Document:

China Security & Surveillance Technology, Inc.: Exhibit 10.1 - Prepared
by TNT Filings Inc.

  

 

Exhibit 10.1

(English Translation)

 

January 12, 2009

 

 

 

 

The Transferor:

PENG Qingqing

 

The Transferee:

CHINA SAFETECH HOLDINGS LIMITED

 

Party C:

CHINA SECURITY & SURVEILLANCE TECHNOLOGY, INC.

 

 

	

 

Equity Transfer Agreement

of

All Issued Shares  

of  

MULTIWIN INTERNATIONAL HOLDINGS LIMITED 

 

 

 

This Equity Transfer Agreement (the “Agreement”) is entered into by and among the following parties on January 12, 2009:

 

 

(1)

PENG Qingqing whose address is Unit B1, 9/F., Loyong Court Commercial Building, 212-220 Lockhart Road, Wanchai, Hong Kong, with the number of the Identity Card of Hong Kong Special Administrative Region of the People’s Republic of China: V131955(8) (hereinafter referred to as “Transferor”);

 

(2)

CHINA SAFETECH HOLDINGS LIMITED, a company duly incorporated according to the laws of British Virgin Islands, whose address is F13, Press Plaza, Shennan Avenue Special Zone, Futian District, Shenzhen (hereinafter referred to as  “Transferee”);

 

(3)

CHINA SECURITY & SURVEILLANCE TECHNOLOGY, INC., a company duly incorporated according to the laws of Delaware, United States, whose address is F13, Special Zone Press Plaza, Shennan Avenue Special Zone, Futian District, Shenzhen (hereinafter referred to as “Party C”);

 

The Transferor, the Transferee and Party C above shall be each referred to as a “Party” and collectively referred to as the “Parties”.

 

WHEREAS

MULTIWIN INTERNATIONAL HOLDINGS LIMITED, a limited liability company legally organized and validly existing under the Company Ordinance of Hong Kong, whose information is listed as Exhibit I (hereinafter referred to as “Multiwin”), and whose all issued shares are beneficially held by the Transferor.

 

WHEREAS

Multiwin established Shenzhen Coson Electronic Co. Ltd., a wholly foreign owned company legally organized and validly existing under the laws of People’s Republic of China, whose information is listed as Exhibit III (hereinafter referred to as “Coson”), and whose all shares are beneficially held by Multiwin.

 

WHEREAS

The Transferee desires to purchase from the Transferor and the Transferor desires to transfer to the Transferee 100% issued shares of Multiwin. Upon completion of the transfer under this Agreement, the Transferee shall indirectly and fully acquire 100% shares of Coson and control Coson.

 

NOW, THEREFORE, the Parties hereby agree as follows:

 

 

Article 1  Definitions

 

1.1

Unless otherwise defined in this Agreement, the following terms shall have the meanings indicated as follow:

 

	
  
  “Company Ordinance”

	
  
  means Chapter 32 Company Ordinance of the laws of Hong Kong;

	
   	
   
	
  
  “Shares for Transfer”

	
  
  means 10,000 common share of Multiwin owned by the Transferor to be transferred from the Transferor to the Transferee under this Agreement, constituting 100% issued and outstanding stock of Multiwin (for details please refer to Exhibit II - Part A);

	 	 
	
  
  “Share Transfer”

	
  
  means 100% issued and outstanding shares of Multiwin to be transferred from the Transferor to the Transferee under Article 2.1 hereof;

	 	 
	
  
  “Balance”

	
  
  shall have the meaning specified under Article 3.2.1 (1) hereof;

	 	 
	
  
  “Total Transfer Price”

	
  
  means total price to be paid to the Transferor by the Transferee under Article 3.1 hereof;

	 	 
	
  
  “Closing Date”

	
  
  January 12, 2009;

	 	 
	
  
  “Accounts of Multiwin”

	
  
  means management financial statements of Multiwin as of December 31, 2008, a copy of which are attached as Exhibit A hereof;

	 	 
	
  
  “Accounts of Coson”

