banking in Guotai Junan Securities Co., Ltd. ("Guotai"), one of the largest
investment banking and securities companies in China, since March, 2009. Mr.
Zhang is mainly in charge of the investment banking services of Guotai in the
transportation industry including financing, IPO, restructuring and M&A.
From May 2006 to March 2009, Mr. Zhang worked as the executive director of
Antaeus Capital Inc.s China office, which is a full service securities
brokerage and investment banking firm. From 2003 to 2006, he worked as General
Manager of the Investment Department of China Landgent Group, a company engaged
in the business of real estate development and education industry. Mr. Zhang
holds a Bachelors degree in material science from Tsinghua University and a
Masters degree in economics and management from Tsinghua University. Mr. Zhang
is a qualified securities practitioner and a charted representative of
underwriters in China. Mr. Zhang has the relevant experiences and expertise to
serve as a director for the company.

In connection with the private placement transaction
consummated on July 17, 2008, we and our two major shareholders, Karmen
Investment Holdings Limited and Leguna Verde Investments Limited (the Major
Shareholders), entered into a voting agreement (the Voting Agreement) with
SAIF Partners (SAIF), pursuant to which, among other things, SAIF Partners and
the Major Shareholders agreed, during the term of the Voting Agreement, to vote,
or cause to be voted, all shares owned by them, to ensure that Mr. Lin will be
elected as a director of the Company. This Voting Agreement continues in effect
until SAIF Partners beneficially owns fewer than 50% of the number of shares of
Common Stock purchased in connection with the private placement transaction.

Except as noted above, there are no other arrangements or
understanding between any of our executive officers or directors and any other
person pursuant to which such executive officer or director was or is to be
selected as an officer or a director.

Directors are elected until their successors are duly elected
and qualified.

Family Relationships

59

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There is no family relationship among any of our officers or
directors.

Involvement in Certain Legal Proceedings

To the best of our knowledge, none of our directors or
executive officers has been convicted in a criminal proceeding, excluding
traffic violations or similar misdemeanors, or has been a party to any judicial
or administrative proceeding during the past five years that resulted in a
judgment, decree or final order enjoining the person from future violations of,
or prohibiting activities subject to, federal or state securities laws, or a
finding of any violation of federal or state securities laws, except for matters
that were dismissed without sanction or settlement. Except as set forth in our
discussion below in Item 13, Certain Relationships and Related Transactions,
and Director Independence, none of our directors, director nominees or
executive officers has been involved in any transactions with us or any of our
directors, executive officers, affiliates or associates which are required to be
disclosed pursuant to the rules and regulations of the SEC.

Board Composition and Committees

The Company is governed by the Board of Directors that
currently consists of seven members: Shudong Xia, Danxia Huang, Jay Trien,
Zhongsu Chen, Dan Liu, Brandon Ho-Ping Lin and Xingming Zhang. Since May 2008,
the Board has established three Committees: the Audit Committee, the
Compensation Committee, and the Governance and Nominating Committee. Each of the
Audit Committee, Compensation Committee and Governance and Nominating Committee
is comprised entirely of our independent directors. From time to time, the Board
may establish other committees. The Board has adopted a written charter for each
of the committees which is available on the Companys website www.chinatransinfo.com. Printed copies of each of our
committee charters may be obtained, without charge, by contacting the Corporate
Secretary, China TransInfo Technology Corp., 9th Floor, Vision
Building, No. 39 Xueyuanlu, Haidian District, Beijing, China 100191.

Audit Committee

Our Audit Committee consists of three members: Jay Trien,
Zhongsu Chen and Dan Liu. Mr. Trien is the Chair of the Audit Committee. Each
member of the Audit Committee meets the independence criteria prescribed by
applicable regulation and the rules of the SEC for audit committee membership
and is an independent director within the meaning of applicable NASDAQ
listing standards. Each Audit Committee member meets NASDAQs financial literacy
requirements, and the Board has further determined that Mr. Jay Trien (i) is
audit committee financial expert as such term is defined in Item 407(d) of
Regulation S-K promulgated by the SEC, and (ii) also meet NASDAQs financial
sophistication requirements.

The Audit Committee oversees our accounting and financial
reporting processes and the audits of the financial statements of our Company.
The Audit Committee is responsible for, among other things:

- selecting our independent auditors and pre-approving all auditing and
  non-auditing services permitted to be performed by our independent auditors;
- reviewing with our independent auditors any audit problems or difficulties
  and managements response;
- reviewing and approving all proposed related-party transactions, as
  defined in Item 404 of Regulation S-K under the Securities Act of 1933, as
  amended;
- discussing the annual audited financial statements with management and our
  independent auditors;
- reviewing major issues as to the adequacy of our internal controls and any
  special audit steps adopted in light of significant internal control
  deficiencies;
- annually reviewing and reassessing the adequacy of our Audit Committee
  charter;
- meeting separately and periodically with management and our internal and
  independent auditors;
- reporting regularly to the full Board; and
- such other matters that are specifically delegated to our Audit Committee
  by our Board from time to time.

60

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Compensation Committee

Our Compensation Committee consists of three directors, Zhongsu
Chen, Dan Liu and Brandon Ho-Ping Lin. Mr. Liu is the Chair of the Compensation
Committee. The members of the Compensation Committee are all independent
directors within the meaning of applicable NASDAQ listing standards.

Our Compensation Committee assists the Board in reviewing and
approving the compensation structure of our executive officers, including all
forms of compensation to be provided to our executive officers. Our chief
executive officer may not be present at any Committee meeting during which his
compensation is deliberated. The Compensation Committee is permitted to delegate
its authority in accordance with Nevada law unless prohibited by the Companys
by-laws or the Compensation Committee charter. The Compensation Committee is
responsible for, among other things:

- approving and overseeing the compensation package for our executive
  officers;
- reviewing and approving corporate goals and objectives relevant to the
  compensation of our chief executive officer, evaluating the performance of our
  chief executive officer in light of those goals and objectives, and setting
  the compensation level of our chief executive officer based on this
  evaluation; and
- reviewing periodically and making recommendations to the Board regarding
  any long-term incentive compensation or equity plans, programs or similar
  arrangements, annual bonuses, employee pension and welfare benefit plans; and
  reviewing and making recommendations to the Board regarding succession plans
  for the chief executive officer and other senior officers.

Compensation Committee Interlocks and Insider
Participation

All current members of the Compensation Committee are
independent directors, and all past members were independent directors at all
times during their service on such Committee. None of the past or present
members of our Compensation Committee are present or past employees or officers
of ours or any of our subsidiaries. No member of the Compensation Committee has
had any relationship with us requiring disclosure under Item 404 of Regulation
S-K. None of our executive officers serves on the board of directors or
compensation committee of a company that has an executive officer that serves on
our Board or the Compensation Committee.

Governance and Nominating Committee

Our Governance and Nominating Committee consists of three
directors: Zhongsu Chen, Dan Liu and Brandon Ho-Ping Lin. Mr. Chen is the Chair
of the Governance and Nominating Committee. The members of our Governance and
Nominating Committee are all independent directors within the meaning of
applicable NASDAQ listing standards.

The Governance and Nominating Committee assists the Board in
identifying individuals qualified to become our directors and in determining the
composition of the Board and its committees. The Governance and Nominating
Committee is responsible for, among other things:

- identifying and recommending to the Board nominees for election or
  re-election to the Board, or for appointment to fill any vacancy;
- reviewing annually with the Board the current composition of the Board in
  light of the characteristics of independence, age, skills, experience and
  availability of service to us;
- review periodically the compensation paid to non-employee directors for
  annual retainers and meeting fees, if any, and making recommendations to the
  Board for any adjustments;
- identifying and recommending to the Board the directors to serve as
  members of the Boards committees; and
- monitoring compliance with our Corporate Governance Guidelines.

61

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Section 16(A) Beneficial Ownership Reporting Compliance

Under U.S. securities laws, directors, certain executive
officers and persons holding more than 10% of our common stock must report their
initial ownership of the common stock, and any changes in that ownership, to the
SEC. The SEC has designated specific due dates for these reports. Based solely
on our review of copies of such reports filed with the SEC by and written
representations of our directors and executive offers, we believe that our
directors and executive offers filed the required reports on time in 2010 fiscal
year.

Code of Ethics

On April 30, 2007, our board of directors adopted a code of
ethics that applies to all of our directors, officers and employees, including
our principal executive officer, principal financial officer, and principal
accounting officer. The code of ethics addresses, among other things, honesty
and ethical conduct, conflicts of interest, compliance with laws, regulations
and policies, including disclosure requirements under the federal securities
laws, confidentiality, trading on inside information, and reporting of
violations of the code. A copy of the code of ethics has been filed as Exhibit
14 to our current report on Form 8-K filed on May 14, 2007 and is also available
on our website, http://www.chinatransinfo.com.
Any amendments or waivers to the code of ethics will be posted on our website
within four business days of such amendment or waiver.

ITEM 11. EXECUTIVE COMPENSATION.

The following table sets forth information concerning all
compensation awarded to, earned by or paid to the following persons for services
rendered in all capacities during 2010 and 2009: Shudong Xia, our Chief
Executive Officer, President and Chairman, and Zhihai Mao, who was our Chief
Financial Officer between January 1, 2008 and October 31, 2010. No other
executive officers received total compensation in excess of $100,000 in either
fiscal year.

StockSalary
    
    
    Bonus
    
    
    Awards
    
    
    TotalName and Principal Position
    
    Year
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)Shudong Xia
    
    2010
    
    
    16,364
    
    
    6,694
    
    
    -
    
    
    23,058CEO, President and Chairman
    
    2009
    
    
    15,813
    
    
    
    
    
    -
    
    
    15,813Zhihai Mao
    
    2010
    
    
    91,508
    
    
    
    
    
    137,259
    (1)
    
    228,767Former Chief Financial
      Officer
    
    2009
    
    
    109,810
    
    
    
    
    
    183,512
    (1)
    
    293,322


|(1) | The amounts in this column reflect the aggregate grant
      date fair values of Restricted Stock, calculated in accordance with FASB
      ASC Topic 718. These are not amounts paid to or realized by Mr. Mao.
      Assumptions used in the calculation of these values are included in Note
      11 to our audited financial statements included in this annual report. On
      October 31, 2010, Mr Mao resigned from the CFO position.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Additional Narrative Disclosure

Our VIE Entity, PKU has employment agreements with the
following executive officers:

Shudong Xia,our CEO, Secretary and Presidents
employment agreement became effective as of January 1, 2006 and expired on
December 31, 2007. On the same date, Mr. Xia's employment agreement was renewed
for a two-year term ended December 31, 2009. On July 10, 2009, Mr. Xia entered
into a new employment agreement with a five-year term ending July 9, 2014. Mr.
Xia is receiving RMB 9,000 per month (approximately $1,297) under the agreement.
We expect that this agreement will be automatically renewed by the parties upon
its expiration.

Zhiping Zhang,our Vice President of Research and
Developments labor contract became effective as of January 1, 2006 and expired
on December 31, 2007. On the same date, Mr. Zhang's employment agreement was
renewed for a two-year term ended December 31, 2009. On July 10, 2009, Mr. Zhang
entered into a new employment agreement with a five-year term ending July 9,
2014.Mr. Zhang is receiving RMB 10,000 per month (approximately $1,442)
under the agreement. We expect that this agreement will be automatically renewed
by the parties upon its expiration.

Zhibin Lai,our Vice Presidents labor contract became
effective as of January 1, 2006 and expired on December 31, 2007. On the same
date, Mr. Lai's employment agreement was renewed for a two-year term ended
December 31, 2009. On July 10, 2009, Mr. Lai entered into a new employment agreement with
a five-year term ending July 9, 2014.Mr. Lai is receiving RMB 9,000 per
month (approximately $1,297) under the agreement. We expect that this agreement
will be automatically renewed by the parties upon its expiration.

62

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Danxia Huang,our Vice President of Operations labor
contract became effective January 1, 2006 and expired on December 31, 2007. On
the same date, Ms. Huang's employment agreement was renewed for a two-year term
ended December 31, 2009. On July 10, 2009, Ms. Huang entered into a new
employment agreement with a five-year term ending July 9, 2014. Ms. Huang is
receiving RMB 8,000 per month (approximately $1,153) under the agreement. We
expect that this agreement will be automatically renewed by the parties upon its
expiration.

On December 21, 2010, the Company and Mr. Rong Zhang entered
into an employment agreement, which became effective on January 1, 2011. The
term of the employment agreement is for four years, after which Mr. Zhangs
employment is at will and either the Company or Mr. Zhang may terminate the
employment with or without cause or advance notice. The employment agreement
provides, among other things, that Mr. Zhangs annual base salary is RMB 737,700
(approximately $111,000) (the Base Salary). During the term of the employment
agreement, if Mr. Zhang terminates his employment for any reason or if the
Company terminates the employment due to death, permanent disability, or with
cause, Mr. Zhang will be entitled only to the Base Salary through the date of
the termination and any other benefits legally required to be paid to Mr. Zhang.
Cause is defined generally to include crime, dishonesty, embezzlement,
continuing inability or refusal to perform reasonable duties, and moral
turpitude. The employment agreement also contains covenants prohibiting Mr.
Zhang from competing with the Company, disclosing any confidential information
of the Company and soliciting the Companys customers and employees, both during
his employment and for specified periods after the termination of employment.

On January 3, 2011, the Company and Mr. Zhang entered into a
stock option agreement. Pursuant to the terms of the stock option agreement, Mr.
Zhang was granted a nonstatutory option under the Companys 2009 Equity
Incentive Plan to purchase 504,901 shares of common stock of the Company at an
exercise price of $4.85 per share, which was the closing price per share of the
Companys common stock as reported on the Nasdaq Global Market on such date. The
option has a term of five years and expires on January 3, 2016. The option vests
in equal installments on a quarterly basis over a four-year period beginning on
January 3, 2011. According to the stock option agreement, in the event Mr.
Zhangs employment with the Company is terminated for any reason except for
death or disability, he may exercise the option only to the extent that the
option would have been exercisable on the termination date and no later than
three months after the termination date. If Mr. Zhangs employment is terminated
because of his death or disability, the option may be exercised only to the
extent that such option would have been exercisable by Mr. Zhang on the
termination date and must be exercised by Mr. Zhang no later than twelve months
after the termination date. If Mr. Zhang is terminated for cause as defined in
the stock option agreement, the option will terminate immediately. In no event
will this option be exercised later than January 3, 2016.

On January 26, 2011, the Company and Mr. Shan Qu entered into
an employment agreement. The term of the employment agreement is for four years,
after which Mr. Qus employment is at will and either the Company or Mr. Qu
may terminate the employment with or without cause or advance notice. The
employment agreement provides, among other things, that Mr. Qus annual base
salary is RMB 480,000 (approximately $72,727) (the Base Salary). During the
term of the employment agreement, if Mr. Qu terminates his employment for any
reason or if the Company terminates the employment due to death, permanent
disability, or with cause, Mr. Qu will be entitled only to the Base Salary
through the date of the termination and any other benefits legally required to
be paid to Mr. Qu. Cause is defined generally to include crime, dishonesty,
embezzlement, continuing inability or refusal to perform reasonable duties, and
moral turpitude. The employment agreement also contains covenants prohibiting
Mr. Qu from competing with the Company, disclosing any confidential information
of the Company and soliciting the Companys customers and employees, both during
his employment and for specified periods after the termination of employment.

On January 26, 2011, the Company and Mr. Qu also entered into a
stock option agreement. Pursuant to the terms of the stock option agreement, Mr.
Qu was granted a nonstatutory option under the Companys 2009 Equity Incentive
Plan to purchase 300,000 shares of common stock of the Company at an exercise
price of $4.82 per share, which was the closing price per share of the Companys
common stock as reported on the Nasdaq Global Market on such date. The option
has a term of five years and expires on January 26, 2016. The shares underlying
the option will vest in four equal installments on each of the first, second,
third and fourth anniversary of the vesting commencement date and will only vest
if Mr. Qu achieves above 80% of the performance goals determined by the Company
at the beginning of each fiscal year. According to the stock option agreement,
in the event Mr. Qus employment with the Company is terminated for any reason
except for death or disability, he may exercise the option only to the extent
that the option would have been exercisable on the termination date and no later
than three months after the termination date. If Mr. Qus employment is terminated because of his death or disability, the option may
be exercised only to the extent that such option would have been exercisable by
Mr. Qu on the termination date and must be exercised by Mr. Qu no later than
twelve months after the termination date. If Mr. Qu is terminated for cause as
defined in the stock option agreement, the option will terminate immediately. In
no event will this option be exercised later than January 26, 2016.

63

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Retirement Benefits

Currently, we do not provide any employees, including our named
executive officers any company sponsored retirement benefits other than a state
pension scheme in which all of our employees in China participate.

Payment Upon Termination or Change-in Control

The Company does not have change-in-control arrangements with
any of its executive officers. The Company is not obligated to pay severance or
other enhanced benefits to any executive officers upon termination of their
employment.

Outstanding Equity Awards at Fiscal Year End

No executive officers received unexercised options, stock that
has not vested or equity incentive plan awards that remained outstanding as of
the end of the fiscal year 2010.

Compensation of Directors

The following table sets forth information concerning all
compensation paid to our directors who were not also employed by us for services
rendered in all capacities for the year ended December 31, 2010.

|Name                |  | Fees Earned or   |  |  | Option Awards |     |  | Total($) | 
|------------------- |  | ---------------- |  |  | ------------- | --- |  | -------- | 
|                    |  | Paid in Cash ($) |  |  | ($)           |     |  |          | 
|Jay Trien           |  | 30,000           |  |  | 29,408        | (1) |  | 59,408   | 
|Zhongsu Chen        |  | 14,056           |  |  | 29,408        | (1) |  | 43,464   | 
|Dan Liu             |  | 20,000           |  |  | -             |     |  | 20,000   | 
|Brandon Ho-Ping Lin |  | 1,8000           |  |  | 8,630         | (1) |  | 26,630   | 
|Xingming Zhang      |  | 4,393            |  |  | 12,311        |     |  | 16,704   | 
|Dongyuan Yang(2)    |  | 7,321            |  |  | -             |     |  | 7,321    | 

|(1) | Pursuant to a stock option repricing under the Plan, on
      June 1, 2009, we cancelled all of the outstanding stock options with an
      exercise price of $6.5 that the Company granted to these three directors
      to purchase an aggregate 90,000 shares of our common stock and replaced
      with the same amount of stock options with an exercise price of $5.09. The
      amount reported in the Option Awards column reflects the aggregate grant
      date fair value computed in accordance with FASB ASC Topic 718 for the
      stock options awarded to each director in 2009. These are not amounts paid
      to or realized by each of the relevant directors. Assumptions used in the
      calculation of these values are included in Note 11 to our audited
      financial statements included in this annual report.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(2) | Mr. Dongyuan Yang did not stand for re-election to the
      Board at our 2010 Annual Meeting of Stockholders held on June 11, 2010.
      The compensation disclosed herein is his compensation for serving as our
      director from January 1, 2010 to June 11, 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

On May 1, 2008, we entered into separate agreements with our
independent directors, Jay Trien, Zhongsu Chen and Dan Liu. Under the terms of
the agreements, we agreed to pay Mr. Trien an annual fee of $30,000, Dr. Chen an
annual fee of RMB 96,000 (approximately $14,056) and Mr. Liu an annual fee of
$20,000, as compensation for the services to be provided by them as independent
directors, and as chairpersons of various board committees, as applicable. On
May 1, 2008, we also entered into separate stock option agreements with each of
Mr. Trien and Dr. Chen. Under the terms of the stock option agreements, we
granted a stock option to each of Mr. Trien and Dr. Chen for the purchase of
30,000 shares of common stock of the Company at an exercise price equal to the
closing price as reported on the OTC Bulletin Board on the grant date of the
option. The options vested in equal installments on a quarterly basis over a
three-year period. For Mr. Trien, the first installment of 2,500 shares vested
immediately on the grant date of May 1, 2008. Mr. Triens compensation is
greater because he has greater responsibilities as the Audit Committee Chairman.

64

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On September 28, 2008, we entered into separate agreements with
each of Mr. Brandon Ho-Ping Lin and Mr. Dongyuan Yang. Under the terms of the
agreements, we agreed to pay Mr. Lin an annual fee of $18,000 and Mr. Mr. Yang
an annual fee of RMB120,000 (approximately $17,570), as compensation for the
services to be provided by them as directors of the Company. On the same date,
we also entered into a stock option agreement with Mr. Lin, under which we
granted a stock option to Mr. Lin for the purchase of 30,000 shares of common
stock of the Company at an exercise price of $6.50. The option vests in equal
installments on a quarterly basis over a three-year period.

On June 1, 2009, pursuant to the Plan, we cancelled all of the
outstanding stock options with an exercise price of $6.5 that the Company
granted to Messrs. Trien, Chen and Lin to purchase an aggregate 90,000 shares of
our common stock and replaced with the same amount of stock options with an
exercise price of $5.09. For Mr. Trien, 12,500 options were vested on June 1,
2009 and the remaining options vest pro rata quarterly through February 1, 2011.
For Mr. Chen, 10,000 options were vested on June 1, 2009 and the remaining
options vest pro rata quarterly through May 1, 2011. For Mr. Lin, 5,000 options
were vested on June 1, 2009 and the remaining options vest pro rata quarterly
through September 28, 2011.

On June 14, 2010, the Company entered into an independent
director contract with Mr. Xingming Zhang. Under the terms of the contract, the
Company agreed to pay Mr. Zhang an annual fee of RMB 60,000 (approximately
$8,785), as compensation for the services to be provided by Mr. Zhang as a
director of the Company. The Company also entered into a stock option agreement
under the Company's 2009 Equity Incentive Plan with Mr. Zhang, under which the
Company agreed to grant a stock option to Mr. Zhang for the purchase of 30,000
shares of common stock of the Company at an exercise price of $6.03. The options
vest in equal installments on a quarterly basis over a three-year period.

