---

UNITED STATES 
SECURITIES 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, 2009

[     ] 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. [ X ]



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, 2009 (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 $29.85 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 24,070,638 shares of the registrants common stock outstanding as of March 31, 2010.

DOCUMENTS INCORPORATED BY REFERENCE

None.

---



|CHINA TRANSINFO
    TECHNOLOGY CORP.           
|-----------------------------------------------
|                                               
|Annual Report
    on FORM 10-K                 
|For the Fiscal Year Ended
    December 31, 2009
|                                               
|TABLE OF
    CONTENTS                          
|                                               
|PART I                                         

|Item 1.      | Business                                                                                                             | 1 
|------------ | -------------------------------------------------------------------------------------------------------------------- | --
|Item 1A.     | Risk Factors                                                                                                         | 26
|Item 1B.     | Unresolved Staff
    Comments                                                                                        | 40
|Item 2.      | Properties                                                                                                           | 40
|Item 3.      | Legal
    Proceedings                                                                                                | 41
|Item 4.      | (Removed and Reserved)                                                                                               | 41
|             |                                                                                                                      |   
|PART
    II 
|             |                                                                                                                      |   
|Item 5.      | Market for
    Registrants Common Equity, Related Stockholder Matters and Issuer Purchases
    of Equity Securities | 41
|Item 6.      | Selected Financial Data                                                                                              | 42
|Item 7.      | Managements
    Discussion and Analysis of Financial Condition and Results of Operations                            | 42
|Item 7A.     | Quantitative and Qualitative
    Disclosures About Market Risk                                                       | 59
|Item 8.      | Financial
    Statements and Supplementary Data                                                                      | 59
|Item 9.      | Changes in and Disagreements with
    Accountants on Accounting and Financial Disclosure                             | 59
|Item 9A(T).  | Controls and
    Procedures                                                                                          | 59
|Item 9B.     | Other Information                                                                                                    | 60
|             |                                                                                                                      |   
|PART
    III
|             |                                                                                                                      |   
|Item 10.     | Directors,
    Executive Officers and Corporate Governance                                                           | 60
|Item 11.     | Executive Compensation                                                                                               | 65
|Item 12.     | Security
    Ownership of Certain Beneficial Owners and Management and Related
    Stockholder Matters               | 68
|Item 13.     | Certain Relationships and Related
    Transactions, and Director Independence                                        | 70
|Item 14.     | Principal
    Accounting Fees and Services                                                                           | 73
|             |                                                                                                                      |   
|PART
    IV 
|             |                                                                                                                      |   
|Item 15.     | Exhibits,
    Financial Statement Schedules                                                                          | 74



---

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, will 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:

- 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;
- BVI refers to the British Virgin Islands;
- SEC refers to the United States Securities and Exchange Commission;
- Securities Act refers to the Securities Act of 1933, as amended;
- Exchange Act refers to the Securities Exchange Act of 1934, as amended;
- RMB refers to Renminbi,
the legal currency of China;
- 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.

PART I

ITEM 1.     BUSINESS.

Business Overview

We are a leading provider of end-to-end public transportation information technology systems and related comprehensive technology solutions in China.  Our goal is to become the largest provider of transportation information products and related
comprehensive technology solutions in China, as well as the largest operator and provider of real-time transportation information to 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 Geographic
Information Systems (GIS), technologies which are used to service the public sector.

1

---

Our main focus is on providing transportation solutions. Our major products and services include:

- Transportation Planning Information System,
- Pavement Maintenance System,
- Electronic toll collection (ETC),
- Traffic Information Service System,
- Taxi Security Monitoring, Commanding and Dispatching Platform,
- GIS-T (Transportation) Middleware,
- Traffic Flow Surveying Systems,
- Intelligent Parking System,
- Red Light Violation Snapshot System,
- Intelligent Highway Vehicle Monitoring System,
- Intelligent Public Transport System,
- TransPLE Passenger Flow Statistic, Detecting and Analysis System
- Palmcity Navigation Engine,
- Comprehensive Location Based Service Platform,
- Digital City,
- 2-D and 3-D GIS.

We also offer full range 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 blank check 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.

2

---

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
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, as described below, through our indirect Chinese subsidiary, Oriental Intra-Asia and Oriental Intra-Asias former subsidiary, 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. 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 17% shareholder of the Company (collectively, 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.

In connection with the Equity Transfer, on February 3, 2009, the following
contractual arrangements were also made among relevant parties, giving 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 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. For the fiscal year ended December 31, 2009, such development and consulting services fee was approximately equal to the amount of total income
before income taxes of the Group Company and the Group Companys subsidiaries;
- 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;

3

---

- 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, (1) 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 (2) 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 us to engage in the above three restricted business areas in China. As a result of the Restructuring, 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 in turn wholly owned by the Group Company Shareholders who are all Chinese citizens. At the same time,
through the Contractual Arrangement, we maintain substantial control over the VIE Entities daily operations and financial affairs, election of their senior executives and all matters requiring shareholder approval.  Under FASB Interpretation
No. 46R Consolidation of Variable Interest Entities (ASC Topic 810 Consolidation), 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.  As a result the Restructuring, we are able to engage in these three restricted business areas through the
VIE Entities and derive the economic benefits that we would otherwise have as the owner of VIE Entities while still complying with Chinese laws.

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

4

---



5

---

Our Industry

Transportation in China

Over the past two decades, China has completed series of large-scale highway infrastructure projects.  As a result, according to the Ministry of Communication of China, China now has the second largest highway network in the world with a total
length of approximately 60,300 kilometers at the end of 2008 based on the National Statistic Yearbook 2009. In addition, China has approximately 70% of the worlds toll highways according to the Highway Management Department of the Ministry of
Communication. During the 10th5  Year Plan of China, the Chinese government spent approximately $29.3 billion on urban rapid transit. The total mileage of urban rapid transit exceeded 400 kilometers and, according to the
11th 5-Year Plan of China, it is estimated that the total mileage of urban rapid transit projects in China will exceed 1,700 kilometers by 2010, with total new investment of nearly $85 billion from 2006 to 2010. According to each
citys plan, it is estimated that the total mileage of urban rapid transit will exceed 2,500 kilometers by 2016 with total investment of $145.7 billion.

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 over 180 million vehicles as of August 2009. The number is
estimated to grow at least 5% over the next several years. Given the current conditions, the Chinese government intends 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.  This strong demand from both the private and public sectors is creating an unprecedented market opportunity for transportation information products and services.

The Ministry of Communication of China is the countrys highest level transportation regulator.  In December 2004, the Ministry of Communication announced a development plan for the Chinese national highway system.  Under this plan, China will
expand its highway network to 65,000 kilometers by 2010, and to 85,000 kilometers by 2020. After its completion, the Chinese national highway network will connect all provincial capitals and cities with populations of at least half-a-million. Based
on the plan, the total investment in the national highway network will be about $294 billion from 2005 to 2020. From 2005 to 2010, the annual investment according to the plan is expected to be approximately $21 billion, with an additional
$14.6 billion to be invested annually from 2010 to 2020.The Ministry of Communication in November 2008 also submitted its new budget to the Chinese central government with the total investments in the transportation sector at about $730
billion for the next 3 to 5 years.

Intelligent Transportation Systems 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 in terms of development.  Although Chinas rapid economic growth over the past decade and accelerating urbanization have already resulted a significant development of its transportation
infrastructure, China has also recognized a need 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 to 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 developments for ITS applications in communication and planning. As increasingly more urban and highway ITS gets deployed, the ITS market will shift towards focusing on
specialized information solutions and value-added information services in the future. The urban ITS market is also still at a very initial development stage, comparable to that of the highway ITS market 10 years ago. On the other hand, this is a
large but fragmented market with great potential.

Despite being at an early stage, the overall ITS market in China is highly attractive due to rapidly developing transportation infrastructure and increasing demand for ITS applications to manage it. The unique characteristics of Chinas ITS
industry mentioned above and the current low penetration level underline the large market potential. Chinas expanding
transportation network, along with its need for more effective and efficient transportation networks, has led to the need for better ITS. As a result of this and support provided by recent central government policies, investment in the ITS industry
has increased significantly. Even though there is no current breakdown of ITS spending from the new $730 billion budget by the Ministry of Communication, we estimated that it would not go below 5% of the total spending.

6

---

Our Growth Strategy

Our objective is to become the largest provider of transportation information products and related comprehensive technology solutions in China, as well as the largest operator and provider of real-time transportation information to 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 the clients exposure to higher cost of switching 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) 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 internal growth We intend to pursue strategic acquisitions 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 target our planned expansion into the expressway market. UNISITS is a leader in Chinas
intelligent transportation systems industry. UNISITS primarily provides traffic engineering E&M (electronic & machinery) systems for expressways in China. Presently, UNISITS provides products and services in over 20 provinces with an
accumulated coverage of over 8,000 kilometers of expressways in China. We intend to leverage UNISITS technology and market channels synergistically with our own in order to cover a larger addressable market. By leveraging UNISITS large
presence in Chinas expressway market with 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 gain access to expressways
real-time traffic information, allowing us to tap Chinas expressway information services market.
- Further penetrate the large China consumer market with new real-time traffic data solutions We believe the Chinese consumer 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 growth of automobiles in China and 3G build out will
enable the Chinese consumer to make more use of its mobile device and applications such as those that provide real-time traffic data.

7

---

Our Products and Services

Our core business is developing theITS, in the transportation sector utilizing GIS application software and technologies.  We also develop GIS applications in digital city and land
and resource areas.  When providing services to customers
for GIS application software, some of our customers require us to purchase necessary hardware and provide system integration for them. Our major products and services include:

Transportation Planning Information System

Our transportation planning information system is a software system utilized by traffic management engineers to plan roads and water transportation, safety monitoring and conduct strategic planning.  The system facilitates the comprehensive
management of different 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 search tools, statistical analysis and models
to serve planning and organizing needs.  We have been providing this system to the Ministry of Communication of China for their nationwide transportation planning and analysis purposes.

Pavement Maintenance System

Our pavement maintenance system is a practical business application system developed specifically for pavement data collection and operations management.  Based on field data collected by PDA devices and with the support of a backend data center,
the system provides multiple functional modules, such as data acquisition, project management, quality management, equipment management, materials management, assessment analysis, business reports and public travel information inquiries.  Our
pavement maintenance system can quickly identify pavement issues, efficiently process related data, and maintain information in a scientific manner for timely and accurate support.  It solves problems arising from the inefficiency of traditional
manual operations by allowing complex information from various sources to be easily processed.  Since the initial development of this system, we have been continuously enhancing its feature.

Electronic Toll Collection

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 of toll payment violations, and debit
the participating account.  With ETC, these transactions can be performed without the need for vehicles to stop or slow down.  Our ETC system had been launched into two provinces by the end of 2009.

Traffic Information Service System

Our Traffic Information Service System is a software system that provides the public with real time road conditions and related information.  The system continuously transmits transportation data gathered from sensory devices and displays the
results on an e-map interface.  The system also supports web based search and analysis applications.  The system has been widely applied and integrated into our solutions provided to various governmental agencies.

Taxi Security Monitoring, Commanding and Dispatching Platform

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 an accident, incident time and images from within a taxi.  The system also allows for better coordination with emergency services. The system was used in the cities of Urumqi, Huhhot and
Dalian as of December 31, 2009.

8

---

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 customizations.  This product has strong applicability 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.

Traffic Flow Surveying Solutions

We provide transportation management authorities at provincial and municipal levels with traffic flow surveying 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 providing this solution to multiple provinces in China.

Intelligent Parking System

Our Intelligent Parking System (IPS), obtains information about available parking spaces, process that information and then presents it to drivers by means of variable message signs.  Our system guides drivers in congested areas to the
nearest parking facility 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.

Red Light Violation Snapshot System

The red light violation snapshot system is used to photograph and record red light violations automatically.  The camera captures the violating vehicle, including its license plate number, as it passes through the monitored area.  The system also
interlinks with a panorama camera to continue photographing the moving vehicle in order to provide comprehensive evidentiary data to authorities.  We have been providing this solution to local governmental authorities of transportation.

Intelligent Highway Vehicle Monitoring System

Our highway vehicle monitoring system is used for image snapshot, license plate identification, speed recording, and blacklist database verification of vehicles passing through monitored areas along a given highway.  The system consists of a
front-end testing unit (camera, video testing module, vehicle tester and LED light) and main control unit (industrial control computer, system management software and communications module).  The front-end system uploads images and related data to
the command center on real time basis.  The central communications server, database server and PC workstation then analyze and manage the uploaded data.  The system can be used for automatic vehicle speed testing.  The system also assists with
traffic flow testing by providing traffic control authorities with relevant traffic data.  We have been providing this solution to the market covering multiple provinces in China
since 2008.

Intelligent Traffic Management Platform

Our intelligent traffic management platform is a comprehensive GIS based traffic management platform specially developed for urban traffic command centers.  This platform functions as an interface for all ITS subsystems and is the integral element
for our intelligent traffic management system.  The intelligent traffic management platform allows for the capture of 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 provided to multiple cities in China.

Dynamic Traffic Information Service Platform

Our dynamic traffic information service platform collects, processes and distributes traffic information.  By utilizing arithmetic models based on moving vehicles, the system provides complete dynamic road traffic flow information.  The platform
also collects, processes and distributes traffic event information.  The system can be used to distribute data
through several different communication channels, including GPRS, EDGE, CDMA, 3G, RDS-TMC, DAB/DMB, CMMB, Internet and call centers.  Our platform captures dynamic traffic information that then can be used for in-car GPS equipment, personal
navigation devices (PND), intelligent handsets (Windows Mobile/S60/KJAVA), UMPC, Internet and other terminals.  In 2009, we applied this platform to Wuhan Transportation Management System project.

9

---

Intelligent Public Transport System

Our intelligent bus traffic system inserts information technology into traditional bus traffic systems.  Our system optimizes bus traffic routes and helps to improve service levels and management of urban bus traffic.  The objective of our
intelligent bus system is to realize efficiency in urban public transportation systems and to ensure the safe operation of bus systems while increasing the quality of bus transportation.  By the end of 2009, we had been continuously enhancing the
functionalities of this system.

Palmcity Navigation Engine

Our PalmCity Explore Navigation Engine is an internet and mobile application based open navigation system, which integrates mapping and navigation into Windows CE (Windows Mobile) and internet applications.  By integrating map data, point of
interest data storage and management, navigation application development and navigation application framework, PalmCity Explorer Navigation Engine helps navigation application developers and navigation system manufacturers develop unique products
and services.  We offered our navigation engine in our cell phone real time traffic software mapping add-ons to cell phone manufacturers in 2009. This navigation engine technology has also been applied at  www.palmcity.cn website.

Comprehensive Location Based Service Platform

Our comprehensive location based service platform is a comprehensive transportation information service platform based on GIS, GPS, ITS and communication technologies.  By integrating the latest e-maps of China, highway and city road information,
vacant parking spaces, environment and weather information, the system enables real time traffic information, collection, transmission and reporting so as to provide navigation, bus transfers, real time road conditions and location search tools.
Since 2009, we have applied this platform to multiple cities in China.

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, statistic, detecting and analysis hosts. It realizes datas seamless coverage and multi-level
acquisition in large circumstances and can accurately detects and tracks each passenger of the passenger flows trajectory by using distributed multi-modal sensor networks composed by several laser scanners and cameras. It is also applied to
the statistics of passenger flows when the channel width is over 10 meters.  This product is often used by the government agencies to optimize the pedestrian flow configurations in transportation centers such as bus station, metro station, railway
station and airports and to promote public safety through crowd control, emergency response and anti-terrorism activities. We had not been able to monetize this application to the market as of December 31, 2009.

Mobile Police Information System

China TransInfo Mobile Police Information System is a comprehensive wireless application system.  It includes vehicles and drivers information system, on-scene traffic violation punishment system, and traffic accident report system.  The system can
be used to search population information, vehicles and drivers information by specific inquiries as well as has the on-line approval and staff assessments functions, which is suitable for traffic police, criminal police, patrolman and 110 command
centers.  We have been providing this solution to local governmental authorities of transportation
since 2009.

UNISITS Highway Monitoring System

UNISITS Highway Monitoring System mainly consists of information collection sub-system, monitoring center and information providing sub-system, which are used for analyzing traffic conditions quickly and accurately, reporting traffic
management information timely to reduce traffic accidents, traffic jams and the damages to road surface.  As a result, this system serves to optimize highway functions in terms of rapidness, security, comfort and effectiveness. The system has been
widely applied to and integrated into our solutions provided to various governmental agencies.

10

---

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
vehicle in motion identification function, vehicles weigh-in-motion function and other accurate vehicles in motion dynamic survey function.  The system has been applied to and integrated into our highway solutions provided to various governmental
agencies.

UNISISTS Optical Fiber Cable Fire-alarm System

UNISITS Optical Fiber Cable Fire-alarm System, a temperature detection alarm system, is co-developed by UNISITS and Wuhan Technology Optical Limited Corp.  By adopting the cutting-edge optical fiber grating sensing technology, the system is
applicable for temperature sensing in different severe environments, and can be used in industries, such as petroleum, chemicals, metallurgy, electric power, coal mine, construction and tunnel transportation. The system has been applied to and
integrated into our solutions provided to various agencies for highways projects.

Digital City

We provide a full range digital services to many cities in China using a Plan-Construct-Operate model.  We analyze different requirements of different regions or cities and design specific information technology systems and digital construction
based on a citys unique requirements.  Our typical clients in this segment are local governments, public service departments and enterprises.

2-D and 3-D GIS

We provide software platforms that utilize two-dimensional GIS.  Two-dimensional GIS defines and presents special data utilizing an X and Y axis.  Beginning in the 1960s, two-dimensional GIS was widely applied in a variety of
sectors, including land management, power, telecommunications and city planning.  We also provide software platforms that utilize three-dimensional GIS.  Three-dimensional GIS defines and presents special data utilizing an X,
Y and Z axis.  Compared with two-dimensional GIS, three-dimensional GIS defines special data in a more accurate manner, and can present both the plane and the vertical spatial relation.  Moreover, three-dimension GIS can
present and analyze more complicated spatial objectives than Computer Aided Design (CAD) and other visualized software.  Three-dimensional GIS is better suited for exploration, resource assessment, disaster warning, and production management.  It is
widely applied in many sectors such as in natural resources, including mineral resources and water resources, and geology.

The Markets for Our Products and Services

We have been marketing and selling our products and services to four main submarkets within the government and regulated sectors in China.  These sectors are Highway Information Systems, Urban Intelligent Transportation Systems, Digital City, and
Land and Resources.  Having built a customer base over the years, our strategy is to not only deliver high quality products, but also to provide ongoing value-added services so as to take advantage of any maintenance requirements or technology
upgrades that may become necessary in the future. We continue to penetrate these submarkets and believe that we can take advantage of our experience by widening our scope of products and services to include data collection and application service
operation.

Highway Information Systems

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
Communication, traffic management bureaus, highway management bureaus, and
municipal construction committees.

11

---

Urban Intelligent Transportation Systems

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 may 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 outfit 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 information infrastructures construction 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 that we own, their registration numbers, first publication dates,
issuance dates, and durations, as well as the significance levels of such
copyrights. The significance levels of the copyrights are divided into three
levels, A, B, and C. A represents Frequently Used in our products and
services, B represents Occasionally Used in our products and services, and
C represents Rarely Used in our products and services.