	
  
  means financial statements of Coson audited by Chinese auditor as of December 31, 2008, a copy of which are attached as Exhibit B hereof;

	 	 
	
  
  “Business Day and Working Hours”

	
  
  means the days when banks in Hong Kong normally provide general bank services (excluding Saturday, Sunday and other Hong Kong public holidays) and normal working hours;

	 	 
	
  
  “PRC”

	
  
  means People’s Republic of China;

	 	 
	
  
  “Hong Kong”

	
  
  means Hong Kong Special Administrative Region of the People’s Republic of China;

	 	 
	
  
  “HKD”

	
  
  means legal currency of Hong Kong;

	 	 
	
  
  “USD”

	
  
  means legal currency of United States;

	 	 
	
  
  “RMB”

	
  
  means legal currency of PRC.

 

2

 

1.2

In this Agreement:

 

(i)

Any rule or law involved herein shall include any and all amendments, supplements or reenactments hereof from time to time;

 

(ii)

Words and terms contained in Companies Ordinance shall be interpreted according to definitions stipulated in Companies Ordinance except as otherwise defined or stated in this Agreement, however, any amendment or change to Companies Ordinance shall be excluded which is not enforced before or on the date to execute this Agreement.

 

(iii)

Single word also includes plural meaning; word referred to any gender also includes the other gender and neuter, word referred to person also includes groups (legal person or non-legal person) and (under every circumstance), vice versa;

 

(iv)

Hereabove mentioned the parties, descriptions, exhibits, appendices and terms and conditions shall be respectively referred to the parties, descriptions, exhibits, appendices and terms and conditions hereof; and

 

(v)

The headings and table of contents in this Agreement are provided for reference only and will not affect its construction or interpretation.

 

 

Article 2  Share Transfer

 

2.1

As per stipulations in this Agreement, the Transferor, as the owner of all issued and outstanding shares of Multiwin (for more details please refer to Part A, Exhibit II), will transfer such Shares for Transfer to the Transferee (for more details please refer to Part B, Exhibit II). After such transfer, the Transferee will own 100% issued and outstanding shares of Multiwin.

 

2.2

Upon the completion of transaction hereunder, Shares for Transfer shall not be attached with any mortgage, lien or property encumbrances of any form, and Shares for Transfer shall be transferred with all rights attached or accumulated thereto, including all dividends, profits, the investment in Coson by Multiwin and relevant benefits accumulated and distributed from the completion date.

 

3

 

Article 3 Transfer Price

 

3.1

Transfer Price

 

The Transferor and the Transferee hereby agree that the Transferor shall transfer the Shares for Transfer to the Transferee. In return, the Transferee shall pay to the Transferor the Total Transfer Price of RMB51,768,429, consisting of RMB 40,000,000 in cash and shares of Party C with a value of RMB 11,768,429.
 

 

3.2

Method of Payment

 

3.2.1

The Transferee shall pay the Total Transfer Price to the Transferor as follows:

 

(1)

The Transferee has already paid to the Transferor RMB9,500,000 as of the Closing Date. The Balance of the cash consideration in the amount of RMB 30,500,000 shall be paid according to the stipulations prescribed by Article 5.2 below.

 

(2)

The Transferee (through its parent company, Party C) shall issue restricted shares with a value equal to RMB11,768,429 to the Transferor or its designees within ninety days after the execution date of this Agreement, and the share value shall be calculated based on the average closing price (USD5.0435/share) of twenty trading days before the execution date of this Agreement, which means that the Transferee shall issue 341,228 shares to the Transferor, among which 68,245 shares (with a value equal to RMB2,353,665) shall be released to the Transferor within ninety days after the execution date of this Agreement. If the shares are issued to YAO Xiaohai, YAO Xiaohua and the directors and general manager of Coson , the lock-up period for sales of those shares is two years, starting from April 11, 2008.  The Transferor shall pledge certain shares to the Transferee as provided under Article 5.2 hereof.

 

3.2.2

The Transferee shall remit the Balance of the cash amounts to the bank account designated by Transferor in accordance with the stipulations by Article 5.2 hereof.  The bank account information will be provided by the Transferor separately.