We also reimburse our directors for reasonable travel expenses
related to attendance at board and committee meetings.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Security Ownership of Certain Beneficial Owners and
Management

The following table sets forth information regarding beneficial
ownership of our common stock as of March 28, 2011 (i) by each person who is
known by us to beneficially own more than 5% of our common stock; (ii) by each
of our officers and directors; and (iii) by all of our officers and directors as
a group. Unless otherwise specified, the address of each of the persons set
forth below is in care of China TransInfo Technology Corp., 9th
Floor, Vision Building, No. 39 Xueyuanlu, Haidian District, Beijing, China
100191.

Name & Address of Beneficial
      Owner
    Office, if Any
    Title of Class
    Amount & Nature of Beneficial
      Ownership(1)
    Percent of Class(2)Officers and
      DirectorsShudong Xia
    Chief Executive Officer,
      President, and Chairman
    Common Stock, $0.001 par value
    6,245,242(3)
    24.71%Rong Zhang
    Chief Financial
      Officer
    Common Stock $0.001 par value
    0
    *Danxia Huang
    Vice President of Operations,
      Treasurer and Director
    Common Stock $0.001 par value
    509,896
    2.02%Zhibin Lai
    Vice President
    Common Stock $0.001 par value
    634,378
    2.51%Zhiping Zhang
    Vice President of Research and
      Development
    Common Stock $0.001 par value
    628,088
    2.49%Shan Qu
    Vice President
    Common Stock $0.001 par value
    0
    *Jay Trien
    Director
    Common Stock $0.001 par value
    30,000
    *Zhongsu Chen
    Director
    Common Stock $0.001 par value
    30,000
    *Dan Liu
    Director
    Common Stock $0.001 par value
    0
    *


65

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Brandon Ho-Ping Lin
    Director
    Common Stock $0.001 par
      value
    25,000
    *Xingming Zhang
    Director
    Common Stock $0.001 par value
    7,500
    *All officers and directors as
      a group (11 persons named above)
    
    Common Stock $0.001 par value
    8,110,104
    32.9%5% Securities HolderLeguna Verde Investments,
      Ltd. P.O. Box 3444 Road Town, Tortola British Virgin Islands
    
    Common Stock $0.001 par
      value
    1,275,218(4)
    5.05%Karmen Investment Holdings, Ltd P.O.
      Box 3444 Road Town, Tortola British Virgin Islands
    
    Common Stock $0.001 par value
    6,005,242(3)
    23.76%SAIF Partners III L.P.
      #2115, Two Pacific Place, 88 Queensway, Admiralty, Hong Kong
    
    Common Stock $0.001 par
      value
    4,151,152(5)
    16.43%Andrew Y. Yan #2115, Two Pacific Place,
      88 Queensway, Admiralty, Hong Kong
    
    Common Stock $0.001 par value
    4,151,152(5)
    16.43%Total Shares Owned by
      Persons Named above:
    
    Common Stock $0.001 par value
    13,536,474
    53.57%


* Less than 1%.

|(1) | Beneficial ownership is determined in accordance with the
      rules of the SEC and includes voting or investment power with respect to
      the ordinary shares.                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(2) | A total of 25,270,069 shares of Common Stock as of March
      28 2011 are considered to be outstanding pursuant to SEC Rule 13d-3(d)(1).
      For each beneficial owner above, any options exercisable within 60 days
      have been included in the denominator.                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(3) | Includes 23.76% shares of Common Stock owned by Karmen
      Investment Holdings Ltd., which is wholly-owned by East Action Investment
      Holdings Ltd. of which Shudong Xia is a 68% shareholder. Mr. Xia may be
      deemed to be a beneficial owner of the shares held by Karmen Investment
      Holdings Ltd.                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(4) | Chuang Yang is the owner of Leguna Verde Investments,
      Ltd. and exercises voting and investment power over the shares owned by
      Leguna Verde Investments, Ltd. Mr. Yang may be deemed to be a beneficial
      owner of the shares held by Leguna Verde Investments, Ltd.                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(5) | Andrew Y. Yan is the sole shareholder and sole director
      of SAIF III GP Capital Ltd., a limited liability entity formed under the
      laws of the Cayman Islands, the sole general partner of SAIF III GP, L.P.,
      a limited partnership formed under the laws of the Cayman Islands, which
      in turn is the sole general partner of SAIF Partners III L.P., a limited
      partnership formed under the laws of the Cayman Islands. Mr. Yan is deemed
      to have sole voting and dispositive powers with respect to the securities
      held by SAIF Partners III L.P.

Changes in Control

There are no arrangements known to us, including any pledge by
any person of our securities, the operation of which may at a subsequent date
result in a change in control of the Company.

66

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Securities Authorized for Issuance Under Equity Compensation
Plans

On May 29, 2009, our stockholders approved China TransInfo
Technology Corp. 2009 Equity Incentive Plan (the "Plan") at the Companys 2009
Annual Meeting of Stockholders, whereby we are authorized to issue shares of our
common stock to certain employees, consultants and directors. The maximum
aggregate number of shares of our common stock that may be issued under the Plan
is 3,000,000 shares. The following table includes the information as of the end
of fiscal year 2010 for each category of our equity compensation plan:

Plan category
    Number of securities to
      be issued upon exercise of outstanding options,
      restricted stock, warrants and rights (a)
    Weighted-average
      exercise price of outstanding options,
      restricted stock, warrants and rights (b)
    Number of securities remaining
      available for future issuance under equity
      compensation plans (excluding securities reflected
      in column (a)) (c)Equity compensation plans
      approved by security holders
    1,230,900(1)
    7.40
    1,619,100Equity compensation plans not approved by
      security holders
    -
    -
    -Total
    1,230,900(1)
    7.40
    1,619,100


|(1) | Pursuant to a stock option repricing under the Plan, on
      June 1, 2009, we cancelled all of the outstanding stock options with an
      exercise price of $6.5 that the Company granted to certain of its
      directors to purchase 90,000 shares of our common stock and replaced with
      the same amount of stock options with an exercise price of $5.09. We also
      granted to our employee, Fan Zhou a stock option with an exercise of $5.09
      to purchase 30,000 shares of our commons stock pursuant to the Plan. On
      November, 2009, pursuant to the Plan, we granted to our certain employees
      stock options with an exercise of $7.69 to purchase an aggregate of
      1,791,600 shares of our common stock. On June 14, 2010, pursuant to the
      Plan, we granted to Xingming Zhang stock options with an exercise of $6.03
      to purchase an aggregate of 30,000 shares of our common stock.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE.

Transactions with Related Persons

The following includes a summary of transactions since the
beginning of the 2010 fiscal year, or any currently proposed transaction, in
which we were or are to be a participant and the amount involved exceeded or
exceeds the lesser of $120,000 or one percent of the average of our total assets
at year-end for the last two completed fiscal years, and in which any related
person had or will have a direct or indirect material interest (other than
compensation described under Item 11, Executive Compensation). We believe the
terms obtained or consideration that we paid or received, as applicable, in
connection with the transactions described below were comparable to terms
available or the amounts that would be paid or received, as applicable, in
arms-length transactions.

On September 8, 2009, our CEO and Chairman, Shudong Xia,
entered into an equity transfer agreement with Unisplendour Corporation Limited
("Unisplendour"), pursuant to which Mr. Xia acquired 35.17% of the equity
interest in UNISITS from Unisplendour for a cash price of RMB 44.4 million
(approximately $6.53 million). Pursuant to the equity transfer agreement, Mr.
Xia pay 50% of the purchase price to Unisplendour within five (5) business days
after the agreement became effective. The rest 50% of the purchase price was
paid by Mr. Xia within forty-five (45) days after the completion of registration
of Mr. Xia as a shareholder of UNISITS with the relevant governmental authority
in China.

On the same day, Mr. Xia entered into an option agreement with
the Group Company, pursuant to which, Mr. Xia granted to the Group Company a
perpetual option to purchase all or a part of his equity interests in UNISITS at
an exercise price (the "Exercise Price") of RMB 44.4 million (approximately
$6.53 million). In exchange, the Group Company agreed to pre-pay to Mr. Xia the
Exercise Price within 45 business days following the date of this option
agreement. In addition, in order to ensure its fulfillment of the obligations
under the option agreement, Mr. Xia pledged all of his equity interests in
UNISITS to the Group Company for five years (the "Term of Pledge"). The Group
Company may exercise the option at any time commencing on the day following of
the expiration of the Term of Pledge. Under the option agreement, Mr. Xia also agreed to grant the Group Company a right to collect the
dividends from his equity interests in UNISITS and any dividends paid upon such
equity interests will be immediately delivered by Mr. Xia to the Group Company.

67

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On March 22, 2010, we and the Group Company entered into
several certain equity transfer agreements with several individual shareholders
of UNISITS, pursuant to which the Group Company acquired 30.85% equity interest
in UNISITS. According to the equity transfer agreements, the Group Company
purchased approximately 16.23 million shares of UNISITS in exchange for RMB 4.41
million (approximately US$0.65 million), 40% of which was paid within seven days
after the effective date of the equity transfer agreements, and approximately
1.16 million shares of our Common Stock, which were issued within 30 days of the
effective date of the equity transfer agreements.

On February 21, 2010, we entered into a securities purchase
agreement with our ten percent shareholder, SAIF Partners, pursuant to
which we sold a total of 1,564,945 shares of common stock for an aggregate
purchase price of $10,000,000. The shares were priced at $6.39 per share.

Except as set forth in our discussion above, none of our
directors, director nominees or executive officers has been involved in any
transactions with us or any of our directors, executive officers, affiliates or
associates which are required to be disclosed pursuant to the rules and
regulations of the SEC.

Promoters and Certain Control Persons

We did not have any promoters at any time during the past five
fiscal years.

Parents of the Company

Karmen Investment Holdings Ltd. currently owns 23.76% of China
TransInfo Technology Corp.

Director Independence

Jay Trien, Zhongsu Chen, Dan Liu, Brandon Ho-Ping Lin and
Xingming Zhang each serves on our board of directors as an independent
director as defined by Rule 5605(a)(2) of Listing Rules of The Nasdaq Stock
Market, Inc.. Our board of directors currently has three standing committees
which perform various duties on behalf of and report to the board of directors:
(i) Audit Committee, (ii) Compensation Committee and (iii) Governance and
Nominating Committee. Each of the three standing committees is solely comprised
of independent directors.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Independent Auditors Fees

The following table sets forth the aggregate fees billed to us
by BDO China Li Xin Da Hua CPA Co., Ltd. (formerly known as Dahua Delu) (BDO
China Li Xin) for fiscal years 2010 and 2009:

|                      |   | 2010     |  |   | 2009    | 
|--------------------- | - | -------- |  | - | ------- | 
|                      |   |          |  |   |         | 
|Audit fees(1)         | $ | $250,000 |  | $ | 130,000 | 
|Audit-related fees(2) |   | 31,277   |  |   | -       | 
|Tax fees(3)           |   | -        |  |   | -       | 
|All other fees(4)     |   | -        |  |   | -       | 
|Total                 |   | 281,277  |  |   | 130,000 | 

The following table sets forth the aggregate fees billed to us
by Simon & Edward, LLP for fiscal years 2010 and 2009:

|                      |   | 2010 |  |   | 2009    | 
|--------------------- | - | ---- |  | - | ------- | 
|                      |   |      |  |   |         | 
|Audit fees(1)         | $ | -    |  | $ | 110,000 | 
|Audit-related fees(2) |   | -    |  |   | 28,948  | 
|Tax fees(3)           |   | -    |  |   | -       | 
|All other fees(4)     |   | -    |  |   | -       | 
|Total                 |   | -    |  |   | 138,948 | 

68

---

|(1) | Audit Fees consisted of the aggregate fees billed for
      professional services rendered for the audit of our annual financial
      statements and the reviews of the financial statements included in our
      Forms 10-Q and for any other services that were normally provided in
      connection with our statutory and regulatory filings or engagements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                      
|(2) | Audit Related Fees consisted of the aggregate fees
      billed for professional services rendered for assurance and related
      services that were reasonably related to the performance of the audit or
      review of our financial statements and were not otherwise included in
      Audit Fees.                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                      
|(3) | Tax Fees consisted of the aggregate fees billed for
      professional services rendered for tax compliance, tax advice and tax
      planning. Included in such Tax Fees were fees for preparation of our tax
      returns and consultancy and advice on other tax planning matters.                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                      
|(4) | All Other Fees consisted of the aggregate fees billed
      for products and services provided and not otherwise included in Audit
      Fees, Audit Related Fees or Tax Fees.                                                                                                                                                                                     

On November 23, 2009 we dismissed Simon & Edward, LLP as
its independent registered public accounting firm. The decision to change our
principal accountants was made by the Audit Committee. On November 23, 2009, the
Audit Committee engaged BDO China Li Xin as our new independent registered
public accounting firm.

Simon & Edward, LLPs reports on the Companys financial
statements as of and for the fiscal years ended December 31, 2008 and 2007 did
not contain an adverse opinion or disclaimer of opinion and were not qualified
or modified as to uncertainty, audit scope, or accounting principles.

During the Companys fiscal years ended December 31, 2008 and
2007 and during the subsequent interim period through November 23, 2009, there
were (1) no disagreements with Simon & Edward, LLP on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedures, which disagreements, if not resolved to the satisfaction of
Simon & Edward, LLP, would have caused Simon & Edward, LLP to make
reference to the subject matter of the disagreements in connection with its
reports, and (2) no events of the type listed in paragraphs (A) through (D) of
Item 304(a)(1)(v) of Regulation S-K.

We have requested and received from Simon & Edward, LLP a
letter, dated November 30, 2009, addressed to the Securities and Exchange
Commission stating whether or not Simon & Edward, LLP agrees with the above
statements. A copy of this letter was attached as Exhibit 16.1 to the Companys
Form 8-K filed on November 30, 2009.

During the Companys fiscal years ended December 31, 2008 and
2007 and through the subsequent interim period to November 23, 2009, the Company
did not consult BDO China Li Xin with respect to (a) the application of
accounting principles to a specified transaction, either completed or proposed;
or the type of audit opinion that might be rendered on the Companys
consolidated financial statements, and neither a written report was provided to
the Company or oral advice was provided that BDO China Li Xin concluded was an
important factor considered by the Company in reaching a decision as to the
accounting, auditing or financial reporting issue; or (b) any matter that was
the subject of either a disagreement as defined in Item 304(a)(1)(iv) of
Regulation S-K or a reportable event as described in Item 304(a)(1)(v) of
Regulation S-K.

Pre-Approval Policies and Procedures

Under the Sarbanes-Oxley Act of 2002, all audit and non-audit
services performed by our auditors must be approved in advance by our Audit
Committee to assure that such services do not impair the auditors independence
from us. In accordance with its policies and procedures, our Audit Committee
pre-approved the audit services performed by BDO China Li Xin for our
consolidated financial statements as of and for the year ended December 31,
2010. Our Audit Committee delegated its pre-approval authority regarding the
non-audited services to its Chair. There were no non-audit services performed by
BDO China Li Xin for the year ended December 31, 2010.

69

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PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
Financial Statements and Schedules

The financial statements are set forth under Item 8 of this
annual report on Form 10-K. Financial statement schedules have been omitted
since they are either not required, not applicable, or the information is
otherwise included.

Exhibit List

The following exhibits are filed as part of this report or
incorporated by reference:

|Exhibit No. |  | Description                                                                                                                                                                                                                                                                                                 
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|            |  |                                                                                                                                                                                                                                                                                                             
|2.1         |  | Share Exchange Agreement, dated May 14, 2007, among the
      registrant, Cabowise International Ltd., its shareholders, Weicheng
      International Inc. and Foster Growth Ltd [Incorporated by reference to
      Exhibit 2.1 to the registrants current report on Form 8-K filed on May
      14, 2007]
|            |  |                                                                                                                                                                                                                                                                                                             
|3.1         |  | Amended and Restated Articles of Incorporation of the
      registrant as filed with the Secretary of State of Nevada on December 19,
      2003. [Incorporated by reference to Exhibit 3.1 to the registrants
      current report on Form 10-KSB filed on March 31, 2005]                                
|            |  |                                                                                                                                                                                                                                                                                                             
|3.2         |  | Certificate of Amendment to Articles of Incorporation
      filed with the Secretary of State of the State of Nevada on August 20,
      2007. [Incorporated by reference to Exhibit 3.1 to the registrants
      current report on Form 8-K filed on August 23, 2007]                                     
|            |  |                                                                                                                                                                                                                                                                                                             
|3.3         |  | Amended and Restated Bylaws of China TransInfo Technology
      Corp., adopted May 1, 2008. [Incorporated by reference to Exhibit 3.1 to
      the registrants current report on Form 8-K filed on May 6, 2008]                                                                                            
|            |  |                                                                                                                                                                                                                                                                                                             
|4.1         |  | Registration Rights Agreement, by and between China
      TransInfo Technology Corp. and SAIF Partners III L.P., dated July 17,
      2008. [Incorporated by reference to Exhibit 4.1 to the registrants
      current report on Form 8-K filed on July 18, 2008]                                          
|            |  |                                                                                                                                                                                                                                                                                                             
|4.2         |  | Common Stock Purchase Warrant issued to Antaeus Capital,
      Inc., dated May 14, 2007. [Incorporated by reference to Exhibit 4.6 to the
      Companys Current Report on Form 8-K filed on May 14, 2007]                                                                                                 
|            |  |                                                                                                                                                                                                                                                                                                             
|10.1        |  | Standard Contracts with Employees - Labor Contract
      between employees and Beijing Jinzhengdong Human Resources Consultant Co.,
      Ltd [Incorporated by reference to Exhibit 10.20 to the registrants
      current report on Form 8-K filed on May 14, 2007]                                       
|            |  |                                                                                                                                                                                                                                                                                                             
|10.2        |  | Labor Contract between Xia Shudong and Beijing PKU
      Chinafront Technology Co., Ltd [Incorporated by reference to Exhibit 10.21
      to the registrants current report on Form 8-K filed on May 14, 2007]                                                                                             
|            |  |                                                                                                                                                                                                                                                                                                             
|10.3        |  | Labor Contract between Huang Danxia and Beijing PKU
      Chinafront Technology Co., Ltd. .[Incorporated by reference to Exhibit
      10.22 to the registrants current report on Form 8-K filed on May 14,
      2007]+                                                                                   
|            |  |                                                                                                                                                                                                                                                                                                             
|10.4        |  | Labor Contract between Lai Zhibin and Beijing PKU
      Chinafront Technology Co., Ltd. .[Incorporated by reference to Exhibit
      10.23 to the registrants current report on Form 8-K filed on May 14,
      2007]+                                                                                     
|            |  |                                                                                                                                                                                                                                                                                                             
|10.5        |  | Labor Contract between Zhang Zhiping and Beijing PKU
      Chinafront Technology Co., Ltd. .[Incorporated by reference to Exhibit
      10.24 to the registrants current report on Form 8-K filed on May 14,
      2007]+                                                                                  
|            |  |                                                                                                                                                                                                                                                                                                             
|10.6        |  | China TransInfo Technology Corp. Independent Directors
      Contract, dated as of May 1, 2008, by and between China TransInfo
      Technology Corp. and Jay Trien. [Incorporated by reference to Exhibit 10.1 to the registrants current report on Form 8-K filed on
      May 6, 2008]+                