12

---

|                                                                                                                                              |                    |                     |                        |            | Expiration Materiality
|--------------------------------------------------------------------------------------------------------------------------------------------- | ------------------ | ------------------- | ---------------------- | ---------- | ----------------------
|Copyright Title                                                                                                                               | Certificate Number | Registration Number | First Publication Date | Issue Date | Date                  
|                                                                                                                                              |                    |                     |                        |            |                       
|Computer Software Copyright
      Registered                                                                                                  | 028661             | 2004SR10260         | 09.08.2004             | 10.21.2004 | 12.31.2054            
|                                                                                                                                              |                    |                     |                        |            |                       
|Certificate (JTLWeb V1.0)                                                                                                                     |                    |                     |                        |            |                       
|                                                                                                                                              |                    |                     |                        |            |                       
|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            
|                                                                                                                                              |                    |                     |                        |            |                       
|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            

13

---

|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 | B
|------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Embed-3D-GIS V1.0)                                                      | 071603  | 2007SR05608   | 01.30.2007 | 04.17.2007 | 12.31.2057 | B
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Environment Protection Emergency Conduct System V 1.0)                  | 063509  | 2006SR15843   | 04.30.2006 | 11.13.2006 | 12.31.2056 | A
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Environment Information System V 1.0)                                   | 063510  | 2006SR15844   | 04.30.2006 | 11.13.2006 | 12.31.2056 | A
|                                                                                                                                      |         |               |            |            |            |  
|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 | B
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (GeoWeb For Linux) V1.0                                                  | 086634  | 2007SR20639   | 05.10.2007 | 12.24.2007 | 12.31.2057 | A
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate 
    (Water Carriage Information System) V1.0                                | BJ10658 | 2008SRBJ035 2 | 06.25.2006 | 02.03.2008 | 12.31.2058 | B
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Intelligent Parking Guide System) V1.0                                  | BJ10662 | 2008SRBJ035 6 | 06.30.2007 | 02.03.2008 | 12.31.2058 | B
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Urban Geological Information Management and Services System)
      V1.0 | BJ10679 | 2008SRBJ037 3 | 10.10.2007 | 02.03.2008 | 12.31.2058 | B
|                                                                                                                                      |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Exploiter Navigation Software V1.0)                                     | BJ10485 | 2008SRBJ017 9 | 11.20.2007 | 01.16.2008 | 12.31.2058 | A

14

---

|Computer Software Copyright Registered
      Certificate
    (Location Services Platform System V 1.0)                                    | 088919  | 2008SR01740   | 11.15.2007 | 01.24.2008 | 12.31.2058 | A
|----------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Taxi Security Alarm System Certificate (V1.0)                               | BJ16618 | 2008SRBJ631 2 | 11.22.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (City One Card Solution Consumption Real Time Transaction
      System) V1.0 | BJ16638 | 2008SRBJ633 2 | 09.12.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Taxi Monitoring Management System v1.0)                                     | BJ16626 | 2008SRBJ632 0 | 11.18.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Taxi Calling System V1.0)                                                   | BJ16653 | 2008SRBJ634 7 | 09.18.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Advertisement Contract Management System V1.0)                              | BJ16612 | 2008SRBJ630 6 | 10.21.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Advertisement Business Information Processing System V1.0)                  | BJ16639 | 2008SRBJ633 3 | 09.26.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Media Call Center Business Management System V1.0)                          | BJ16620 | 2008SRBJ631 4 | 10.27.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Real Time Information Broadcasting System V1.0)                             | BJ16615 | 2008SRBJ630 9 | 09.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Electronic Project Management System V1.0)                                  | BJ16795 | 2008SRBJ648 9 | 10.20.2008 | 12.13.2008 | 12.31.2058 | B

15

---

|Computer Software Copyright Registered
      Certificate
    (Data Collection System V1.0)                          | BJ16796 | 2008SRBJ649 0 | 09.18.2008 | 12.13.2008 | 12.31.2058 | C
|------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Employee Information Management System V1.0)          | BJ16809 | 2008SRBJ650 3 | 11.20.2008 | 12.13.2008 | 12.31.2058 | C
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Digitalization Assets Management System V1.0)         | BJ16797 | 2008SRBJ649 1 | 06.10.2008 | 12.13.2008 | 12.31.2058 | C
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Logistics Information System V1.0)                    | BJ16793 | 2008SRBJ648 7 | 01.20.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Students Archive Management System V1.0)              | BJ16808 | 2008SRBJ650 2 | 12.10.2007 | 12.13.2008 | 12.31.2058 | C
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Product Selling Monitoring System V1.0)               | BJ16792 | 2008SRBJ648 6 | 01.20.2007 | 12.13.2008 | 12.31.2058 | C
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (E-business Shopping System V1.0)                      | BJ16794 | 2008SRBJ648 8 | 08.16.2007 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Expressway ETC System V1.0)                           | BJ16694 | 2008SRBJ638 8 | 10.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (GIS-T Expressway Equipment Management System V1.0)    | BJ16771 | 2008SRBJ646 5 | 10.21.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                    |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Data Collection and Distribution System V1.0) | BJ16770 | 2008SRBJ646 4 | 10.29.2008 | 12.13.2008 | 12.31.2058 | B

16

---

|Computer Software Copyright Registered
      Certificate
    (Highway Transportation Indication System V1.0)                              | BJ16769 | 2008SRBJ646 3 | 08.20.2008 | 12.13.2008 | 12.31.2058 | B
|----------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Expressway Emergency Command and Monitoring System V1.0)                    | BJ16699 | 2008SRBJ639 3 | 09.10.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Traffic Information Service System V1.0)                                    | BJ16751 | 2008SRBJ644 5 | 10.22.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Urban Intelligent Traffic Management System V1.0)                           | BJ16906 | 2008SRBJ660 0 | 12.20.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Urban Traffic Information Decision-making and Analysis System
      V1.0)   | BJ16926 | 2008SRBJ662 0 | 11.18.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Appropriative GIS V1.0)                                                     | BJ16928 | 2008SRBJ662 2 | 12.10.2007 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Information Total Solution and Decision-analysis
      System V1.0) | BJ16927 | 2008SRBJ662 1 | 05.18.2007 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Red Light Violation Snapshot System V1.0)                                   | BJ16905 | 2008SRBJ659 9 | 09.20.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                          |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Vehicles Intelligent Testing and Recording System
      V1.0)       | BJ16876 | 2008SRBJ657 0 | 11.20.2007 | 12.13.2008 | 12.31.2058 | A

17

---

|Computer Software Copyright Registered
      Certificate
    (Public Sanitation Quality Monitoring and Alarm System V1.0)  | BJ16457 | 2008SRBJ615 1 | 10.30.2008 | 12.13.2008 | 12.31.2058 | B
|-------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Human Resource Management System V1.0)                       | BJ16428 | 2008SRBJ612 2 | 10.20.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Local Sanitation Information Platform V1.0)                  | BJ16450 | 2008SRBJ614 4 | 10.10.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Management Competition Imitation Platform V1.0)              | BJ16424 | 2008SRBJ611 8 | 10.14.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Disabled Association Job Information Management System V1.0) | BJ16473 | 2008SRBJ616 7 | 09.08.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Message Service Platform V1.0)                               | BJ16423 | 2008SRBJ611 7 | 09.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Telecom Value-added Service System V1.0)                     | BJ16422 | 2008SRBJ611 6 | 10.25.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Emergency Command and Prevention System V1.0)                | BJ16472 | 2008SRBJ616 6 | 10.22.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Palmcity WebGIS Engine V1.0)                                 | BJ16589 | 2008SRBJ628 3 | 04.10.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                           |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Mobile Map Software V1.0)                                    | BJ16591 | 2008SRBJ628 5 | 05.10.2008 | 12.13.2008 | 12.31.2058 | A

18

---

|Computer Software Copyright Registered
      Certificate
    (Multiple-source Traffic Information Integration System V1.0)                         | BJ16629 | 2008SRBJ632 3 | 08.26.2008 | 12.13.2008 | 12.31.2058 | A
|-------------------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Palmcity Traffic information collection System V1.0)                                 | BJ16605 | 2008SRBJ629 9 | 10.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (PalmCity Floating Car Data Processing System V1.0)                                   | BJ16628 | 2008SRBJ632 2 | 05.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (PalmCity Information Exchange Platform V1.0)                                         | BJ16631 | 2008SRBJ632 5 | 06.21.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (PalmCity In-car PND Comprehensive Information System V1.0)                           | BJ16617 | 2008SRBJ631 1 | 10.31.2007 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Super GIS Data Comprehensive Integration System V1.0)                                | BJ16604 | 2008SRBJ629 8 | 10.26.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Water Transportation Flow Investigation VTS System V1.0)                             | BJ16641 | 2008SRBJ633 5 | 11.12.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Traffic Flow Investigation Data Center V1.0)                                 | BJ16507 | 2008SRBJ620 1 | 09.30.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Traffic Flow GIS System V1.0)                                                | BJ16476 | 2008SRBJ617 0 | 10.27.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                                                   |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Highway Traffic Flow Investigation Equipment Long-distance Monitoring Platform V1.0) | BJ16557 | 2008SRBJ625 1 | 09.30.2008 | 12.13.2008 | 12.31.2058 | A

19

---

|Computer Software Copyright Registered
      Certificate
    (Coil Traffic Flow Data Collection System V1.0)                                                   | BJ16621 | 2008SRBJ631 5 | 10.28.2008 | 12.13.2008 | 12.31.2058 | A
|-------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------- | ---------- | ---------- | ---------- | -
|                                                                                                                                                               |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Video Traffic Flow Data Collection System V1.0)                                                  | BJ16643 | 2008SRBJ633 7 | 11.20.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                               |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Video Traffic Flow Investigation - Digital Image Processing
      System V1.0)                   | BJ16622 | 2008SRBJ631 6 | 11.06.2008 | 12.13.2008 | 12.31.2058 | A
|                                                                                                                                                               |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Video Traffic Flow Investigation Watching-dog System V1.0)                                       | BJ16627 | 2008SRBJ632 1 | 10.10.2008 | 12.13.2008 | 12.31.2058 | B
|                                                                                                                                                               |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Yootu Real-Time Road Condition Information Processing and
      Releasing Software V1.0)         | 77504   | 2007SL11509   | 05.01.2007 | 08.01.2007 | 12.31.2057 | A
|                                                                                                                                                               |         |               |            |            |            |  
|Computer Software Copyright Registered
      Certificate
    (Portable Survey Instruments of Traffic Flow Management
      Software V1.0(Portable NC200 V1.0)) | BJ24485 | 2009SBRJ7479  | 09.21.2009 | 09.21.2009 | 12.31.2059 | A

Research and Development

In 2009 and 2008, our research and development expenses
amounted to approximately $3.80 million and $2.60 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 departments, one is internal and the other is external, which involves our
strategic relationship with the GeoSIS Laboratory at Peking University.

Internal R&D Department

Our internal R&D department consists of 140 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 department is to
analyze customer demands and develop application software products, with the use
of the most highly advanced software development tools available today.

20

---

Our research department 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, the department 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 created at 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 2009.

TOP TEN CLIENTS IN 2009

|    |  |                                                                         |  |                                                                             |  | Sales            |  |              
|--- |  | ----------------------------------------------------------------------- |  | --------------------------------------------------------------------------- |  | ---------------- |  | -------------
|    |  |                                                                         |  |                                                                             |  | (in thousands of |  | Percentage of
|No. |  | Name                                                                    |  | Description of
      Client                                                 |  | US dollars)      |  | Total Sales  
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|1   |  | China Mobile
      Shangxi Co., Ltd. Xinzhou Branch                     |  | Local branch of
      national telecom carrier                              |  | 4,155            |  | 6.53%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|2   |  | Gansu Province
      High Grade Road Construction Co., Ltd.             |  | A provincial
      transportation authority owned road construction company |  | 4,026            |  | 6.32%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|3   |  | Wuhan
      Transportation Management Bureau                            |  | City-level
      governmental transportation department                     |  | 3,995            |  | 6.27%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|4   |  | Zhejiang
      Huangqunan Highway Co., Ltd.                             |  | A state-owned
      highway construction company                            |  | 3,051            |  | 4.79%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|5   |  | Beijing
      Transportation Information Center                         |  | City-level
      governmental transportation department                     |  | 2,661            |  | 4.18%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|6   |  | Hubei Lurongxi
      Highway Construction Command Center                |  | Local governmental
      transportation authority                           |  | 2,175            |  | 3.41%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|7   |  | Hangzhou
      Construction Committee                                   |  | City-level
      governmental department                                    |  | 1,737            |  | 2.73%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|8   |  | Beijing Platinum
      Real Estate Development Co., Ltd.                |  | Local real estate
      development company                                 |  | 1,675            |  | 2.63%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|9   |  | Beijing Xiangxian
      Technology Co., Ltd.                            |  | High-tech company
      in environmental application development            |  | 1,646            |  | 2.59%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|10  |  | Beijing Municipal
      Commission of Economy and InformationTechnology |  | City-level
      governmental department                                    |  | 1,491            |  | 2.34%        
|    |  |                                                                         |  |                                                                             |  |                  |  |              
|    |  | TOTAL                                                                   |  |                                                                             |  | 26,612           |  | 41.79%       

21

---

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 provision services. 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 would have had 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.

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 these
government customers. 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 is concerned.

In order to comply with these legal restrictions, on February
3, 2009, we conducted the Restructuring and entered into the Contractual
Arrangement 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 Renminbi reserves primarily through direct
regulation of the conversion of Renminbi 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.

22

---

Our Competition and Competitive Strenghts

Competition in Chinas transportation information industry is very fragmented and consists of a combination of a few foreign competitors and many domestic transportation information technology companies.  Whereas most international competitors
seek to provide component software for the industry, our focus is 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 Geographic Information System, or 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 background. Under the cooperation agreement between our VIE Entity, 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 Intelligent
Transportation System, or 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.
- 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 Intelligent
Transportation Systems (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 position to the traffic, security and environmental management markets.

23

---

- 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 breaking new ground, together with industrial
partners on site, in the implementation of traffic infrastructure projects. The company develops new concepts (public private partnership) 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 of 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s business is about all hand business of ETC system in Japanese market including disclosing standard for data
security in ETC systems, providing processed data for identical ETC systems and developed 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 in 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 & hardware systems with independent intellectual property and cooperated with police departments for urban public security and traffic
command center constructions.
- Beijing Rhytech Co., Ltd. (Rhytech) - Based in Beijing, Rhytech is focusing 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 engages itself in the 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 & traffic comprehensive information platforms and other public transportation systems.

24

---

- Beijing Stone Intelligent Transportation System Integration Co., Ltd. -
  This company 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 dedicated 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 vehicle market currently.
- Shenzhen GENVICT Technologies Co., Ltd. (GENVICT) - GENVICT is a high-tech
  corporation specialized in developing, designing, manufacturing, supplying and
  technical services of Intelligent Transportation System (ITS) devices, IC card
  readers, embedded intelligent terminals and related hardware products. The
  company is headquartered in Shenzhen, with major customers as expressway,
  public security, traffic control, finance, urban traffic authorities.
- NAVINFO - NavInfo is a leading company in Chinas vehicle navigable map
  market and is an all-round big player in the fields of 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.

Raw Materials

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 its services
and software applications to customers.

Our Employees

As of December 31, 2009, we employed a total of 654 full-time
employees. The following table sets forth the number of our employees by
function as of December 31, 2009.

|                     |  | Number of | 
|-------------------- |  | --------- | 
|Department           |  | Employees | 
|Software Development |  | 318       | 
|Quality Control      |  | 67        | 
|Sales and Marketing  |  | 95        | 
|Administration       |  | 116       | 
|Human Resources      |  | 19        | 
|Finance              |  | 39        | 
|Total                |  | 654       | 

Our employees are not represented by a labor organization or
covered by a collective bargaining agreement. We have not experienced any work
stoppages. We are required under PRC law to make contributions to the employee
benefit plans at specified percentages of the after-tax profit. 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 material compliance with the
relevant PRC laws.

25

---

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.

Seasonality

Our results of operations are not materially affected by seasonality and we do not expect seasonality to cause any material impact on our operations in the future.

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.

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.

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.

26

---

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 pursuant to the Restructuring Documents 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 under the Service Agreement 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 43% of the 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., our 17% shareholder. 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.

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.

27

---

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.

The recent global financial crisis could negatively affect our business, results of operations, and financial condition.

The recent credit crisis and turmoil in the global financial system may have an adverse impact on our business and our financial condition, and we may face challenges if conditions in the financial markets do not improve.  Our ability to access the
capital markets may be restricted at a time when we would like, or need, to raise capital, which could have an impact on our flexibility to react to changing economic and business conditions. In addition, these economic conditions also impact levels
of government and consumer spending, which have recently deteriorated significantly and may remain depressed for the foreseeable future. It is uncertain how long the global crisis in the financial services and credit markets will continue and how
much of an impact it will have on the global economy in general or the Chinese economy in particular. If demand for our products and services fluctuates as a result of economic conditions or otherwise, our revenue and gross margin could be harmed.

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.  Sales to the Digital City, Transportation and Land
and Resources sectors of the Chinese government
accounted for an aggregate approximately 54% and 55% of our sales for the years ended December 31, 2009 and 2008, respectively.  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:

- 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.

28

---

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 $29.4 million in 2008, and to $63.7 million in 2009.  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.

29

---

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.

30

---

We may be exposed to potential risks relating to our internal control over financial reporting and our independent auditors may not attest to the effectiveness of our internal control.

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. In
addition, the independent registered public accounting firm auditing a public companys financial statements must also attest to the effectiveness of the companys internal controls. 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, although the auditor attestation is not required until our annual report for the fiscal year ending December 31, 2010,
assuming our filing status remains as a smaller reporting company.  A report of our management is included under Item 9A(T) 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, 2009.  However, in the future, our management may conclude that our internal controls over financial reporting are not effective, or our independent registered public
accounting firm may issue an adverse opinion on our internal controls over financial reporting, 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 or we are unable to receive a positive attestation from our independent auditors with respect to our internal controls, 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, Zhihai Mao and our vice presidents, Zhibin Lai, Zhiping Zhang, 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:

31

---

- a higher level of government involvement;
- a 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.

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.

32

---

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, or 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.

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.

33

---

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 past ten years, the rate of inflation in China has been as high as 5.9% and as low as -0.8%. These factors have
led to the adoption by the Chinese government, from time to time, of 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.

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.

34

---

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.

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 State Administration of Foreign Exchange, or 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, or 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, or 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.

35

---

SAFE rules and regulations may limit our ability to convert and transfer the net proceeds from this offering to our VIE Entities in the PRC, which may adversely affect the business expansion of our VIE Entities, and we may not be able to
convert the net proceeds from this offering into RMB to invest in or acquire any other PRC companies or establish other VIE Entities in the PRC.

On August 29, 2008, SAFE promulgated Circular 142, a notice regulating the conversion by a foreign-invested company of foreign currency into RMB by restricting how the converted RMB may be used.  The notice requires that the registered capital of a
foreign-invested company settled in RMB converted from foreign currencies may only be used for purposes within the business scope approved by the applicable governmental authority and may not be used for equity investments within the PRC.  In
addition, SAFE strengthened its oversight of the flow and use of the registered capital of a foreign-invested company settled in RMB converted from foreign currencies.  The use of such RMB capital may not be changed without SAFEs approval, and
may not in any case be used to repay RMB loans if the proceeds of such loans have not been used.  Violations of Circular 142 will result in severe penalties, such as heavy fines.  As a result, Circular 142 may significantly limit our ability to
transfer the net proceeds from this offering to our VIE Entities through our subsidiary in the PRC, which may adversely affect the business expansion of our VIE Entities, and we may not be able to convert the net proceeds from this offering into RMB
to invest in or acquire any other PRC companies, or establish other VIE Entities in the PRC.

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, 2009 and 2008, our effective tax rate was 1.1% and 0.2%, 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.

Our business and financial performance may be materially adversely affected if the PRC regulatory authorities determine that our acquisition of PKU constitutes a Round-trip Investment without MOFCOM approval.

On August 8, 2006, six PRC regulatory agencies promulgated the Regulation on Mergers and Acquisitions of Domestic Companies by Foreign Investors, which became effective on September 8, 2006 (the 2006 M&A Rule). According to the 2006
M&A Rule, a Round-trip Investment is defined as having taken place when a PRC business that is owned by PRC individual(s) is sold to a non-PRC entity that is established or controlled, directly or indirectly, by those same PRC
individual(s). Under the 2006 M&A Rules, any Round-trip Investment must be approved by the MOFCOM, and any indirect arrangement or series of arrangements which achieves the same end result without the approval of MOFCOM is a violation of PRC
law.

Prior to the consummation of the transactions contemplated by the Share Exchange Agreement on May 14, 2007, PKU was a PRC business whose majority shareholders were PRC individuals (the PRC Individuals). In addition, our BVI subsidiary
Cabowise, was originally indirectly owned by the PRC Individuals, and Cabowise owned an option (the Option), to purchase the entire equity interest owned by the PRC Individuals in PKU. The Option was assigned to our wholly owned
subsidiary, Oriental Intra-Asia by Cabowise on May 14, 2007. Thereafter, on May 14, 2007, as a condition to the closing of the share exchange transaction contemplated by the Share Exchange Agreement, Oriental Intra-Asia exercised the Option assigned
to it from Cabowise and, as a result thereof, the PRC Individuals sold their equity interest in PKU for $2 million in cash to Oriental Intra-Asia (the Acquisition). Following the Acquisition, pursuant to the Share Exchange Agreement,
on May 14, 2007, we issued 10,841,492 shares of common stock to the shareholders of Cabowise in exchange for all of the issued and outstanding capital stock of Cabowise (the Share Exchange). As a result of these transactions, the PRC
Individuals are now our controlling shareholders. The Acquisition has been registered with the
competent administration of industry and commerce authorities (AIC), in Beijing. Thereafter, the PRC Individuals made filings with the Beijing SAFE, to register the Company and its non-PRC subsidiaries to qualify them as SPVs, pursuant
to Circular 75 and Circular 106.