 

4

 

Article 4  Closing

 

4.1

The Share Transfer shall be completed on the Closing Date at the place stipulated by both parties in accordance with Exhibit V.

 

4.2

Terms and conditions to be performed hereunder shall remain in force after the Closing Date.

 

4.3

From the Closing Date, debts and credits and all risks of Multiwin and Coson shall be promptly borne by the Transferee (except otherwise undertaken by the Transferor in Exhibit IV).

 

4.4

From the Closing Date, the Transferee shall have the right to consolidate profits of Multiwin and Coson with the Transferee group. At the meantime, the Transferee shall have the right to appoint management and financial personnel, or appoint existing personnel of Multiwin and Coson to take charge of management and operation of Multiwin and Coson as well as all files, materials, financial documents and so on.  The Transferor shall have no right and/or interest as shareholder of Multiwin and Coson from the Closing Date due to such Share Transfer, except any relevant obligations required to be borne by the Transferor under applicable laws and regulations and this Agreement.

 

 

Article 5  Representations, Warranties and Covenants of the Transferor

 

5.1

In addition to the information disclosed in this Agreement, the Transferor shall represent and covenant to the Transferee under terms and conditions stipulated in Exhibit IV, which also constitute the base for the Transferee to accept the Shares for Transfer.

 

5.2

The Transferor covenants that the Transferee’s after-tax profits as audited by the US Auditor in 2007 shall be no less than RMB2,600,000 and the Transferee’s net assets as audited by US Auditor in 2007 shall be no less than RMB8,000,000.  If the 2007 after-tax profits of Multiwin and Coson are no less than RMB2,600,000 and the 2007 net assets of Multiwin and Coson are no less than RMB8,000,000, the Transferee shall pay RMB 10,500,000 to the shareholder of Multiwin and Coson or its designees and release 102,368 shares of the pledged shares to the Transferor.  The Transferor covenants that the Transferee’s after-tax profits in 2008 as audited by the US Auditor shall be no less than RMB 8,000,000.  If the 2008 after-tax profits of Multiwin and Coson are no less than RMB8,000,000, the Transferee shall pay RMB 12,000,000 to the shareholder of Multiwin and Coson or its designees and release 102,368 shares of the pledge shares to the Transferor.  The Transferor covenants that the Transferee’s after-tax profits in 2009 as audited by the US Auditor shall be no less than RMB 13,000,000.  If the 2009 after-tax profits of Multiwin and Coson are no less than RMB 13,000,000, the Transferee shall pay RMB 8,000,000 to the shareholder of Multiwin and Coson or its designees and release the 68,247 shares of the pledge shares to the Transferor.
 

 

5

 

Article 6  Representations, Warranties and Covenants of the Transferee and Party C

 

6.1

The Transferee covenants to keep the organization structure of Multiwin and Coson after the Share Transfer, expand its brand influence, fully support business development of Multiwin and Coson.  The Transferee shall also provide financial support as required by business.

 

6.2

The Transferee undertakes that existing employees of Multiwin and Coson shall remain employed given that they are willing to stay and their stay will not impede development of Multiwin and Coson after the Share Transfer; arrangement of senior management and technical staff and the operation rights and benefits of such persons shall be governed by separate agreements to be entered after the Share Transfer. In addition, the Transferee covenants that benefits of such persons shall not be lower than their previous benefits.

 

6.3

The Transferee shall provide appropriate operation funds to Multiwin and Coson in order to support the Transferor to realize their after-tax profit targets for 2007, 2008 and 2009, dates and amounts of providing such funds shall be otherwise stipulated.

 

6.4

Party C shall file relevant reports with the U.S. Securities and Exchange Committee (“SEC”) according to the applicable laws and issue shares to the Transferor under Article 3.2.1(2) hereof after the execution of this Agreement.

 

 

Article 7 Governing Law

 

This Agreement shall be governed and construed by rules and laws of Hong Kong.