70

---

|10.7  |  | China TransInfo Technology Corp. Independent Directors
      Contract, dated as of May 1, 2008, by and between China TransInfo
      Technology Corp. and Zhongsu Chen. [Incorporated by reference to Exhibit
      10.2 to the registrants current report on Form 8-K filed on May 6, 2008]+                                                               
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.8  |  | China TransInfo Technology Corp. Independent Directors
      Contract, dated as of May 1, 2008, by and between China TransInfo
      Technology Corp. and Dan Liu. [Incorporated by reference to Exhibit 10.3
      to the registrants current report on Form 8-K filed on May 6, 2008]+                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.9  |  | Indemnification Agreement, dated as of May 1, 2008, by
      and between China TransInfo Technology Corp. and Jay Trien. [Incorporated
      by reference to Exhibit 10.4 to the registrants current report on Form
      8-K filed on May 6, 2008]+                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.10 |  | Indemnification Agreement, dated as of May 1, 2008, by
      and between China TransInfo Technology Corp. and Zhongsu Chen.
      [Incorporated by reference to Exhibit 10.5 to the registrants current
      report on Form 8-K filed on May 6, 2008]+                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.11 |  | Indemnification Agreement, dated as of May 1, 2008, by
      and between China TransInfo Technology Corp. and Dan Liu. [Incorporated by
      reference to Exhibit 10.6 to the registrants current report on Form 8-K
      filed on May 6, 2008]+                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.12 |  | Equity Transfer Agreement, dated May 9, 2008, by and
      among Xu Wang, Tieying Zhao and PKU. [Incorporated by reference to Exhibit
      10.1 to the registrants quarterly report on Form 10-Q filed on May 13,
      2008]                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.13 |  | Equity Transfer Agreement, dated May 22, 2008, by and
      among Beijing Marine Communication & Navigation Company, China
      TranWiseway Information Technology Co., Ltd. and Beijing PKU Chinafront
      High Technology Co., Ltd [Incorporated by reference to Exhibit 10.1 to the
      registrants current report on Form 8-K filed on May 29, 2008]
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.14 |  | Securities Purchase Agreement, by and among China
      TransInfo Technology Corp., Beijing PKU Chinafront High Technology Co.,
      Ltd. and SAIF Partners III L.P., dated July 17, 2008. [Incorporated by
      reference to Exhibit 10.1 to the registrants current report on Form 8-K
      filed on July 18, 2008]                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.15 |  | Voting Agreement, by among China TransInfo Technology
      Corp., Karmen Investment Holdings Limited, Leguna Verde Investments
      Limited and SAIF Partners III L.P., dated July 17, 2008. [Incorporated by
      reference to Exhibit 10.2 to the registrants current report on Form 8-K
      filed on July 18, 2008]                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.16 |  | Cooperation Agreement, dated August 6, 2006, between
      Beijing PKU Chinafront Technology Co., Ltd. and Earth and Space College,
      Peking University. [Incorporated by reference to Exhibit 10.18 to the
      registrants current report on Form 8-K filed on May 14, 2007]                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.17 |  | Loan Agreement, dated June 17, 2008, by and between China
      TransInfo Technology Corp. and Beijing Bank, Youyi Branch. [Incorporated
      by reference to Exhibit 10.1 to the registrants quarterly report on Form
      10-Q filed on August 14, 2008]                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.18 |  | Equity Transfer Agreement, dated September 16, 2008, by
      and among Beijing Zhangcheng Culture and Media Co., Ltd., Sun Jian, Xin
      Yibo and Zhu Juntao. [Incorporated by reference to Exhibit 10.1 to the
      registrants current report on Form 8-K filed on September 19, 2008]                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.19 |  | China TransInfo Technology Corp. Director Agreement,
      dated as of September 28, 2008, by and between China TransInfo Technology
      Corp. and Brandon Ho-Ping Lin. [Incorporated by reference to Exhibit 10.1
      to the registrants current report on Form 8-K filed on October 2, 2008]+                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                               
|10.20 |  | China TransInfo Technology Corp. Director Agreement,
      dated as of September 28, 2008, by and between China TransInfo Technology
      Corp. and Dongyuan Yang. [Incorporated by reference to Exhibit 10.2 to the
      registrants current report on Form 8-K filed on October 2, 2008]+                                                                

71

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|10.21 |  | Indemnification Agreement, dated as of September 28,
      2008, by and between China TransInfo Technology Corp. and Brandon Ho-Ping
      Lin. [Incorporated by reference to Exhibit 10.3 to the registrants
      current report on Form 8-K filed on October 2, 2008]+                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.22 |  | Indemnification Agreement, dated as of September 28,
      2008, by and between China TransInfo Technology Corp. and Dongyuan Yang.
      [Incorporated by reference to Exhibit 10.4 to the registrants current
      report on Form 8-K filed on October 2, 2008]+                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.23 |  | Equity Transfer Agreement, dated October 1, 2008, by and
      among Beijing PKU Chinafront High Technology Co., Ltd. and Qing Lu,
      Xiaohong Chen, Hangfei Lin, Gang Li, Jianzhong Zhang and Jieqing Guo.
      [Incorporated by reference to Exhibit 10.1 to the registrants current
      report on Form 8-K filed on October 7, 2008]                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.24 |  | Equity Transfer Agreement, by and between Oriental
      Intra-Asia Entertainment (China) Limited and China TransInfo Technology
      Group Co., Ltd., dated February 3, 2009. [Incorporated by reference to
      Exhibit 10.1 to the registrants current report on Form 8-K filed on
      February 6, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.25 |  | Equity Transfer Agreement, by and between Beijing PKU
      Chinafront High Technology Co., Ltd. and China TransInfo Technology Group
      Co., Ltd., dated February 3, 2009. [Incorporated by reference to Exhibit
      10.2 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.26 |  | Equity Transfer Agreement, by and between Beijing PKU
      Chinafront High Technology Co., Ltd. and China TransInfo Technology Group
      Co., Ltd., dated February 3, 2009. [Incorporated by reference to Exhibit
      10.3 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.27 |  | Equity Transfer Agreement, by and between Beijing PKU
      Chinafront High Technology Co., Ltd. and China TransInfo Technology Group
      Co., Ltd., dated February 3, 2009. [Incorporated by reference to Exhibit
      10.4 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.28 |  | Equity Transfer Agreement, by and between Beijing PKU
      Chinafront High Technology Co., Ltd. and China TransInfo Technology Group
      Co., Ltd., dated February 3, 2009. [Incorporated by reference to Exhibit
      10.5 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.29 |  | Equity Transfer Agreement, by and between Beijing PKU
      Chinafront High Technology Co., Ltd. and China TransInfo Technology Group
      Co., Ltd., dated February 3, 2009. [Incorporated by reference to Exhibit
      10.6 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.30 |  | Exclusive Technical Development and Consulting Agreement,
      by and among Oriental Intra-Asia Entertainment (China) Limited, China
      TransInfo Technology Group Co., Ltd., Beijing PKU Chinafront High
      Technology Co., Ltd., Beijing Tian Hao Ding Xin Science and Technology
      Co., Ltd., Beijing Zhangcheng Culture and Media Co., Ltd., Beijing
      Zhangcheng Science and Technology Co., Ltd., China TranWiseway Information
      Technology Co., Ltd., Shanghai Yootu Information Technology Co., Ltd.,
      Xinjiang Zhangcheng Science and Technology Co., Ltd., and Dalian Dajian
      Zhitong Information Service Co., Ltd., dated February 3, 2009.
      [Incorporated by reference to Exhibit 10.7 to the registrants current
      report on Form 8-K filed on February 6, 2009]
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.31 |  | Equity Pledge Agreement, by and among Oriental Intra-Asia
      Entertainment (China) Limited, Shudong Xia, Zhiping Zhang, Zhibin Lai and
      Wei Gao, dated February 3, 2009. [Incorporated by reference to Exhibit
      10.8 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.32 |  | Option Agreement, by and among Oriental Intra-Asia
      Entertainment (China) Limited, Shudong Xia, Zhiping Zhang, Zhibin Lai and
      Wei Gao, dated February 3, 2009. [Incorporated by reference to Exhibit
      10.9 to the registrants current report on Form 8-K filed on February 6,
      2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.33 |  | Power of Attorney, signed by Shudong Xia, dated February
      3, 2009. [Incorporated by reference to Exhibit 10.10 to the registrants
      current report on Form 8-K filed on February 6, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.34 |  | Power of Attorney, signed by Zhiping Zhang, dated
      February 3, 2009. [Incorporated by reference to Exhibit 10.11 to the registrants current report on Form
      8-K filed on February 6, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

72

---

|10.35 |  | Power of Attorney, signed by Zhibin Lai, dated February
      3, 2009. [Incorporated by reference to Exhibit 10.12 to the registrants
      current report on Form 8-K filed on February 6, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.36 |  | Power of Attorney, signed by Wei Gao, dated February 3,
      2009. [Incorporated by reference to Exhibit 10.13 to the registrants
      current report on Form 8-K filed on February 6, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.37 |  | Operating Agreement, by and among Oriental Intra-Asia
      Entertainment (China) Limited, China TransInfo Technology Group Co., Ltd.,
      Beijing PKU Chinafront High Technology Co., Ltd., Beijing Tian Hao Ding
      Xin Science and Technology Co., Ltd., Beijing Zhangcheng Culture and Media
      Co., Ltd., Beijing Zhangcheng Science and Technology Co., Ltd., China
      TranWiseway Information Technology Co., Ltd., Shanghai Yootu Information
      Technology Co., Ltd., Xinjiang Zhangcheng Science and Technology Co.,
      Ltd., and Dalian Dajian Zhitong Information Service Co., Ltd., Shudong
      Xia, Zhiping Zhang, Zhibin Lai and Wei Gao, dated February 3, 2009.
      [Incorporated by reference to Exhibit 10.14 to the registrants current
      report on Form 8-K filed on February 6, 2009].
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.38 |  | English Translation of Equity Transfer Agreement, by and
      between Shudong Xia and Unisplendour Corporation Limited, dated September
      8, 2009. [Incorporated by reference to Exhibit 10.1 to the registrants
      current report on Form 8-K filed on September 14, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.39 |  | Option Agreement, by and between Shudong Xia and China
      TransInfo Technology Group Co., Ltd., dated September 8, 2009.
      [Incorporated by reference to Exhibit 10.2 to the registrants current
      report on Form 8-K filed on September 14, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.40 |  | English Translation of the Short-term Loan Agreement, by
      and between Beijing PKU Chinafront High Technology Co., Ltd. and Huaxia
      Bank, Zhichunlu Branch, dated September 29, 2009. [Incorporated by
      reference to Exhibit 10.1 to the registrants quarterly report on Form
      10-Q filed on November 13, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.41 |  | English Translation of Lease Agreement, by and between
      China TransInfo Technology Group Co., Ltd. and Beijing Weishi Hotel
      Management Co. Ltd., dated August 18, 2009. [Incorporated by reference to
      Exhibit 10.2 to the registrants quarterly report on Form 10-Q filed on
      November 13, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.42 |  | English Translation of Acting in Concert Agreement, by
      and among China TransInfo Technology Group Co., Ltd. and four individual
      directors of Beijing UNISITS Technology Co., Ltd. dated September 2009.
      [Incorporated by reference to Exhibit 10.3 to the registrants quarterly
      report on Form 10-Q filed on November 13, 2009]                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.43 |  | Securities Purchase Agreement, dated February 21, 2010,
      by and between the Company and SAIF Partners III L.P [Incorporated by
      reference to Exhibit 10.1 to the registrants current report on Form 8-K
      filed on February 23, 2010]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.44 |  | English Translation of Equity Transfer Agreement, by and
      among the Group Company and certain individual shareholders of UNISITS,
      dated March 22, 2010. [Incorporated by reference to Exhibit 10.1 to the
      registrants current report on Form 8-K filed on March 26, 2010]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.45 |  | English Translation of Equity Transfer Agreement, by and
      among the Company, the Group Company, Shih Ming Holdings Limited and
      certain individual shareholders of UNISITS, dated March 22, 2010.
      [Incorporated by reference to Exhibit 10.2 to the registrants current
      report on Form 8-K filed on March 26, 2010]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.46 |  | English Translation of Equity Transfer Agreement, by and
      among the Company, the Group Company, Large Crown Holdings Limited and
      certain individual shareholders of UNISITS, dated March 22, 2010.
      [Incorporated by reference to Exhibit 10.3 to the registrants current
      report on Form 8-K filed on March 26, 2010]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.47 |  | China TransInfo Technology Corp. Independent Director
      Contract, dated as of June 14, 2010, by and between China TransInfo
      Technology Corp. and Xingming Zhang. [Incorporated by reference to Exhibit 10.1 to the registrants current report on Form
      8-K filed on June 17, 2010]+                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

73

---

|10.48 |  | Indemnification Agreement, dated as of June 14, 2010, by
      and between China TransInfo Technology Corp. and Xingming Zhang.
      [Incorporated by reference to Exhibit 10.2 to the registrants current
      report on Form 8-K filed on June 17, 2010]+                                                                    
|----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.49 |  | China TransInfo Technology Corp. Stock Option Agreement,
      dated as of June 14, 2010, by and between China TransInfo Technology Corp.
      and Xingming Zhang. [Incorporated by reference to Exhibit 10.3 to the
      registrants current report on Form 8-K filed on June 17, 2010]+                                      
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.50 |  | Loan Agreement, dated June 21, 2010, by and between
      Beijing PKU Chinafront High Technology Co.,Ltd. and Bank of Beijing,
      Zhongguancun Branch. [Incorporated by reference to Exhibit 10.1 to the
      registrants current report on Form 8-K filed on June 25, 2010]                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.51 |  | English Translation of Loan Agreement, dated November 29,
      2010, by and between China TranWiseway Technology Co., Ltd. and
      Zhongguancun Haidianyuan Branch of Bank of Beijing Co., Ltd [Incorporated
      by reference to Exhibit 10.1 to the registrants current report on Form
      8-K filed on December 3, 2010]
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.52 |  | Employment Agreement by and between China TransInfo
      Technology Corp. and Roger (Rong) Zhang, dated December 21, 2010.
      [Incorporated by reference to Exhibit 10.1 to the registrants current
      report on Form 8-K filed on December 28, 2010]+                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.53 |  | Stock Option Agreement by and between China TransInfo
      Technology Corp. and Rong Zhang, dated January 3, 2011. [Incorporated by
      reference to Exhibit 10.1 to the registrants current report on Form 8-K
      filed on January 7, 2011]+                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.54 |  | Employment Agreement by and between China TransInfo
      Technology Corp. and Shan Qu, dated January 26, 2011.*+                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                   
|10.55 |  | Stock Option Agreement by and between China TransInfo
      Technology Corp. and Shan Qu, dated January 26, 2011.*+                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                   
|21    |  | Subsidiaries of the Company.*                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                   
|23.1  |  | Consent of BDO China Li Xin Da Hua CPA Co., Ltd.,
      Independent Registered Public Accounting Firm.*                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                   
|31.1  |  | Certifications of Chief Executive Officer Pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                   
|31.2  |  | Certifications of Chief Financial Officer Pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                   
|32.1  |  | Certification of Chief Executive Officer Pursuant to
      Section 906 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                   
|32.2  |  | Certification of Chief Financial Officer Pursuant to
      Section 906 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                                       

*Filed herewith.

+ Represents management contract or compensatory plan or
arrangement.

74

---

SIGNATURES

In accordance with section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant caused this Report on Form 10-K to be
signed on its behalf by the undersigned, thereto duly authorized individual.

Date: March 29, 2011

CHINA TRANSINFO TECHNOLOGY CORP.By:
    /s/ Shudong
      XiaShudong XiaChief Executive OfficerBy:
    /s/ Rong
      ZhangRong ZhangChief Financial Officer


In accordance with the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Each person whose signature appears below hereby authorizes
Shudong Xia and Rong Zhang, and each or any of them, as attorneys-in-fact to
sign on his or her behalf, individually, and in each capacity stated below, and
to file all amendments and/or supplements to this annual report on Form 10-K.

|Signature         |  | Title                                                               | Date          
|----------------- |  | ------------------------------------------------------------------- | --------------
|                  |  |                                                                     |               
|/s/ Shudong Xia   |  | Chairperson, Chief Executive Officer, President
      and Secretary | March 29, 2011
|Shudong Xia       |  | (Principal Executive Officer)                                       |               
|                  |  |                                                                     |               
|/s/ Rong Zhang    |  | Chief Financial Officer                                             | March 29, 2011
|Rong Zhang        |  | (Principal Financial and Accounting Officer)                        |               
|                  |  |                                                                     |               
|/s/ Danxia Huang  |  | Vice President of Operations, Treasurer and
      Director          | March 29, 2011
|Danxia Huang      |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Zhibin Lai    |  | Vice President                                                      | March 29, 2011
|Zhibin Lai        |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Zhiping Zhang |  | Vice President of Research and Development                          | March 29, 2011
|Zhiping Zhang     |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Shan Qu       |  | Vice President                                                      | March 29, 2011
|Shan Qu           |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Jay Trien     |  | Director                                                            | March 29, 2011
|Jay Trien         |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Zhongsu Chen  |  | Director                                                            | March 29, 2011
|Zhongsu Chen      |  |                                                                     |               
|                  |  |                                                                     |               
|/s/ Dan Liu       |  | Director                                                            | March 29, 2011
|Dan Liu           |  |                                                                     |               

75

---

|/s/
      Brandon Ho-Ping Lin |  | Director | March 29, 2011
|----------------------------- |  | -------- | --------------
|Brandon Ho-Ping Lin           |  |          |               
|                              |  |          |               
|                              |  |          |               
|/s/
      Xingming Zhang      |  | Director | March 29, 2011
|Xingming Zhang                |  |          |               

76

---

Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders China TransInfo
Technology Corp. Beijing, China

We have audited the accompanying consolidated balance sheets of
China TransInfo Technology Corp. as of December 31, 2010 and 2009 and the
related consolidated statements of income, stockholders equity, and cash flows
for each of the two years in the period ended December 31, 2010. These financial
statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. The Company
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Companys internal control
over financial reporting. Accordingly, we express no such opinion. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial position of
China TransInfo Technology Corp. at December 31, 2010 and 2009, and the results
of its operations and its cash flows for each of the two years in the period
ended December 31, 2010, in conformity with accounting principles
generally accepted in the United States of America.

BDO China Li Xin Da Hua CPA Co., Ltd. Shenzhen, P.R.C.
March 29, 2011

77

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                     |   | December 31, |  |   | December 31, | 
|---------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------ |  | - | ------------ | 
|                                                                                                                                                     |   | 2010         |  |   | 2009         | 
|ASSETS                                                                                                                                               |   |              |  |   |              | 
|Current Assets:                                                                                                                                      |   |              |  |   |              | 
|Cash and cash
      equivalents                                                                                                                      | $ | 43,916,597   |  | $ | 27,400,420   | 
|Restricted cash                                                                                                                                      |   | 3,131,660    |  |   | 1,591,076    | 
|Accounts receivable, net of allowance for
      doubtful accounts of $92,749 and $38,209, respectively                                               |   | 26,881,280   |  |   | 14,968,778   | 
|Inventory                                                                                                                                            |   | 1,079,221    |  |   | 482,286      | 
|Cost and estimated earnings in excess of
      billings on uncompleted contracts                                                                     |   | 38,626,089   |  |   | 33,853,708   | 
|Prepayments                                                                                                                                          |   | 18,551,801   |  |   | 5,871,997    | 
|Other receivables                                                                                                                                    |   | 10,632,452   |  |   | 8,416,096    | 
|Deferred tax assets                                                                                                                                  |   | 25,508       |  |   | 28,715       | 
|Total current assets                                                                                                                                 |   | 142,844,608  |  |   | 92,613,076   | 
|                                                                                                                                                     |   |              |  |   |              | 
|Long-term investments                                                                                                                                |   | 8,760,692    |  |   | 8,027,122    | 
|Property and equipment, net                                                                                                                          |   | 10,878,276   |  |   | 10,541,486   | 
|Intangible assets, net                                                                                                                               |   | 7,402,829    |  |   | 4,494,781    | 
|Goodwill                                                                                                                                             |   | 10,319,768   |  |   | 9,979,631    | 
|Other assets                                                                                                                                         |   | 319,679      |  |   | 826,671      | 
|                                                                                                                                                     |   |              |  |   |              | 
|Total assets                                                                                                                                         | $ | 180,525,852  |  | $ | 126,482,767  | 
|                                                                                                                                                     |   |              |  |   |              | 
|LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                                 |   |              |  |   |              | 
|Current Liabilities:                                                                                                                                 |   |              |  |   |              | 
|Accounts payable                                                                                                                                     | $ | 32,296,459   |  | $ | 20,728,539   | 
|Short-term borrowings from banks                                                                                                                     |   | 13,728,850   |  |   | 7,481,700    | 
|Loans payable to
      related parties                                                                                                               |   | -            |  |   | -            | 
|Billings in excess of costs and estimated earnings on
      uncompleted contracts                                                                    |   | 14,080,475   |  |   | 17,021,936   | 
|Accrued liabilities and
      other current liabilities                                                                                              |   | 8,988,180    |  |   | 3,022,140    | 
|Total current liabilities                                                                                                                            |   | 69,093,964   |  |   | 48,254,315   | 
|                                                                                                                                                     |   |              |  |   |              | 
|Other long-term liability                                                                                                                            |   | 200,699      |  |   | 389,489      | 
|Total liabilities                                                                                                                                    |   | 69,294,663   |  |   | 48,643,804   | 
|Commitments and contingencies                                                                                                                        |   |              |  |   |              | 
|Stockholders' equity :                                                                                                                               |   |              |  |   |              | 
|Preferred stock, par value $0.001 per share, 10,000,000
      shares authorized and 0 shares issued and outstanding                                  |   | -            |  |   | -            | 
|Common stock, par value $0.001 per share,
      150,000,000 shares authorized , 25,270,069 and 22,452,745 issued and
      outstanding, respectively |   | 25,270       |  |   | 22,453       | 
|Additional paid-in
      capital                                                                                                                     |   | 42,887,452   |  |   | 25,253,666   | 
|Retained earnings                                                                                                                                    |   | 47,417,481   |  |   | 31,948,323   | 
|Noncontrolling
      interests                                                                                                                       |   | 15,873,242   |  |   | 18,499,475   | 
|Accumulated other comprehensive income                                                                                                               |   | 5,027,744    |  |   | 2,115,046    | 
|                                                                                                                                                     |   |              |  |   |              | 
|Total stockholders' equity                                                                                                                           |   | 111,231,189  |  |   | 77,838,963   | 
|                                                                                                                                                     |   |              |  |   |              | 
|Total liabilities and stockholders' equity                                                                                                           | $ | 180,525,852  |  | $ | 126,482,767  | 

The accompanying notes are an integral part of the financial
statements.