36

---

The PRC regulatory authorities may take the view that the Acquisition and the Share Exchange are part of an overall series of arrangements which constitute a Round-trip Investment, because at the end of these transactions, the PRC Individuals became
majority owners and effective controlling parties of a foreign entity that acquired ownership of PKU. The PRC regulatory authorities may also take the view that the registration of the Acquisition with the relevant AIC in Beijing and the filings
with the Beijing SAFE may not be evidence that the Acquisition has been properly approved because the relevant parties did not fully disclose to the AIC, SAFE or MOFCOM the details of the overall restructuring arrangements, the existence of the
Share Exchange and its link with the Acquisition. The PRC legal counsel of PKU has opined that the Acquisition did not violate any PRC law, which would include the 2006 M&A Rules. We, however, cannot assure you that the PRC regulatory
authorities, MOFCOM in particular, may take the same view as the PRC legal counsel. If the PRC regulatory authorities take the view that the Acquisition constitutes a Round-trip Investment under the 2006 M&A Rules, we cannot assure you we may be
able to obtain the approval required from MOFCOM.

If the PRC regulatory authorities take the view that the Acquisition constitutes a Round-trip Investment without MOFCOM approval, they could invalidate our acquisition and ownership of PKU. Additionally, the PRC regulatory authorities may take the
view that the Acquisition constitutes a transaction which requires the prior approval of the China Securities Regulatory Commission (CSRC), before MOFCOM approval is obtained. We believe that if this takes place, we may be able to find a
way to re-establish control of PKUs business operations through a series of contractual arrangements rather than an outright purchase of PKU. But we cannot assure you that such contractual arrangements will be protected by PRC law or that the
registrant can receive as complete or effective economic benefit and overall control of PKUs business than if the Company had direct ownership of PKU. In addition, we cannot assure you that such contractual arrangements can be successfully
effected under PRC law. If we cannot obtain MOFCOM or CSRC approval if required by the PRC regulatory authorities to do so, and if we cannot put in place or enforce relevant contractual arrangements as an alternative and equivalent means of control
of PKU, our business and financial performance will be materially 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.

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 affect our ability to expand our business or maintain our market share.

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.

37

---

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, 2009 and December 31, 2009, the closing price of our common stock, as reported on the markets on which our securities have traded,
ranged between $3.05 and $8.17.  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

---

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 39.74% 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

---

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 that we will be able 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 two free month rentals of RMB 228,776 (approximately $33,496) for the
first two months.  This lease expires on February 28, 2013.

We have entered into a lease agreement with a Chinese individual, Zhao Li, from whom we have leased our office space at 07 Floor E-Wing Center, No. 113 Zhichunlu, Haidian District, Beijing, China.  Pursuant to this lease, we have the right to use
the office space of 517 square meters in the E-Wing Center.  We paid a monthly rent of RMB 50,000 (approximately $7,325) for this facility. This lease expires on December 31, 2010.  However, we terminated it prematurely in December 2009.  On
June 2, 2007, we also entered into a real property purchase agreement with Zhao Li, pursuant to which Mr. Zhao agreed to sell the facility to us for a purchase price of RMB 9,747,000 (approximately $1,427,936).  In September, 2009, the real
property purchase agreement was verbally terminated by the parties and the prepaid amounts were returned to us in full.

We also entered into two additional lease agreements to lease office spaces at the 15th and the 16th floors of E-Wing Center, No. 113 Zhichunlu, Haidian District, Beijing, China. Under these two leases, we have the rights to use the office space of
378 square meters at the 15th floor and the office space of 609 square meters at the 16th floor in the E-Wing Center, respectively. We paid monthly rent of RMB 51,011 (approximately $7,473) and RMB 76,783 (approximately $11,249) under these
two lease agreements, respectively.  The leases expire on August 31, 2010 and March 30, 2011, respectively.  We terminated both leases prematurely in December 2009.

We believe that our properties have been adequately maintained, are generally in good condition, and are suitable and adequate for our business.

40

---

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)

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 had been 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 by the
Over-the-Counter Bulletin Board and the quarterly high and low closing sale
prices as reported by NASDAQ, as applicable. These prices reported by the
Over-the-Counter Bulletin Board do not include retail markup, markdown or
commission and may not represent actual transactions.

|                             |   | Closing
      Prices(1) | 
|---------------------------- | - | ----------------------- | 
|                             |   | High                    | 
|Year Ended December 31, 2009 |   |                         | 
|1stQuarter                   | $ | 3.44                    | 
|2ndQuarter                   |   | 5.36                    | 
|3rdQuarter                   |   | 8.42                    | 
|4thQuarter                   |   | 12.00                   | 
|                             |   |                         | 
|Year Ended December 31, 2008 |   |                         | 
|1stQuarter                   | $ | 8.30                    | 
|2ndQuarter                   |   | 7.07                    | 
|3rdQuarter                   |   | 6.40                    | 
|4thQuarter                   |   | 4.05                    | 

(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 30, 2010, there were approximately 84 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, subject to the approval of our stockholders. 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.

41

---

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, 2009 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 2009 fiscal year.

Purchases of Equity Securities

No repurchases of our common stock were made during the fourth quarter of 2009.

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.

Overview

We are a leading provider of end-to-end public transportation information technology systems and related comprehensive technology solutions in China.  Our goal is to become the largest provider of transportation information products and related
comprehensive technology solutions in China, as well as the largest operator and provider of real-time transportation information to 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, we were engaged in three business areas: transportation, land and resources, and digital city.  Our transportation solutions track and store a variety of traffic information for various government entities,
private sectors clients and individual users.  The land and resources business enables municipal governments to assess the efficiency of land use and the management of natural resources.  The digital city sector is designed to aid the Chinese
governments initiative to outfit all major cities with broadband and wireless internet access.

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.  Our transportation products and solutions are targeted for transportation management authorities under the management of the Ministry of Communication 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 the continuous increase of Chinese governments and public
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 this trend will impact favorably on the demand for our transportation information products and services, and accordingly result in the growth in sales of our transportation products 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 sale of transportation information products and solutions in China, our sales revenues have a high
correlation to the high speed growth of the transportation information industry in China generally.  Our sales compounded annual growth rate has been at approximately 71% for the past four years and our earnings compounded annual growth rate has
also been at about 71% over the same period.  Therefore, we believe that our sales over the next five years will grow in close correlation with the rapid growth of Chinas transportation information industry.

42

---

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 create 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. We believe that Made in China transportation information products and services will have a distinct advantage over similar products
and services provided in developed countries, where development costs are generally higher. The Chinese economy is developing at a rapid pace. As a result, there is a growing consumer market that is developing in China. We also believe that the
worldwide perception of the quality level of Chinese products is improving.

Recent Developments

On February 21, 2010, we entered into a Securities Purchase Agreement with SAIF Partners III L.P., pursuant to which
we 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 SEC on November 16, 2009.  The offering and sale of the shares closed on February 24,
2010.

On March 22, 2010, we and our VIE Entity, the Group
Company, entered into certain equity transfer agreements (the Equity Transfer
Agreements) with several individual shareholders (the 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 US$0.65 million) in
cash (the 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 our 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 of our common stock with an escrow
agent designated by us that they 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 our common
stock deposited by the Transferors in escrow will be returned to us for
cancellation for each applicable year. In addition, for each applicable year as
described above, we 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.

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 2009 and 2008.

BVI

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 taxes in 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 2009 and 2008.  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

Our former Chinese operating subsidiaries 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. Accordingly, our former Chinese operating subsidiaries have been entitled to tax concessions whereby the profit for its first two financial years beginning with the first profit-making year (after
setting off
tax losses carried forward from prior years) is exempt from income tax in the PRC and the profit for each of the subsequent three financial years is taxed at 50% of the prevailing tax rates set by the relevant tax authorities. 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.

43

---

Despite these changes, the EIT Law gives existing FIEs a five-year grandfather period during which they can continue to enjoy their existing preferential tax treatments. We are expecting that the measures to implement the grandfather period will be
enacted by the Chinese government in the coming months and will assess what the impact of the new regulations are at that time. The discontinuation of any such special or preferential tax treatment or other incentives would have an adverse affect on
any organizations business, fiscal condition and current operations in China.

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, 2009, the above tax rules did not have any material financial impact on the Company because we did not have any income from outside of the PRC in 2009.

The Group Company, Zhangcheng Media, 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 2009.  PKU, China TranWiseway, UNISITS, Beijing UNISITS, and
Hangzhou UNISITS are subject to a tax rate of 15% on the taxable income for PRC income tax purposes in 2009.  Beijing Tian Hao, Beijing Zhangcheng and Shanghai Yootu qualify as new or high-technology enterprises located in High-Tech
Zones in Beijing and Shanghai, and are entitled to tax exemptions or preferential tax rates on the taxable income for PRC income tax purposes in 2009.  Henan UNISITS are subject to a special rate of 2.5% for its taxable revenue in 2009.

Results of Operations

For the year ended December 31, 2009, our revenues increased to $63.69 million, an increase of 116.84% over 2008.  Gross profit was up 53.76% from the previous year, increasing from $16.5 million to $25.38 million, and operating income
reached $13.71 million, an increase of 20.02%. Finally, the Companys net income for the year increased 16.98% to $12.97 million from $11.09 million in 2008.

As these results show, the Company had a successful year of significant growth in 2009.  It was the second successful year of transition 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 2009, revenue from this area accounted for 85.95%, growing from
62.76% in 2008. Our digital city and land resources urban planning software accounted for the remainder.

In 2009 we continued to provide customized transportation related software solutions to the national government and provincial and local level governments across China. One of our most high profile contracts was with the Wuhan Municipal
Transportation Management Bureau to build a comprehensive transportation management system to collect, access, process
and manage real time traffic data on all major roads in Wuhan. This project was the first large scale local comprehensive
transportation management system in China. With a high degree of brand recognition and strong governmental relationships, we believe that we will continue to work closely with various governmental agencies to accommodate Chinas continued
transportation planning needs.

Our consumer-targeted new real time traffic data application business was also continuously enhanced this year. In August 2009, we launched Chinas first multi-city real-time traffic website and mobile phone software with current coverage in 10
major cities in China, including Beijing, Shanghai, Chongqing, Shenzhen and Tianjin.  In October, our mobile software application, Palmcity Live Traffic, was added to China Telecoms Surfing Space AppMarket. While mobile users can currently download this application for free as the AppMarket
is in its initial beta phase, we expect to monetize the application once the
AppMarket launches commercially. We also expect that more high-end cell phone
manufactures will install this application on new handsets to satisfy growing
consumer demand for real time traffic data.

44

---

We also launched in August 2009 our new product, the TransPLE,
an equipment and monitoring service system, which tracks transit passengers in
high density areas, such as metro stations, railway stations, and airports. The
technology utilizes multi-modal sensor networks composed of several laser
scanners and cameras to detect and analyze pedestrian flow quantity, density,
speed, and direction. As a result, the TransPLE can assist government
authorities to develop and expand high-traffic transportation centers with
optimal configurations for pedestrian flow, as well as support public safety
with crowd control, emergency response, and anti-terrorism activities.

Our most important and strategic business development during
2009 was our expansion into intelligent transportation systems for expressways
through indirect acquisition of a 35.17% equity interest in UNISITS in September
2009. UNISITS is a leader in Chinas intelligent transportation systems
industry, providing traffic engineering E&M systems for expressways in
China. Presently, the company has a presence in more than 20 provinces in the
country. UNISITS collaborates with Tsinghua University to develop an expressway
weight-in-motion system and lighting control system, both of which have been
utilized by several provinces in China. We believe that UNISITS is an excellent
complement to our business, allowing us to take advantage of the many synergies
between our two companies. We plan to leverage UNISITS established market
position in the expressway market with our leadership in the urban
transportation market to better penetrate markets for our products and services.

Year Ended December 31, 2009 Compared to Year Ended
December 31, 2008

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, |  
|                                                                                                |   | 2009         |  
|                                                                                                |   |              |  
|                                                                                                |   |              |  
|Revenues                                                                                        | $ | 63,686,121   |  
|Cost of sales                                                                                   |   | 38,310,183   |  
|                                                                                                |   |              |  
|Gross profit                                                                                    |   | 25,375,938   |  
|                                                                                                |   |              |  
|Selling, general and administrative expenses                                                    |   | 11,667,895   |  
|                                                                                                |   |              |  
|Income from operation                                                                           |   | 13,708,043   |  
|                                                                                                |   |              |  
|Other income and (expenses)                                                                     |   |              |  
|Interest income                                                                                 |   | 109,744      |  
|Interest expense                                                                                |   | (244,574     | )
|Subsidy income                                                                                  |   | 1,730,291    |  
|Other income                                                                                    |   | 91,439       |  
|                                                                                                |   | 1,686,900    |  
|Income before income taxes, noncontrolling interests, and
      equity investments              |   | 15,394,943   |  
|                                                                                                |   |              |  
|Income tax expenses                                                                             |   | 677,355      |  
|Net income before noncontrolling interests
      and gain on equity investments in affiliates   |   | 14,717,588   |  
|Gain on investments in affiliates due to proportional
      shares of the affiliates net income |   | 1,793,387    |  
|Net income before noncontrolling
      interests                                                |   | 16,510,975   |  
|Noncontrolling interests in net income of subsidiary                                            |   | 3,536,876    |  

|Net income  controlling interests | $ | 12,974,099 |  | $ | 11,090,477 | 
|---------------------------------- | - | ---------- |  | - | ---------- | 

45

---

|                                                                                                |   | Years Ended  |  
|----------------------------------------------------------------------------------------------- | - | ------------ | -
|                                                                                                |   | December 31, |  
|                                                                                                |   | 2009         |  
|                                                                                                |   |              |  
|As a percentage of Revenues                                                                     |   |              |  
|                                                                                                |   |              |  
|Revenues                                                                                        |   | 100.00 %     |  
|Cost of sales                                                                                   |   | 60.15%       |  
|                                                                                                |   |              |  
|Gross profit                                                                                    |   | 39.85%       |  
|                                                                                                |   |              |  
|Selling, general and administrative expenses                                                    |   | 18.32%       |  
|                                                                                                |   |              |  
|Operating income                                                                                |   | 21.52%       |  
|                                                                                                |   |              |  
|Other income and (expenses)                                                                     |   |              |  
|Interest income                                                                                 |   | 0.17%        |  
|Interest expenses                                                                               |   | (0.38%       | )
|Subsidy income                                                                                  |   | 2.72%        |  
|Other income                                                                                    |   | 0.14%        |  
|Income before income taxes, noncontrolling
      interests, and equity investments              |   | 24.17%       |  
|                                                                                                |   |              |  
|Income tax expenses                                                                             |   | 1.06%        |  
|Net income before noncontrolling interests and gain on
      equity investments in affiliates   |   | 23.11%       |  
|Gain on investments in affiliates due to
      proportional shares of the affiliates net income |   | 2.82%        |  
|Net income before noncontrolling interests                                                      |   | 25.92%       |  
|Noncontrolling interests in net
      income of subsidiary                                      |   | 5.55%        |  
|Net income  controlling interests                                                              | $ | 20.37%       |  

Revenues. Revenues increased approximately $34.32
million, or 116.84% to approximately $63.69 million for the year ended December
31, 2009, from approximately $29.37 million in 2008. Approximately 105.79% of
this increase is attributable to the increase in sales of our transportation
products in 2009, which had approximately 196.96% increase year over year
compared to 2008. Such 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 since September 2009. However, our Digital City and
Land and Resource businesses in total experienced about 22.52% decrease
compared to the same period of 2008 because we did not actively pursue Digital
City and Land and Resource businesses during 2009 even though we believe these
two businesses are still experiencing healthy development and growth in China.
In addition, we believe that the overall sales increased as a result of the
growing recognition of our brand name and technology. During 2009, the Company
had been constantly offering new products and solutions to the market and was
able to secure more contracts from recurring clients.

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.

46

---

|                   |   |            |  |  |            |  |   |            |  |  |            | 
|------------------ | - | ---------- |  |  | ---------- |  | - | ---------- |  |  | ---------- | 
|                   |   | Year Ended |  |  | Percentage |  |   | Year Ended |  |  | Percentage | 
|                   |   | December   |  |  | of         |  |   | December   |  |  | of         | 
|                   |   | 31,        |  |  | Total      |  |   | 31,        |  |  | Total      | 
|                   |   | 2009       |  |  | Revenues   |  |   | 2008       |  |  | Revenues   | 
|Transportation     | $ | 54,735,455 |  |  | 85.95%     |  | $ | 18,432,187 |  |  | 62.76%     | 
|Digital City       |   | 6,898,472  |  |  | 10.83%     |  |   | 8,387,422  |  |  | 28.56%     | 
|Land and Resources |   | 1,517,908  |  |  | 2.38%      |  |   | 2,475,023  |  |  | 8.42%      | 
|Other              |   | 534,286    |  |  | 0.84%      |  |   | 75,831     |  |  | 0.26%      | 
|Total              | $ | 63,686,121 |  |  | 100.00%    |  | $ | 29,370,463 |  |  | 100.00%    | 

As the table above indicates, the Transportation and Digital
City sectors accounted for an aggregate of 96.78% and 91.32% of our sales for
the years ended December 31, 2009 and 2008, respectively. Sales in Land and
Resources accounted for 2.38% and 8.42% of total sales over each of periods
indicated above, respectively.

Cost of Sales. Our cost of sales increased approximately
$25.44 million, or 197.73%, to approximately $38.31 million for the year ended
December 31, 2009, from approximately $12.87 million in 2008. This increase was
mainly due to the increase in the costs of hardware components and hardware
equipment depreciation, which was generally in line with the increase in our
sales. Such increase in the costs of hardware components were also due to the
consolidation of the financial results of UNISITS, whose business involves using
more hardware components in its products than the Companys legacy
transportation business. As a percentage of revenues, the cost of sales
increased to 60.15% during the year ended December 31, 2009 from 43.81% in 2008
due to the fact that the business of UNISITS involves using more hardware
components in its products and has much lower margin than the Companys legacy
business.

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

|                  |   | Year ended  |  |   | Year ended  | 
|----------------- | - | ----------- |  | - | ----------- | 
|                  |   | December 31 |  |   | December 31 | 
|Cost Item         |   | 2009        |  |   | 2008        | 
|Salary            | $ | 1,900,370   |  | $ | 1,311,126   | 
|Hardware          |   | 23,444,889  |  |   | 5,647,874   | 
|Software licenses |   | 2,271,370   |  |   | 1,494,675   | 
|Outsourcing       |   | 6,884,631   |  |   | 3,618,116   | 
|Others            |   | 3,808,923   |  |   | 795,467     | 
|Total             | $ | 38,310,183  |  | $ | 12,867,258  | 

Gross Profit. Our gross profit increased approximately
$8.88 million, or 53.76%, to approximately $25.38 million for the year ended
December 31, 2009, from approximately $16.50 million in 2008. Gross profit as a
percentage of revenues was 39.85% for the year ended December 31, 2009, a
decrease of 16.34% from 56.19% in 2008. Our gross profit increase was mainly
attributable to the increase of sales in 2009 in general. However, our gross
profit increase underperformed our revenue increase from 2008 to 2009 by about
63.08%, which was mainly due to the inclusion of the financials of UNISITS whose
sales generally involve more hardware components and have much lower margin than
the Companys legacy business during 2009.

Selling, General and Administrative Expenses. Majority
of our services and products are sold into 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 repeat business. Historically, we did
not invest heavily in establishing a substantial marketing program. We promoted
our products by developing relationships through Peking University, professional
relationships with various agencies and municipalities and in participation in
industry trade exhibitions. 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. Starting from the
first quarter of 2009, 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.

47

---

Our selling expenses including sales
representative commissions, promotion fees and marketing expenses, increased
approximately $0.72 million, or 57.42%, to $1.97 million for the year ended
December 31, 2009, from $1.25 million in 2008. As a percentage of revenues,
selling expenses decreased to 3.10% for the year ended December 31, 2009, from
4.26% in 2008. 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, 2009.

Our general and
administrative expenses were approximately $9.70 million (15.22% of total sales)
and approximately $3.83 million (13.04% of total sales) for the years ended
December 31, 2009 and 2008, respectively. The increase of administrative
expenses was mainly attributable to the increase of 314 employees, enhanced research and
development efforts as well as more professional expenses associated with being
a public company.

Income Taxes. For the year ended December 31, 2009, we
recognized income tax expense of $0.68 million and effective tax rate of 4.40%
while in 2008, we recognized an income tax expense of $0.06 million and
effective tax rate of 0.53%. The increase in the income tax expense mainly
resulted from the income tax paid or accrued with the increased taxable net
incomes in 2009.

Liquidity and Capital Resources

As of December 31, 2009, we had cash and cash equivalents
(excluding restricted cash) of approximately $27.40 million and restricted cash
of approximately $1.59 million. The following table provides detailed
information about our net cash flow for all financial statements periods
presented in this report.