 

 

Article 8  Settlement of Disputes and Agent of  Receiving Legal Procedure Documents

 

8.1

Any dispute arising out of or relating to this Agreement shall be settled by friendly negotiation and discussion. If no agreement is reached through friendly negotiation and discussion, such dispute shall be finally arbitrated by Hong Kong International Arbitration Center (HKIAC) in accordance with HKIAC Arbitration Rules then in effect. Unless otherwise provided in the arbitration rules of HKIAC then in effect, the arbitration shall be the sole and exclusive method and procedure of any dispute arising out of or relating to this Agreement.

 

8.2

The Parties to this Agreement agree that unless not permitted by the applicable laws and rules, the arbitration terms hereto shall be interpreted as and constitute the currently effective arbitration agreement in writing with legal effect, and shall be granted with such effect.  The Parties to this Agreement hereby expressly waive any right of possibly requested local administrative, judicial or alternative dispute settlement methods, as the conditions of any settlement procedure which arising our of this Agreement.

 

6

 

8.3

The Parties to this Agreement expressly represent that the award made according to Article 8 hereof shall be final award binding upon the Parties.  In addition, the Parties to this Agreement hereby waive the right to appeal the award made according to Article 8 hereof.  The Article 8 shall constitute the most comprehensive exclusive agreement to the extent permitted by the applicable laws.

 

8.4

(1)

The Transferee irrevocably entrusts BOYU ENTERPRISE CONSULTING CO., LIMITED, whose address is Unit B1, 9/F, Loyong Court Commercial Building, 212-220 Lockhart Road, Wanchai, Hong Kong (“Agent”), to receive legal procedure documents and to be on behalf of the Transferee to receive claims arising out of or relevant to the Agreement or the legal procedures in Hong Kong (including but not limited to, claims for reimbursement, summons, arbitration application and arbitration award) (“Legal Procedure Documents”).

 

(2)

Transferee undertakes to consecutively entrust the Agent as the agent of receiving Legal Procedure Documents, in order to on behalf of the Transferee receive Legal Procedure Documents in Hong Kong and immediately notify the Transferor in writing if the Agent or its address is modified.

 

(3)

The Transferee agrees and confirms that Legal Procedure Documents which have been sent to its Agent shall be deemed as having been sent to any Transferee.

 

 

Article 9  Liabilities for Breach of Contract

 

9.1

If any statement or warrants made by any Party in this Agreement is untrue or false, it shall be deemed as breach of contract by the Party.

 

9.2

If any Party intentionally changes its mind and causes the failure of the Share Transfer, it shall be deemed as breach of contract by such Party.

 

9.3

The breaching party shall, in addition to performance of other obligations under this Agreement, be liable for all losses, damages, expenses suffered by the observant party due to breach of contract caused by breaching party.

 

9.4

If the Transferor changes minds on purpose and causes that the Shares for Transfer cannot be transferred to the Transferee or the Shares for Transfer is forfeited after the transfer, the Transferee shall have the right to terminate the Agreement, and the Transferor shall return the share transfer price or the shares and assume liabilities under Article 9.3 of this Agreement.

 

7

 

Article 10  Force Majeure and Change of Circumstances

 

10.1  

If any Party to this Agreement can not perform any part or all of the terms hereto directly or indirectly because of events such as fire, flood, earthquake or other unforeseeable, unavoidable and/or uncontrollable events, the Party shall be exempted from liabilities to the extent as affected by force majeure.

 

10.2  

If any Party or Parties lose(s) its/their interests under this Agreement because of legislation, or administration order or specific administration act of government, any Party shall have the right to terminate this Agreement and to restore to the conditions before the execution of this Agreement.

 

10.3  

Any Party affected by force majeure shall deliver the other Party the written notice regarding the occurrence of force majeure within 12 days after the occurrence of the force majeure event.

 

10.4  

After the occurrence of force majeure event, the Parties to this Agreement shall immediately consultant and decide whether to delay the performance of this Agreement to a day in the future agreed by the Parties or to terminate this Agreement.