F-1

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

|                                                                                                          |   | Years Ended December
      31, |  
|--------------------------------------------------------------------------------------------------------- | - | ------------------------------ | -
|                                                                                                          |   | 2010                           |  
|Revenues                                                                                                  | $ | 122,727,958                    |  
|Cost of sales                                                                                             |   | 80,279,465                     |  
|Gross profit                                                                                              |   | 42,448,493                     |  
|Selling, general and administrative expenses                                                              |   | 22,481,758                     |  
|Income from operations                                                                                    |   | 19,966,735                     |  
|Other income (expense):                                                                                   |   |                                |  
|Interest income                                                                                           |   | 127,468                        |  
|Interest expense                                                                                          |   | (470,711                       | )
|Subsidy income                                                                                            |   | 1,574,928                      |  
|Other income (expense), net                                                                               |   | (54,443                        | )
|Total other income                                                                                        |   | 1,177,242                      |  
|Income before income taxes, non-controlling interests, and
      gain on equity investments in affiliates |   | 21,143,977                     |  
|Income tax expense provision                                                                              |   | 2,074,187                      |  
|Net income before non-controlling interests and gain on
      equity investments in affiliates            |   | 19,069,790                     |  
|Gain on equity investments in affiliates
      due to proportional shares of the affiliates net income    |   | 1,307,679                      |  
|Net income before non-controlling interests                                                               |   | 20,377,469                     |  
|Non-controlling interests in net income of
      subsidiaries                                             |   | 4,908,311                      |  
|Net income - controlling interests                                                                        | $ | 15,469,158                     |  
|Weighted average number of common shares of
      outstanding                                             |   |                                |  
|Basic                                                                                                     |   | 24,647,707                     |  
|Diluted                                                                                                   |   | 24,683,208                     |  
|Earnings per share -                                                                                      |   |                                |  
|Basic                                                                                                     | $ | 0.63                           |  
|Diluted                                                                                                   | $ | 0.63                           |  

The accompanying notes are an integral part of the financial
statements.

F-2

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                       |   | Years Ended December
      31, |  
|------------------------------------------------------------------------------------------------------ | - | ------------------------------ | -
|                                                                                                       |   | 2010                           |  
|Cash flows from operating activities:                                                                  |   |                                |  
|Net income, including non-controlling interest                                                         | $ | 15,469,158                     |  
|Adjustments to reconcile net income to net
      cash provided by operating activities:                |   |                                |  
|Non-controlling interests                                                                              |   | 4,908,311                      |  
|Depreciation and
      amortization expenses                                                           |   | 2,007,246                      |  
|Stock-based compensation                                                                               |   | 1,160,016                      |  
|Gain on equity investments in affiliates
      due to proportional shares of the affiliates net income |   | (1,307,679                     | )
|Loss on disposal of property and
      equipment                                                       |   | (1,615                         | )
|Allowance for doubtful
      accounts                                                                  |   | 51,918                         |  
|Deferred income tax                                                                                    |   | 4,081                          |  
|(Increase) Decrease in
      assets:                                                                   |   |                                |  
|Restricted cash                                                                                        |   | (1,449,515                     | )
|Accounts receivable                                                                                    |   | (11,171,621                    | )
|Inventory                                                                                              |   | (566,109                       | )
|Prepayments                                                                                            |   | (12,215,219                    | )
|Other receivables                                                                                      |   | (3,224,644                     | )
|Cost and estimated earnings in excess of
      billings on uncompleted contracts                       |   | (3,528,851                     | )
|Other assets                                                                                           |   | 564,805                        |  
|Decrease (Increase) in
      liabilities:                                                              |   |                                |  
|Accounts payable                                                                                       |   | 10,592,767                     |  
|Billings in excess of costs and estimated
      earnings on uncompleted contracts                      |   | (3,434,336                     | )
|Accrued
      liabilities and other current liabilities                                                |   | 6,007,590                      |  
|Net cash provided by operating activities                                                              |   | 3,866,303                      |  

The accompanying notes are an integral part of the financial
statements.

F-3

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS(CONTINUED)

|                                                                           |   | Years Ended December 31, |  
|-------------------------------------------------------------------------- | - | ------------------------ | -
|                                                                           |   | 2010                     |  
|Cash flows from investing activities:                                      |   |                          |  
|Cash from acquisitions                                                     | $ | 73,970                   |  
|Proceeds from disposal of property and
      equipment                     |   | 64,861                   |  
|Refund from prepayment of building                                         |   |                          |  
|Purchases of property and equipment                                        |   | (1,841,087               | )
|Payments for acquisition of companies                                      |   | (260,966                 | )
|Purchases of intangible assets                                             |   | (2,933,180               | )
|Dividends from equity or cost investees                                    |   | 822,855                  |  
|Net cash provided by (used in) investing
      activities                  |   | (4,073,547               | )
|                                                                           |   |                          |  
|Cash flows from financing activities:                                      |   |                          |  
|Proceeds from short-term borrowings                                        |   | 13,388,570               |  
|Payments of short-term borrowings                                          |   | (7,544,940               | )
|Minority shareholders' capital contribution                                |   | 209,335                  |  
|Payment of dividends from subsidiaries' and
      variable interest entity |   | (51,779                  | )
|Proceeds from issuing shares                                               |   | 10,000,000               |  
|Payments of transaction costs related
      shares issuance                |   | (611,601                 | )
|Proceeds from (payments to) related parties                                |   |                          |  
|Net cash provided by financing activities                                  |   | 15,389,585               |  
|                                                                           |   |                          |  
|Effect of foreign currency exchange
      translation                      |   | 1,333,836                |  
|                                                                           |   |                          |  
|Net increase in cash                                                       |   | 16,516,177               |  
|                                                                           |   |                          |  
|Cash and cash equivalents  beginning                                      |   | 27,400,420               |  
|Cash and cash equivalents  ending                                         | $ | 43,916,597               |  
|                                                                           |   |                          |  
|Supplemental disclosures:                                                  |   |                          |  
|Interest paid                                                              | $ | 416,554                  |  
|Income taxes paid                                                          | $ | 787,449                  |  

The accompanying notes are an integral part of the financial
statements.

F-4

---

CHINATRANSINFOTECHNOLOGYCORP.ANDSUBSIDIARIES CONSOLIDATEDSTATEMENTSOFCHANGESINSTOCKHOLDERSEQUITY

Common Stock
    
    
    Additional Paid-In Capital
    
    
    Retained Earnings
    
    
    Accumulated Other Comprehensive Gain
    
    
    Noncontrolling Interest
    
    
    Total Stockholders' EquityShares
    
    
    AmountBalance, January 1, 2009
    
    22,187,314
    
    
    22,187
    
    
    24,654,890
    
    
    18,974,224
    
    
    2,499,893
    
    
    1,465,743
    
    
    47,616,937Reduction of noncontrolling interest due to restructuring
    
    
    
    
    
    
    
    126,078
    
    
    
    
    
    
    
    
    (126,078
    )
    
    -Paid Transaction Cost debit to APIC
    
    
    
    
    
    
    
    (32,500
    )
    
    
    
    
    
    
    
    
    
    
    (32,500
    )Issuance of common stock on cashless exercise of warrants
    
    177,931
    
    
    178
    
    
    (178
    )
    
    
    
    
    
    
    
    
    
    
    -Issuance of restricted shares
    
    87,500
    
    
    88
    
    
    (88
    )
    
    
    
    
    
    
    
    
    
    
    -Stock-based compensation
    
    
    
    
    
    
    
    505,464
    
    
    
    
    
    
    
    
    
    
    
    505,464Increase in noncontrolling interest of
      newly acquired subsidiaries including a subsidiary's subsidiaries
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,740,228
    
    
    13,740,228Minority shareholder's capital contribution pursuant to
      capital increase in subsidiaries
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    87,960
    
    
    87,960Cash dividends distributed by subsidiary of
      subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (205,254
    )
    
    (205,254
    )Translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    (384,847
    )
    
    
    
    
    (384,847
    )Net income for the year
    
    
    
    
    
    
    
    
    
    
    12,974,099
    
    
    
    
    
    3,536,876
    
    
    16,510,975Balance, January 1, 2010
    
    22,452,745
    
    
    22,453
    
    
    25,253,666
    
    
    31,948,323
    
    
    2,115,046
    
    
    18,499,475
    
    
    77,838,963Reduction of noncontrolling interest due to
      restructuring
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    -Paid Transaction Cost debit to APIC
    
    
    
    
    
    
    
    (611,255
    )
    
    
    
    
    
    
    
    
    
    
    (611,255
    )Issuance of common stock
    
    1,564,945
    
    
    1,565
    
    
    9,998,435
    
    
    
    
    
    
    
    
    
    
    
    10,000,000Issuance of common stock on cashless exercise of warrants
    
    40,448
    
    
    40
    
    
    (40
    )
    
    
    
    
    
    
    
    
    
    
    -Issuance of restricted shares
    
    50,000
    
    
    50
    
    
    (50
    )
    
    
    
    
    
    
    
    
    
    
    -Stock-based compensation
    
    
    
    
    
    
    
    1,160,016
    
    
    
    
    
    
    
    
    
    
    
    1,160,016Decrease in noncontrolling interest of
      previously acquired subsidiaries including a subsidiary's subsidiaries
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,734,789
    )
    
    (7,734,789
    )Issuance of common stock for contingent payment in
      previously acquired subsidiaries including a subsidiary's subsidiaries
    
    1,161,931
    
    
    1,162
    
    
    7,086,680
    
    
    
    
    
    
    
    
    
    
    
    7,087,842Minority shareholder's capital contribution
      pursuant to capital increase in subsidiaries
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    253,339
    
    
    253,339Cash dividends distributed by subsidiary of subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (53,094
    )
    
    (53,094
    )Translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,912,698
    
    
    
    
    
    2,912,698Net income for the year
    
    
    
    
    
    
    
    
    
    
    15,469,158
    
    
    
    
    
    4,908,311
    
    
    20,377,469Balance, December 31, 2010
    
    25,270,069
    
    $
    25,270
    
    $
    42,887,452
    
    $
    47,417,481
    
    $
    5,027,744
    
    $
    15,873,242
    
    $
    111,231,189


F-5

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of BusinessChina
TransInfo Technology Corp.(the Company), we, or us, was originally
incorporated in Nevada on August 3, 1998, under the name R & R Ranching,
Inc. to breed bison. At around March 2003, R & R Ranching Inc. sold its
bison to Blue Sky Bison Ranch, Ltd.

The Company has experienced several corporate name changes:
GloTech Industries, Inc. in March 2003, Intra-Asia Entertainment Corporation in
December 2003, and China TransInfo Technology Corp. in August 2007.

On May 14, 2007, the Company entered into a share exchange
agreement with Cabowise International Ltd. (Cabowise), a British Virgin
Islands company, the stockholders of Cabowise, Weicheng International Inc. and
Foster Growth Ltd. Pursuant to the share exchange agreement, the Company, among
other things, agreed to issue to the stockholders of Cabowise an aggregate of
10,841,491 shares of its common stock in exchange for all of the issued and
outstanding capital stock of Cabowise. In addition, Cabowise agreed to assign
its option to purchase a majority equity interest in Beijing PKU Chinafront High
Technology Co., Ltd.(PKU), to the Companys indirect Chinese subsidiary
Oriental Intra-Asia Entertainment (China) Limited (Oriental Intra-Asia).

Cabowise does not have any subsidiaries nor is it engaged in
any business. Cabowises sole asset was its option to purchase an eighty-five
percent (85%) interest in PKU (the PKU Option). Pursuant to the share exchange
agreement, Cabowise agreed to assign the PKU Option to Oriental Intra-Asia. On
May 14, 2007, Cabowise, the Company and Oriental Intra-Asia entered into an
assignment and assumption agreement whereby Cabowise assigned the PKU Option to
Oriental Intra-Asia. On May 14, 2007, Oriental Intra-Asia exercised the PKU
Option, and Oriental Intra-Asia became the owner of an eighty-five percent (85%)
equity interest in PKU.

The exchange of shares has been accounted for as a reverse
acquisition under the purchase method of accounting since the shareholders of
the PKU obtained control of the consolidated entity. Accordingly, the merger of
the two companies has been recorded as a recapitalization of PKU, with PKU being
treated as the continuing entity. The historical financial statements presented
are those of PKU. The continuing company has retained December 31 as its fiscal
year end.

During August 2007, the Company completed a 1-for-7.5 reverse
split of all issued and outstanding shares of common stock. The capital stock
accounts and all share data in this report give effect to the reverse split,
applied retroactively, for all periods presented.

PKU is in the business of providing Geography Information
System (GIS), application services to the Chinese governments in the sectors
of Transportation, Land and Resources, and Digital City. PKU offers GIS
application services that cover GIS system planning, deployment, system
construction, data testing, system audit and optimization, users manual and
customer training, through self-developed GIS platform software products
applicable for two-dimension and three-dimension system models. PKU was
incorporated in Beijing, China on October 30, 2000.

In addition to PKU and subsidiaries, the Company has the
following operating variable interest entities:

- Beijing Tian Hao Ding Xin Science and Technology Co.,
      Ltd.(Beijing Tian Hao), was established on December 31, 2005 with registered capital of RMB 5 million
      (approximately $0.73 million). Beijing Tian Hao is engaged in the business of GIS application research and
      development.
- Beijing Zhangcheng Science & Technology Co.,
      Ltd.(Beijing Zhangcheng Science), was established on October 12, 2007 with registered capital of RMB 10 million
      (approximately $1.46 million). Beijing Zhangcheng is engaged in the business of GIS application
      development for real time traffic information reporting.
- Beijing Zhangcheng Culture and Media Co.,
      Ltd.(Zhangcheng Media), was set up on June 8, 2008 with registered capital of RMB 5 million (approximately $0.73
      million). Zhangcheng Media is mainly engaged in taxi media advertising business.

F-6

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

- Shanghai Yootu Information Technology Co., Ltd.(Shanghai Yootu), was
  established on February 6, 2007 with registered capital of RMB 2 million
  (approximately $0.29 million). Shanghai Yootu is engaged in the business of
  real time traffic data application research and development.
- China TranWiseway Technology Co., Ltd.(China TranWiseway), was
  established on June 28, 2004 with registered capital of RMB 0.5 million
  (approximately $0.07 million). China TranWiseway is engaged in the business of
  traffic surveying technology applications.

On September 8, 2009, Mr. Shudong Xia, Chairman and Chief
Executive Officer of the Company, executed agreement to acquire a 35.17% equity
interest in Beijing UNISITS Technology Co., Ltd.(UNISITS) from Unisplendour
Corporation Limited (Unisplendour), with a cash payment of RMB 44.4 million
(approximately $6.53 million). Subsequently, on September 8, 2009, China
TransInfo Technology Group Co., Ltd.(the Group Company), a variable interest
entity of the Company entered into an option agreement with Mr. Xia, under which
Mr. Xia granted to the Group Company a perpetual option to acquire all of Mr.
Xia's equity interest in UNISITS for RMB 44.4 million (approximately $6.53
million), which is the exercise price. The exercise price of the option was
prepaid upon the granting of the option. Concurrently, the Group Company
acquired from Mr. Xia the rights to his share of all future UNISITS dividends or
other distributions. Mr. Xia pledged his equity interest in UNISITS to the Group
Company for five years. The Group Company expects to exercise the option and
take title to the equity interest now held by Mr. Xia upon the expiration of the
five-year term of the pledge agreement when the option first becomes
exercisable. In September 2009, the Group Company and four of five board
directors of UNISITS entered into an Acting in Concert Agreement. The agreement
allows the Group Company to govern the financial and operating policies of
UNISITS and therefore to obtain the control of UNISITS. As a result, UNISITS
became a variable interest entity of the Group Company and its financials has
been included in the Companys consolidated financial statements.

On March 22, 2010, the Company and the Group Company entered
into equity transfer agreements (Equity Transfer Agreements) with several
individual shareholders (Transferors) of UNISITS, pursuant to which the Group
Company acquired 30.85% equity interest in UNISITS from the Transferors.
Pursuant to the Equity Transfer Agreements, the Group Company purchased
approximately 16.23 million shares of UNISITS from the Transferors in exchange
for RMB 4.41 million (approximately $0.65 million) in cash (Cash
Consideration), 40% of which is payable within seven days after the effective
date of the Equity Transfer Agreements, and approximately 1.16 million shares of
the Company common stock, which are issuable within 30 days of the effective
date of the Equity Transfer Agreements. The Equity Transfer Agreements contain
make good provisions, under which the Transferors agree to deposit a total of
697,162 shares (60% of total common stock consideration) of the Company common
stock valued at $8.01 per share, which is the share price on acquisition date,
for a total value of $5.58 million, with an escrow agent designated by the
Company that the Transferors will receive as partial consideration for the
acquisition. Specifically, if UNISITSs 2010 after-tax net income under Chinese
GAAP is less than RMB 37.50 million (approximately US$5.50 million) or its 2011
after-tax net income under Chinese GAAP is less than RMB 46.88 million
(approximately US$6.86 million), then 50% of the shares of the Company common
stock deposited by the Transferors in escrow will be returned to the Company for
cancellation for each applicable year. In addition, for each applicable year as
described above, the Company will not be required to pay the remainder of the
Cash Consideration, which represents RMB 1.323 million (approximately US$0.19
million), or 30% of the total Cash Consideration, per year if UNISITS fails to
meet the respective performance targets. Total consideration for this
acquisition, including contingent consideration and stock, amounts to $9.95
million on the acquisition date.

UNISITS is a company organized on November 8, 2002 under the
laws of the People's Republic of China, engaging in the business of providing
traffic engineering E&M systems, intelligent transportation products, and
intelligent transportation services (ITS) to the domestic expressway, railway,
and urban transportation markets.

F-7

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Principles of ConsolidationThe consolidated
financial statements include the accounts of the Company, its wholly owned
subsidiaries Oriental Intra-Asia Entertainment (Asia Pacific) Limited,
Intra-Asia Entertainment (China) Limited and Cabowise, its indirectly owned
subsidiaries Oriental Intra-Asia, and the Companys variable interest entities,
or the VIE Entities, and the VIE Entities respective subsidiaries, including
the Group Company, PKU, Beijing Tian Hao , Beijing Zhangcheng, Xinjiang
Zhangcheng, Zhangcheng Media, China TranWiseway, Hunan Tran Wiseway, Hebei Tran
Wiseway, Guizhou TranWiseway, Dajian Zhitong, Shanghai Yootu, UNISITS, Hangzhou
Ziguang Jietong Technology Co., Ltd., Hangzhou UNISITS, Henan Ziguang Jietong
Technology Co., Ltd.(Henan UNISITS), and Beijing Ziguang Jinzhidun Information
Technology Co., Ltd. (Beijing UNISITS). All material intercompany accounts,
transactions, and profits have been eliminated in consolidation.

The consolidated financial statements include the accounts of
VIE and VIEs majority owned subsidiaries, which approximates 3% to 70% owned by
noncontrolling interests. All intercompany accounts, transactions, and profits
have been eliminated upon consolidation.

VIE RestructuringCurrent Chinese laws restrict
companies with foreign ownership to operate in three business areas that we
recently entered into: online services, taxi advertising, and security and
surveillance related business. In order to comply with the applicable Chinese
laws, we determined to restructure our subsidiaries and entered into a series of
commercial arrangements to allow the Company to operate in these restricted
business areas (Restructuring). On February 3, 2009, as described below,
through the Companys indirect Chinese subsidiary, Oriental Intra-Asia and
Oriental Intra-Asias former subsidiary, PKU, the Company entered into a series
of equity transfer agreements with China TransInfo Technology Group Co., Ltd., a
company formed under Chinese law (the Group Company), pursuant to which we
transferred all of the Companys indirect equity interests in PKU and PKUs
subsidiaries to the Group Company. Established in China on May 26, 2008, the
Group Company is wholly owned by four Chinese affiliates of the Company, Shudong
Xia, our Chairman, CEO and President and the beneficial owner of approximately
43% of the Companys outstanding capital stock, Zhiping Zhang, the Companys
Vice President of Research and Development, Zhibin Lai, the Companys Vice
President and Wei Gao, the designee of SAIF Partners III L.P., a 12% shareholder
of the Company (the Group Company Shareholders).

Through Oriental Intra-Asia and PKU, we entered into the
following specific agreements to transfer all of its equity interests in its
respective Chinese subsidiaries to the Group Company (the Equity Transfer):

- Pursuant to an equity transfer agreement (the PKU Equity Transfer
  Agreement), entered into by and between Oriental Intra-Asia and the Group
  Company, Oriental Intra-Asia transferred all of its 97% equity interests in
  PKU to the Group Company;
- Pursuant to an equity transfer agreement (the Beijing Tian Hao Equity
  Transfer Agreement), entered into by and between PKU and the Group Company,
  PKU transferred all of its 100% equity interests in Beijing Tian Hao Ding Xin
  Science and Technology Co., Ltd. to the Group Company;
- Pursuant to an equity transfer agreement (the China TranWiseway Equity
  Transfer Agreement), entered into by and between PKU and the Group Company,
  PKU transferred all of its 70% equity interests in China TranWiseway
  Information Technology Co., Ltd. to the Group Company;
- Pursuant to an equity transfer agreement (the Zhangcheng Culture Equity
  Transfer Agreement), entered into by and between PKU and the Group Company,
  PKU transferred all of its 100% equity interests in Zhangcheng Culture and
  Media Co., Ltd. to the Group Company;
- Pursuant to an equity transfer agreement (the Zhangcheng Science Equity
  Transfer Agreement), entered into by and between PKU and the Group Company,
  PKU transferred all of the 100% equity interests in Beijing Zhangcheng Science
  and Technology Co., Ltd. to the Group Company; and
- Pursuant to an equity transfer agreement (the Shanghai Yootu Equity
  Transfer Agreement), entered into by and between PKU and the Group Company,
  PKU transferred all of its 100% equity interests in Shanghai Yootu Information
  Technology Co., Ltd. to the Group Company.