Cash Flow

|                                                    |   | Fiscal Years Ended | 
|--------------------------------------------------- | - | ------------------ | 
|                                                    |   | December 31,       | 
|                                                    |   | 2009               | 
|Net cash provided by operating
      activities     | $ | 8,823,845          | 
|Net cash provided by (used in) investing activities |   | 1,674,998          | 
|Net cash provided by financing
      activities     |   | 1,134,165          | 
|Net cash inflow                                     |   | 11,277,956         | 

Operating Activities

Net cash provided by operating activities was approximately
$8.82 million in fiscal year ended December 31, 2009, which was an increase of
approximately $6.31 million from approximately $2.51 million net cash provided
by operating activities in fiscal year ended December 31, 2008. Such increase of
net cash provided by operating activities was primarily attributable to the
increase of our sales and net profit for 2009 compared to 2008 as well as the
increase in billings in excess of costs and estimated earnings on incompleted
contracts, which was due to the fact that we received the payments from
customers ahead of our working schedules on certain contracts. However, we also
experienced significant increase in cost and estimated earnings in excess of
billings on incompleted contracts in 2009 compared to 2008 mainly due to the
fact that our working schedules were ahead of billings based on the payment
terms of certain contracts, which negatively affected our cash flows from
operations. We also experienced the increase in other receivable, which consists
mainly of performance bonds that we put into escrow accounts set up by our
customers for contract performance purposes. Such increases were in correlation
to the increase of our sales and also negatively impacted our cash from
operations. In addition, we had increases in accounts receivable and accounts
payable, which were mainly due to the increase of sales and business scale.

48

---

Investing Activities

Our main uses of cash for investing activities are payments relating to the acquisition of property, plant and equipment.

Net cash provided by investing activities was approximately $1.67 million in fiscal year 2009, an increase of $11.92 million from the $10.25 million net cash used in investing activities in fiscal year 2008.  Such increase of net cash
provided by investing activities was primarily attributable to the cash acquired from the acquisition of UNISITS.

Financing Activities

Net cash provided by financing activities for the fiscal year ended December 31, 2009 was approximately $1.13 million, while in the same period of 2008 we had approximately $16.73 million of net cash provided by financing activities.  Such
change was mainly attributable to the facts that we raised $15 million in the private placement transaction in July 2008 and the payment of dividends to original shareholders of UNISITS for undistributed earnings prior to the acquisition in
September 2009.

Financing Agreements

On June 17, 2008, we entered into a short-term loan agreement with Beijing Bank, Youyi Branch (the Bank), pursuant to which the Bank 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 8.964%, which was floating based on interest rates determined by the Peoples Bank of China from time to time. The interest is payable on a quarterly basis commencing September 20, 2008. The loan
expired on June 17, 2009 and was renewed on June 22, 2009 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 the 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 the date of this report, a principal amount of approximately $2.93 million is outstanding. There
are no financial covenants or ratios under this short-term loan agreement.

On July 17, 2008, we completed a private placement pursuant to which we issued and sold 2,586,207 shares of our common stock to SAIF Partners III L.P. As a result of this private placement we raised $15 million in gross proceeds, which left us
with approximately $13.21 million in net proceeds after the deduction of offering expenses in the amount of approximately $1.79 million.

On September 29, 2009, PKU entered into a short-term loan agreement with Huaxia Bank, Zhichunlu Branch (the Huaxia Bank0, pursuant to which the Huaxia Bank has agreed to loan to PKU RMB 30 million (approximately $4.40 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. The interest is payable on a monthly basis commencing
October 20, 2009. The loan expires on September 29, 2010.  As of the date of this report, a principal amount of approximately $4.40 million is outstanding.  There are no financial covenants or ratios under this short-term loan agreement.

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

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.

49

---

Contractual Obligation and Capital Commitments

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 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 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 two free month rentals of RMB
228,776 (approximately $33,496) for the first two months. This lease expires on
February 28, 2013.

We have entered into a lease agreement with a Chinese
individual, Zhao Li, from whom we have leased our current office space at 07
Floor E-Wing Center, No. 113 Zhichunlu, Haidian District, Beijing, China.
Pursuant to this lease, we have the right to use the office space of 517 square
meters in the E-Wing Center. We paid a monthly rent of RMB 50,000 (approximately
$7,325) for this facility. This lease expires on December 31, 2010 and we
terminated it prematurely in December 2009. On June 2, 2007, we entered into a
real property purchase agreement with Zhao Li, pursuant to which Mr. Zhao agreed
to sell the facility to us for a purchase price of RMB 9,747,000 (approximately
$1,427,936). In September, 2009, the real property purchase agreement was
verbally terminated by the parties and the prepaid amounts were returned to us
in full.

We also entered into two additional lease agreements to lease
office spaces at the 15th and the 16th floors of E-Wing Center, No. 113
Zhichunlu, Haidian District, Beijing, China. Under these two leases, we had the
rights to use the office space of 378 square meters at the 15th floor and the
office space of 609 square meters at the 16th floor in the E-Wing Center,
respectively. We paid a monthly rent of RMB 51,011 (approximately $7,473) and
RMB 76,783 (approximately $11,249) under these two lease agreements,
respectively. The leases expire on August 31, 2010 and March 30, 2011,
respectively. We terminated both leases prematurely in December 2009.

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

|Year ending December 31, |   | Lease Commitments | 
|------------------------ | - | ----------------- | 
|2010                     | $ | 1,201,586         | 
|2011                     |   | 1,055,593         | 
|2012                     |   | 888,657           | 
|Total                    | $ | 3,145,836         | 

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.

50

---

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.

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, it's 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, Dajian Zhitong, Shanghai Yootu, UNISITS, Hangzhou Ziguang Jietong Technology Co., Ltd., Hangzhou UNISITS, Henan Ziguang Jietong Technology Co., Ltd., or Henan UNISITS, and Beijing Ziguang Jinzhidun Information
Technology Co., Ltd., or 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.

51

---

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.

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.

- Existing Technology

China TranWiseway, one of the Companys VIE entities,
internally developed the Traffic Volume Long-Distance Monitoring and Data Center
Platform technology. The useful life of the technology is estimated at 10 years.

- ETC and GPS Technologies

The Company purchased software from third parties for total
cash consideration of $1,184,057. This software was integrated into an
Electrical Toll collection, or ETC, non-stop toll system and GPS technology. The
Company plans to distribute fully integrated ETC systems with both hardware and
software included. The estimated useful life of the technology is for 10 years.

52

---

As of December 31, 2009, the Company capitalized research and development costs of $2,676,054 after establishing technical feasibilities for its real time traffic information application software (GPS Technology). Amortization of the real time
traffic information technology will not start until the application is completely developed.

- Highway Monitoring and Control Technology

UNSITS, a VIE entity of the Company, possesses the Highway Monitoring and Control technology. The Company amortizes such asset on a straight-line basis over 10 years.

- Contract Backlogs

UNISITS has certain intangible assets relating to earnings-generating service contracts that were independently valuated as an intangible asset for the equity acquisition purposes. The Company amortizes such asset on a straight-line basis over 2
years.

The company completed the annual impairment testing for indefinite-lived intangible assets during the twelve months ended December 31, 2009 and 2008, 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, 2009 and 2008.  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.

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 were 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, 2009 and 2008, research and development expenses were capitalized in the amount of $2,126,399 and $833,281 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 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. During 2008, we granted both stock options as part of our key performer stock-based compensation program. 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.

53

---

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 2009, 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, 2009, our annualized estimated forfeiture rates were 0% for non-employee director awards and 15-20% 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 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.

54

---

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, 2009, the Company believed no goodwill was
subject to the risk of impairment.

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.

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, 2009 and 2008, bad debt expenses
totaled $5,767 and $31,571, 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,             |   | 2009                            | 
|Renminbi (RMB)           |   | RMB 1.00                        | 
|United States dollar ($) | $ | 0.14661                         | 

55

---

|                
|----------------
|Exchange Rate at
|                

|December 31,             |   | 2009     |  |   | 2008     | 
|------------------------ | - | -------- |  | - | -------- | 
|Renminbi (RMB)           |   | RMB 1.00 |  |   | RMB 1.00 | 
|United States dollar ($) | $ | 0.1467   |  | $ | 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, 2009, 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, 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        |  |   | -           |  |   | -            | 
|Long-term investments           |   | 8,027,122    |  |   | -                |  |   | -           |  |   | 8,027,122    | 
|Total                           | $ | 37,018,618   |  | $ | 28,991,496       |  | $ | -           |  | $ | 8,027,122    | 

Financial assets at fair value as of December 31, 2008:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2008         |  |   | (Level 1)        |  |   | (Level 2)   |  |   | (Level 3)    | 
|Cash and cash equivalents | $ | 16,122,464   |  | $ | 16,122,464       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 1,209,542    |  |   | 1,209,542        |  |   | -           |  |   | -            | 
|Total                     | $ | 17,332,006   |  | $ | 17,332,006       |  | $ | -           |  | $ | -            | 

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 2007, the FASB issued ASC 810-10-65, Consolidation,
which applies to all companies that prepare consolidated financial statements,
except not-for-profit organizations, but will affect only those entities that
have an
outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. ASC 810-10-65 is effective for us on January 1, 2009. Earlier adoption is prohibited. We adopted ASC 810-10-65 on January 1, 2009 and the adoption of
ASC 810-10-65 did not have a material  impact on our results of operations or financial position.

56

---

In May 2009, the FASB issued ASC 855, Subsequent Events. ASC 855 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be
issued. The standard, which includes a new required disclosure of the date through which an entity has evaluated subsequent events, is effective for interim or annual periods ending after June 15, 2009.

In April 2009, the FASB issued three related staff positions to clarify the application of FASB ASC 820 to fair value measurements in the current economic environment, modify the recognition of other-than-temporary impairments of debt securities,
and require companies to disclose the fair value of financial instruments in interim periods. The final staff positions are effective for interim and annual periods ending after June 15, 2009.

- FASB ASC 820 (Transitional 820-10-65-4)which provides guidance on how to determine the fair value of assets and liabilities under FASB ASC 820 in the current economic environment and reemphasizes that the objective of a fair value measurement
remains the price that would be received to sell an asset or paid to transfer a liability at the measurement date.
- FASB ASC 320which modifies the requirements for recognizing other-than-temporarily impaired debt securities and significantly changes the existing impairment model for such securities. It also modifies the presentation of other-than-temporary
impairment losses and increases the frequency of and expands already required disclosures about other-than-temporary impairment for debt and equity securities.
- FASB ASC 820-10-50which requires disclosures of the fair value of financial instruments within the scope of FASB ASC 820 in interim financial statements, adding to the current requirement to make those disclosures in annual financial
statements. The staff position also requires that companies disclose the method or methods and significant assumptions used to estimate the fair value of financial instruments and a discussion of changes, if any, in the method or methods and
significant assumptions during the period.

In June 2009, the Financial Accounting Standards Board (FASB) issued its final Statement of Financial Accounting Standards (SFAS) No. 168, The FASB Accounting Standards Codification and the
Hierarchy of Generally Accepted Accounting Principlesa replacement of FASB Statement No. 162 (SFAS No. 168). SFAS No. 168 established the FASB Accounting Standards Codification (ASC)
as the single source of authoritative U.S. GAAP to be applied by nongovernmental entities in the preparation of financial statements. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of
authoritative U.S. GAAP for SEC registrants. All guidance in the ASC carries an equal level of authority. The ASC supersedes all previously existing non-SEC accounting and reporting standards. The ASC simplifies user access to all authoritative U.S.
GAAP by reorganizing previously issued U.S. GAAP pronouncements into approximately 90 accounting topics within a consistent structure, without creating new accounting and reporting guidance. The ASC became effective for financial statements issued
for interim and annual periods ending after September 15, 2009; accordingly, we adopted the ASC in the third quarter of fiscal 2009. Following SFAS No. 168, the FASB will not issue new standards in the form of Statements, FASB Staff Positions, or
Emerging Issues Task Force Abstracts; instead, it will issue Accounting Standards Updates. The FASB will not consider Accounting Standards Updates as authoritative in their own right; these updates will serve only to update the ASC, provide
background information about the guidance, and provide the bases for conclusions on the change(s) in the ASC. For the discussion herein, we refer to ASC citations that relate to ASC Topics and their descriptive titles, as appropriate, and no longer
refer to citations that relate to accounting pronouncements superseded by the ASC.

In June 2009, the FASB issued ASC 860, which eliminates the concept of a qualifying special-purpose entity, creates more stringent conditions for reporting a transfer of a portion of a financial asset as a sale, clarifies other sale-accounting
criteria, and changes the initial measurement of a transferors interest in transferred financial assets. FASB ASC 860 will be effective for transfers of financial assets in fiscal years beginning after November 15, 2009 and in interim periods
within those fiscal years with earlier adoption prohibited. We will adopt FASB ASC 860 on January 1, 2010.

In September 2009, the FASB issued new accounting guidance related to the revenue recognition of multiple element arrangements. The new guidance states that if vendor specific objective evidence or third party evidence for deliverables
in an arrangement cannot be determined, companies will be required to develop a best estimate of the selling price to separate deliverables and allocate arrangement consideration using the relative selling price method. The accounting guidance will
be applied prospectively and will become effective during the first quarter of 2011. Early adoption is allowed. The Company will adopt this guidance beginning January 1, 2010 and the Company does not expect this accounting guidance to materially
impact the Companys consolidated financial statements.

57

---

In January 2010, the FASB issued new accounting guidance related to the disclosure requirements for fair value measurements and provides clarification for existing disclosures requirements. More specifically, this update will require (a) an entity
to disclose separately the amounts of significant transfers in and out of Levels 1 and 2 fair value measurements and to describe the reasons for the transfers; and (b) information about purchases, sales, issuances and settlements to be presented
separately (i.e. present the activity on a gross basis rather than net) in the reconciliation for fair value measurements using significant unobservable inputs (Level 3 inputs). This guidance clarifies existing disclosure requirements for the level
of disaggregation used for classes of assets and liabilities measured at fair value and requires disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements using Level
2 and Level 3 inputs. The new disclosures and clarifications of existing disclosure are effective for fiscal years beginning after December 15, 2009, except for the disclosure requirements for related to the purchases, sales, issuances and
settlements in the rollforward activity of Level 3 fair value measurements. Those disclosure requirements are effective for fiscal years ending after December 31, 2010. The Company does not believe the adoption of this guidance will have a material
impact to the Companys consolidated financial statements.

In August 2009, the FASB issued ASU 2009-05, which provides additional guidance under the Fair Value Measurements and Disclosures Topic, ASC 820-10 Application to Liabilities. The guidance clarifies that the quoted price for the liability when
traded as an asset in an active market is a Level 1 measurement, when no adjustment to the quoted price is required. In the absence of a Level 1 (quoted price) measurement, an entity must use one or more valuation techniques to estimate fair value
in a manner consistent with the principles in ASC 820. We do not expect adoption of this guidance to have an impact on the Companys consolidated financial statements.

In October 2009, the FASB issued an ASU regarding accounting for own-share lending arrangements in contemplation of convertible debt issuance or other financing. This ASU requires that at the date of issuance of the shares in a share-lending
arrangement entered into in contemplation of a convertible debt offering or other financing, the shares issued shall be measured at fair value and be recognized as an issuance cost, with an offset to additional paid-in capital. Further, loaned
shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs, at which time the loaned shares would be included in the basic and diluted earnings-per-share calculation. This ASU is effective
for fiscal years beginning on or after December 15, 2009, and interim periods within those fiscal years for arrangements outstanding as of the beginning of those fiscal years. The adoption of this guidance did not have a material impact on our
consolidated financial statements .

In October 2009, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2009-13, Multiple-Deliverable Revenue Arrangements (Topic 605), or ASU 2009-13. ASU 2009-13 amends existing revenue recognition accounting
pronouncements that are currently within the scope of Accounting Standards Codification (ASC) Subtopic 605-25. The consensus in ASU 2009-13 provides accounting principles and application guidance on whether multiple deliverables exist, how the
arrangement should be separated, and the consideration allocated. This guidance eliminates the requirement to establish the fair value of undelivered products and services and instead provides for separate revenue recognition based upon management's
estimate of the selling price for an undelivered item when there is no other means to determine the fair value of that undelivered item. The present standard requires that the fair value of the undelivered item be the price of the item either sold
in a separate transaction between unrelated third parties or the price charged for each item when the item is sold separately by the vendor. This was difficult to determine when the product was not individually sold because of its unique features.
In addition, if the fair value of all of the elements in the arrangement was not determinable, then revenue was deferred until all of the items were delivered or fair value was determined. This new approach is effective prospectively for revenue
arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. The Company does not believe this standard will have a material impact on its financial position or results of operations.

In October 2009, the FASB issued ASU 2009-14 which amended the accounting requirements under the Software Topic, ASC 985-605 Revenue Recognition. The objective of this update is to address the accounting for revenue arrangements that contain
tangible products and software. Specifically, products that contain software that is more than incidental to
the product as a whole will be removed from the scope of ASC subtopic 985-605. The amendments align the accounting for these revenue transaction types with the amendments under ASU 2009-13 mentioned above. The guidance provided within ASU 2009-14 is
effective for fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We are currently evaluating the impact that adoption of this guidance will have on our
consolidated financial statements.

58

---

In October 2009, the FASB issued an ASU 2009-15 regarding accounting for own-share lending arrangements in contemplation of convertible debt issuance or other financing. This ASU requires that at the date of issuance of the shares in a share-lending
arrangement entered into in contemplation of a convertible debt offering or other financing, the shares issued shall be measured at fair value and be recognized as an issuance cost, with an offset to additional paid-in capital. Further, loaned
shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs, at which time the loaned shares would be included in the basic and diluted earnings-per-share calculation. This ASU is effective
for fiscal years beginning on or after December 15, 2009, and interim periods within those fiscal years for arrangements outstanding as of the beginning of those fiscal years. The adoption of this guidance did not have a material impact on our
consolidated financial statements .

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, 2009 and 2008 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(T).  CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer and chief financial officer, Mr. Shudong Xia and Mr. Zhihai Mao, respectively, evaluated the effectiveness of our disclosure controls and procedures. The term disclosure
controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports,
such as this report, that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SECs rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the companys management, including
its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.  Based on that evaluation, Mr. Shudong Xia and Mr. Zhihai Mao
concluded that as of December 31, 2009, 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:

59

---

- 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.

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, 2009. 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, 2009, our internal control over financial reporting is
effective at the reasonable assurance level based on those criteria.

This annual report 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 temporary rules of the SEC that permit the
Company to provide only managements report in this annual report.

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 2009 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

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 2009, but
was not reported.

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 | 37  | Chairman,
      CEO, President and Secretary
|Zhibin Lai  | 36  | Vice President of
      Technology          

|Zhiping Zhang       | 40 | Vice President of
      Research and Development
|------------------- | -- | ------------------------------------------------
|Danxia Huang        | 37 | Vice President of Operations and
      Director 
|Zhihai Mao          | 34 | Chief Financial Officer                         
|Jay Trien           | 69 | Director                                        
|Zhongsu Chen        | 46 | Director                                        
|Dan Liu             | 68 | Director                                        
|Brandon Ho-Ping Lin | 38 | Director                                        
|Dongyuan Yang       | 56 | Director                                        

60

---

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 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.

DANXIA HUANG. Ms. Huang became our Vice President of
Finance 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, business administration management and finance. 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.

61

---

ZHIHAI MAO. Mr. Mao has been our Chief Financial Officer since January 1, 2008.  From August 2006 to December 2007, Mr. Mao was a senior auditor of Deloitte & Touche Tohmatsu CPA, Ltd.s Beijing office. Prior to that, Mr. Mao was a
senior auditor of Deloitte & Touche LLP, USA, from October 2004 through July 2006. From July 2003 to October 2004, Mr. Mao was a senior tax consultant of Deloitte Tax LLP USA.  Mr. Mao also was previously employed as a budget analyst of
University of North Carolina at Chapel Hill, Program for International Training in Health, from December 2002 through May 2003.  Mr. Mao is a U.S. Certified Public Accountant with extensive experience of corporate financial reporting and disclosure.
 Mr. Mao holds a Maters degree in accounting from University of North Carolina at Chapel Hill.

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.

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.

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 councillor 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.

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.

DONGYUAN YANG. Mr. Yang has been our director since September 28, 2008.  Mr. Yang has over 26 years of experience in the research and application of urban transportation planning, transportation modeling, intellectual
transportation systems, and logistic systems planning. Mr. Yang has been the vice chancellor of Tongji University since 2002 and has published over 80 academic articles in domestic and international industry journals. In recent years, Mr. Yang has
spearheaded a number of transportation and logistic planning projects, including the highway intellectual information platform for Guangdong province, Zhengzhou's integrated transportation systems planning, Shanghai's World Expo transportation
systems planning and Shanghai's comprehensive transportation information center planning. Mr. Yang holds a Ph.D. in Road and Traffic Engineering from Tongji University.

62

---

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 III L.P. (SAIF), pursuant to which, among other things, SAIF 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.