 

10.5  

If any Party delays or unable to perform all or part of the terms of this Agreement for more than 30 days as a result of force majeure, the other Party shall have the right to rescind this Agreement, and the Parties shall take all necessary actions to restore the rights and obligations of all Parties to their respective original positions.

 

 

 

Article 11  Miscellaneous

 

11.1

This Agreement and its involved relevant documents constitute the full understanding of the Parties regarding the share transfer, and replace any previous intention, expression and understanding of the Parties.

 

11.2

If any term of this Agreement is regarded as illegal, invalid or unenforceable at any time, the validity, effectiveness and enforceability of other terms of this Agreement shall not affected or impaired in any way and shall remain the full validity.

 

11.3

This Agreement shall bind the Parties and their respective successors and assignees. The interests of this Agreement shall be assigned to the Parties hereto and their respective successors and assignees. Without the permission of the Parties in writing, any Party shall not amend, modify or revise this Agreement.

 

11.4

This Agreement shall be effective upon signing.

 

11.5

Without written consent of all Parties (such consent shall not be unreasonably withheld), the Parties hereto shall not transfer any rights or obligations under this Agreement.

 

8

 

11.6

expenses arising out of the transfer of Shares for Transfer
(including but not limited to, arising out of  in China or in any other areas),
shall be borne and paid by the Transferor.

 

11.7

Unless required by laws, regulations, order or judgments by the competent authorities or courts (including, but not limited to, applicable regulation of security exchanges), without the prior written consent of the other Party (such consent shall not be unreasonably withheld), the Parties shall not make or distribute any related press statement or announcement.

 

11.8

Without the prior written consent of the other Party, the Parties shall not disclose the Agreement or any content or material in connection with any transaction of this Agreement, excluding the following disclosure:

 

(1)

the disclosure is made according to the provisions of applicable laws, regulations and rules (including, but not limited to,  regulations of security exchanges) or requirements of relevant government authorities or supervision authorities, or court orders;

 

(2)

the disclosure is made to Multiwin and Coson, or its applicable government authorities, or to related banks or professional consultant of the disclosing Party;

 

(3)

the disclosure is made by the Transferor to any member of its company group or senior management thereof.

 

11.9

If any term of this Agreement is or becomes illegal, invalid or unenforceable at any time in any respect, other terms of this Agreement shall not be affected or impaired.

 

11.10

Any notice required to be sent under this Agreement shall be made in writing. The notice shall be delivered to the following address or fax number or other address or fax number that the recipient designates according to this Agreement:

 

(1)

The Transferor:

PENG Qingqing

Address:

Unit B1, 9/F., Loyong Court Commercial Building, 212-220 Lockhart Road, Wanchai, Hong Kong

Telephone:     (852) 2116-1199

Fax:                  (852) 2116-1232

 

 

(2)

The Transferee:CHINA SAFETECH HOLDINGS LIMITED

Address:Floor 13, Press Plaza, Shennan Avenue Special Zone, Futian District, Shenzhen

Telephone:    (86-755) 8351 0888

Fax:                
(86-755) 8351 0815

 

9

 

(3)

Party C:

CHINA SECURITY & SURVEILLANCE TECHNOLOGY, INC.

Address:Floor 13, Press Plaza, Shennan Avenue Special Zone, Futian District, Shenzhen

Telephone:     (86-755) 8351 0888

Fax:

 (86-755) 8351 0815

 

11.11

Notices may be sent by mail with postage pre-paid, personal delivery, courier with good reputation or by facsimile, and shall be deemed as delivered at the following time:

 

(1)

two days (seven days if sending by airmail with postage prepaid) after post (the date of postmark is the posting date) for those sent by mail with postage prepaid;

 

(2)

the next business day for those sent by fax;

 

(3)

the receiving time for those sent by courier or personal delivery.

 

Any notice to the Transferee, when properly delivered to any Transferee, shall be regarded as delivered to the other Transferee.

 

11.12

This Agreement shall be written in Chinese in three copies with each Party holding one copy.