F-8

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

In connection with the Equity Transfer, on February 3, 2009,
the following contractual arrangements were also made among relevant parties,
which have given us contractual rights to control and manage the business of the
Group Company and the Group Companys subsidiaries (the Contractual
Arrangement and together with the Equity Transfer, the Restructuring):

- Pursuant to an exclusive technical consulting and services agreement (the
  Service Agreement), entered into by and among Oriental Intra-Asia, the Group
  Company and the Group Companys subsidiaries, Oriental Intra-Asia agreed to
  provide certain technical and consulting services to the Group Company and the
  Group Companys subsidiaries (each a VIE Entity and collectively, the VIE
  Entities) in exchange for the payment by each VIE Entity of an annual
  development and consulting services fee that is to be determined solely by
  Oriental Intra-Asia;
- Pursuant to an equity pledge agreement (the Pledge Agreement), entered
  into by and among Oriental Intra-Asia and each of the Group Company
  Shareholders, the Group Company Shareholders agreed to pledge all of their
  equity interests in the Group Company (the Equity Interests), to Oriental
  Intra-Asia as collateral security for Oriental Intra-Asias collection of the
  fees under the Service Agreement;
- Pursuant to an option agreement (the Option Agreement), entered into by
  and among Oriental Intra-Asia and each of the Group Company Shareholders, the
  Group Company Shareholders agreed to grant to Oriental Intra-Asia an option to
  purchase, from time to time, all or a part of the Equity Interests, at the
  exercise price equal to the lowest possible price permitted by Chinese laws;
- Pursuant to separate powers of attorney (the Powers of Attorney), each
  Group Company Shareholder agreed to grant to Oriental Intra-Asia a power to
  excise on his or her behalf all voting rights as a shareholder at the
  shareholders meetings of the Group Company that have been given to him or her
  by law and by the Articles of Association of the Group Company; and
- Pursuant to an operating agreement, entered into by and among Oriental
  Intra-Asia, the VIE Entities and the Group Company Shareholders, (a) Oriental
  Intra-Asia agreed to act as the guarantor for the VIE Entities in the
  contracts, agreements or transactions in connection with the VIE Entities
  operation between the VIE Entities and any other third parties and to provide
  full guarantee for the VIE Entities in performing such contracts, agreements
  or transactions, subject to applicable laws, in exchange for which the VIE
  Entities agreed to mortgage the receivables of their operation and all of
  their assets which have not been mortgaged to any third parties to Oriental
  Intra-Asia, and (b) the VIE Entities and the Group Company Shareholders agreed
  to accept the provision of the corporate policies and guidance by Oriental
  Intra-Asia at any time in respect of the appointment and dismissal of the VIE
  Entities employees, the VIE Entities daily operation and administration as
  well as financial administrative systems, including the appointment of senior
  managers recommended by Oriental Intra-Asia (the Operating Agreement and
  together with the Service Agreement, Pledge Agreement, Option Agreement,
  Powers of Attorney, the PKU Equity Transfer Agreement, the Beijing Tian Hao
  Equity Transfer Agreement, the China TranWiseway Equity Transfer Agreement,
  the Zhangcheng Culture Equity Transfer Agreement, the Zhangcheng Science
  Equity Transfer Agreement, and the Shanghai Yootu Equity Transfer Agreement,
  the Restructuring Documents).

The main purpose of the Restructuring is to allow the Company
to engage in online services, taxi advertising and security and surveillance
related business in China in which companies with foreign ownership, like the
Company and its subsidiaries, are either prohibited or restricted from operating
under the current applicable Chinese laws and regulations. As a result of the
Restructuring, the Company transferred all of the Companys indirect equity
interests in PKU and PKUs subsidiaries to the affiliated Group Company and
accordingly, PKU and PKUs subsidiaries became direct and indirect subsidiaries
of the Group Company, which is wholly owned by the Group Company Shareholders
who are all Chinese citizens. Through contractual agreement, the Company acts as
the primary beneficiary and maintains substantial control over the variable
interest entities daily operations and financial affairs, election of their
senior executives and all matters requiring shareholders approval. Furthermore,
as the primary beneficiary of the variable interest entities, the Company ,
under ASC Topic 810 Consolidation (formerly FASB Interpretation No. 46 (R)
Consolidation of Variable Interest Entities), the Company is entitled to
consolidate the variable interest entities into the Companys financial
statements because the Contractual Arrangement provides the Company with the
risks and rewards associated with equity ownership, even though the Company does not own any of the outstanding
equity interests in any of the variable interest entities. As a result the
Restructuring, the Company is able to engage in these three business areas
through the variable interest entities and derive the economic benefits that the
Company would otherwise have as the owner of variable interest entities while
still complying with Chinese laws.

F-9

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

The following charts reflect our organizational structure as of
December 31, 2010 and 2009, respectively:

F-10

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Organizational Structure of the Company, as of December 31,
2010:



F-11

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Organizational Structure of the Company, as of December 31,
2009:



F-12

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

On October 19, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Shiji Yingli Science and
Technology Co., Ltd. (Shiji Yingli) whereby Shiji Yingli agreed to contribute
RMB 9.6 million (approximately $1.4 million) in cash and RMB 44.6 million
(approximately $6.6 million) in intangible assets (mostly technology and
intellectual property owned by Shiji Yingli) into the Group Companys wholly
owned subsidiary, Beijing Zhangcheng in exchange for a 49% equity interest in
Beijing Zhangcheng. Under the procedure of Beijing Administration for Industry
& Commerce (BAIC), the transaction is expected to be completed by the end of
March, 2011. Following this transaction, the Group Company will retain a 51%
majority ownership of Beijing Zhangcheng while Shiji Yingli will own the rest
49% equity interest.

On October 21, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Marine Communication
& Information Co., Ltd. (Beijing Marine) and Zhongyuan Credit Guarantee
Co., Ltd.(Zhongyuan Credit) whereby Zhongyuan Credit agreed, to contribute RMB
30 million (approximately $4.38 million) in cash into the Group Companys
majority-owned subsidiary, China TranWiseway in exchange for a 30% equity
interest in China TranWiseway. Under the procedure of Beijing Administration for
Industry & Commerce (BAIC), the transaction is expected to be completed by
the end of March, 2011. Following this transaction, the Group Company will
retain a 55% majority ownership of China TranWiseway while Beijing Marine and
Zhongyuan Credit will own 15% and 30% equity interest in China TranWiseway,
respectively.

Use of EstimatesThe preparation of financial
statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Significant estimates include accrued warranty costs, as well as revenue and
costs recorded under the percentage-of-completion method. Actual results could
materially differ from those estimates.

Segment InformationASC 280 requires companies to
report information about operating segment in interim and annual financial
statements. It also requires segment disclosures about products and services
geographic and major customers. The Company has determined that it does not have
any separately reportable operating segments.

Cash and Cash EquivalentsThe Company classifies
all highly liquid investments purchased with a maturity of three months or less
as cash equivalents.

Accounts ReceivableAccounts receivable are
carried at original invoice amount less the allowance for doubtful accounts
based on a review of all outstanding amounts at year end. Management determines
the allowance for doubtful accounts by using historical experience applied to an
aging of accounts. Trade receivables are written off when deemed uncollectible.

Long-Term InvestmentsThe Company classifies
long-term investments as available-for-sale in accordance with ASC 320,
Investments  Debt and Equity Securities, and are reported at fair value.
Unrealized gains and losses as a result of changes in the fair value of the
available-for-sale investments are recorded as a separate component within
accumulated other comprehensive income in the accompanying consolidated balance
sheets.

The Company uses the cost method of accounting for investments
in companies that do not have a readily determinable fair value in which it
holds an interest of less than 20% and over which it does not have the ability
to exercise significant influence. For entities in which the Company holds an
interest of greater than 20% or in which the Company does have the ability to
exercise significant influence, the Company uses the equity method.

The Companys investments also include privately-held companies
where quoted market prices are not available and as a result, the cost method,
combined with other intrinsic information, is used to assess the fair value of
the investment. If the carrying value is above the fair value of an investment
at the end of any period, the investment is considered for impairment.
Investments are considered to be impaired when a decline in fair value is judged
to be other-than-temporary. Once a decline in fair value is determined to be
other-than-temporary, an impairment charge is recorded and a new cost basis in
the investment is established.

F-13

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Property and EquipmentProperty and equipment are
recorded at cost, less accumulated depreciation. Depreciation is provided for
using straight-line methods over the estimated useful lives of the respective
assets. Amortization of leasehold improvements is over the lesser of the lease
term or useful life of the improvement.

|                         | Useful Lives (Years)
|------------------------ | --------------------
|Automobiles              | 5 -10               
|Machinery and equipments | 4 -7                
|Furniture and fixtures   | 3 -5                

Amortization of Intangible AssetsIntangible
assets primarily include the costs of capitalized R&D costs, costs for
purchased intangibles and intangibles result from acquisitions. Purchased
intangible costs are amortized on a straight-line basis over the estimated
useful lives of the assets, which approximate 10 years. Intangible assets result
from acquisitions and include developed technology, customer-related
intangibles, trade names and other identifiable intangible assets with finite
lives. With the exception of developed technology, these intangible assets are
amortized using the straight-line method. Developed technology is amortized over
the greater of (1) the amount calculated using the ratio of current quarter
revenues to the total of current quarter and anticipated future revenues over
the estimated useful life of the developed technology, and (2) the straight-line
method over each developed technologys remaining useful life. Amortization of
developed technology is recorded within cost of revenues. Amortization of
customer-related intangibles, trade names and other identifiable intangible
assets is recorded within operating expenses.

Intangible asset capitalizedFor the year ended
December 31, 2010 and 2009, the intangible asset capitalized but not yet
amortized were $1,510,823 and $2,126,399, respectively.

Purchased assets from third parties for further research and
developmentThe Company purchased software from third parties for
further research and development for total cash consideration of $986,050 and
$1,184,057 for the years ended December 31, 2010 and 2009, respectively.

Intangible asset capitalized through internal R&D or through
acquisition and amortizedFor the years ended December 31, 2010
and 2009, the intangible asset capitalized through internal R&D or through
acquisition and amortized were $4,000,047 and $711,028, and the amortization
expenses for these assets were $211,237 and $74,380, respectively.

The Company performed an annual impairment testing for
indefinite-lived intangible assets during the twelve months ended December 31,
2010 and 2009, and the Company determined that there was no impairment in any of
these years. The Company performs its annual impairment test as of the last day
of the fiscal year. These impairment tests must be performed more frequently if
there are triggering events.

Revenue RecognitionThe Company recognizes
revenue in accordance with ASC 605, Revenue Recognition, when persuasive
evidence of an arrangement exists, the price is fixed or determinable,
collection is reasonably assured and delivery of products has occurred or
services have been rendered.

The Companys revenue of service fees are primarily fixed price
contracts. Revenue on eligible fixed price contracts is recognized on the basis
of the estimated percentage-of-completion within the scope of ASC 605 and is
consistently applied for all fixed price contracts. Such contracts include
services provided for software development projects, IT outsourcing and
solutions, system integration, and network integration services at fixed price
arrangements with its customers. Progress towards completion is typically
measured based on achievement of specified contract milestones, or other
measures of progress when available, or based on costs incurred as a proportion
of estimated total costs. Profit in a given period is reported at the expected
profit margin to be achieved on the overall contract. This method can result in
the recognition of unbilled receivables or the deferral of costs or profit on
these contracts. The company did not incur any deferred costs for the years
ended December 31, 2010 and 2009. Management regularly reviews project
profitability and underlying estimates. Revisions to the estimates at completion
are reflected in results of operations as a change in accounting estimate in the
period in which the facts that give rise to the revision become known by
management. Provisions for estimated losses, if any, are recognized in the
period in which the loss becomes evident. The provision includes estimated costs
in excess of estimated revenue and any profit margin previously recognized. Any
advance payments received from its customers prior to recognition of revenue is classified as a current liability as
billings in excess of costs and estimated earnings on incompleted contracts.

F-14

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

For taxi media advertising revenue, the Company recognizes
deferred revenue when cash is received, but the revenue has not yet been earned.
The Company recognizes taxi media advertising revenue ratably over the period in
which the advertisement is to be published.

The Company has very limited system maintenance and technology
upgrade services for the systems/platforms we have built for clients. In most
cases, such service revenue was secured on separate contracts basis. Such
service revenues are recognized ratably over the service periods.

Research and DevelopmentResearch and development
expenses include payroll, employee benefits, and other headcount-related
expenses associated with product development. Such costs related to product
development costs are included in research and development expense until the
point that technological feasibility is reached, which for the Company's
products, is generally shortly before the products are released for the
commercial use. Once technological feasibility is reached, such costs are
capitalized and amortized to cost of revenue over the estimated lives of the
products. As of December 31, 2010 and 2009, research and development expenses
were capitalized in the amount of $4,776,643 and $2,126,399, respectively, and
were included in intangible assets in the Company's consolidated balance sheet.

Stock-Based CompensationThe Company accounts for
stock-based compensation in accordance with ASC topic 718, CompensationStock
Compensation (formerly SFAS No. 123 (revised 2004), Share-Based Payment), which
requires the application of a fair-value-based measurement method in accounting
for share-based payment transactions with employees. During 2010, we granted
stock options as part of our key performer stock-based compensation program, as
well as stock options or restricted stock units to management and directors. The
vesting of stock option grants may be based on time, performance, market
conditions, or a combination of performance and market conditions. In the
future, we may grant stock awards, options, or other equity-based instruments
allowed by our stock-based compensation plans, or a combination thereof, as part
of our overall compensation strategy.

The fair values of restricted stock awards with time-based
vesting, including restricted stock and restricted stock units, are generally
based on the intrinsic values of the awards at the date of grant. As permitted
under ASC topic 718, we use the Black-Scholes option pricing model to estimate
the fair value of stock option grants. The Black-Scholes model relies on a
number of key assumptions to calculate estimated fair values. Our assumed
dividend yield of zero is based on the fact that we have never paid cash
dividends and have no present intention to pay cash dividends. Our expected
stock-price volatility assumption is based on recent (six to twelve months
trailing) implied volatility calculations. These calculations are performed on
exchange-traded options of our common stock. We believe that using a
forward-looking market-driven volatility assumption will result in the best
estimate of expected volatility. The assumed risk-free interest rate is the U.S.
Treasury security rate with a term equal to the expected life of the option. The
assumed expected life is based on company-specific historical experience. With
regard to the estimate of the expected life, we consider the exercise behavior
of past grants and model the pattern of aggregate exercises.

We estimate forfeiture rates at the time awards are made based
on historical and estimated future turnover rates and apply these rates in the
calculation of estimated compensation cost. The estimation of forfeiture rates
includes a quarterly review of historical turnover rates and an update of the
estimated forfeiture rates to be applied to employee classes for the calculation
of stock-based compensation. During 2010, forfeiture rates for the calculation
of stock-based compensation were estimated and applied based on three classes,
non-employee directors, executive management staff and other employees. At
December 31, 2010, our annualized estimated forfeiture rates were 0% for
non-employee director awards and 45-55% for both executive management staff and
other employee awards. Then-current estimated forfeiture rates are also applied
quarterly to all outstanding stock options and non-vested restricted stock
awards, which may result in a revised estimate of compensation costs related to
these stock-based grants.

If factors change and we employ different assumptions for
estimating stock-based compensation expense in future periods, or if we decide
to use a different valuation model, the stock-based compensation expense we
recognize in future periods may differ significantly from what we have recorded
in the current period and could materially affect our operating income, net
income and earnings per share. It may also result in a lack of comparability
with other companies that use different models, methods and assumptions. See Note to our Consolidated
Financial Statements in Item 10 for further information regarding stock-based
compensation.

F-15

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Income TaxesThe Company accounts for income
taxes in accordance with ASC 740, Income Taxes, which requires that the Company
recognize deferred tax liabilities and assets based on the differences between
the financial statement carrying amounts and the tax basis of assets and
liabilities, using enacted tax rates in effect in the years the differences are
expected to reverse. Deferred income tax benefit (expense) results from the
change in net deferred tax assets or deferred tax liabilities. A valuation
allowance is recorded when, in the opinion of management, it is more likely than
not that some or all of any deferred tax assets will not be realized.

The Company adopted ASC 740-10-25, Income
Taxes-Overall-Recognition, on January 1, 2007, which provides criteria for the
recognition, measurement, presentation and disclosure of uncertain tax position.
The Company must recognize the tax benefit from an uncertain tax position only
if it is more likely than not that the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the
position. The tax benefits recognized in the financial statements from such a
position are measured based on the largest benefit that has a greater than 50%
likelihood of being realized upon ultimate resolution. The Company did not
recognize any additional liabilities for uncertain tax positions as a result of
the implementation of ASC 740-10-25.

GoodwillThe Company performs an annual goodwill
impairment test on December 31 of each year in accordance with ASC subtopic
350-20, Goodwill (formerly SFAS No. 142), and updates the test between annual
tests if events or circumstances occur that would more likely than not reduce
the fair value of a reporting unit below its carrying value. The Company
performs the annual review for goodwill impairment at the reporting unit level,
which the Company has determined to be an operating segment.

The annual test of the potential impairment of goodwill
requires a two step process. Step one of the impairment test involves comparing
the estimated fair values of reporting units with their aggregate carrying
values, including goodwill. If the carrying amount of a reporting unit exceeds
the reporting units fair value, step two must be performed to determine the
amount, if any, of the goodwill impairment loss. If the carrying amount is less
than fair value, further testing of goodwill impairment is not performed.

Step two of the goodwill impairment test involves comparing the
implied fair value of the reporting units goodwill against the carrying value
of the goodwill. Under step two, determining the implied fair value of goodwill
requires the valuation of a reporting units identifiable tangible and
intangible assets and liabilities as if the reporting unit had been acquired in
a business combination on the testing date. The difference between the fair
value of the entire reporting unit as determined in step one and the net fair
value of all identifiable assets and liabilities represents the implied fair
value of goodwill. The goodwill impairment charge, if any, would be the
difference between the carrying amount of goodwill and the implied fair value of
goodwill upon the completion of step two.

For purposes of the step one analysis, determination of
reporting units fair value is typically based on the income approach, which
estimates the fair value of the Companys reporting units based on discounted
future cash flows.

The Company recorded $983,345, $189,748, $1,921,924, and
$6,884,614 in goodwill in connection with its acquisitions (see Note 9) of
equity of China TranWiseway, Dajian Zhitong, Shanghai Yootu, and UNISITS,
respectively. As of December 31, 2010, the Company believed no goodwill was
subject to the risk of impairment. In the disclosure of acquisitions, the
Company uses the year-end exchange rate of the year when the acquisition
occurred.

Impairment of Long-Lived AssetsThe Company
accounts for the impairment and disposition of long-lived assets in accordance
with ASC 360, Property, Plant and Equipment. The Company periodically evaluates
long-lived assets for impairment whenever events or changes in circumstances
indicate that the carrying value of an asset may not be recoverable. If the
estimated future cash flows (undiscounted and without interest charges) from the
use of an asset were less than the carrying value, a write-down would be
recorded to reduce the related asset to its estimated fair value.

F-16

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

The assumptions used by management in determining the future
cash flows are critical. In the event these expected cash flows are not
realized, future impairment losses may be recorded. Management has determined
that no impairments of long-lived assets currently exist.

Concentrations of Credit RiskFinancial
instruments that subject the Company to credit risk consist primarily of
accounts receivable, which are concentrated in a small number of customers in
the Chinese governments. The Company performs ongoing credit evaluations of its
customers. For the years ended December 31, 2010 and 2009, bad debt expenses
totaled $54,540 and $5,767, respectively.

Translation AdjustmentThe Company financial
statements are presented in the U.S. dollar ($), which is the Companys
reporting currency, while its functional currency is Renminbi (RMB).
Transactions in foreign currencies are initially recorded at the functional
currency rate ruling at the date of transaction. Any differences between the
initially recorded amount and the settlement amount are recorded as a gain or
loss on foreign currency transaction in the consolidated statements of income.
Monetary assets and liabilities denominated in foreign currency are translated
at the functional currency rate of exchange ruling at the balance sheet date.
Any differences are taken to profit or loss as a gain or loss on foreign
currency translation in the statements of income.

In accordance with ASC 830, Foreign Currency Matters, the
Company translates the assets and liabilities into U.S. dollar ($) using the
rate of exchange prevailing at the balance sheet date and the statements of
operations and cash flows are translated at an average rate during the reporting
period. Adjustments resulting from the translation from RMB into U.S. dollar are
recorded in stockholders equity as part of accumulated other comprehensive
income. The exchange rates used for interim financial statements in accordance
with ASC 830, Foreign Currency Matters, are as follows:

|                         |  | Average Rate for the
      year | 
|------------------------ |  | ------------------------------- | 
|December 31,             |  | 2010                            | 
|Renminbi (RMB)           |  | 1.00                            | 
|United States dollar ($) |  | 0.1517                          | 

|                         |  | Exchange Rate at | 
|------------------------ |  | ---------------- | 
|December 31,             |  | 2010             | 
|Renminbi (RMB)           |  | 1.00             | 
|United States dollar ($) |  | 0.14794          | 

Comprehensive IncomeComprehensive income
includes accumulated foreign currency translation gains and losses. The Company
has reported the components of comprehensive income on its statements of
stockholders equity.