Except as noted above, there are no other arrangement 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

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 that currently consists of seven members: Shudong Xia, Danxia Huang, Jay Trien, Zhongsu Chen, Dan Liu, Brandon Ho-Ping Lin and Dongyuan Yang.  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 are 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.  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:

63

---

- 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.

Compensation Committee

Our Compensation Committee consists of three directors, Jay Trien, Zhongsu Chen and Dan Liu.  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.

64

---

Governance and Nominating Committee

Our Governance and Nominating Committee consists of three
directors: Jay Trien, Zhongsu Chen and Dan Liu. 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.

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 2009 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. We are in the
process of making our code of ethics available on our website, which is located
at www.ctfo.com. Once it is available on our website, any amendments or waivers
to the code of ethics will be posted on our website within four business days of
such amendment or waiver. Until such time, however, any amendments or waivers to
our code of ethics will be filed with the SEC in a Current Report on Form 8-K.

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 2009 and 2008: Shudong Xia, our Chief
Executive Officer, President and Chairman, and Zhihai Mao, who became our Chief
Financial Officer on January 1, 2008. No other executive officers received total
compensation in excess of $100,000 in either fiscal year.

|                            |  |      |  |  |         |  |  | Stock   |     |  | Option  |     |  | All Other     |  |  |         | 
|--------------------------- |  | ---- |  |  | ------- |  |  | ------- | --- |  | ------- | --- |  | ------------- |  |  | ------- | 
|                            |  |      |  |  | Salary  |  |  | Awards  |     |  | Awards  |     |  | Compensations |  |  | Total   | 
|Name and Principal Position |  | Year |  |  | ($)     |  |  | ($)     |     |  | ($)     |     |  | ($)           |  |  | ($)     | 
|Shudong Xia                 |  | 2009 |  |  | 15,813  |  |  | .-      |     |  | -       |     |  | -             |  |  | 15,813  | 
|CEO, President and Chairman |  | 2008 |  |  | 15,568  |  |  | -       |     |  | -       |     |  | -             |  |  | 15,568  | 
|Zhihai Mao                  |  | 2009 |  |  | 109,810 |  |  | 183,512 | (1) |  | -       |     |  | -             |  |  | 293,322 | 
|Chief Financial Officer     |  | 2008 |  |  | 108,112 |  |  | -       |     |  | 181,000 | (2) |  | -             |  |  | 289,112 | 

65

---

|(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 annul report. The
      amounts for 2008 have been restated to reflect the aggregate grant date
      fair value in accordance with new SEC rules.                                
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(2) | The amounts in the Option Awards column represent the
      grant date fair value of stock option awards granted to Mr. Mao,
      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 annul report. The amounts for 2008 have been restated to
      reflect the aggregate grant date fair value in accordance with new SEC
      rules.

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
with the Company 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 with the Company 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 with the Company 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.

Danxia Huang,our Vice President of Operationss 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 with the Company 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 November 27, 2007, the Company and Mr. Mao entered into an
employment agreement (the Employment Agreement), which is effective as of
January 1, 2008 (the Effective Date). The term of the Employment Agreement is
for three years (the Initial Term) commencing on the Effective Date. After the
Initial Term of employment, Mr. Maos employment will be at will and either
the Company or Mr. Mao may terminate the employment with or without cause or
advance notice.

The Employment Agreement provides, among other things, that Mr.
Maos annual base salary will be 750,000 Renminbi (approximately $108,112) (the
Base Salary). During the Initial Term, if Mr. Mao terminates his employment
for any reason or if the Company terminates the employment due to death,
permanent disability, or with cause, Mr. Mao 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. Mao. If during the Initial Term, the Company
terminates Mr. Maos employment without cause, he will be entitled to one or two
or three months Base Salary as severance based on how long he has worked for the
Company when the employment is terminated. 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. Mao 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.

66

---

On June 1, 2009, pursuant to the 2009 Equity Incentive Plan, we
cancelled all of the outstanding stock options with an exercise price of $6.7
that we granted to Zhihai Mao to purchase 200,000 shares of our common stock and
replaced with 150,000 shares of restricted stock, among which 100,000 restricted
shares have been vested and issued as of the date of this report and the
remaining 50,000 shares vest pro rata quarterly through January 7, 2011.

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. Except for Mr. Mao, 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

The following table sets forth information concerning the
fiscal 2009 year-end value of unvested restricted shares for Mr. Zhihai Mao. No
other 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 2009.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

|           |  | Stock Awards                                                         | 
|---------- |  | -------------------------------------------------------------------- | 
|Name       |  | **Number of shares** or units
      of sock that have not vested (#) | 
|           |  |                                                                      | 
|Zhihai Mao |  | 0                                                                    | 

|(1) | Among 62,500 shares, 12,500 shares vested on January 7,
      2010 and the remaining shares will vest pro rata quarterly through January
      7, 2011.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

Compensation of Directors

The following table sets forth information concerning all
compensation paid to our directors for services rendered in all capacities for
the year ended December 31, 2009.

|                    |  | Fees Earned or         |  |  | Option Awards |     |  |          | 
|------------------- |  | ---------------------- |  |  | ------------- | --- |  | -------- | 
|Name                |  | Paid in Cash
      ($) |  |  | ($)           |     |  | Total($) | 
|Jay Trien           |  | 30,000                 |  |  | 31,412        | (3) |  | 61,412   | 
|Zhongsu Chen        |  | 14,056                 |  |  | 31,412        | (3) |  | 45,468   | 
|Dan Liu             |  | 20,000                 |  |  | 0             |     |  | 20,000   | 
|Brandon Ho-Ping Lin |  | 18,000                 |  |  | 9,402         | (3) |  | 27,402   | 
|Dongyuan Yang       |  | 17,570                 |  |  | 0             |     |  | 17,570   | 

|Shudong Xia  |  | 15,813 | (1) |  | 0 |  |  | 15,813 | 
|------------ |  | ------ | --- |  | - |  |  | ------ | 
|Danxia Huang |  | 14,056 | (2) |  | 0 |  |  | 14,056 | 

67

---

|(1) | Mr. Xia does not receive additional compensation for his
      service as our director. The compensation disclosed herein is his
      compensation for serving as our CEO and President as disclosed in the
      Summary Compensation Table above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(2) | Reflects the compensation Ms. Huang receives as the Vice
      President of the Company. She receives no additional compensation for her
      services as a director of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(3) | 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 annul
report.

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.

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.

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 30, 2010 (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.

68

---

|                                                                                              |                                                            |                                      | Amount & Nature     | Percent of
|--------------------------------------------------------------------------------------------- | ---------------------------------------------------------- | ------------------------------------ | ------------------- | ----------
|                                                                                              |                                                            |                                      | of Beneficial       | Class(2)  
|Name & Address of Beneficial Owner                                                            | Office, if Any                                             | Title of Class                       | Ownership(1)        |           
|Officers and Directors                                                                       
|Shudong Xia                                                                                   | Chief Executive
      Officer, President, and Chairman     | Common Stock,
      $0.001 par value | 9,566,532
      (3) | 39.74%    
|Zhihai Mao                                                                                    | Chief Financial Officer                                    | Common Stock $0.001 par value        | 66,711              | *         
|Danxia Huang                                                                                  | Vice President of
      Operations, Treasurer and Director | Common Stock
      $0.001 par value  | 0                   | *         
|Zhibin Lai                                                                                    | Vice President                                             | Common Stock $0.001 par value        | 0                   | *         
|Zhiping Zhang                                                                                 | Vice President of
      Research and Development           | Common Stock
      $0.001 par value  | 0                   | *         
|Jay Trien                                                                                     | Director                                                   | Common Stock $0.001 par value        | 22,500              | *         
|Zhongsu Chen                                                                                  | Director                                                   | Common Stock
      $0.001 par value  | 20,000              | *         
|Dan Liu                                                                                       | Director                                                   | Common Stock $0.001 par value        | 0                   | *         
|Brandon Ho-Ping Lin                                                                           | Director                                                   | Common Stock
      $0.001 par value  | 15,000              | *         
|Dongyuan Yang                                                                                 | Director                                                   | Common Stock $0.001 par value        | 0                   | *         
|All officers and directors as
      a group (10 persons named above)                          |                                                            | Common Stock
      $0.001 par value  | 9,690,743           | 40.14%    
|5% Securities Holder                                                                         
|Karmen Investment Holdings,
      Ltd P.O. Box 3444 Road Town, Tortola British Virgin Islands |                                                            | Common Stock
      $0.001 par value  | 9,566,532
      (3) | 39.74%    
|SAIF Partners III L.P. #2115, Two Pacific
      Place, 88 Queensway, Admiralty, Hong Kong     |                                                            | Common Stock $0.001 par value        | 4,151,152(4)        | 17.25%    
|Andrew Y. Yan #2115, Two
      Pacific Place, 88 Queensway, Admiralty, Hong Kong              |                                                            | Common Stock
      $0.001 par value  | 4,151,152(4)        | 17.25%    
|Total Shares Owned by Persons Named
      above:                                              |                                                            | Common Stock $0.001 par value        | 13,841,895          | 57.34%    

* 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 24,070,638 shares of Common Stock as of March
      30, 2010 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.

69

---

|(3) | Includes 9,566,532 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) | 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.

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 2009 for each category of our equity compensation plan:

|                                                             |  | Number of securities to be issued
      upon exercise of outstanding options, restricted stock,
      warrants and rights |     |   | Weighted-average exercise price
      of outstanding options, restricted stock, warrants
      and rights |     |  | Number of securities remaining
      available for future issuance under equity compensation
      plans (excluding securities reflected in column (a)) | 
|------------------------------------------------------------ |  | ------------------------------------------------------------------------------------------------------------------------- | --- | - | --------------------------------------------------------------------------------------------------------- | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Plan category                                                |  | (a)                                                                                                                       |     |   | (b)                                                                                                       |     |  | (c)                                                                                                                                                     | 
|Equity compensation plans approved by
      security holders |  | 1,925,600                                                                                                                 | (1) | $ | 7.33                                                                                                      | (2) |  | 974,400                                                                                                                                                 | 
|Equity compensation plans not approved by security holders   |  | -                                                                                                                         |     |   | -                                                                                                         |     |  | -                                                                                                                                                       | 
|Total                                                        |  |                                                                                                                           |     |   |                                                                                                           |     |  |                                                                                                                                                         | 

|(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. On the
      same day, we also cancelled all of the outstanding stock options with an
      exercise price of $6.7 that we granted to Zhihai Mao to purchase 200,000
      shares of our common stock and replaced with 150,000 shares of restricted
      stock, among which 62,500 restricted shares have been vested and issued
      and the remaining 87,500 shares vest pro rata quarterly through January 7,
      2011. On June 1, 2009, 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 3, 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, 36,000
      shares of which has been forfeited.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(2) | Under FAS 123R, the Company recognized a total
      compensation expense of $505,464 in 2009 This expense is accounted under
      Operating Expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

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

The following includes a summary of transactions since the
beginning of the 2009 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.

70

---

As disclosed before, on February 3, 2009, through Oriental Intra-Asia and PKU, we entered into a series of equity transfer agreements with the Group Company, pursuant to which we transferred all of our indirect equity interests in PKU and PKUs
subsidiaries to the Group Company.  The Group Company is wholly owned by four Chinese affiliates of the Company, Shudong Xia, Zhiping Zhang, Zhibin
Lai and Wei Gao.

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:

- Pursuant to 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 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 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 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 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 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.

In connection with the above equity transfers, 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:

- Pursuant to the Service Agreement, Oriental Intra-Asia agreed to provide certain technical and consulting services to 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 the Pledge Agreement, the Group Company Shareholders agreed to pledge all of their equity interests in the Group Company, to Oriental Intra-Asia as collateral security for Oriental Intra-Asias
collection of the fees under the Service Agreement;
- Pursuant to the Option Agreement, 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, 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

71

---

- Pursuant to an operating agreement, entered into by and among Oriental Intra-Asia, the VIE Entities and the Group Company Shareholders, (1) 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 (2) 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.

On September 8, 2009, our CEO and Chairman, Shudong Xia, entered into an equity transfer agreement with Unisplendour Corporation Limited ("Unisplendour") (the "Equity Transfer Agreement"), 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) (the "Purchase Price").  UNISITS is a company organized under the laws of the Peoples Republic
of China, engaged 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. Pursuant to
the Equity Transfer Agreement, Mr. Xia will pay 50% of the Purchase Price to Unisplendour within five (5) business days after the Equity Transfer Agreement became effective. The rest 50% of the Purchase Price will be 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 agreed to pledge 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.

On March 22, 2010, we and the Group Company entered into the
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 is payable within seven days after
the effective date of the Equity Transfer Agreements, and approximately 1.16
million shares of our common stock, which are issuable within 30 days of the
effective date of the Equity Transfer Agreements.

On February 21, 2010, we entered into a Securities Purchase Agreement with SAIF Partners III L.P., pursuant to which we 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.

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 39.74% of China TransInfo Technology Corp.

Director Independence

Jay Trien, Zhongsu Chen, Dan Liu and Dongyuan Yang 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. (the Nasdaq Listing Rules).
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 comprised entirely of Messrs. Jay Trien, Zhongsu Chen and Dan Liu.

72

---

ITEM 14.      PRINCIPAL ACCOUNTING FEES AND SERVICES.

Independent Auditors Fees

The following table represents fees billed for 2009 and 2008
for professional audit services rendered by Simon & Edward, LLP for the
audit of the companys annual financial statements and fees billed in 2009 and
2008 for other services rendered by Simon & Edward, LLP:

|                      |   | 2009    |  |   | 2008    | 
|--------------------- | - | ------- |  | - | ------- | 
|                      |   |         |  |   |         | 
|Audit fees(1)         | $ | 110,000 |  | $ | 140,000 | 
|Audit-related fees(2) |   | 28,948  |  |   | 30,120  | 
|Tax fees(3)           |   | 0       |  |   | 11,800  | 
|All other fees        |   | 0       |  |   | 0       | 
|Total                 |   | 138,948 |  |   | 181,920 | 

The following table represents fees billed for 2009 and 2008
for professional audit services rendered by BDO China Li Xin Da Hua CPAs Co.,
Ltd (formerly known as Dahua Delu) ("BDO China Li Xin") for the audit of the
companys annual financial statements and fees billed in 2009 and 2008 for other
services rendered by BDO China Li Xin:

|                      |   | 2009    |  |   | 2008 | 
|--------------------- | - | ------- |  | - | ---- | 
|                      |   |         |  |   |      | 
|Audit fees(1)         | $ | 130,000 |  | $ | 0    | 
|Audit-related fees(2) |   | 0       |  |   | 0    | 
|Tax fees(3)           |   | 0       |  |   | 0    | 
|All other fees        |   | 0       |  |   | 0    | 
|Total                 |   | 130,000 |  |   | 0    | 

|(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 two most recent 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.

73

---

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 two most recent 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 Simon & Edward, LLP and  BDO
China Li Xin for our consolidated financial statements as of and for the year
ended December 31, 2009. Our Audit Committee delegated its pre-approval
authority regarding the non-audited services to its Chair. The Chair of our
Audit Committee pre-approved the non-audit services performed by Simon &
Edward, LLP and  BDO China Li Xin for our consolidated financial statements as of
and for the year ended December 31, 2009.

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].                                                                                          

74

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|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  |  | Lease Contract of E-Wing Center, dated November 25,
      2004,. between Zhao Li and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.15 to the registrants current
      report on Form 8-K filed on May 14, 2007].                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.2  |  | 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].                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.3  |  | 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].**                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.4  |  | 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].**                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.5  |  | 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].**                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.6  |  | 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].**                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.7  |  | Real Property Purchase Agreement, dated June 2, 2007,
      between Mr. Zhao Li and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.1 to the registrants quarterly
      report on Form 10-QSB filed on August 16, 2007].                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.8  |  | Entrust Agreement, dated July 6, 2007, among Oriental
      Intra-Asia Entertainment (China) Limited, Beijing Tiandi Zuobiao
      Technology Co., Ltd. and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.27 to the registrants
      Registration Statement on Form SB-2 on May 14, 2007.]
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.9  |  | Employment Agreement by and between China Trans Info
      Technology Corp. and Zhihai Mao, dated November 27, 2007. [Incorporated by
      reference to Exhibit 10.1 to the registrants current report on Form 8-K
      filed on December 3, 2007].**                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.10 |  | 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].**                                       
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.11 |  | 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].**                                  
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.12 |  | 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].**                                         
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.13 |  | 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].**                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.14 |  | 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].**                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.15 |  | 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].**                                                                                    

75

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|10.16 |  | 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].                                                                                                                                  
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.17 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.18 |  | 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].                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.19 |  | 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].                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.20 |  | 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].                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.21 |  | 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].                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.22 |  | 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].                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.23 |  | 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].**                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.24 |  | 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].**                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.25 |  | 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].**                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.26 |  | 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].**                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.27 |  | 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].                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.28 |  | 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].                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.29 |  | 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
      10.2 to the registrants current report on Form 8-K filed on February 6,
      2009].                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.30 |  | 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].                                                  

76

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|10.31 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.32 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.33 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.34 |  | 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].                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.35 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.36 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.37 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.38 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.39 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.40 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.41 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.42 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.43 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.44 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

77

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|10.45 |  | 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].                                 
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.46 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.47 |  | 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].                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.48 |  | 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].                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.49 |  | 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].              
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.50 |  | 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].            
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|21    |  | Subsidiaries of the Company.*                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|23.1  |  | Consent of Simon & Edwards, LLP, Independent
      Registered Public Accounting Firm.*                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|23.2  |  | Consent of  BDO China Li Xin Da
      Hua CPAs 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.

78

---

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 31, 2010

CHINA TRANSINFO TECHNOLOGY CORP.By:
	/s/ Shudong XiaShudong XiaChief Executive OfficerBy:
	/s/ Zhihai MaoZhihai MaoChief 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 Zhihai Mao, 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 31, 2010
|Shudong Xia             |  | (Principal Executive Officer)                                 |  |               
|                        |  |                                                               |  |               
|/s/ Zhihai Mao          |  | Chief Financial Officer                                       |  | March 31, 2010
|Zhihai Mao              |  | (Principal Financial and Accounting Officer)                  |  |               
|                        |  |                                                               |  |               
|/s/ Danxia Huang        |  | Vice President of Operations, Treasurer and Director          |  | March 31, 2010
|Danxia Huang            |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Zhibin Lai          |  | Vice President                                                |  | March 31, 2010
|Zhibin Lai              |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Zhiping Zhang       |  | Vice President of Research and Development                    |  | March 31, 2010
|Zhiping Zhang           |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Jay Trien           |  | Director                                                      |  | March 31, 2010
|Jay Trien               |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Zhongsu Chen        |  | Director                                                      |  | March 31, 2010
|Zhongsu Chen            |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Dan Liu             |  | Director                                                      |  | March 31, 2010
|Dan Liu                 |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Brandon Ho-Ping Lin |  | Director                                                      |  | March 31, 2010
|Brandon Ho-Ping Lin     |  |                                                               |  |               
|                        |  |                                                               |  |               
|/s/ Dongyuan Yang       |  | Director                                                      |  | March 31, 2010
|Dongyuan Yang           |  |                                                               |  |               
|                        |  |                                                               |  |               

---

EXHIBITS

|            |  |            
|----------- |  | -----------
|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  |  | Lease Contract of E-Wing Center, dated November 25,
      2004,. between Zhao Li and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.15 to the registrants current
      report on Form 8-K filed on May 14, 2007].                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.2  |  | 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].                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.3  |  | 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].**                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.4  |  | 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].**                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.5  |  | 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].**                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.6  |  | 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].**                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.7  |  | Real Property Purchase Agreement, dated June 2, 2007,
      between Mr. Zhao Li and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.1 to the registrants quarterly
      report on Form 10-QSB filed on August 16, 2007].                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.8  |  | Entrust Agreement, dated July 6, 2007, among Oriental
      Intra-Asia Entertainment (China) Limited, Beijing Tiandi Zuobiao
      Technology Co., Ltd. and Beijing PKU Chinafront Technology Co., Ltd.
      [Incorporated by reference to Exhibit 10.27 to the registrants
      Registration Statement on Form SB-2 on May 14, 2007.]
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.9  |  | Employment Agreement by and between China Trans Info
      Technology Corp. and Zhihai Mao, dated November 27, 2007. [Incorporated by
      reference to Exhibit 10.1 to the registrants current report on Form 8-K
      filed on December 3, 2007].**                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.10 |  | 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].**                                       
|      |  |                                                                                                                                                                                                                                                                                                                                          
|10.11 |  | 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].**                                  
|      |  |                                                                                                                                                                                                                                                                                                                                          

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|10.12 |  | 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].**                                                                  
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.13 |  | 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].**                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.14 |  | 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].**                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.15 |  | 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].**                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.16 |  | 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].                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.17 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.18 |  | 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].                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.19 |  | 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].                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.20 |  | 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].                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.21 |  | 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].                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.22 |  | 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].                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.23 |  | 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].**                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.24 |  | 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].**                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.25 |  | 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].**                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.26 |  | 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].**                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                   
|10.27 |  | 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].                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                   

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|10.28 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.29 |  | 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
      10.2 to the registrants current report on Form 8-K filed on February 6,
      2009].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.30 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.31 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.32 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.33 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.34 |  | 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].                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.35 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.36 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.37 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.38 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.39 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.40 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.41 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10.42 |  | 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].                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

---

|            |  |            
|----------- |  | -----------
|Exhibit No. |  | Description
|            |  |            

|      |  |                                                                                                                                                                                                                                                                                                                                                          
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.43 |  | 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].                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.44 |  | 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].                     
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.45 |  | 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].                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.46 |  | 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].
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.47 |  | 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].                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.48 |  | 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].                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.49 |  | 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].              
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|10.50 |  | 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].            
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|21    |  | Subsidiaries of the Company.*                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|23.1  |  | Consent of Simon & Edwards, LLP, Independent
      Registered Public Accounting Firm.*                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                          
|23.2  |  | Consent of  BDO China Li Xin Da
      Hua CPAs 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.