 

 

 

10

 

IN WITNESS WHEREOF, this Agreement has been executed by the Parties on the date first above written and the Parties confirm that the Parties have carefully reviewed and fully understand all the provisions of the Agreement.

 

The Transferor:

	

PENG Qingqing

	
  
  Signature:/s/ Peng Qingqing

	
  
  Place of Signature:Shenzhen

 

Witness:PENG Yaoguang

Signature:/s/ PENG Yaoguang

 

The Transferee:

 

	
  
  TU Guoshen for and on behalf of

CHINA SAFETECH HOLDINGS  

	
  
  LIMITED       

	
  
  Signature:  /s/ Tu Guoshen

Place of Signature:Shenzhen

 

	
  
  Witness:LUO Ganqi

Signature:/s/ LUO Ganqi

 

 

Party C:

 

To execute, chop and deliver by

TU Guoshen for and on behalf of

CHINA SECURITY & SURVEILLANCE TECHNOLOGY,  INC.

  
  Signature:  /s/ Tu Guoshen

Place of Signature:Shenzhen

 

Witness:LUO Ganqi  

Signature:  /s/ LUO Ganqi

 

11

 

Exhibit I

Information of Multiwin

 

 

Name in Chinese

:万盈国际集团有限公司

 

Name in English

:MULTIWIN INTERNATIONAL HOLDINGS LIMITED

 

Place of Registration

:Hong Kong

 

Registered Address

 

:Unit B1, 9/F, Loyong Court Commercial Building, 212-220 Lockhart Road, Wanchai, Hong Kong

 

Date of Registration and Establishment:April 17, 2008

 

Company Form

:Limited Liability Company

 

Registered No.

:1228565

 

Director

:PENG Qingqing

 

Company Secretary:JPS CONSULTING LIMITED

 

 Shares

:Authorized: HKD10,000, divided into 10,000 shares with par value of HKD1.00 per share
Issued and fully paid:HKD10,000, divided into 10,000 share with par value of
HKD1.00 per share

 

 

12

 

Exhibit II

Part A

 

Information of Share for Transfer

 

	 	 	 	 	
    Percent of
	
    Company	
    Registered Shareholder	
    Quantity of Common Shares	
    Par Value	
    issued Shares
	 	 	 	 	 
	
    Multiwin	
    PENG Qingqing	
    10,000	
    HKD 1 yuan	
    100%

 

Part B

 

Information of the Recipient of Share for Transfer

 

  
	
    The Transferee	
    Amount of Share to Be Transferred
	 	 
	
    CHINA SAFETECH HOLDINGS LIMITED	
    10,000

  

 

13

 

Exhibit III

Information of Coson

Name in Chinese

:深圳市科松电子有限公司
 

Name in English

:Shenzhen Coson Electronic Co., Ltd.

Legal Address

:2/F West, No.4 Factory Building, Jianye Industrial Zone, Zhuzilin, Nonglin Road, Futian District, Shenzhen
 

Type of Enterprise

:Wholly Foreign Owned Enterprise

Date of Establishment

:November 26, 1994

Business License No.

:440301103470886

Term of Operation.

:10 years

Total Amount of Investment:RMB 9,500,000

Registered Capital

:RMB 9,500,000

Name of Investor

:MULTIWIN INTERNATIONAL HOLDINGS LIMITED

Legal Representative

:YAO Xiaohai

Director

:YAO Xiaohai

 Business Scope

:manufacture and operate access control equipment, safety guarding equipment for use in parking lot, electric door 

  
opener, as well as technical development and wholesale of the aforesaid products and software.

 

 

14

 

Exhibit IV

Representations and Warranties

 

 

1.

Multiwin and Coson are companies legally established and validly existing under the laws of their respective places of establishment.

 

2.

Multiwin and Coson have been authorized and qualified to conduct business within the jurisdiction of their existing businesses.

 

3.

The businesses and operations of Multiwin and Coson have been in compliance with the relevant laws in all material respects.

 

4.

Accounts of Multiwin and Coson have been properly recorded in accordance with applicable account principles, standards and laws, and accurately represents and reflects the situation of Multiwin and Coson for the fiscal year or the period as of the date of the relevant book account.