Fair Value MeasurementsEffective January 1,
2008, the Company adopted ASC 820, Fair Value Measurement and Disclosures, for
its financial assets and liabilities that are re-measured and reported at fair
value at each reporting period, and non-financial assets and liabilities that
are re-measured and reported at fair value at least annually. The adoption of
ASC 820, Fair Value Measurements and Disclosures, to the Companys financial
assets and liabilities and non-financial assets and liabilities that are
re-measured and reported at fair value at least annually did not have an impact
on the Companys financial results. The following table presents information
about the Companys assets and liabilities that are measure at fair value on
recurring basis as of December 31, 2010, and indicates the fair value hierarchy
of the valuation techniques the Company utilized to determine such fair value.
In general, fair values determined by Level 1 inputs utilize quoted prices
(adjusted) in active markets for identical assets or liabilities. Fair values
determined by Level 2 inputs utilize data points that are observable such as
quoted prices in markets that are not active, interest rates and yield curves.
Fair values determined by Level 3 inputs are unobservable data points for the
asset or liability, and includes situations where there is little, if any,
market activity for the asset or liability:

F-17

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Financial assets at fair value as of December 31, 2010:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2010         |  |   | (Level 1)        |  |   | (Level 2)   |  |   | (Level 3)    | 
|Cash and cash equivalents | $ | 43,916,597   |  | $ | 43,916,597       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 3,131,660    |  |   | 3,131,660        |  |   | -           |  |   | -            | 
|Total                     | $ | 47,408,257   |  | $ | 47,048,257       |  | $ | -           |  | $ | -            | 

Financial assets at fair value as of December 31, 2009:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2009         |  |   | (Level 1)        |  |   | (Level 2)   |  |   | (Level 3)    | 
|Cash and cash equivalents | $ | 27,400,420   |  | $ | 27,400,420       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 1,591,076    |  |   | 1,591,076        |  |   | -           |  |   | -            | 
|Total                     | $ | 28,991,496   |  | $ | 28,991,496       |  | $ | -           |  | $ | -            | 

The fair values of the Companys cash and cash equivalents and
restricted cash are determined through market, observable and corroborated
sources. The fair values of the Companys long-term investments are unobservable
data points and include situations where there is little, if any, market
activity. The carrying amounts reflected in the consolidated balance sheets for
other current assets, accounts payable, accrued expenses, long-term debt
approximate fair value due to their short-term maturities.

New Accounting Pronouncements

In December 2010, the FASB amended the guidance related to
application of the goodwill impairment model when a reporting unit has a
carrying amount that is zero or a negative value. The guidance clarifies that
when this is the case, a goodwill impairment test should be performed if
qualitative factors indicate that it is more likely than not that goodwill
impairment exists. The Company does not expect the adoption of this guidance to
have a material effect on its consolidated financial statements.

In April 2010 the FASB reached a consensus on the Milestone
Method of Revenue Recognition which provides guidance on the criteria that
should be met for determining whether the milestone method of revenue
recognition is appropriate. A vendor can recognize consideration that is
contingent upon the achievement of a milestone in its entirety as revenue in the
period in which the milestone is achieved only if the milestone meets all
criteria to be considered substantive. The updated guidance is effective on a
prospective basis for milestones achieved in fiscal years, and interim periods
within those years beginning on or after June 15, 2010, with early adoption
permitted. The Company is currently evaluating the potential impact, if any, of
the new accounting guidance on its consolidated financial statements.

In January 2010, the FASB amended the guidance related to fair
value disclosures. This amended guidance requires disclosures about inputs and
valuation techniques used to measure fair value as well as disclosures about
significant transfers, beginning in the first quarter of 2010. Additionally,
this guidance requires presentation of disaggregated activity within the
reconciliation for fair value measurements using significant unobservable inputs
(Level 3), beginning in the first quarter of 2011. The adoption of this guidance
did not have a material impact on the Companys financial position or results of
operations and the Company does not believe that it will have subsequent impact
after the 2011 adoption of the guidance around fair value measurements using
unobservable inputs.

In October 2009, the FASB updated the guidance related to
Multiple Element Arrangements. This guidance relates to the final consensus
reached by FASB on a new revenue recognition guidance regarding revenue
arrangements with multiple deliverables. The new accounting guidance addresses
how to determine whether an arrangement involving multiple deliverables contains more than one unit of accounting, and how
the arrangement consideration should be allocated among the separate units of
accounting. The new accounting guidance is effective for fiscal years beginning
after June 15, 2010 and may be applied retrospectively or prospectively for new
or materially modified arrangements. In addition, early adoption is permitted.
The Company is currently evaluating the potential impact, if any, of the new
accounting guidance on its consolidated financial statements.

F-18

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

In June 2009, the FASB issued ASC 810-10-30, Variable Interest
Entities (formerly FASB 167), regarding when and how to determine, or
re-determine, whether an entity is a variable interest entity. In addition, FASB
No. 167 replaces FIN 46Rs quantitative approach for determining who has a
controlling financial interest in a variable interest entity with a qualitative
approach. Furthermore, ASC 810-10-30 requires ongoing assessments of whether an
entity is the primary beneficiary of a variable interest entity. ASC 810-10-30
is effective beginning January 1, 2010 and the adoption did not to have a
material impact on the Companys consolidated financial statements.

2. RESTRICTED CASH

The Companys restricted cash balances at December 31, 2010 and
2009 were $3,131,660 and $1,591,076, respectively. Restricted cash normally
consists of cash deposited into third party banks with certain period of time
restrictions for various business purposes, which may include contract
performance bonds, registered capital bonds required by governmental
authorities, etc.. The restrictions expire when related obligations are
fulfilled.

3. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

The costs and estimated earnings on uncompleted contracts were
as follows:

|                                            |   | December 31, |  
|------------------------------------------- | - | ------------ | -
|                                            |   | 2010         |  
|Costs incurred on uncompleted contracts     | $ | 142,198,373  |  
|Estimated earnings on uncompleted contracts |   | 63,591,599   |  
|                                            |   | 205,789,972  |  
|Less: billings to date                      |   | (181,244,358 | )
|Total                                       | $ | 24,545,614   |  

The costs and estimated earnings on incomplete contracts are
included in the accompanying balance sheets under the following captions:

|                                                                                  |   | December 31, |  
|--------------------------------------------------------------------------------- | - | ------------ | -
|                                                                                  |   | 2010         |  
|Costs and estimated earnings in excess of
      billings on uncompleted contracts | $ | 38,626,089   |  
|Billings in excess of costs and estimated earnings on
      uncompleted contracts |   | (14,080,475  | )
|                                                                                  |   |              |  
|Total                                                                             | $ | 24,545,614   |  

F-19

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

4. OTHER RECEIVABLES

Other receivables consisted of the following as of December 31,
2010 and 2009:

|                           |   | December 31, | 
|-------------------------- | - | ------------ | 
|                           |   | 2010         | 
|Contract bidding bonds     | $ | 4,988,371    | 
|Contract performance bonds |   | 4,819,860    | 
|Other receivables          |   | 824,221      | 
|Total                      | $ | 10,632,452   | 

Other receivables mainly include contract bidding bonds and
performance bonds. Contract bidding bonds are the returnable funds deposited to
the contract offering parties as required for contract biddings and are normally
returned to the Company within half year period after the biddings are
completed. Contract performance bonds are the returnable funds deposited to the
contract offering parties for contract performance guaranty purposes and are
normally returned to the Company once the contracts are completed. The remaining
Other Receivable balance mainly consists of miscellaneous receivables such as
government subsidies earned but not yet received and office lease deposits for
leases expiring within one year.

5. LONG-TERM INVESTMENTS

The Company had the following long-term investments accounted
under the equity method and cost method:

|       |                                                                                 | December 31, 2010
|------ | ------------------------------------------------------------------------------- | -----------------
|       |                                                                                 | Equity           
|       | Equity                                                                          | Investment       
|Type   | Investee                                                                        | Ownership        
|Equity | GanSu Ziguang Intelligent
      Transportation and Control (Gansu)            | 33.33%           
|Equity | ShanXi Ziguang Trans Technology Co.,
      Ltd.(Shanxi)                       | 49.00%           
|Equity | Beijing Chinacommunications
      UNISPlendour TECHNOLOGY Co. , Ltd. (ZJUNIS) | 30.00%           
|Equity | Beijing Optic Times Technology Co., Ltd.
      (BOTTC)                        | 23.17%           
|Cost   | ShanDong Hi-speed Information
      Engineering Co., Ltd. (Shandong)          | 5.00%            
|Cost   | BeiJing Ziguang Youma Technology Co., Ltd.
      (ZGYM)                       | 15.00%           

Equity and cost investments in affiliates as of December 31,
2010 consisted of the following:

Type
    
    EquityInvestee
    
    
    BeginningEquityInvestmentBasis12/31/09
    
    
    Dividends
    
    
    Increaseshare inEquityCompany
    
    
    ProportionalShare of theEquity-AccountedAffiliatesNet Income
    
    
    ForeignCurrencyTranslationAdjustment
    
    
    EndingEquityInvestmentBasis12/31/10Equity
    
    Gansu
    
    $
    7,261,227
    
    $
    (707,863
    )
    $
    -
    
    $
    1,051,154
    
    $
    274,203
    
    $
    7,878,721Equity
    
    Shanxi
    
    
    204,971
    
    
    (22,300
    )
    
    -
    
    
    147,642
    
    
    10,739
    
    
    341,052Equity
    
    ZJUNIS
    
    
    207,168
    
    
    (60,892
    )
    
    -
    
    
    (5,244
    )
    
    6,928
    
    
    147,960Equity
    
    BOTTC
    
    
    185,784
    
    
    (52,714
    )
    
    -
    
    
    114,127
    
    
    9,232
    
    
    256,429Equity
    
    CQJK
    
    
    35,942
    
    
    -
    
    
    (37,167
    )
    
    -
    
    
    1,225
    
    
    -Cost
    
    Shandong
    
    
    110,025
    
    
    -
    
    
    -
    
    
    -
    
    
    3,750
    
    
    113,775Cost
    
    ZGYM
    
    
    22,005
    
    
    -
    
    
    -
    
    
    -
    
    
    750
    
    
    22,755Total
    
    
    
    $
    8,027,122
    
    $
    (843,769
    )
    $
    (37,167
    )
    $
    1,307,679
    
    $
    306,827
    
    $
    8,760,692


F-20

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

ChongQing JiaoKai Information Technology Co., Ltd (CQJK)
became an affiliate of the Company after the injection funds by PKU and China
TranWiseway on December 23, 2010.

Critical audited financial information of significant equity
investment in affiliates as of and for the year ended December 31, 2010 is as
follows:

|December 31, 2010         |   | Gansu      |  |  |                              |  |   | Gansu      | 
|------------------------- | - | ---------- |  |  | ---------------------------- |  | - | ---------- | 
|Total current assets      | $ | 38,529,364 |  |  | Net sales                    |  | $ | 26,163,512 | 
|Total assets              |   | 41,913,249 |  |  | Gross Profit                 |  |   | 2,512,630  | 
|Total current liabilities |   | 18,107,854 |  |  | Income from
      operations |  |   | 3,697,036  | 
|Total liabilities         | $ | 18,274,724 |  |  | Net income                   |  | $ | 3,129,426  | 

6. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

|                                  |   | December 31, |  
|--------------------------------- | - | ------------ | -
|                                  |   | 2010         |  
|Automobiles                       | $ | 1,847,499    |  
|Machinery and equipments          |   | 10,720,910   |  
|Furniture and fixtures            |   | 317,380      |  
|Leasehold improvement             |   | 905,465      |  
|Work-in-progress                  |   | 474,842      |  
|Total                             |   | 14,266,096   |  
|Less: accumulated depreciation    |   | (3,387,820   | )
|Total Property and Equipment, net | $ | 10,878,276   |  

Depreciation expenses during fiscal 2010 and 2009 were
$1,799,782 and $1,243,518, respectively.

7. INTANGIBLE ASSETS

Intangible assets consisted of the following:

|                               |   | December 31, |  
|------------------------------ | - | ------------ | -
|                               |   | 2010         |  
|Intangible assets              | $ | 7,718,124    |  
|Less: accumulated amortization |   | (315,295     | )
|Intangible assets, net         | $ | 7,402,829    |  

Amortization expenses during fiscal 2010 and 2009 were $215,908
and $76,513, respectively.

Estimated future intangible amortization as of December 31,
2010 for each of the next five years is as follows:

|Years ending December 31, |   | Amount    | 
|------------------------- | - | --------- | 
|2011                      | $ | 523,767   | 
|2012                      |   | 425,141   | 
|2013                      |   | 425,141   | 
|2014                      |   | 425,141   | 
|2015                      |   | 425,141   | 
|Thereafter                |   | 5,178,498 | 
|Total                     | $ | 7,402,829 | 

F-21

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

8. SHORT-TERM BORROWINGS FROM BANKS

Short-term borrowings from banks consisted of the following:

|At December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | 2010      |  |  | 2009      | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------- |  |  | --------- | 
|On June 22, 2009, the Company renewed the loan agreement
      in the amount of RMB 20,000,000, or $2,934,000. The loan had an initial
      annual interest rate of 5.31%, which was floating based on interest rates
      determined by the Peoples Bank of China from time to time and it was
      matured and paid off.                                                                                                                                                                                                        |  | -         |  |  | 2,934,000 | 
|On May 27, 2009, UNISITS entered into a loan agreement
      with a commercial bank in the amount of RMB 1,000,000, or $146,700.
      Interest rate is variable at 10% above the benchmark interest rate
      determined by the Peoples Bank of China from time to time and it was
      matured and paid off.                                                                                                                                                                                                                     |  | -         |  |  | 146,700   | 
|On September 29, 2009, the Company entered into a loan
      agreement with a commercial bank in the amount of RMB 30,000,000, or
      $4,401,000. The loan had an initial annual interest rate of 5.31%, which
      was floating based on interest rates determined by the Peoples Bank of
      China from time to time a and it was matured and paid off.                                                                                                                                                                       |  | -         |  |  | 4,401,000 | 
|On September 16, 2010, PKU, entered into a short-term
      loan agreement with a commercial bank in the amount of RMB 30,000,000, or
      $4,551,000. The loan had an initial annual interest rate of 5.31%, which
      was floating based on interest rates determined by the Peoples Bank of
      China from time to time and it matures on March 28, 2011.                                                                                                                                                                    |  | 4,551,000 |  |  | -         | 
|On November 29, 2010, China TranWiseway, entered into a
      loan agreement with a commercial bank in the amount of RMB 30,000,000, or
      $4,551,000. The loan is variable at interest rate 10% above the benchmark
      interest rate as of the date of the first withdrawal of the principal from
      time to time and the interests must be paid on a quarterly basis. The loan
      expires within 12 months after the date of the first withdrawal
      but can be renewed upon the written consent by Bank of Beijing. |  | 4,551,000 |  |  | -         | 

|On June 21, 2010, PKU entered into a loan agreement with
      a commercial bank in the amount of RMB 30,000,000, or $4,551,000. The loan
      has an annual interest rate based on the benchmark interest rate as of the
      date of the first withdrawal of the principal. The loan expires within 12
      months after the date of the first withdrawal but can be renewed upon the
      written consent by Bank of Beijing. |   | 4,551,000  |  |   | -         | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | - | ---------- |  | - | --------- | 
|On August 18, 2010, UNISITS entered into a loan agreement
      with a commercial bank in the amount of RMB 500,000, or $75,850. The loan
      has an annual interest rate based on the benchmark interest rate as of the
      date of the first withdrawal of the principal. The loan expires on
      February 18, 2011.                                                                                                         |   | 75,850     |  |   | -         | 
|Total                                                                                                                                                                                                                                                                                                                                                                                                                                | $ | 13,728,850 |  | $ | 7,481,700 | 

F-22

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

For the years ended December 31, 2010 and 2009, interest
expenses totaled $470,711 and $244,574, respectively. The USD ending balances
are calculated based on the average and year-end exchange rates of 0.14794 and
0.1517 for 2010 and 0.14661 and 0.1467 for 2009, respectively.

9. ACQUISITIONS

Acquisition of China TranWiseway

In May 2008, PKU entered into equity transfer agreements with
shareholders of China TranWiseway, pursuant to which, PKU acquired 70% ownership
of China TranWiseway for a cash price of RMB 6,500,000 (approximately $953,550).
China TranWiseway is a high-tech company specializing in transportation
information system and application developments. On May 22, 2008, PKU entered
into an agreement supplemental to the aforementioned equity transfer agreements.
Pursuant to the supplemental agreement, PKU will make an additional capital
contribution of RMB 7,000,000 (approximately $1,026,900) to China TranWiseway to
increase the total registered capital to RMB 10,000,000 (approximately
$1,467,000), and PKUs ownership remains at 70%. The purchase price of the 70%
ownership in China TranWiseway therefore was RMB 8,600,000, or $1,261,620.

The acquisition was accounted for under the purchase method of
accounting. Accordingly, the results of China TranWiseway have been included in
the accompanying consolidated financial statements since the date of
acquisition. The purchase price has been allocated to the assets acquired and
liabilities assumed based upon their estimated fair values and the price were
allocated as follows:

|                                       |   | May 31, 2008 | 
|-------------------------------------- | - | ------------ | 
|Current assets                         | $ | 2,006,526    | 
|Property and equipment                 |   | 45,722       | 
|Intangible assets- existing technology |   | 174,573      | 
|Goodwill                               |   | 983,345      | 

|Current liabilities      |   | (1,904,102 | )
|------------------------ | - | ---------- | -
|Non-controlling interest |   | (44,444    | )
|Total purchase price     | $ | 1,261,620  |  

F-23

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

No supplemental pro forma information is presented for the
acquisition due to the immaterial effect of the acquisition on the Companys
results of operations.

Acquisition of Dajian Zhitong

On September 16, 2008, Zhangcheng Media, the Companys
indirectly-owned subsidiary, entered into equity transfer agreements with
shareholders of Dajian Zhitong. Pursuant to the agreements, Zhangcheng Media
acquired 85% ownership of Dajian Zhitong from three of the shareholders for a
cash price of RMB 1,980,000 (approximately $290,000). Included in the price was
assumption of Dajian Zhitong's liabilities totaling RMB 1,639,518.

On October 13, 2008, a supplemental agreement to the
aforementioned agreements was entered between Zhangcheng Media and the three
shareholders of Dajian Zhitong. Pursuant to the agreement, Zhangchang Media will
not pay the RMB 1,980,000 to the three shareholders nor assume Dajian Zhitongs
liabilities. Instead, it will make a cash contribution of RMB 9,000,000 directly
to Dajian Zhitong. Other terms in the original equity transfer agreements were
unaffected. Zhangcheng Medias ownership in Dajian Zhitong remains at 85%. As a
result of the supplemental agreement, the actual acquisition price of the 85%
ownership of Dalian Zhitong was RMB 1,350,000=RMB 9,000,000 x (1-85%),
(approximately $198,045). As of December 31, 2009, RMB 9,000,000 has been
remitted to Dajian Zhitong.

The acquisition was accounted for under the purchase method of
accounting. Accordingly, the results of Dajian Zhitong have been included in the
accompanying consolidated financial statements since the date of acquisition.
The purchase price has been allocated to the assets acquired and liabilities
assumed based upon their estimated fair values and the price was allocated as
follows:

|                         |   | September 16, 2008 |  
|------------------------ | - | ------------------ | -
|Current assets           | $ | 172,061            |  
|Property and equipment   |   | 78,217             |  
|Goodwill                 |   | 189,748            |  
|Current liabilities      |   | (240,517           | )
|Non-controlling interest |   | (1,464             | )
|Total purchase price     | $ | 198,045            |  

Acquisition of Shanghai Yootu

On October 1, 2008, PKU, the Companys indirectly-owned
subsidiary, entered into an equity transfer agreement with shareholders of
Shanghai Yootu. Pursuant to the agreement, PKU acquired 100% ownership of
Shanghai Yootu from six individual shareholders. Under the terms of the equity
transfer agreement, PKU will make the payments in three installments to the
transferors. The initial cash payment of RMB 8.8 million (approximately
$1,290,960) will be paid to the transferors within five (5) business days after
the date of execution of the equity transfer agreement. The remaining two
installments will be conditional upon Shanghai Yootus results of operations in
the next two years. In accordance with ASC 805, Business Combinations, the
acquisition was accounted for under the purchase method of accounting.
Accordingly, the results of Shanghai Yootu have been included in the
accompanying consolidated financial statements since the date of acquisition.
The purchase price has been allocated to the assets acquired and liabilities
assumed based upon their estimated fair values and the price was allocated as
follows:

|                       |   | October 1, 2008 |  
|---------------------- | - | --------------- | -
|Current assets         | $ | 28,081          |  
|Property and equipment |   | 5,680           |  
|Goodwill               |   | 1,921,924       |  
|Other assets           |   | 20,311          |  
|Current liabilities    |   | (685,036        | )
|Total purchase price   | $ | 1,290,960       |  

F-24

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

No supplemental pro forma information is presented for the
acquisitions due to the immaterial effect of the acquisition on the Companys
results of operations.

Acquisition of UNISITS

On September 8, 2009, Shudong Xia, Chairman, CEO and President
of the Company, entered into an equity transfer agreement with Unisplendour,
pursuant to which Mr. Xia acquired 35.17% of the equity interest in UNISITS from
Unisplendour for a cash price of RMB 44.4 million (approximately $6.53 million).
UNISITS is a company organized under the laws of the People's Republic of China,
engaging in the business of providing traffic engineering E&M systems,
intelligent transportation products, and intelligent transportation services
(ITS) to the domestic expressway, railway, and urban transportation markets.

Subsequently, on September 8, 2009, the Group Company entered
into an option agreement with Mr. Xia, under which Mr. Xia granted to the Group
Company a perpetual option to acquire all of Mr. Xia's equity interest in
UNISITS for RMB 44.4 million (approximately $6.53 million), which is the
exercise price. Concurrently, the Group Company acquired from Mr. Xia the rights
to his share of all potential UNISITS dividends or other distributions. Mr. Xia
pledged his equity interest in UNISITS to the Group Company for five years. The
Group Company expects to exercise the option and take title to the equity
interest now held by Mr. Xia upon the expiration of the five-year term of the
pledge agreement when the option will first become exercisable. In September
2009, the Group Company and four of five board directors of UNISITS entered into
an Acting in Concert agreement. The agreement allows the Group Company to govern
the financial and operating policies of UNISITS and therefore to obtain the
control of UNISITS. As a result, UNISITS became a variable interest entity of
the Group Company and its financials has been included in the Companys
consolidated financial statements.