---

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

|                                                                                 |  | Page          | 
|-------------------------------------------------------------------------------- |  | ------------- | 
|Report of Independent Registered
      Public Accounting Firm                    |  | F-2
     F-3 | 
|Consolidated Balance Sheets                                                      |  | F-4           | 
|Consolidated Statements of
      Operations and Comprehensive Income             |  | F-5           | 
|Consolidated Statements of Changes in Stockholders
      Equity                 |  | F-6           | 
|Consolidated Statements of Cash
      Flows                                      |  | F-7  F-8     | 
|Notes to Consolidated Statements                                                 |  | F-9  F-39    | 
|Consolidated Financial Statement
    Schedule: Valuation and Qualifying Accounts |  | Schedule II   | 
|                                                                                 |  |               | 

F-1

---

Simon &
          Edward, LLPCertified Public Accountants & Consultants
          A PCAOB Registered CPA Firm
          17700 Castleton
          Street, Suite 200City of
          Industry, CA 91748, U.S.ATel: +1 (626) 854]6500Fax: +1 (626) 854]6505http://www.2mycpa.com


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and 
      China TransInfo Technology Corp.
      Gentlemen:
      We have audited the accompanying consolidated balance
      sheet of China TransInfo Technology Corp. and subsidiaries (the "Company")
      as of December 31, 2008, and the related consolidated statements of
      operations, stockholders equity, and cash flows for the year ended
      December 31, 2008. These consolidated financial statements are the
      responsibility of the Companys management. Our responsibility is to
      express an opinion on these consolidated financial statements based on our
      audit.
      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 audit 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 also 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
      consolidated financial position of China TransInfo Technology Corp. and
      subsidiaries as of December 31, 2008, and the consolidated results of its
      operations and its cash flows for the year ended December 31, 2008 in
      conformity with accounting principles generally accepted in the United
      States of America.
      Simon & Edward, LLP
      City of Industry, California 
      March 14, 2009


F-2

---

|                                         | 
|---------------------------------------- | 
|                                         | 
|11th Floor B Block
    Union Square 5022
|Binhe Road
    Shenzhen 518033P.R.China 
|TelephoneF+86-755-82900952              
|FaxF+86-755-82900965                    
|BDO China Li
    Xin Da Hua CPA CO.,Ltd. | 



Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of 
China TransInfo Technology Corp. and Subsidiaries:

We have audited the accompanying consolidated balance sheet
of China TransInfo Technology Corp. and Subsidiaries (the "Company") as of
December 31, 2009 and the related consolidated statements of income,
shareholders equity, and cash flows for the year ended December 31, 2009. In
connection with our audit of the financial statements, we have also audited the
financial statement schedule listed in the accompanying index as of and for the
year ended December 31, 2009. These financial statements and schedule are the
responsibility of the Companys management. Our responsibility is to express an
opinion on these financial statements based on our audit. The financial
statements of China TransInfo Technology Corp. and Subsidiaries as of December
31, 2008 and for year ended December 31, 2008 were audited by other auditors
whose report dated March 14, 2009, expressed an unqualified opinion on those
statements.

We conducted our audit 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 also
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 audit provides 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 the Company at December 31, 2009, and the results of its operations
and its cash flows for the year ended December 31, 2009, in conformity with
accounting principles generally accepted in the United States of America.

Also, in our opinion, the financial statement schedule, when
considered in relation to the basic consolidated financial statements taken as a
whole, present fairly, in all material respects, the information set forth
therein.

BDO China Li Xin Da Hua CPAs Co., Ltd. 
Shenzhen, Peoples Republic of China 
March 31, 2010

F-3

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                     |   | December 31 | 
|---------------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------- | 
|                                                                                                                                                     |   | 2009        | 
|                                                                                                                                                     |   |             | 
|ASSETS                                                                                                                                               |   |             | 
|Current Assets:                                                                                                                                      |   |             | 
|Cash and cash equivalents                                                                                                                            | $ | 27,400,420  | 
|Restricted cash                                                                                                                                      |   | 1,591,076   | 
|Accounts receivable, net of allowance for doubtful accounts
      of $38,209 and $32,439, respectively                                               |   | 14,968,778  | 
|Inventory                                                                                                                                            |   | 482,286     | 
|Cost and estimated earnings in excess of billings on
      incompleted contracts                                                                     |   | 33,853,708  | 
|Prepayments                                                                                                                                          |   | 5,871,997   | 
|Other receivables                                                                                                                                    |   | 8,416,096   | 
|Deferred tax
      assets                                                                                                                            |   | 28,715      | 
|Total current assets                                                                                                                                 |   | 92,613,076  | 
|                                                                                                                                                     |   |             | 
|Long-term investments                                                                                                                                |   | 8,027,122   | 
|Property and equipment, net                                                                                                                          |   | 10,541,486  | 
|Intangible assets, net                                                                                                                               |   | 4,494,781   | 
|Goodwill                                                                                                                                             |   | 9,979,631   | 
|Other assets                                                                                                                                         |   | 826,671     | 
|                                                                                                                                                     |   |             | 
|Total assets                                                                                                                                         | $ | 126,482,767 | 
|                                                                                                                                                     |   |             | 
|LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                                 |   |             | 
|Current Liabilities:                                                                                                                                 |   |             | 
|Accounts payable                                                                                                                                     | $ | 20,728,539  | 
|Short-term
      borrowings from banks                                                                                                               |   | 7,481,700   | 
|Loans payable to related parties                                                                                                                     |   | -           | 
|Billings in excess of costs and estimated
      earnings on incompleted contracts                                                                    |   | 17,021,936  | 
|Accrued liabilities and other
      current liabilities                                                                                              |   | 3,022,140   | 
|Total current liabilities                                                                                                                            |   | 48,254,315  | 
|                                                                                                                                                     |   |             | 
|Other long-term liability                                                                                                                            |   | 389,489     | 
|Total liabilities                                                                                                                                    |   | 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 , 22,452,745 and 22,187,314 issued and outstanding,
      respectively |   | 22,453      | 
|Additional paid-in capital                                                                                                                           |   | 25,253,666  | 
|Retained earnings                                                                                                                                    |   | 31,948,323  | 
|Noncontrolling interests                                                                                                                             |   | 18,499,475  | 
|Accumulated other comprehensive income                                                                                                               |   | 2,115,046   | 
|                                                                                                                                                     |   |             | 
|Total stockholders' equity                                                                                                                           |   | 77,838,963  | 
|                                                                                                                                                     |   |             | 
|Total liabilities and stockholders' equity                                                                                                           | $ | 126,482,767 | 

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

F-4

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

|                                                                                                         |   | 2009       |   |   | 2008       |  
|-------------------------------------------------------------------------------------------------------- | - | ---------- | - | - | ---------- | -
|                                                                                                         |   |            |   |   |            |  
|Revenues                                                                                                 | $ | 63,686,121 |   | $ | 29,370,463 |  
|Cost of sales                                                                                            |   | 38,310,183 |   |   | 12,867,258 |  
|Gross profit                                                                                             |   | 25,375,938 |   |   | 16,503,205 |  
|Selling, general and administrative expenses                                                             |   | 11,667,895 |   |   | 5,081,502  |  
|Income from operations                                                                                   |   | 13,708,043 |   |   | 11,421,703 |  
|Other income (expense):                                                                                  |   |            |   |   |            |  
|Interest income                                                                                          |   | 109,744    |   |   | 68,782     |  
|Interest expense                                                                                         |   | (244,574   | ) |   | (135,120   | )
|Subsidy income                                                                                           |   | 1,730,291  |   |   | 530,100    |  
|Other income - net                                                                                       |   | 91,439     |   |   | 32,168     |  
|Total other income                                                                                       |   | 1,686,900  |   |   | 495,930    |  
|Income before income taxes, noncontrolling interests, and
      gain on equity investments in affiliates |   | 15,394,943 |   |   | 11,917,633 |  
|Income tax expense                                                                                       |   | 677,355    |   |   | 62,955     |  
|Net income before noncontrolling interests and gain on
      equity investments in affiliates            |   | 14,717,588 |   |   | 11,854,678 |  
|Gain on equity investments in affiliates
      due to proportional shares of the affiliates net income   |   | 1,793,387  |   |   | -          |  
|Net income before noncontrolling interests                                                               |   | 16,510,975 |   |   | 11,854,678 |  
|Noncontrolling interests in net
      income of subsidiary                                               |   | 3,536,876  |   |   | 764,201    |  
|Net income - controlling interests                                                                       | $ | 12,974,099 |   | $ | 11,090,477 |  
|Weighted average number of common
      shares of outstanding -                                          |   |            |   |   |            |  
|Basic                                                                                                    |   | 22,333,765 |   |   | 20,678,693 |  
|Diluted                                                                                                  |   | 22,505,641 |   |   | 20,883,951 |  
|Earnings per share -                                                                                     |   |            |   |   |            |  
|Basic                                                                                                    | $ | 0.58       |   | $ | 0.54       |  
|Diluted                                                                                                  | $ | 0.58       |   | $ | 0.53       |  

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

F-5

---

CHINATRANSINFOTECHNOLOGYCORP.ANDSUBSIDIARIES 
CONSOLIDATEDSTATEMENTSOFCHANGESINSTOCKHOLDERSEQUITY

|                                                                                                               |  | Common Stock |  |   | Additional |  |   | Retained        |   |   | Accumulated Other |  |   | Noncontrolling       |   |   | Total Stockholders' |  
|-------------------------------------------------------------------------------------------------------------- |  | ------------ |  | - | ---------- |  | - | --------------- | - | - | ----------------- |  | - | -------------------- | - | - | ------------------- | -
|                                                                                                               |  | Shares       |  |   | Amount     |  |   | Paid-In Capital |   |   | Earnings          |  |   | Comprehensive Income |   |   | Interest            |  
|                                                                                                               |  |              |  |   |            |  |   |                 |   |   |                   |  |   |                      |   |   |                     |  
|Balance, January 1, 2008                                                                                       |  | 19,601,107   |  | $ | 19,601     |  | $ | 10,905,114      |   | $ | 7,883,747         |  | $ | 887,184              |   | $ | 655,876             |  
|Issuances of common Stock                                                                                      |  | 2,586,207    |  |   | 2,586      |  |   | 14,997,414      |   |   |                   |  |   |                      |   |   |                     |  
|Paid transaction cost debit to APIC                                                                            |  |              |  |   |            |  |   | (1,794,660      | ) |   |                   |  |   |                      |   |   |                     |  
|Stock-based compensation                                                                                       |  |              |  |   |            |  |   | 217,756         |   |   |                   |  |   |                      |   |   |                     |  
|Effect of subsidiary equity
      transactions                                                                 |  |              |  |   |            |  |   | 329,266         |   |   |                   |  |   |                      |   |   | (329,266            | )
|Increase in noncontrolling interest of newly acquired
      subsidiaries                                       |  |              |  |   |            |  |   |                 |   |   |                   |  |   |                      |   |   | 374,932             |  
|Translation adjustments                                                                                        |  |              |  |   |            |  |   |                 |   |   |                   |  |   | 1,612,709            |   |   |                     |  
|Net income                                                                                                     |  |              |  |   |            |  |   |                 |   |   | 11,090,477        |  |   |                      |   |   | 764,201             |  
|Balance, January 1, 2009                                                                                       |  | 22,187,314   |  |   | 22,187     |  |   | 24,654,890      |   |   | 18,974,224        |  |   | 2,499,893            |   |   | 1,465,743           |  
|Reduction of noncontrolling interest due to restructuring                                                      |  |              |  |   |            |  |   | 126,078         |   |   |                   |  |   |                      |   |   | (126,078            | )
|Paid transaction cost debit to APIC                                                                            |  |              |  |   |            |  |   | (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         |   |   |                   |  |   |                      |   |   |                     |  
|Increase in noncontrolling interest of
      newly acquired subsidiaries including a subsidiary's subsidiaries |  |              |  |   |            |  |   |                 |   |   |                   |  |   |                      |   |   | 13,740,228          |  
|Minority shareholder's capital contribution pursuant to
      capital increase in subsidiaries                 |  |              |  |   |            |  |   |                 |   |   |                   |  |   |                      |   |   | 87,960              |  
|Cash dividends distributed by
      subsidiary of subsidiary                                                   |  |              |  |   |            |  |   |                 |   |   |                   |  |   |                      |   |   | (205,254            | )
|Translation adjustments                                                                                        |  |              |  |   |            |  |   |                 |   |   |                   |  |   | (384,847             | ) |   |                     |  
|Net income                                                                                                     |  |              |  |   |            |  |   |                 |   |   | 12,974,099        |  |   |                      |   |   | 3,536,876           |  
|Balance, December 31, 2009                                                                                     |  | 22,452,745   |  | $ | 22,453     |  | $ | 25,253,666      |   | $ | 31,948,323        |  | $ | 2,115,046            |   | $ | 18,499,475          |  

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

F-6

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                       |   | 2009        |   |   | 2008       |  
|------------------------------------------------------------------------------------------------------ | - | ----------- | - | - | ---------- | -
|                                                                                                       |   |             |   |   |            |  
|Cash flows from operating
      activities:                                                            |   |             |   |   |            |  
|Net income, including noncontrolling interest                                                          | $ | 12,974,099  |   | $ | 11,090,477 |  
|Adjustments to reconcile net income to net
      cash provided by operating activities:                |   |             |   |   |            |  
|Non-controlling
      interests                                                                        |   | 3,536,876   |   |   | 764,201    |  
|Depreciation and amortization expenses                                                                 |   | 1,320,031   |   |   | 200,746    |  
|Stock-based
      compensation                                                                         |   | 505,464     |   |   | 217,756    |  
|Gain on equity investments in affiliates
      due to proportional shares of the affiliates net income |   | (1,793,387  | ) |   | -          |  
|Loss on
      disposal of property and equipment                                                       |   | 9,164       |   |   | 11,747     |  
|Allowance for doubtful accounts                                                                        |   | 5,767       |   |   | 31,571     |  
|Deferred
      income tax                                                                              |   | 189,586     |   |   | 55,531     |  
|(Increase) Decrease in assets:                                                                         |   |             |   |   |            |  
|Restricted cash                                                                                        |   | 634,402     |   |   | (932,126   | )
|Accounts receivable                                                                                    |   | (1,793,525  | ) |   | (2,634,838 | )
|Inventory                                                                                              |   | (414,369    | ) |   | 185,993    |  
|Prepayments                                                                                            |   | 3,944,172   |   |   | (1,035,964 | )
|Other receivables                                                                                      |   | (1,169,751  | ) |   | (1,617,519 | )
|Cost and estimated earnings in excess of
      billings on uncompleted contracts                       |   | (16,350,203 | ) |   | (8,088,233 | )
|Other assets                                                                                           |   | (678,646    | ) |   | (147,489   | )
|Decrease (Increase) in liabilities:                                                                    |   |             |   |   |            |  
|Accounts payable                                                                                       |   | 3,687,044   |   |   | 4,471,898  |  
|Billings in excess of costs and estimated
      earnings on uncompleted contracts                      |   | 3,974,128   |   |   | (613,988   | )
|Accrued liabilities and other current
      liabilities                                                |   | 242,993     |   |   | 548,815    |  
|Net cash provided by
      operating activities                                                        |   | 8,823,845   |   |   | 2,508,578  |  

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

F-7

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Continued:

|                                                                           |   | 2009       |   |   | 2008        |  
|-------------------------------------------------------------------------- | - | ---------- | - | - | ----------- | -
|Cash flows from investing
      activities:                                |   |            |   |   |             |  
|Cash from acquisitions                                                     | $ | 12,210,500 |   | $ | 294,872     |  
|Proceeds from
      disposal of property and equipment                     |   | 5,412      |   |   | 26,072      |  
|Refund from prepayment of
      building                                   |   | 1,217,457  |   |   | -           |  
|Purchases of
      property and equipment                                  |   | (2,669,035 | ) |   | (6,547,901  | )
|Payments for acquisition of
      companies                                |   | (6,545,403 | ) |   | (2,702,813  | )
|Purchases of
      intangible assets                                       |   | (2,543,933 | ) |   | (1,324,577  | )
|Net cash provided by (used in) investing activities                        |   | 1,674,998  |   |   | (10,254,347 | )
|                                                                           |   |            |   |   |             |  
|Cash flows from financing activities:                                      |   |            |   |   |             |  
|Proceeds from
      short-term borrowings                                  |   | 4,398,300  |   |   | 2,883,000   |  
|Payable for acquiring
      subsidiary                                     |   | -          |   |   | 86,490      |  
|Minority
      shareholders' capital contribution                          |   | 87,960     |   |   | 300,775     |  
|Payment of dividends from
      subsidiaries' and variable interest entity |   | (2,791,434 | ) |   | -           |  
|Proceeds from
      issuing shares                                         |   | -          |   |   | 15,000,000  |  
|Payments of transaction costs
      related shares issuance                |   | (32,500    | ) |   | (1,794,660  | )
|Proceeds from
      (payments to) related parties                          |   | (528,161   | ) |   | 250,859     |  
|Net cash provided by financing activities                                  |   | 1,134,165  |   |   | 16,726,464  |  
|                                                                           |   |            |   |   |             |  
|Effect of foreign currency exchange translation                            |   | (355,052   | ) |   | 299,531     |  
|                                                                           |   |            |   |   |             |  
|Net increase in cash                                                       |   | 11,277,956 |   |   | 9,280,226   |  
|                                                                           |   |            |   |   |             |  
|Cash and cash equivalents - beginning                                      |   | 16,122,464 |   |   | 6,842,238   |  
|Cash and cash equivalents - ending                                         | $ | 27,400,420 |   | $ | 16,122,464  |  
|                                                                           |   |            |   |   |             |  
|Supplemental disclosures:                                                  |   |            |   |   |             |  
|Interest paid                                                              | $ | 228,899    |   | $ | 135,120     |  
|Income taxes
      paid                                                    | $ | 21,819     |   | $ | 847         |  

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

F-8

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of BusinessChina TransInfo Technology Corp., or the Company, we, or us, was originally incorporated in Nevada on August 3, 1998, under the name R & R Ranching, Inc. to breed bison. In about 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., or 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, or PKU, to the Companys indirect Chinese subsidiary Oriental Intra-Asia Entertainment (China) Limited, or
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,or 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, or 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, the Company has the following operating variable interest entities:

- Beijing Tian Hao Ding Xin Science and Technology Co., Ltd., or 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., or 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., or 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.
- Shanghai Yootu Information Technology Co., Ltd., or 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.

F-9

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

- Xinjiang Zhangcheng Science and Technology Co., Ltd., or Xinjiang Zhangcheng, was established on January 25, 2008 with registered capital of RMB 10 million (approximately $1.46 million). Xinjiang Zhangcheng is mainly engaged in taxi media
advertising business.
- China TranWiseway Technology Co., Ltd., or 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.
- Dalian Dajian Zhitong Information Service Ltd., or Dajian Zhitong, was established on June 9, 2006 with registered capital of RMB 1 million (approximately $0.15 million). Dalian Dajian is mainly engaged in taxi media advertising business.

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., or UNISITS from Unisplendour Corporation Limited, or
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., or 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.

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.

Principles of ConsolidationThe consolidated financial statements include the accounts of the Company, it's 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, Dajian Zhitong, Shanghai Yootu, UNISITS, Hangzhou Ziguang Jietong Technology Co., Ltd., Hangzhou UNISITS, Henan Ziguang Jietong Technology Co., Ltd., or Henan UNISITS, and Beijing Ziguang Jinzhidun Information
Technology Co., Ltd., or 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).

F-10

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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.

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;

F-11

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

- 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 FASB Interpretation No. 46R Consolidation of Variable Interest Entities (ASC Topic 810 Consolidation), 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.