The fair value of UNISITS at the acquisition date is allocated
as follows:

|                                        |   | September 8, 2009 |  
|--------------------------------------- | - | ----------------- | -
|Currents assets                         | $ | 32,442,272        |  
|Long-term investments                   |   | 7,616,433         |  
|Property and equipment                  |   | 230,809           |  
|Intangible assets:                      |   |                   |  
|Highway Monitoring and Control          |   | 242,055           |  
|Contract Backlogs                       |   | 293,400           |  
|Total intangible assets                 |   | 535,455           |  
|Goodwill                                |   | 6,884,614         |  
|Current liabilities                     |   | (26,935,090       | )
|Other long-term liability               |   | (520,785          | )
|Noncontrolling interest                 |   | (13,740,228       | )
|Total fair value at date of acquisition | $ | 6,513,480         |  

The following table summarizes what the results of operations
of the Company would have been on a pro forma basis for the year ended December
31, 2009, if the acquisition had occurred prior to the beginning of the year.
These results do not purport to represent what the results of operations for the
Company would have actually been or to be indicative of the future results of
operations of the Company.

|                                               |   | Year Ended        | 
|---------------------------------------------- | - | ----------------- | 
|                                               |   | December 31, 2009 | 
|Revenue                                        | $ | 84,473,648        | 
|Net income attributable to common shareholders | $ | 13,359,625        | 
|Net income per share:                          |   |                   | 
|Basic                                          | $ | 0.60              | 
|Diluted                                        | $ | 0.59              | 

F-25

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

10. NON-CONTROLLING INTERESTS

Non-controlling interests consisted of the following:

Adjustments/Net Income% of Non-
    
    
    As of
    
    
    2009
    
    
    of
    
    
    As ofcontrolling
    
    
    December 31,
    
    
    Acquisition
    
    
    Non-controlling
    
    
    December 31,Name of Affiliate
    
    Interest
    
    
    2008
    
    
    (Fair Value)
    
    
    Interest
    
    
    2009Beijing PKU
    
    3%
    
    $
    1,188,662
    
    $
    -
    
    $
    247,525
    
    $
    1,436,187China TranWiseway
    
    30%
    
    
    286,224
    
    
    -
    
    
    (1,498
    )
    
    284,726Dalian Dajian Zhitong
    
    15%
    
    
    (9,143
    )
    
    -
    
    
    42,419
    
    
    33,276UNISITS
    
    64.83%
    
    
    -
    
    
    13,740,228
    
    
    3,005,058
    
    
    16,745,286Total
    
    
    
    $
    1,465,743
    
    $
    13,740,228
    
    $
    3,293,504
    
    $
    18,499,475


2010Acquisition and
    
    
    Adjustments/Net% of Non-
    
    
    As of
    
    
    Increase
    
    
    Income
    
    
    
    
    
    As ofcontrolling
    
    
    December 31,
    
    
    Investment
    
    
    of Non-controlling
    
    
    
    
    
    December 31,Name of Affiliate
    
    Interest
    
    
    2009
    
    
    (Fair Value)
    
    
    Interest
    
    
    Dividends
    
    
    2010PKU
    
    3%
    
    $
    1,436,187
    
    $
    113,016
    
    $
    105,346
    
    $
    -
    
    $
    1,654,549China TranWiseway
    
    30%
    
    
    284,726
    
    
    140,323
    
    
    94,950
    
    
    -
    
    
    519,999Dajian Zhitong
    
    15%
    
    
    33,276
    
    
    -
    
    
    (38,498
    )
    
    -
    
    
    (5,222
    )UNISITS
    
    33.98%
    
    
    16,745,286
    
    
    (7,734,789
    )
    
    4,746,513
    
    
    (53,094
    )
    
    13,703,916Total
    
    
    
    $
    18,499,475
    
    $
    (7,481,450
    )
    $
    4,908,311
    
    $
    (53,094
    )
    $
    15,873,242


On March 22, 2010, the Company and the Group Company entered
into the Equity Transfer Agreements with several individual Transferors of
UNISITS, pursuant to which the Group Company acquired 30.85% equity interest in
UNISITS from the Transferors. Pursuant to the Equity Transfer Agreements, the
Group Company purchased approximately 16.23 million shares of UNISITS from the
Transferors in exchange for RMB 4.41 million (approximately $0.65 million) in
cash (Cash Consideration), 40% of which is payable within seven days after the
effective date of the Equity Transfer Agreements, and approximately 1.16 million
shares of the Companys common stock. The shares are issuable within 30 days of
the effective date of the Equity Transfer Agreements. The Equity Transfer
Agreements contain make good provisions, under which the Transferors agree to
deposit a total of 697,162 shares (60% of total common stock consideration) of
the Company common stock valued at $8.01 per share, which is the share price on
acquisition date, for a total value of $5.58 million, with an escrow agent
designated by the Company that the Transferors will receive as partial
consideration for the acquisition. Specifically, if UNISITSs 2010 after-tax net
income under Chinese GAAP is less than RMB 37.50 million (approximately US$5.50
million) or its 2011 after-tax net income under Chinese GAAP is less than RMB
46.88 million (approximately US$6.86 million), then 50% of the shares of the
Company common stock deposited by the Transferors in escrow will be returned to
the Company for cancellation for each applicable year. In addition, for each
applicable year as described above, the Company will not be required to pay the
remainder of the Cash Consideration, which represents RMB 1.323 million
(approximately US$0.19 million), or 30% of the total Cash Consideration, per
year if UNISITS fails to meet the respective performance targets. Total
consideration, including contingent consideration and stock, amounts to $9.95
million on acquisition date.

The Company had previously consolidated the financial
statements of UNISITS since September 8, 2009 which Mr. Shudong Xia acquired
35.17% of the equity interest in UNISITS. As part of this acquisition, the Group
Company and four of five members of the board of directors of UNISITS entered
into an Acting in Concert Agreement, pursuant to which the Group Company has the
right to make decisions on the financial and operating policies of UNISITS and
therefore to obtain the control of UNISITS. As a result, UNISITS became a
variable interest entity of the Group Company and UNISITSs financial statements
have been included in the Companys consolidated financial statements since
September 8, 2009 in accordance with ASC 810-10-15-3, Consolidation of Entities
through Majority of Voting Interest.

F-26

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

The Group Companys 30.85% equity interest purchase has been
accounted in accordance with ASC 810-10-45-23. Accordingly, the Group Companys
purchase of additional equity interest ownership in UNISITSs interest while the
Group Company retains its controlling financial interest in UNISITS has been
accounted for as equity transactions (investments by owners and distributions to
owners acting in their capacity as owners). Therefore, no gain or loss has been
recognized in consolidated net income or comprehensive income. The carrying
amount of the non-controlling interest has been adjusted to reflect the change
in its ownership interest in the subsidiary UNISITS. Any difference between the
fair value of the consideration received or paid and the amount by which the
non-controlling interest is adjusted has been recognized in equity attributable
to the Company.

11. STOCK-BASED COMPENSATION

ASC 815-40, Derivatives and Hedging-Contracts in Entitys Own
Equity (formerlyAccounting for Derivative Financial Instruments Indexed to
and Potentially Settled in, a Companys Own Stock, or EITF 00-19), provides
criteria for determining whether freestanding contracts that are settled in a
companys own stock, including common stock warrants, should be designated as
either an equity instrument, an asset or as a liability under SFAS No. 133.
Under the provisions of ASC 815-40, Derivatives and Hedging-Contracts in
Entitys Own Equity (formerly EITF 00-19), a contract designated as an asset or
a liability must be carried at fair value on a companys balance sheet, with any
changes in fair value recorded in a companys results of operations. It was
determined that the Company's warrants qualify for accounting treatment under
ASC 815-40 Derivatives and Hedging-Contracts in Entitys Own Equity (formerly
EITF 00-19), "Accounting for Derivative Financial Instruments Indexed to,
and Potentially Settled in, A Company's Own Stock ". Under the terms of the
warrant agreements, if the Company fails to deliver the required number of
Warrant Shares, the Company will be obligated to pay cash to settle the warrant
claims. As a result, the Company must assume that it could be required to settle
the warrants on a net-cash basis, thereby necessitating the treatment of the
potential settlement obligation as a liability. The fair values of the warrants
are presented on the accompanying consolidated balance sheet as Accrued
Warrant Liability and the changes in the values of these warrants are
shown in the accompanying consolidated statement of operations as
Decrease in fair value of warrants liability. Such gains and
losses are non-operating and have no effect on cash flows from operating
activities.

Warrants

The Company recognized the share-based compensation cost based
on the grant-date fair value estimated in accordance with ASC 718, Compensation-
Stock Compensation (formerly SFAS No. 123R).The Company issued warrants to
Anteaus Capital, Inc., in aggregate, to purchase 277,778 shares of the Companys
common stock in connection with merger related services on May 14, 2007, with an
exercise price of $1.80 per share. These warrants will expire on May 13, 2014
pursuant to the common stock purchase warrant agreement. The Company used the
Black-Scholes option pricing model to determine the fair value of the stock
warrants on May 14, 2007. On May 14, 2007, the fair value was $3.97 per share,
resulting in a share-based compensation totaling $1,104,166, which was recorded
as a reduction of additional Paid-in Capital and an increase of Accrued Warrant
Liability. On November 29, 2007, the Company and Anteaus Capital, Inc. entered
an amendment to the Companys common stock purchase warrants. The amendment
eliminated the clause subject to which if the Company fails to deliver the
required number of Warrant Shares, the Company will be obligated to pay cash to
settle the warrant claims. The 277,778 warrants issued to Antaeus Capital, Inc.
have been re-valued at $1,039,807, and reclassified to Additional Paid-in
Capital from Accrued Warrant Liability. The difference of $64,359 was recorded
to Other Income account for the warrants at fair value.

The fair value for the share-based awards was estimated using
the Black-Scholes option pricing model with the assumptions listed below:

|                        |  | May 14, 2007 |  |  | November 29, 2007 | 
|----------------------- |  | ------------ |  |  | ----------------- | 
|Expected volatility     |  | 203%         |  |  | 148%              | 
|Expected life (years)   |  | 7            |  |  | 6.46              | 
|Risk-free interest rate |  | 4.6%         |  |  | 3.7%              | 
|Expected dividend yield |  | 0%           |  |  | 0%                | 

On November 30, 2007, the Company issued warrants to CCG
Investor Relations Partners LLC, in aggregate, to purchase 50,000 shares of the
Companys common stock in connection with investor relations services, with an
exercise price of $5.00 per share. These warrants will expire on November 29,
2010 pursuant to the common stock purchase warrant agreement. The fair market value of these stock warrants was
$200,105 and recorded as an increase in Selling, General, and Administrative
expense and Additional Paid-in Capital. The fair market value was estimated on
the date of grant using the Black-Scholes option-pricing model in accordance
with ASC 718, Compensation-Stock Compensation, using the following
weighted-average assumptions: expected dividend yield 0%; risk-free interest
rate of 3.08%; volatility of 148% and an expected term of three years. As of
December 31, 2010, all of the warrants had been exercised.

F-27

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

The expected volatilities are based on the historical
volatility of the Companys stock. The observations were made in a 52-week
period. The expected terms of stock warrants are based on the remaining
contractual life of stock warrants outstanding as these stock warrants vested
immediately.

A summary of stock warrants for the year ended December 31,
2010 and 2009 is as follows:

|                                 |  |         |  |   |                |  |  | Weighted-Average |  |   |           | 
|-------------------------------- |  | ------- |  | - | -------------- |  |  | ---------------- |  | - | --------- | 
|                                 |  |         |  |   | Weighted-      |  |  | Remaining        |  |   | Aggregate | 
|                                 |  |         |  |   | Average        |  |  | Contractual Term |  |   | Intrinsic | 
|Stock Warrants                   |  | Shares  |  |   | Exercise Price |  |  | (Months)         |  |   | Value     | 
|Outstanding at December 31, 2010 |  | 327,778 |  | $ | 2.3            |  |  | 58               |  |   |           | 
|Granted                          |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Exercised or converted           |  | 272,223 |  |   | 2.4            |  |  | -                |  |   |           | 
|Forfeited or expired             |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Outstanding at December 31, 2009 |  | 55,555  |  |   | 1.8            |  |  | 52               |  | $ | 353,885   | 
|Exercisable at December 31, 2009 |  | 55,555  |  |   | 1.8            |  |  | 52               |  | $ | 353,885   | 
|                                 |  |         |  |   |                |  |  |                  |  |   |           | 
|Granted                          |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Exercised or converted           |  | 50,000  |  |   | 1.8            |  |  | -                |  |   |           | 
|Forfeited or expired             |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Outstanding at December 31, 2010 |  | 5,555   |  | $ | 1.8            |  |  | 40               |  | $ | 16,332    | 
|Exercisable at December 31, 2010 |  | 5,555   |  | $ | 1.8            |  |  | 40               |  | $ | 16,332    | 

The aggregate intrinsic value in the preceding table represents
the total pretax intrinsic value, based upon the Companys closing stock price
of $4.74 and $8.17 as of December 31, 2010 and 2009, which would have been
received by the warrant holders had all warrant holders exercised their warrant
awards as of that date.

Stock Options

On January 7, 2008, the Company and Mr. Zhihai Mao, the then
Chief Financial Officer of the Company, entered into a stock option agreement.
Pursuant to the terms of the stock option agreement, Mr. Mao was granted a
non-qualified option on January 7, 2008 to purchase 200,000 shares of common
stock of the Company at an exercise price of $6.70 per share, which was the
closing price per share of the Companys common stock as reported on the OTC
Bulletin Board on such date. The options have a term of ten years and will
expire on January 7, 2018. The option vests in equal installments on a quarterly
basis over a three-year period beginning on January 7, 2008.

On May 1, 2008, the Company entered into separate stock option
agreements with each of Mr. Jay Trien and Dr. Zhonsu Chen. Under the terms of
the stock option agreements, the Company agreed to grant a stock option to each
of Mr. Trien and Dr. Chen for the purchase of 30,000 shares of common stock of
the Company at an exercise price of $6.50 per share, which was the closing price
per share of the Companys common stock as reported on the OTC Bulletin Board on
such date. The option has a term of five years and expires on May 1, 2013. The
option vests in equal installments on a quarterly basis over a three-year period
except for 2,500 options vested immediately on May 1 for Mr. Trien.

On September 28, 2008, the Company entered into a stock option
agreement with Mr. Ho-Ping Lin. Under the terms of the stock option agreement,
the Company agreed to grant a stock option to Mr. Lin for the purchase of 30,000
shares of common stock of the Company at an exercise price of $6.50 per
share. The option has a term of five years and expires on September 28, 2013.
The option vests in equal installments on a quarterly basis over a three-year
period.

F-28

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

On April 29, 2009, the board adopted the 2009 Equity Incentive
Plan, which was subsequently approved by shareholders at the Companys 2009
Annual Shareholder Meeting on May 29, 2009. On June 1, 2009, the Board granted
an employee 30,000 stock options with an exercise price of $5.09, which was the
closing price per share of the Companys common stock as reported on the NASDAQ
Stock Market on such date. The options have a term of five years and expire on
June 1, 2014. The options vest in equal installments on a semi-annual basis over
a three-year period. On the same date, the Board voted to adjust the exercise
prices of the stock options which were granted on May 1, 2008 and September 28,
2008 to $5.09 per share and replaced the stock options granted on January 7,
2008 with 150,000 shares of restricted stocks. The incremental compensation cost
of the re-priced options and replaced restricted stocks was $27,000, with $8,507
recognized as compensation cost at the date of re-pricing.

On November 3, 2009, the Companys board of directors granted
non-qualified options under the Companys 2009 Equity Incentive Plan to the
Companys employees and consultants to purchase 1,791,600 shares of common stock
of the Company at an exercise price of $7.69 per share, which was the closing
price per share of the Company's common stock as reported on the NASDAQ on such
date. The options have a term of five years and expire on November 3, 2014. The
options vest in equal installments on an annual basis over a four-year period
beginning on November 3, 2009.

On June 14, 2010, the Company entered into a stock option
agreement with Mr. Xingming Zhang. Under the terms of the stock option
agreement, the Company agreed to grant a stock option to Mr. Zhang for the
purchase of 30,000 shares of common stock of the Company at an exercise price of
$6.03 per share which was the closing price per share of the Companys common
stock as reported on the NASDAQ on such date. The option has a term of five
years and expires on June 14, 2015. The option vests in equal installments on a
quarterly basis over a three-year period.

The Company recorded compensation expense of $1,160,016 and
$505,464 during years ended December 31, 2010 and 2009 in connection with the
stock options and restricted shares.

The Company estimates the fair value of stock options using a
Black-Scholes option pricing valuation model, consistent with the provisions of
ASC 718, Compensation-Stock Compensation. Key inputs and assumptions used to
estimate the fair value of stock options include the grant price of the award,
the expected option term, volatility of the Companys stock, the risk-free rate
and the Companys dividend yield. Estimates of fair value are not intended to
predict actual future events or the value ultimately realized by grantees, and
subsequent events are not indicative of the reasonableness of the original
estimates of fair value made by the Company.

The fair value of each stock option is estimated on the date of
the grant using the Black-Scholes option pricing model. No dividends were
assumed due to the nature of the Companys current business strategy. The
following table presents the assumptions used for options granted:

|                                       |   | Years Ended December 31, | 
|-------------------------------------- | - | ------------------------ | 
|                                       |   | 2010                     | 
|Risk-free interest rate                |   | 1.44%                    | 
|Expected life (year)                   |   | 3.5                      | 
|Expected volatility                    |   | 49%                      | 
|Weighted average fair value per option | $ | 2.24                     | 

F-29

---

A summary of options transactions during the year ended
December 31, 2010 and 2009 is as follows:

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

|                                    |  |           |   |   |                |  |  | Weighted    |  |   |           | 
|----------------------------------- |  | --------- | - | - | -------------- |  |  | ----------- |  | - | --------- | 
|                                    |  |           |   |   | Weighted       |  |  | Remaining   |  |   | Aggregate | 
|                                    |  | Number of |   |   | Average        |  |  | Contractual |  |   | Intrinsic | 
|                                    |  | Options   |   |   | Exercise Price |  |  | (months)    |  |   | Value     | 
|Outstanding at December 31, 2008    |  | 290,000   |   | $ | 6.6            |  |  | 91          |  |   |           | 
|Granted                             |  | 1,821,600 |   | $ | 7.7            |  |  | 60          |  |   |           | 
|Replaced                            |  | 150,000   |   |   |                |  |  |             |  |   |           | 
|Exercised                           |  | -         |   | $ | -              |  |  |             |  |   |           | 
|Cancelled or Forfeited              |  | (236,000  | ) | $ | 5.5            |  |  |             |  |   |           | 
|Outstanding at December 31,2009     |  | 2,025,600 |   | $ | 7.5            |  |  | 57          |  | $ | 2,437,788 | 
|Unvested as of December 31,2009     |  | 1,883,100 |   | $ | 7.6            |  |  | 57          |  | $ | 1,553,513 | 
|Exercisable as of December 31,2009  |  | 142,500   |   | $ | 5.1            |  |  | 57          |  | $ | 884,275   | 
|                                    |  |           |   |   |                |  |  |             |  |   |           | 
|Granted                             |  | 30,000    |   | $ | 6.0            |  |  | 34          |  |   |           | 
|Exercised                           |  | -         |   | $ | -              |  |  | -           |  |   | -         | 
|Cancelled or forfeited              |  | (687,200  | ) | $ | 7.6            |  |  | -           |  |   | -         | 
|Outstanding at December 31, 2010    |  | 1,368,400 |   | $ | 7.2            |  |  | -           |  |   | -         | 
|Unvested as of December 31, 2010    |  | 890,800   |   | $ | 7.6            |  |  | 42          |  |   | -         | 
|Exercisable as of December 31, 2010 |  | 477,600   |   | $ | 7.0            |  |  | 33          |  |   | -         | 

The aggregate intrinsic value in the preceding table represents
the total pretax intrinsic value, based upon the Companys closing stock price
of $4.74 and $8.17 as of December 31, 2010 and 2009, which would have been
received by the option holders had all option holders exercised their option
awards as of that date. No options were exercised during the year ended December
31, 2010 and 2009.

Unvested share awards

The following table details the Companys unvested share awards
activity for fiscal 2009 and 2010:

|                             |  |           |   |   | Weighted-       | 
|---------------------------- |  | --------- | - | - | --------------- | 
|                             |  |           |   |   | Average Grant-  | 
|                             |  | Shares    |   |   | Date Fair Value | 
|                             |  |           |   |   |                 | 
|Balance at December 31, 2009 |  | 1,883,100 |   | $ | 4.0             | 
|Granted                      |  | 30,000    |   |   | 2.2             | 
|Replaced                     |  | -         |   |   | -               | 
|Vested                       |  | (335,100  | ) |   | 4.0             | 
|Cancelled or Forfeited       |  | (687,200  | ) |   | 4.0             | 
|Balance at December 31, 2010 |  | 890,800   |   | $ | 3.9             | 

The weighted-average grant-date fair value of unvested share
awards is the quoted market value of the Companys common stock on the date of
grant, as shown in the table above. The weighted-average grant date fair value
of unvested share awards granted in fiscal 2010 and 2009 was $7.6 and $7.5,
respectively. The total fair value of unvested share awards which vested during
fiscal 2010 and 2009 were $2.09 million and $0.7 million, respectively.

As of December 31, 2010 and 2009, total unrecognized
compensation costs related to unvested stock options and restricted shares was
$2,635,380 and $5,750, 323, respectively. Unvested stock options are expected to
be recognized over a weighted average period of 2.77 years and 3.76years.

F-30

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

12. EQUITY TRANSACTIONS

During the first quarter of 2009, the Company restructured
investments in its Chinese VIE entities, resulting in a discrepancy of $126,078
in noncontrolling interests. The discrepancy is charged to Additional Paid-in
Capital.

During the year ended December 31, 2009, warrants to purchase
222,223 shares of common stock were exercised in a cashless exercise, resulting
in the issuance of 177,931 shares of common stock.

On February 21, 2010, the Company entered into a Securities
Purchase Agreement with SAIF Partners III L.P., pursuant to which the Company
sold a total of 1,564,945 shares of common stock, par value $0.001 per share,
for an aggregate purchase price of $10,000,000. The shares were priced at $6.39
per share. The shares were sold pursuant to a shelf registration statement
declared effective by the Securities and Exchange Commission on November 16,
2009. The issuance of these shares was exempted from registration under the
Securities Act of 1933.

On April 14, 2010, the Company issued a total of 1,161,931
shares of common stock pursuant to the Equity Transfer Agreements entered with
the Transferors of UNISITS on March 22, 2010. There were 464,769 shares,
representing 40% of the total shares issuable were transferred to the
Transferors, and the remaining 697,162 shares were placed in escrow according to
the Equity Transfer Agreements. The shares held in escrow will be issued to the
Transferors if certain conditions are met. See Note 10 for further information.

13. INCOME TAXES

As of December 31, 2010 and 2009 there were no unrecognized tax
benefits and the Company does not anticipate the total amount of unrecognized
tax benefits will significantly change within the next twelve months. There were
no amounts recognized for interest and penalties in the consolidated statements
of income for the two years ended December 31, 2010 and 2009.

The Company, through its VIE and its VIEs subsidiaries and
affiliates, is governed by the Income Tax Laws of the PRC. Operations in the
United States of America have incurred net accumulated operating losses of
$15,000,000 as of December 31, 2010 for income tax purposes. However, a hundred
percent allowance has been created on the deferred tax asset of $4,600,000 due
to uncertainty of its realization.

For the two years ended December 31, 2010 and 2009, income tax
expenses were as follows:

Years Ended
      December 31,2010
    
    
    2009Domestic
    
    
    Foreign
    
    
    Domestic
    
    
    ForeignFederal
    
    
    State
    
    
    China
    
    
    Federal
    
    
    State
    
    
    ChinaCurrent
    
    -
    
    
    -
    
    $
    2,070,106
    
    
    -
    
    
    -
    
    $
    487,769Deferred
    
    
    
    
    
    
    
    4,081
    
    
    
    
    
    
    
    
    189,586-
    
    
    -
    
    $
    2,074,187
    
    
    -
    
    
    -
    
    $
    677,355


The components of income tax expense consisted of the
following:

|Years Ended December 31,          |   | 2010      |  |  | **2009** | 
|--------------------------------- | - | --------- |  |  | -------- | 
|Actual provision for income taxes | $ | 2,070,106 |  |  | 9.79%    | 
|Changes in deferred income taxes: |   | -         |  |  | -        | 
|Temporary differences             |   | 4,081     |  |  | 0.02%    | 
|Effect of exchange rate changes   |   | -         |  |  | -        | 
|Income tax expense                | $ | 2,074,187 |  |  | 9.81%    | 

The effective income tax rates for the years ended December 31,
2010 and 2009 were approximately, 9.81% and 4.40%, respectively. The increase in
effective income tax is primarily due to increase in statutory tax rate due to
increase in pre-tax income.

F-31

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Hebei TranWiseway, Hunan TranWiseway, Guizhou TranWiseway, PKU
Chengdu Branch, PKU Shanxi Branch, Chongqing PKU, Shanghai PKU, Chongqing
Jiaokai, Qianfang Hongxin, Xinjiang Zhangcheng, and Dajian Zhitong are subject
to a tax rate of 25% on the taxable income for PRC income tax purposes under the
new EIT Law in 2010. PKU, China TranWiseway, UNISITS, Beijing UNISITS, and
Hangzhou UNISITS, are qualify as new or high-technology enterprises and
subject to a tax rate of 15% on the taxable income for PRC income tax purposes
in 2010. Beijing Tian Hao, Beijing Zhangcheng and Shanghai Yootu, Beijing
Zhangcheng Media and the Group Company qualify as software enterprises located
in Beijing and Shanghai, and are entitled to tax exemptions or preferential tax
rates on the taxable income for PRC income tax purposes in 2010. Henan UNISITS
are subject to a special rate of 2.5% for its taxable revenue in 2010.

The Company recognizes deferred tax assets and liabilities for
temporary differences between the financial reporting and tax bases of its
assets and liabilities. Deferred assets are reduced by a valuation allowance
when deemed appropriate.

The tax effects of existing temporary differences that give
rise to significant portions of deferred tax assets at December 31, 2010 and
December 31, 2009 were as follows:

|                    |   |                    |  |   | Deferred Tax Assets |   |   |                  | 
|------------------- | - | ------------------ |  | - | ------------------- | - | - | ---------------- | 
|                    |   | Net operating loss |  |   | Valuation           |   |   | Net deferred tax | 
|                    |   | carryforwards      |  |   | allowance           |   |   | assets           | 
|December 31, 2010:  |   |                    |  |   |                     |   |   |                  | 
|Foreign:            |   |                    |  |   |                     |   |   |                  | 
|In RMB              | ¥ | 168,151            |  | ¥ | -                   |   | ¥ | 168,151          | 
|Exchange
      rate |   | 0.1517             |  |   | 0.1517              |   |   |                  | 
|In USD              | $ | 25,508             |  | $ | -                   |   | $ | 25,508           | 
|Domestic :          |   |                    |  |   |                     |   |   |                  | 
|In USD              | $ | 4,600,000          |  | $ | (4,600,000          | ) | $ | -                | 
|                    |   |                    |  |   |                     |   |   |                  | 
|December 31, 2009:  |   |                    |  |   |                     |   |   |                  | 
|Foreign:            |   |                    |  |   |                     |   |   |                  | 
|In RMB              | ¥ | 195,740            |  | ¥ | -                   |   | ¥ | 195,740          | 
|Exchange
      rate |   | 0.1467             |  |   | 0.1467              |   |   |                  | 
|In USD              | $ | 28,715             |  | $ | -                   |   | $ | 28,715           | 
|Domestic :          |   |                    |  |   |                     |   |   |                  | 
|In USD              | $ | 4,600,000          |  | $ | (4,600,000          | ) | $ | -                | 

The tax effects of temporary differences that result in
significant portions of the deferred income tax assets and liabilities are as
follows:

|Years Ended December 31,                |   | 2010   |  |   | 2009   | 
|--------------------------------------- | - | ------ |  | - | ------ | 
|Deferred tax assets:                    | $ |        |  | $ |        | 
|Depreciation                            |   | -      |  |   | -      | 
|Amortization of intangible
      assets |   | 25,508 |  |   | 28,715 | 
|Investment securities                   |   | -      |  |   | -      | 
|Government subsidy                      |   | -      |  |   | -      | 
|Allowance for doubtful accounts         |   | -      |  |   | -      | 
|Operating loss
      carryforward       |   | -      |  |   | -      | 
|Total deferred tax assets               |   | 25,508 |  |   | 28,715 | 
|Deferred tax liabilities:               |   |        |  |   |        | 
|Foreign asset and liabilities           |   | -      |  |   | -      | 
|Investment securities                   |   | -      |  |   | -      | 
|Others                                  |   | -      |  |   | -      | 
|Total deferred tax liabilities          |   | -      |  |   | -      | 
|Net deferred tax assets                 | $ | 25,508 |  | $ | 28,715 | 

F-32

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

No valuation allowance has been recorded against the deferred
tax asset as of December 31, 2010 and 2009 as the Company believes that it is
more likely than not that all deferred tax assets will be realized.

The difference between the effective income tax rate and the
expected federal statutory rate was as follows:

|Years Ended December 31,  |  | 2010    |  |  | 2009    | 
|------------------------- |  | ------- |  |  | ------- | 
|Statutory rate (PRC)      |  | 25.0%   |  |  | 25.0%   | 
|Permanent difference      |  | (15.2)% |  |  | (20.6)% | 
|Valuation allowance       |  | -       |  |  | -       | 
|                          |  |         |  |  |         | 
|Effective income tax rate |  | 9.8%    |  |  | 4.4%    | 

The Company adopted ASC 740-10-25, Income
Taxes-Overall-Recognition, on January 1, 2007, which provides criteria for the
recognition, measurement, presentation and disclosure of uncertain tax position.
The Company must recognize the tax benefit from an uncertain tax position only
if it is more likely than not that the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the
position. The tax benefits recognized in the financial statements from such a
position are measured based on the largest benefit that has a greater than 50%
likelihood of being realized upon ultimate resolution. The Company did not
recognize any additional liabilities for uncertain tax positions as a result of
the implementation of ASC 740-10-25.

14. EARNINGS PER SHARE

The Company calculates its basic and diluted earnings per share
in accordance with ASC 260, Earnings per Share. Basic earnings per share is
calculated by dividing net income by the weighted average number of common
shares outstanding for the period. Diluted earnings per share is calculated by
adjusting the weighted average outstanding shares to assume conversion of all
potentially dilutive warrants and options include nonvested stock granted to
employees. The Company uses the treasury stock method to reflect the potential
dilutive effect of the unvested stock options and unexercised warrants. In
calculating the number of dilutive shares outstanding, the shares of common
stock underlying unvested stock options are assumed to have been delivered on
the grant date.

|                                                  |   | Year ended December 31, | 
|------------------------------------------------- | - | ----------------------- | 
|                                                  |   | 2010                    | 
|Net income                                        | $ | 15,469,158              | 
|                                                  |   |                         | 
|Basic earnings per share:                         |   |                         | 
|Basic weighted average share outstanding          |   | 24,647,707              | 
|                                                  |   |                         | 
|Basic earnings per common share                   | $ | 0.63                    | 
|                                                  |   |                         | 
|Diluted earnings per share:                       |   |                         | 
|Basic weighted average share
      outstanding    |   | 24,647,707              | 
|Effect of dilutive stock options and warrants     |   | 35,501                  | 
|Diluted weighted average
      shares outstanding |   | 24,683,208              | 
|                                                  |   |                         | 
|Diluted earnings per common
      share           | $ | 0.63                    | 

The following securities were not included in the computation
of diluted net earnings per share as their effects would have been
anti-dilutive.

|                                 |  | 2010      |  |  | 2009 | 
|-------------------------------- |  | --------- |  |  | ---- | 
|Options to purchase common stock |  | 1,080,900 |  |  | -    | 

F-33

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

15. RELATED-PARTY TRANSACTIONS

Due To Related Parties

As of December 31, 2010 and 2009, Dajian Zhitong borrowed from
two of its individual shareholders in the aggregated amount of RMB 532,556, or
$80,789 and RMB 504, 065, or $73,946, respectively, for general working capital
needs. The borrowings do not bear interest and are payable on demand.

Related-party transactions

During the year of 2010, the subsidiaries of the Group Company
(the Companys VIE) have several transactions, which were eliminated during
consolidation.

16. CONCENTRATION

Cash Concentration

The Company maintains cash in US dollars in two commercial
banks located in California. Up to $250,000 of the balance in each bank was
insured by the U.S. Federal Deposit Insurance Corporation (FDIC). As of December
31, 2010 and 2009, uninsured balances totaled $497,777 and $1,901,266,
respectively.

Customer Concentration

For the years ended December 31, 2010 and 2009, no customer
individually represents 10% or more of the Company's total revenue.

17. COMPREHENSIVE INCOME

Total comprehensive income includes, in addition to net income,
changes in equity that are excluded from the consolidated statement of income
and are recorded directly into a separate section of stockholders equity on the
consolidated balance sheet. Comprehensive income and its components consist of
the following:

|Years Ended December 31,                |   | 2010       |  |   | 2009       |  
|--------------------------------------- | - | ---------- |  | - | ---------- | -
|Net income                              | $ | 15,469,158 |  | $ | 12,974,099 |  
|Foreign currency translation adjustment |   | 2,912,698  |  |   | (384,847   | )
|Comprehensive income                    | $ | 18,381,856 |  | $ | 12,589,252 |  

18. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company and its subsidiaries rent offices under several
operating leases. Rent expenses for these offices totaled $1,591,931 and $
$561,295 for the years ended December 31, 2010 and 2009, respectively. The
aggregate future minimum payments under these lease agreements over one year are
as follows:

|Year ending December 31, |   | Lease Commitments | 
|------------------------ | - | ----------------- | 
|2011                     | $ | 1,585,333         | 
|2012                     |   | 1,193,243         | 
|2013                     |   | 146,446           | 
|Total                    | $ | 2,925,022         | 

Acquisition of Shanghai Yootu

On October 1, 2008, PKU, the Companys variable interest
entity, entered into equity transfer agreements with shareholders of Shanghai
Yootu. Pursuant to the agreement, PKU acquired 100% ownership of Shanghai Yootu
from six individual shareholders. Under the terms of the Equity Transfer Agreement,
PKU will make the payments in three installments to the Transferors. The initial
cash payment of RMB 8.8 million (approximately $1.3 million) was made in 2008.
The second payment, consisting of 50% in cash and 50% in the Companys common
stock aggregately equal to twice Shanghai Yootus 2009 net income, will be made
by the later of (1) January 1, 2010 or (2) the completion of the audit of
financial statements of Shanghai Yootu for the year ended December 31, 2009. The
final payment, consisting of 50% in cash and 50% in the Companys common stock
aggregately equal to three times Shanghai Yootus 2010 net income, will be made
by the later of (1) January 1, 2011 or (2) the completion of the audit of
financial statements of Shanghai Yootu for the year ended December 31, 2010.
This contingent consideration has not been recognized as payment is not certain.

F-34

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

Acquisition of UNISITS

On March 22, 2010, China TransInfo Technology Corp. and the
Group Company (Transferees) entered into equity transfer agreements (Equity
Transfer Agreements) with several individual shareholders (Transferors) of
UNISITS, pursuant to which the Group Company acquired 30.85% equity interest in
UNISITS from the Transferors. Pursuant to the Equity Transfer Agreements, the
Group Company purchased approximately 16.23 million shares of UNISITS from the
Transferors in exchange for RMB 4.41 million (approximately $0.65 million) in
cash (Cash Consideration), 40% of which is payable within seven days after the
effective date of the Equity Transfer Agreements, and approximately 1.16 million
shares of CTFO common stock, which are issuable within 30 days of the effective
date of the Equity Transfer Agreements. The Equity Transfer Agreements contain
make good provisions, under which the Transferors agree to deposit a total of
697,162 shares (60% of total common stock consideration) of the CTFO common
stock valued at $8.01 per share, which is the share price on acquisition date,
for a total value of $5.58 million, with an escrow agent designated by CTFO that
the Transferors will receive as partial consideration for the acquisition.
Specifically, if UNISITSs 2010 after-tax net income under Chinese GAAP is less
than RMB 37.50 million (approximately US$5.50 million) or its 2011 after-tax net
income under Chinese GAAP is less than RMB 46.88 million (approximately US$6.86
million), then 50% of the shares of the CTFO common stock deposited by the
Transferors in escrow will be returned to CTFO for cancellation for each
applicable year. In addition, for each applicable year as described above, CTFO
will not be required to pay the remainder of the Cash Consideration, which
represents RMB 1.323 million (approximately US$0.19 million), or 30% of the
total Cash Consideration, per year if UNISITS fails to meet the respective
performance targets. Total consideration for this acquisition, including
contingent consideration and stock, amounts to $9.95 million on the acquisition
date.

Purchase of Office Building

On June 2, 2007, the Company entered into an agreement to
purchase an office building for approximately $1,336,000. The Company made
prepayments totaling RMB 8,304,050 or $1,218,204, pursuant to the agreement. In
September, 2009, the agreement was mutually terminated and the prepaid amounts
were returned to the Company in full.

Property and Equipment

The Company entered an agreement with Taxi Association of City
of Urumqi for installation of a global positioning system, or GPS, control
system. Pursuant to the agreement, the Company will install GPS Control
Terminals on the 5,220 rental and taxi cars in the city of Urumqi in exchange
for rights of interior or exterior advertisements on each taxis rear window,
top light (LED display) and interior. According to the agreement, the Company
began to operate the system on October 1, 2007 for a period of 15 years. Costs
incurred for installed terminals that have been inspected and accepted were
recorded as Machinery and Equipment and are depreciated over a 7-year period.
Costs incurred for uninstalled terminals and installed terminals t not yet
inspected and accepted were recorded as work-in-progress.

In addition, on March 31, 2008, the Company signed the
Agreement for Installation of Taxi GPS Monitoring System with the Urumqi City
Transportation Bureau, or the Transportation Bureau, which is the higher
management authority of the Taxi Association of City of Urumqi. The agreement
reconfirmed the Companys responsibility for providing to the Transportation
Bureau's Passenger Transport Office with equipment for LED-based GPS monitoring,
network hardware, GPS monitoring platform, and LED-based information release
platform and software in exchange for 15 years of taxi advertising rights. The
Transportation Bureau further guarantees that the Company will be its exclusive
cooperation partner for a period of 15 years. No changes related to this
guaranty will be made during the 15-year period.

The Company signed a contract jointly with the Huhhot
Comprehensive Traffic Information Center and the Huhhot Department of
Transportation Administration on January 28, 2008 to exclusively invest in and
construct the LED stripe screen advertisement broadcasting system for taxis
(LSABS) in the city of Huhhot. The contract is for a period of 15 years, and the
Company will provide funding for LED strip screens and taxi rooftop light
alterations to construct the citys Taxi Advertising and Information Release System. Costs incurred for
installed terminals that have been inspected and accepted were recorded as
Machinery and Equipment and depreciated over a 7-year period. Costs incurred for
uninstalled terminals and installed terminals that have not been inspected and
accepted were recorded as Work-in-progress.

F-35

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CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES NOTES
TO CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2010

19. SUBSEQUENT EVENTS

On January 3, 2011, the Company entered into a stock option
agreement with the CFO, Mr. Rong Zhang. Under the terms of the stock option
agreement, the Company granted the options to Mr. Zhang to purchase 504,901
shares of common stock of the Company at an exercise price of $4.85 per share,
which was the closing price per share of the Companys common stock as reported
on the NASDAQ on such date. The option has a term of five years and expires on
June 3, 2016. The options vest in equal installments on a quarterly basis over a
four-year period beginning on January 3, 2011.

On October 19, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Shiji Yingli Science and
Technology Co., Ltd. (Shiji Yingli) whereby Shiji Yingli agreed to contribute
RMB 9.6 million (approximately $1.4 million) in cash and RMB 44.6 million
(approximately $6.6 million) in intangible assets (mostly technology and
intellectual property owned by Shiji Yingli) into the Group Companys wholly
owned subsidiary, Beijing Zhangcheng in exchange for a 49% equity interest in
Beijing Zhangcheng. Following this transaction, the Group Company will retain a
51% majority ownership of Beijing Zhangcheng while Shiji Yingli will own the
remaining 49% equity interest. The capital increase will be completed by the end
of March, 2011.

On October 21, 2010, the Group Company entered into a
registered capital contribution agreement with Beijing Marine Communication
& Information Co., Ltd. (Beijing Marine) and Zhongyuan Credit Guarantee
Co., Ltd.(Zhongyuan Credit) whereby Zhongyuan Credit agreed, to contribute RMB
30 million (approximately $4.38 million) in cash into the Group Companys
majority-owned subsidiary, China TranWiseway in exchange for a 30% equity
interest in China TranWiseway. Following this transaction, the Group Company
will retain a 55% majority ownership of China TranWiseway while Beijing Marine
and Zhongyuan Credit will own 15% and 30% equity interest in China TranWiseway,
respectively. The capital increase will be completed by the end of March, 2011.

On January 16, 2011, a PRC statutory audit report for UNISITS
at and for the years ended December 31, 2010 and 2009 was issued by UNISITSs
local accounting firm with an unqualified opinion, in which the net income of
UNISITS for the year ended December 31, 2010 exceeded the RMB 37.5 million
performance target set forth in the Equity Transfer Agreements. In early April
2011, a cash balance of RMB 1.323 million and 348,519 shares of the Companys
common stock will be paid and released,
respectively, to the relevant parties listed on the Exhibit Is to the Equity
Transfer Agreements dated March 22, 2010.

On January 19, 2011, PKU entered into a short-term loan
agreement with Communication Bank, Jiuxianqiao Branch (the Communication
Bank), pursuant to which the Communication Bank has agreed to loan to PKU RMB
20 million (approximately $3.03 million) for working capital purposes. The loan
has an annual interest rate equal to 10% above the benchmark interest rate as of
the actual launch day and the interests must be paid on a quarterly basis. The
loan expires within 12 months after the date of the first withdrawal.

On January 26, 2011, the Company entered into a stock option
agreement with Mr. Shan Qu. Under the terms of the stock option agreement, the
Company agreed to grant a stock option to Mr. Qu for the purchase of 300,000
shares of common stock of the Company at an exercise price of $4.82 per share
which was the closing price per share of the Companys common stock as reported
on the NASDAQ on such date. The option has a term of five years and expires on
June 26, 2016.

From February 24, 2011 to the date of this report, our CEO, Mr.
Shudong Xia purchased a total of 240,000 shares of the Companys common stock from
the open market pursuant to a Rule 10b5-1 stock purchase plan adopted by Mr. Xia
on December 22, 2010.

The Company has evaluated subsequent events through the date
the financial statements were issued. Management does not believe there were any
other subsequent events have occurred that would require further disclosure or
adjustment to the financial statements.

F-36

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