The following charts reflect our organizational structure as of December 31, 2009 and 2008, respectively:

F-12

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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



F-13

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Organizational Structure of the Company, as of December 31, 2008



F-14

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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 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.

F-15

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

1) Existing Technology

China TranWiseway, one of the Companys VIE entities, internally developed the Traffic Volume Long-Distance Monitoring and Data Center Platform technology. The useful life of the technology is estimated at 10 years.

(2) ETC and GPS Technologies

The Company purchased software from third parties for total cash consideration of $1,184,057. This software was integrated into an Electrical Toll collection, or ETC, non-stop toll system and GPS technology. The Company plans to distribute fully
integrated ETC systems with both hardware and software included. The estimated useful life of the technology is for 10 years.

As of December 31, 2009, the Company capitalized research and development costs of $2,676,054 after establishing technical feasibilities for its real time traffic information application software (GPS Technology). Amortization of the real time
traffic information technology will not start until the application is completely developed.

(3) Highway Monitoring and Control Technology

UNSITS, a VIE entity of the Company, possesses the Highway Monitoring and Control technology. The Company amortizes such asset on a straight-line basis over 10 years.

(4) Contract Backlogs

UNISITS has certain intangible assets relating to earnings-generating service contracts that were independently valuated as an intangible asset for the equity acquisition purposes. The Company amortizes such asset on a straight-line basis over 2
years.

The company completed the annual impairment testing for indefinite-lived intangible assets during the twelve months ended December 31, 2009 and 2008, 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, 2009 and 2008. 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.

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.

F-16

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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 were 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, 2009 and 2008, research and development expenses were capitalized in the amount of $2,126,399 and $833,281 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 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. During 2008, we granted both stock options as part of our key performer stock-based compensation program. 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 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 2009, 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, 2009, our annualized estimated forfeiture rates were 0% for non-employee director awards and 15-20% 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.

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.

F-17

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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 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 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, 2009, the Company believed no goodwill was subject to the risk of impairment.

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.

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, 2009 and 2008, bad debt expenses totaled $5,767 and $31,571, respectively.

F-18

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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,             |   | 2009                            | 
|Renminbi (RMB)           |   | RMB 1.00                        | 
|United States dollar ($) | $ | 0.14661                         | 
|                         |   |                                 | 
|                         |   | Exchange Rate at                | 
|December 31,             |   | 2009                            | 
|Renminbi (RMB)           |   | RMB 1.00                        | 
|United States dollar ($) | $ | 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, 2009, 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, 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        |  |   | -           |  |   | -            | 
|Long-term investments     |   | 8,027,122    |  |   | -                |  |   | -           |  |   | 8,027,122    | 
|Total                     | $ | 37,018,618   |  | $ | 28,991,496       |  | $ | -           |  | $ | 8,027,122    | 

F-19

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Financial assets at fair value as of December 31, 2008:

|                          |   |              |  |   |                  |  |   | Significant |  |   |              | 
|------------------------- | - | ------------ |  | - | ---------------- |  | - | ----------- |  | - | ------------ | 
|                          |   |              |  |   |                  |  |   | Other       |  |   | Significant  | 
|                          |   |              |  |   | Quoted Prices in |  |   | Observable  |  |   | Unobservable | 
|                          |   | December 31, |  |   | Active Markets   |  |   | Inputs      |  |   | Inputs       | 
|Description               |   | 2008         |  |   | (Level 1)        |  |   | (Level 2    |  |   | (Level 3     | 
|Cash and cash equivalents | $ | 16,122,464   |  | $ | 16,122,464       |  | $ | -           |  | $ | -            | 
|Restricted cash           |   | 1,209,542    |  |   | 1,209,542        |  |   | -           |  |   | -            | 
|Total                     | $ | 17,332,006   |  | $ | 17,332,006       |  | $ | -           |  | $ | -            | 

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 2007, the FASB issued ASC 810-10-65, Consolidation,
which applies to all companies that prepare consolidated financial statements,
except not-for-profit organizations, but will affect only those entities that
have an outstanding noncontrolling interest in one or more subsidiaries or that
deconsolidate a subsidiary. ASC 810-10-65 is effective for us on January 1,
2009. Earlier adoption is prohibited. We adopted ASC 810-10-65 on January 1,
2009 and the adoption of ASC 810-10-65 did not have a material impact on our
results of operations or financial position.

In May 2009, the FASB issued ASC 855, Subsequent Events. ASC
855 establishes general standards of accounting for and disclosure of events
that occur after the balance sheet date but before financial statements are
issued or are available to be issued. The standard, which includes a new
required disclosure of the date through which an entity has evaluated subsequent
events, is effective for interim or annual periods ending after June 15, 2009.

In April 2009, the FASB issued three related staff positions to
clarify the application of FASB ASC 820 to fair value measurements in the
current economic environment, modify the recognition of other-than-temporary
impairments of debt securities, and require companies to disclose the fair value
of financial instruments in interim periods. The final staff positions are
effective for interim and annual periods ending after June 15, 2009.

- FASB ASC 820 (Transitional 820-10-65-4)which provides guidance on how to
  determine the fair value of assets and liabilities under FASB ASC 820 in the
  current economic environment and reemphasizes that the objective of a fair
  value measurement remains the price that would be received to sell an asset or
  paid to transfer a liability at the measurement date.
- FASB ASC 320which modifies the requirements for recognizing
  other-than-temporarily impaired debt securities and significantly changes the
  existing impairment model for such securities. It also modifies the
  presentation of other-than-temporary impairment losses and increases the
  frequency of and expands already required disclosures about
  other-than-temporary impairment for debt and equity securities.
- FASB ASC 820-10-50which requires disclosures of the fair value of
  financial instruments within the scope of FASB ASC 820 in interim financial
  statements, adding to the current requirement to make those disclosures in
  annual financial statements. The staff position also requires that companies
  disclose the method or methods and significant assumptions used to estimate
  the fair value of financial instruments and a discussion of changes, if any,
  in the method or methods and significant assumptions during the period.

F-20

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In June 2009, the Financial Accounting Standards Board (FASB) issued its final Statement of Financial Accounting Standards (SFAS) No. 168, The FASB Accounting Standards Codification and the
Hierarchy of Generally Accepted Accounting Principlesa replacement of FASB Statement No. 162 (SFAS No. 168). SFAS No. 168 established the FASB Accounting Standards Codification (ASC)
as the single source of authoritative U.S. GAAP to be applied by nongovernmental entities in the preparation of financial statements. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of
authoritative U.S. GAAP for SEC registrants. All guidance in the ASC carries an equal level of authority. The ASC supersedes all previously existing non-SEC accounting and reporting standards. The ASC simplifies user access to all authoritative U.S.
GAAP by reorganizing previously issued U.S. GAAP pronouncements into approximately 90 accounting topics within a consistent structure, without creating new accounting and reporting guidance. The ASC became effective for financial statements issued
for interim and annual periods ending after September 15, 2009; accordingly, we adopted the ASC in the third quarter of fiscal 2009. Following SFAS No. 168, the FASB will not issue new standards in the form of Statements, FASB Staff Positions, or
Emerging Issues Task Force Abstracts; instead, it will issue Accounting Standards Updates. The FASB will not consider Accounting Standards Updates as authoritative in their own right; these updates will serve only to update the ASC, provide
background information about the guidance, and provide the bases for conclusions on the change(s) in the ASC. For the discussion herein, we refer to ASC citations that relate to ASC Topics and their descriptive titles, as appropriate, and no longer
refer to citations that relate to accounting pronouncements superseded by the ASC.

In June 2009, the FASB issued ASC 860, which eliminates the concept of a qualifying special-purpose entity, creates more stringent conditions for reporting a transfer of a portion of a financial asset as a sale, clarifies other sale-accounting
criteria, and changes the initial measurement of a transferors interest in transferred financial assets. FASB ASC 860 will be effective for transfers of financial assets in fiscal years beginning after November 15, 2009 and in interim periods
within those fiscal years with earlier adoption prohibited. We will adopt FASB ASC 860 on January 1, 2010.

In September 2009, the FASB issued new accounting guidance related to the revenue recognition of multiple element arrangements. The new guidance states that if vendor specific objective evidence or third party evidence for deliverables in an
arrangement cannot be determined, companies will be required to develop a best estimate of the selling price to separate deliverables and allocate arrangement consideration using the relative selling price method. The accounting guidance will be
applied prospectively and will become effective during the first quarter of 2011. Early adoption is allowed. The Company will adopt this guidance beginning January 1, 2010 and the Company does not expect this accounting guidance to materially impact
the Companys consolidated financial statements.

In January 2010, the FASB issued new accounting guidance related to the disclosure requirements for fair value measurements and provides clarification for existing disclosures requirements. More specifically, this update will require (a) an entity
to disclose separately the amounts of significant transfers in and out of Levels 1 and 2 fair value measurements and to describe the reasons for the transfers; and (b) information about purchases, sales, issuances and settlements to be presented
separately (i.e. present the activity on a gross basis rather than net) in the reconciliation for fair value measurements using significant unobservable inputs (Level 3 inputs). This guidance clarifies existing disclosure requirements for the level
of disaggregation used for classes of assets and liabilities measured at fair value and requires disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements using Level
2 and Level 3 inputs. The new disclosures and clarifications of existing disclosure are effective for fiscal years beginning after December 15, 2009, except for the disclosure requirements for related to the purchases, sales, issuances and
settlements in the rollforward activity of Level 3 fair value measurements. Those disclosure requirements are effective for fiscal years ending after December 31, 2010. The Company does not believe the adoption of this guidance will have a material
impact to the Companys consolidated financial statements.

In August 2009, the FASB issued ASU 2009-05, which provides additional guidance under the Fair Value Measurements and Disclosures Topic, ASC 820-10 Application to Liabilities. The guidance clarifies that the quoted price for the liability when
traded as an asset in an active market is a Level 1 measurement, when no adjustment to the quoted price is required. In the absence of a Level 1 (quoted price) measurement, an entity must use one or more valuation techniques to estimate fair value
in a manner consistent with the principles in ASC 820. We do not expect adoption of this guidance to have an impact on the Companys consolidated financial statements.

F-21

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In October 2009, the FASB issued an ASU regarding accounting for own-share lending arrangements in contemplation of convertible debt issuance or other financing. This ASU requires that at the date of issuance of the shares in a share-lending
arrangement entered into in contemplation of a convertible debt offering or other financing, the shares issued shall be measured at fair value and be recognized as an issuance cost, with an offset to additional paid-in capital. Further, loaned
shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs, at which time the loaned shares would be included in the basic and diluted earnings-per-share calculation. This ASU is effective
for fiscal years beginning on or after December 15, 2009, and interim periods within those fiscal years for arrangements outstanding as of the beginning of those fiscal years. The adoption of this guidance did not have a material impact on our
consolidated financial statements .

In October 2009, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2009-13, Multiple-Deliverable Revenue Arrangements (Topic 605), or ASU 2009-13. ASU 2009-13 amends existing revenue recognition accounting
pronouncements that are currently within the scope of Accounting Standards Codification (ASC) Subtopic 605-25. The consensus in ASU 2009-13 provides accounting principles and application guidance on whether multiple deliverables exist, how the
arrangement should be separated, and the consideration allocated. This guidance eliminates the requirement to establish the fair value of undelivered products and services and instead provides for separate revenue recognition based upon management's
estimate of the selling price for an undelivered item when there is no other means to determine the fair value of that undelivered item. The present standard requires that the fair value of the undelivered item be the price of the item either sold
in a separate transaction between unrelated third parties or the price charged for each item when the item is sold separately by the vendor. This was difficult to determine when the product was not individually sold because of its unique features.
In addition, if the fair value of all of the elements in the arrangement was not determinable, then revenue was deferred until all of the items were delivered or fair value was determined. This new approach is effective prospectively for revenue
arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. The Company does not believe this standard will have a material impact on its financial position or results of operations.

In October 2009, the FASB issued ASU 2009-14 which amended the accounting requirements under the Software Topic, ASC 985-605 Revenue Recognition. The objective of this update is to address the accounting for revenue arrangements that contain
tangible products and software. Specifically, products that contain software that is more than incidental to the product as a whole will be removed from the scope of ASC subtopic 985-605. The amendments align the accounting for these
revenue transaction types with the amendments under ASU 2009-13 mentioned above. The guidance provided within ASU 2009-14 is effective for fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective
application, with early adoption permitted. We are currently evaluating the impact that adoption of this guidance will have on our consolidated financial statements.

In October 2009, the FASB issued an ASU 2009-15 regarding accounting for own-share lending arrangements in contemplation of convertible debt issuance or other financing. This ASU requires that at the date of issuance of the shares in a share-lending
arrangement entered into in contemplation of a convertible debt offering or other financing, the shares issued shall be measured at fair value and be recognized as an issuance cost, with an offset to additional paid-in capital. Further, loaned
shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs, at which time the loaned shares would be included in the basic and diluted earnings-per-share calculation. This ASU is effective
for fiscal years beginning on or after December 15, 2009, and interim periods within those fiscal years for arrangements outstanding as of the beginning of those fiscal years. The adoption of this guidance did not have a material impact on our
consolidated financial statements .

2. RESTRICTED CASH

The Companys restricted cash balances at December 31, 2009 and 2008 were $1,591,076 and $1,209,542, 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.

F-22

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

3. COSTS AND ESTIMATED EARNINGS ON INCOMPLETED CONTRACTS

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

|                                              |   | December 31, |  
|--------------------------------------------- | - | ------------ | -
|                                              |   | 2009         |  
|Costs incurred on incompleted
      contracts | $ | 85,079,704   |  
|Estimated earnings on incompleted contracts   |   | 43,918,724   |  
|                                              |   | 128,998,428  |  
|Less: billings to date                        |   | (112,166,656 | )
|Total                                         | $ | 16,831,772   |  

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

|                                                                                  |   | December 31, |  
|--------------------------------------------------------------------------------- | - | ------------ | -
|                                                                                  |   | 2009         |  
|Costs and estimated earnings in excess of
      billings on incompleted contracts | $ | 33,853,708   |  
|Billings in excess of costs and estimated earnings on
      incompleted contracts |   | (17,021,936  | )
|                                                                                  |   |              |  
|Total                                                                             | $ | 16,831,772   |  

4. OTHER RECEIVABLES

Other receivables consisted of the following as of December 31,
2009 and 2008:

|                           |   | December 31, | 
|-------------------------- | - | ------------ | 
|                           |   | 2009         | 
|Contract bidding bonds     | $ | 3,596,086    | 
|Contract performance bonds |   | 3,454,112    | 
|Other receivables          |   | 1,365,898    | 
|Total                      | $ | 8,416,096    | 

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.

F-23

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

5. LONG-TERM INVESTMENTS

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

|       |  |          |  | December 31, 2009
|------ |  | -------- |  | -----------------
|       |  |          |  | Equity           
|       |  | Equity   |  | Investment       
|Type   |  | Investee |  | Ownership        
|Equity |  | Gansu    |  | 33.33%           
|Equity |  | Shanxi   |  | 49.00%           
|Equity |  | ZJUNIS   |  | 30.00%           
|Equity |  | BOTTC    |  | 23.17%           
|Equity |  | CQJK     |  | 49.00%           
|Cost   |  | Shandong |  | 5.00%            
|Cost   |  | ZGYM     |  | 15.00%           

Equity and cost investments in affiliates as of December 31,
2009 consisted of the following:

|       |  |          |  |   |            |  |   |             |  |   | Proportional |  |   |             |  |   |                | 
|------ |  | -------- |  | - | ---------- |  | - | ----------- |  | - | ------------ |  | - | ----------- |  | - | -------------- | 
|       |  |          |  |   |            |  |   |             |  |   | Share of the |  |   |             |  |   |                | 
|       |  |          |  |   | Beginning  |  |   |             |  |   | Equity-      |  |   |             |  |   |                | 
|       |  |          |  |   | Equity     |  |   |             |  |   | Accounted    |  |   | Foreign     |  |   |                | 
|       |  |          |  |   | Investment |  |   |             |  |   | Affiliates  |  |   | Currency    |  |   | Ending Equity  | 
|       |  | Equity   |  |   | Basis      |  |   | Purchase of |  |   | Net          |  |   | Translation |  |   | Investment     | 
|Type   |  | Investee |  |   | 12/31/08   |  |   | Investments |  |   | Income       |  |   | Adjustment  |  |   | Basis 12/31/09 | 
|Equity |  | Gansu    |  | $ | -          |  | $ | 5,699,419   |  | $ | 1,560,849    |  | $ | 959         |  | $ | 7,261,227      | 
|Equity |  | Shanxi   |  |   | -          |  |   | 162,075     |  |   | 42,870       |  |   | 26          |  |   | 204,971        | 
|Equity |  | ZJUNIS   |  |   | -          |  |   | 152,911     |  |   | 54,224       |  |   | 33          |  |   | 207,168        | 
|Equity |  | BOTTC    |  |   | -          |  |   | 50,257      |  |   | 135,444      |  |   | 83          |  |   | 185,784        | 
|Equity |  | CQJK     |  |   | -          |  |   | 35,942      |  |   | -            |  |   |             |  |   | 35,942         | 
|Cost   |  | Shandong |  |   | -          |  |   | 110,025     |  |   | -            |  |   |             |  |   | 110,025        | 
|Cost   |  | ZGYM     |  |   | -          |  |   | 22,005      |  |   | -            |  |   |             |  |   | 22,005         | 
|Total  |  |          |  | $ | -          |  | $ | 6,232,634   |  | $ | 1,793,387    |  | $ | 1,101       |  | $ | 8,027,122      | 

Critical audited financial information of significant equity
investment in affiliates as of and for the year ended December 31, 2009 is as
follows:

|December 31, 2009         |   | Gaunsu     |  |  |                        |  |   | Gaunsu     | 
|------------------------- | - | ---------- |  |  | ---------------------- |  | - | ---------- | 
|Total current assets      | $ | 34,579,757 |  |  | Net sales              |  | $ | 20,350,731 | 
|Total assets              |   | 38,151,264 |  |  | Gross Profit           |  |   | 5,442,659  | 
|Total current liabilities |   | 16,343,351 |  |  | Income from operations |  |   | 4,684,724  | 
|Total liabilities         | $ | 16,365,356 |  |  | Net income             |  | $ | 4,,683,015 | 

F-24

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

6. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

|                                  |   | December 31, |  
|--------------------------------- | - | ------------ | -
|                                  |   | 2009         |  
|Automobiles                       | $ | 1,180,013    |  
|Machinery and equipments          |   | 9,199,526    |  
|Furniture and fixtures            |   | 295,548      |  
|Leasehold improvement             |   | 835,434      |  
|Prepayment for building           |   | -            |  
|Work-in-progress                  |   | 565,373      |  
|Total                             |   | 12,075,894   |  
|Less: accumulated depreciation    |   | (1,534,408   | )
|Total Property and Equipment, net | $ | 10,541,486   |  

Depreciation expenses during fiscal 2009 and 2008 were
$1,243,518 and $ 178,095 , respectively.

7. INTANGIBLE ASSETS

Intangible assets consisted of the following:

|                               |   | December 31, |  
|------------------------------ | - | ------------ | -
|                               |   | 2009         |  
|                               |   | 4,594,168    |  
|Less: accumulated amortization |   | (99,387      | )
|Intangible assets, net         | $ | 4,494,781    |  

Amortization expenses during fiscal 2009 and 2008 were $76,513
and $22,651, respectively.

Estimated future intangible amortization as of December 31,
2009 for each of the next five years is as follows:

|Years ending December 31, |   | Amount    | 
|------------------------- | - | --------- | 
|2010                      | $ | 266,088   | 
|2011                      |   | 217,218   | 
|2012                      |   | 119,478   | 
|2013                      |   | 119,478   | 
|2014                      |   | 119,381   | 
|Thereafter                |   | 3,653,138 | 
|Total                     | $ | 4,494,781 | 

8. SHORT-TERM BORROWINGS FROM BANKS

Short-term borrowings from banks consisted of the following:

|December 31,                                                                                                                                                                                                                                                                 | 2009    | 2008      
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------- | ----------
|On June 17, 2008, the Company entered into
      a loan agreement with a commercial bank in the amount of RMB 20,000,000,
      or $2,934,000. The loan bears an interest rate of 6.372% per annum. The
      loan was paid off when the agreement expired on June 17, 2009. | $
    - | $2,934,000

|On June 22, 2009, the Company renewed the
      above 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 expires on June 22, 2010.                                     | 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. The loan expires on May 27,
      2010.                                                      | 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 and it expires on September 29,
      2010. | 4,401,000  | -         
|Total                                                                                                                                                                                                                                                                                                                                                                    | $7,481,700 | $2,934,000

For the years ended December 31, 2009 and 2008, interest
expenses totaled $244,574 and $135,120, respectively. The USD ending balances
are calculated based on the average and year-end exchange rates of 0.14661 and
0.1467 for 2009 and 0.14415 and 0.1467 for 2008, respectively.

F-25

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

9. ACQUISITIONS

(1) 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 condensed 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:

|                                             |   | 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-26

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

9. ACQUISITIONS (Continued)

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.

(2) 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 condensed 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            |  

(3) Acquisition of Shanghai Yootu

On October 1, 2008, PKU, the Companys indirectly-owned
subsidiary, entered into an 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
$1,290,960) 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 condensed 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:

F-27

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

9. ACQUISITIONS (Continued)

|                       |   | 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       |  

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.

(4) 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:

F-28

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

9. ACQUISITIONS (Continued)

|                                        |   | 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 years ended December
31, 2009 and 2008, 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.

|                                              |   | 2009       |  |   | 2008       | 
|--------------------------------------------- | - | ---------- |  | - | ---------- | 
|Revenue                                       | $ | 84,473,648 |  | $ | 63,931,607 | 
|Net Income                                    | $ | 13,359,625 |  | $ | 12,915,716 | 
|                                              |   |            |  |   |            | 
|EPS attributable to CTFO common shareholders: |   |            |  |   |            | 
|Basic                                         | $ | 0.60       |  | $ | 0.62       | 
|Diluted                                       | $ | 0.59       |  | $ | 0.62       | 

10. NON-CONTROLLING INTERESTS

Non-controlling interests consisted of the following:

|                      |  |             |  |   |              |  |   |              |  |   | Adjustments/    |   |   |              |  
|--------------------- |  | ----------- |  | - | ------------ |  | - | ------------ |  | - | --------------- | - | - | ------------ | -
|                      |  |             |  |   |              |  |   |              |  |   | Net Income      |   |   |              |  
|                      |  | % of Non-   |  |   | As of        |  |   | 2008         |  |   | of              |   |   | As of        |  
|                      |  | controlling |  |   | December 31, |  |   | Acquisition  |  |   | Non-controlling |   |   | December 31, |  
|Name of Affiliate     |  | Interest    |  |   | 2007         |  |   | (Fair Value) |  |   | Interest        |   |   | 2008         |  
|                      |  |             |  |   |              |  |   |              |  |   |                 |   |   |              |  
|Beijing PKU           |  | 3%          |  | $ | 655,876      |  | $ | -            |  | $ | 532,786         |   | $ | 1,188,662    |  
|China TranWiseway     |  | 30%         |  |   | -            |  |   | 44,444       |  |   | 241,780         |   |   | 286,224      |  
|Dalian Dajian Zhitong |  | 15%         |  |   | -            |  |   | 1,464        |  |   | (10,607         | ) |   | (9,143       | )
|Unisits               |  | 64.83%      |  |   | -            |  |   | -            |  |   | -               |   |   |              |  
|                      |  |             |  |   |              |  |   |              |  |   |                 |   |   |              |  
|Total                 |  |             |  | $ | 655,876      |  | $ | 45,908       |  | $ | 764,201         |   | $ | 1,465,743    |  

F-29

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

10. NON-CONTROLLING INTERESTS (Continued)

|                  |  |             |  |  |              |  |  |              |  |  | Adjustments/    |  |  |              | 
|----------------- |  | ----------- |  |  | ------------ |  |  | ------------ |  |  | --------------- |  |  | ------------ | 
|                  |  |             |  |  |              |  |  |              |  |  | Net Income      |  |  |              | 
|                  |  | % of Non-   |  |  | As of        |  |  | 2009         |  |  | of              |  |  | As of        | 
|                  |  | controlling |  |  | December 31, |  |  | Acquisition  |  |  | Non-controlling |  |  | December 31, | 
|Name of Affiliate |  | Interest    |  |  | 2008         |  |  | (Fair Value) |  |  | Interest        |  |  | 2009         | 

|Beijing PKU           |  | 3%     |  | $ | 1,188,662 |   | $ | -          |  | $ | 247,525   |   | $ | 1,436,187  | 
|--------------------- |  | ------ |  | - | --------- | - | - | ---------- |  | - | --------- | - | - | ---------- | 
|China TranWiseway     |  | 30%    |  |   | 286,224   |   |   | -          |  |   | (1,498    | ) |   | 284,726    | 
|Dalian Dajian Zhitong |  | 15%    |  |   | (9,143    | ) |   | -          |  |   | 42,419    |   |   | 33,276     | 
|Unisits               |  | 64.83% |  |   | -         |   |   | 13,740,228 |  |   | 3,005,058 |   |   | 16,745,286 | 
|                      |  |        |  |   |           |   |   |            |  |   |           |   |   |            | 
|Total                 |  |        |  | $ | 1,465,743 |   | $ | 13,740,228 |  | $ | 3,293,504 |   | $ | 18,499,475 | 

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.

(1) 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%         |  |  | 3.72%             | 
|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.

F-30

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

11. STOCK-BASED COMPENSATION (Continued)

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,
2009 is as follows:

|                                       |  |         |  |   |                |  |  | Weighted-Average |  |   |           | 
|-------------------------------------- |  | ------- |  | - | -------------- |  |  | ---------------- |  | - | --------- | 
|                                       |  |         |  |   | Weighted-      |  |  | Remaining        |  |   | Aggregate | 
|                                       |  |         |  |   | Average        |  |  | Contractual Term |  |   | Intrinsic | 
|Stock Warrants                         |  | Shares  |  |   | Exercise Price |  |  | (Months)         |  |   | Value     | 
|Outstanding at January
      1, 2009   |  | 327,778 |  | $ | 2.29           |  |  | 58               |  |   |           | 
|Granted                                |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Exercised or converted                 |  | 272,223 |  |   | 2.39           |  |  | -                |  |   |           | 
|Forfeited or expired                   |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Outstanding at December
      31, 2009 |  | 55,555  |  | $ | 1.80           |  |  | 52               |  | $ | 353,885   | 
|Exercisable at December 31, 2009       |  | 55,555  |  | $ | 1.80           |  |  | 52               |  | $ | 353,885   | 

- A summary of stock warrants for the year ended December 31,
2008 is as follows:

|                                       |  |         |  |   |                |  |  | Weighted-Average |  |   |           | 
|-------------------------------------- |  | ------- |  | - | -------------- |  |  | ---------------- |  | - | --------- | 
|                                       |  |         |  |   | Weighted-      |  |  | Remaining        |  |   | Aggregate | 
|                                       |  |         |  |   | Average        |  |  | Contractual Term |  |   | Intrinsic | 
|Stock Warrants                         |  | Shares  |  |   | Exercise Price |  |  | (Months)         |  |   | Value     | 
|Outstanding at January
      1, 2008   |  | 327,778 |  | $ | 2.29           |  |  | 70               |  | $ | 347,223   | 
|Granted                                |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Exercised or converted                 |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Forfeited or expired                   |  | -       |  |   | -              |  |  | -                |  |   |           | 
|Outstanding at December
      31, 2008 |  | 327,778 |  | $ | 2.29           |  |  | 58               |  | $ | 347,223   | 
|Exercisable at December 31, 2008       |  | 327,778 |  | $ | 2.29           |  |  | 52               |  | $ | 347,223   | 

The aggregate intrinsic value in the preceding table represents
the total pretax intrinsic value, based upon the Companys closing stock price
of $8.17 and $3.05 as of December 31, 2009 and 2008, which would have been
received by the warrant holders had all warrant holders exercised their warrant
awards as of that date. No options were exercised during the year ended December
31, 2008.

(2) Stock Options

On January 7, 2008, the Company and Mr. Zhihai Mao, the 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 option has a term of ten years and expires 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.

F-31

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

11. STOCK-BASED COMPENSATION (Continued)

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.

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
totaling $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.

The Company recorded compensation expense of $505,464 and
$217,756 during years ended December 31, 2009 and 2008 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, | 
|-------------------------------------- | - | ------------------------ | 
|                                       |   | 2009                     | 
|Risk-free interest rate                |   | 1.50% - 1.65%            | 
|Expected life (year)                   |   | 3.5  4.5                | 
|Expected volatility                    |   | 65% - 82%                | 
|Weighted average fair value per option | $ | 3.16                     | 

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

F-32

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

11. STOCK-BASED COMPENSATION (Continued)

|                                     |  |           |   |   |                |  |  | Weighted    |  |   |           | 
|------------------------------------ |  | --------- | - | - | -------------- |  |  | ----------- |  | - | --------- | 
|                                     |  |           |   |   | Weighted       |  |  | Remaining   |  |   | Aggregate | 
|                                     |  | Number of |   |   | Average        |  |  | Contractual |  |   | Intrinsic | 
|                                     |  | Options   |   |   | Exercise Price |  |  | (months)    |  |   | Value     | 
|Outstanding at January
      1, 2009 |  | 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,          |  | 2,025,600 |   | $ | 7.5            |  |  | 57          |  | $ | 2,437,788 | 
|Nonvested as of
      December 31,   |  | 1,883,100 |   | $ | 7.6            |  |  | 57          |  | $ | 1,553,513 | 
|Exercisable as of December 31,       |  | 142,500   |   | $ | 5.1            |  |  | 57          |  | $ | 884,275   | 

b) A summary of options transactions during the year ended
December 31, 2008 is as follows:

|                                     |  |           |  |   | Weighted       |  |  | Remaining   |  |   | Aggregate | 
|------------------------------------ |  | --------- |  | - | -------------- |  |  | ----------- |  | - | --------- | 
|                                     |  | Number of |  |   | Average        |  |  | Contractual |  |   | Intrinsic | 
|                                     |  | Options   |  |   | Exercise Price |  |  | (months)    |  |   | Value     | 
|Outstanding at January
      1, 2008 |  | -         |  | $ | -              |  |  |             |  |   |           | 
|Granted                              |  | 290,000   |  | $ | 6.6            |  |  | 101         |  |   |           | 
|Exercised                            |  | -         |  | $ | -              |  |  |             |  |   |           | 
|Cancelled or Forfeited               |  | -         |  | $ | -              |  |  |             |  |   |           | 
|Outstanding at December
      31,    |  | 290,000   |  | $ | 6.6            |  |  | 91          |  | $ | -         | 
|Nonvested as of December 31,         |  | 225,000   |  | $ | 6.6            |  |  | 91          |  | $ | -         | 
|Exercisable as of
      December 31, |  | 65,000    |  | $ | 6.6            |  |  | 91          |  | $ | -         | 

The aggregate intrinsic value in the preceding table represents
the total pretax intrinsic value, based upon the Companys closing stock price
of $8.17 and $3.05 as of December 31, 2009 and 2008, 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, 2009 and 2008.

Nonvested share awards

The following table details the Companys nonvested share
awards activity for fiscal 2009:

|                             |  |           |   |   | Weighted-       | 
|---------------------------- |  | --------- | - | - | --------------- | 
|                             |  |           |   |   | Average Grant-  | 
|                             |  | Shares    |   |   | Date Fair Value | 
|                             |  |           |   |   |                 | 
|Balance at December 31, 2008 |  | 225,000   |   | $ | 6.65            | 
|Granted                      |  | 1,875,600 |   |   | 7.52            | 
|Replaced                     |  | 150,000   |   |   | 5.09            | 
|Vested                       |  | (142,500  | ) |   | 5.09            | 
|Cancelled or Forfeited       |  | (225,000  | ) |   | 6.65            | 
|Balance at December 31, 2009 |  | 1,883,100 |   | $ | 7.51            | 

F-33

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

11. STOCK-BASED COMPENSATION (Continued)

The weighted-average grant-date fair value of nonvested 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 nonvested share awards granted in fiscal 2009 and 2008 was $7.51 and $6.65,
respectively. The total fair value of nonvested share awards which vested during
fiscal 2009 and 2008 were $0.7 million and $0.4 million, respectively.

As of December 31, 2009 and 2008, total unrecognized
compensation costs related to unvested stock options and restricted shares was
$5,750, 323 and $508,621, respectively. Unvested stock options are expected to
be recognized over a weighted average period of 3.76 years and 2.17years.

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.

13. INCOME TAXES

As of December 31, 2009 and 2008 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, 2009 and 2008.

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, 2009 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, 2009 and 2008, income tax
expenses were as follows:

|         |  | Year Ended December 31, | 
|-------- |  | ----------------------- | 
|         |  | 2009                    | 
|         |  | Domestic                | 
|         |  | Federal                 | 
|Current  |  |                         | 
|Deferred |  |                         | 
|         |  |                         | 

The components of income tax expense consisted of the
following:

|Years Ended December 31,          |   | 2009    |  |  | 2008  | 
|--------------------------------- | - | ------- |  |  | ----- | 
|Actual provision for income taxes | $ | 487,769 |  |  | 3.17% | 
|Changes in deferred income taxes: |   |         |  |  |       | 
|Temporary differences.            |   | 189,586 |  |  | 1.23% | 
|Effect of exchange rate changes   |   | 0       |  |  | 0.00% | 
|Income tax expense                | $ | 677,355 |  |  | 4.40% | 

F-34

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

13. INCOME TAXES (Continued)

The effective income tax rates for the years ended December 31,
2009 and 2008 were approximately, 4.40% and 0.53%, respectively. The increase in
effective income tax is primarily due to increase in statutory tax rate due to
increase in pre-tax income.

The Group Company, Zhangcheng Media, Xinjiang Zhangcheng, and
Dajian Zhitong are charged at the tax rate at 25% on the taxable net income for
PRC income tax purposes under the new Enterprise Tax Law in 2009. PKU, China
TranWiseway, UNISITS, Beijing UNISITS, and Hangzhou UNISITS are charged at the
tax rate at 15% on the taxable net income for PRC income tax purposes in 2009.
Beijing Tian Hao, Beijing Zhangcheng and Shanghai Yootu qualify as new or
high-technology enterprise located in High-Tech Zones in Beijing and Shanghai,
and are entitled to tax exemptions or preferential tax rates on the taxable net
income for PRC income tax purposes in 2009. Henan UNISITS are subject to a
special rate at 2.5% of its taxable revenue in 2009.

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, 2009 and
December 31, 2008 were as follows:

|                   |   | Deferred Tax Assets | 
|------------------ | - | ------------------- | 
|                   |   | Net operating loss  | 
|                   |   | carryforwards       | 
|December 31, 2009: |   |                     | 
|Foreign:           |   |                     | 
|In RMB             | ¥ | 195,740             | 
|Exchange rate      |   | 0.1467              | 
|In USD             | $ | 28,715              | 
|Domestic :         |   |                     | 
|In USD             | $ | 4,600,000           | 
|                   |   |                     | 
|December 31, 2008: |   |                     | 
|Foreign:           |   |                     | 
|In RMB             | ¥ | 1,443,132           | 
|Exchange rate      |   | 0.1467              | 
|In USD             | $ | 211,708             | 
|Domestic :         |   |                     | 
|In USD             | $ | 4,860,000           | 

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,                |   | 2009   |  |   | 2008    | 
|--------------------------------------- | - | ------ |  | - | ------- | 
|Deferred tax assets:                    | $ |        |  | $ |         | 
|Depreciation                            |   | 0      |  |   | 0       | 
|Amortization of
      intangible assets |   | 28,715 |  |   | 48,180  | 
|Investment securities                   |   | 0      |  |   | 0       | 
|Government subsidy                      |   | 0      |  |   | 44,010  | 
|Allowance for doubtful accounts         |   | 0      |  |   | 0       | 
|Operating loss
      carryforward       |   | 0      |  |   | 119,518 | 
|Total deferred tax assets               |   | 28,715 |  |   | 211,708 | 
|Deferred tax liabilities:               |   |        |  |   |         | 
|Foreign asset and liabilities           |   | 0      |  |   | 0       | 
|Investment securities                   |   | 0      |  |   | 0       | 

|Others                          |   | 0      |  |   | 0       | 
|------------------------------- | - | ------ |  | - | ------- | 
|Total deferred tax liabilities. |   | 0      |  |   | 0       | 
|Net deferred tax assets         | $ | 28,715 |  | $ | 211,708 | 

F-35

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

13. INCOME TAXES

No valuation allowance has been recorded against the deferred
tax asset as of December 31, 2009 and 2008 as the Company believes that it is
more likely than not that all deferred tax assets will 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.

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, | 
|--------------------------------------------------- | - | ----------------------- | 
|                                                    |   | 2009                    | 
|Net income                                          | $ | 12,974,099              | 
|                                                    |   |                         | 
|Basic earnings per share:                           |   |                         | 
|Basic weighted average share
      outstanding      |   | 22,333,765              | 
|                                                    |   |                         | 
|Basic earnings per common share                     | $ | 0.58                    | 
|                                                    |   |                         | 
|Diluted earnings per share:                         |   |                         | 
|Basic weighted average
      share outstanding      |   | 22,333,765              | 
|Effect of dilutive stock options and
      warrants |   | 171,876                 | 
|Diluted weighted
      average shares outstanding   |   | 22,505,641              | 
|                                                    |   |                         | 
|Diluted earnings per
      common share             | $ | 0.58                    | 

15. RELATED-PARTY TRANSACTIONS

Due To Related Parties

As of December 31, 2009 and 2008, Dajian Zhitong borrowed from
two of its individual shareholders in the aggregated amount of RMB 504,065, or
$73,946 and RMB 538,065, or $78,934, respectively, for general working capital
needs. The borrowings do not bear interest and are payable on demand.

F-36

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

16. CONCENTRATION

a. Cash

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, 2009 and 2008, uninsured balances totaled $1,901,266 and $1,422,809,
respectively.

b. Major Customers

|                                                                                                                                                    |   | Revenue                 |  |   | Accounts Receivable | 
|--------------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------------------- |  | - | ------------------- | 
|                                                                                                                                                    |   | Year Ended December 31, |  |   | At December 31,     | 
|2009:                                                                                                                                               |   |                         |  |   |                     | 
|During the 12 months
      ended December 31, there were no customers that individually represent 10%
      or more of the Company's total revenue.
|2008:                                                                                                                                               |   |                         |  |   |                     | 
|Customer A                                                                                                                                          | $ | 3,044,547               |  | $ | 1,114,932           | 
|Total                                                                                                                                               | $ | 3,044,547               |  | $ | 1,114,932           | 

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,                |   | 2009       |   |   | 2008       | 
|--------------------------------------- | - | ---------- | - | - | ---------- | 
|Net income                              | $ | 12,974,099 |   | $ | 11,090,477 | 
|Foreign currency translation adjustment |   | (384,847   | ) |   | 1,612,709  | 
|Comprehensive income                    |   | 12,589,252 |   |   | 12,703,186 | 

18. COMMITMENTS AND CONTINGENCIES

(1)Operating Leases

The Company and its subsidiaries rent offices under several
operating leases. Rent expenses for these offices totaled $561,295 and $
$269,011 for the years ended December 31, 2009 and 2008, respectively. The
aggregate future minimum payments under these lease agreements over one year are
as follows:

|Year ending December 31, |   | Lease Commitments | 
|------------------------ | - | ----------------- | 
|2010                     | $ | $1,201,586        | 
|2011                     |   | 1,055,593         | 
|2012                     |   | 888,657           | 
|Total                    | $ | $3,145,836        | 

(2) 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-37

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

18. COMMITMENTS AND CONTINGENCIES (Continued)

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.

(2) 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 that have not been 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 the 15 years 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-38

---

CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
DECEMBER 31, 2009

19. SUBSEQUENT EVENTS

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.

On March 22, 2010, the Company and its variable interest entity, the Group Company, entered into certain equity transfer agreements (the Equity Transfer Agreements) with several individual shareholders (the 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 US$0.65 million) in cash (the 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, 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 of the Companys common stock with an escrow agent designated by the Company that they 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s
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.

******

F-39

---

Consolidated Financial Statement Schedule: Valuation and
Qualifying Accounts
(In thousands)

|                                   | Balance at   | Charged to |            |        | Balance at
|---------------------------------- | ------------ | ---------- | ---------- | ------ | ----------
|                                   | Beginning of | Costs and  |            |        | End
    of
|                                   | Period       | Expenses   | Deductions | Period
|                                   |              |            |            |        |           
|December 31,
    2009              |              |            |            |        |           
|                                   |              |            |            |        |           
|Allowance for doubtful accounts    | $            | 32,439     | $          | 5,770  | $         
|                                   |              |            |            |        |           
|Allowance for
    sales returns    |              | -          |            | -      |           
|                                   |              |            |            |        |           
|Inventory reserves                 |              | -          |            | -      |           
|                                   |              |            |            |        |           
|December 31,
    2008              |              |            |            |        |           
|                                   |              |            |            |        |           
|Allowance for doubtful receivables | $            | -          | $          | 32,439 | $         
|                                   |              |            |            |        |           
|Allowance for
    sales returns    |              | -          |            | -      |           
|                                   |              |            |            |        |           
|Inventory reserves                 |              | -          |            | -      |           

Schedule II

---