 

5.

(a)

Exhibit I has listed all the directors and company secretaries of Multiwin as of the Closing Date.

 

(b)

Exhibit III has listed the legal representative and all the directors of Coson as of the Closing Date.

 

(c)

There has not been any shareholder resolution adopted to liquidate Multiwin and Coson before the Closing Date.

 

6.

The register of shareholders of Multiwin has truly and accurately recorded the date and the changes of shareholders from its establishment to the Closing date.

 

7.

None of the Transferor, Multiwin and Coson has ever issued or given any other person warrants or rights to purchase shares of Multiwin or Coson.

 

8.

(a)

Multiwin has no business activities or operations other than 100% ownership of Coson.

 

(b)

Multiwin has no subsidiary other than Coson.  Coson has only one subsidiary: Shanghai Coson Electronic Co., Ltd.

 

9.

Articles of associations of Multiwin and Coson have been delivered to Transferee, which are true and complete.

 

10.

If any thing conflicts or is inconsistent with foregoing warrants before the Closing Date, the Transferee agrees to immediately notify the Transferor in writing.

 

11.

All issued shares of Multiwin have been fully paid.  The registered capital of Coson has already been fully contributed.

 

15

 

12.

The Transferor is the sole legal and beneficial owner of the Shares for Transfer.  The Shares for Transfer are not free from any mortgage, lien or other property encumbrances.

 

13.

Multiwin owns 100% of the equity interests in Coson.  Multiwin is the sole legal and beneficial owner of Coson. Such equity interests in Coson are free of any mortgage, lien or other property encumbrances.

 

14.

The Transferor has the authority to execute the Agreement and sell any Shares for Transfer without any third party’s consent. The Agreement shall be legally binding on the Transferor.

 

15.

Except for the ongoing litigations disclosed to the Transferee, Multiwin and Coson are not currently involved in any material litigation or a party to any litigation and/or any unexecuted verdict, and are subject to any ongoing material injunction or order.

 

16.

As of the Closing Date, all or part of the assets or businesses of Multiwin  and Coson have not been entrusted to take over by any person, and there are not any orders or applications before court or adopted solutions to dissolve Multiwin or Coson.

 

17.

Except for debts (including any outstanding and unpaid tax) already disclosed in the Coson Account and Multiwin Account, under this Agreement or to the Transferee, neither Multiwin nor Coson has any other debts and/or outstanding and unpaid tax as of the Closing Date. All other debts incurred by Multiwin or Coson and/or unpaid tax before the Closing Date, if any, shall be borne by the Transferor.

 

18.

Except for the information disclosed by the Transferor, under the Agreement or in the accounts of Multiwin and Coson, Multiwin and Coson have no other unperformed material contracts.

19.

The net assets on June 30, 2008 as audited by the US auditor and verified by a third party appraiser shall exceed RMB 15,000,000.

 

20.

The shareholders and the board of directors of Multiwin and Coson have adopted valid and necessary resolutions to approve the Share Transfer under the Agreement.

 

21.

Any outstanding legal liabilities of Multiwin and Coson incurred before the Closing Date (such as labor compensation disputes, bad debts and losses of bad assets, debt disputes and/or risks of contingent debts) shall be borne by the Transferor. For any losses that can be calculated in money, if it causes the net assets of Multiwin and Coson to be less than RMB15,000,000, the Transferor shall be obliged to make it up to RMB15,000,000.

 

16

 

22.

The Transferor shall be fully liable for any civil and criminal liability of Multiwin and Coson before and on the Closing Date.

 

23.

The Transferor shall not intentionally make any adverse change to the operations of Multiwin and Coson (excluding the normal operation and force majeure) after the execution of this Agreement.  The Transferor shall immediately inform the Transferee if there is anything causing the material change to the operation of Multiwin and Coson.

 

24.

YAO Xiaohai and YAO Xiaohua covenant to continue to serve as the executive officer of Multiwin and Coson for five years and maintain the stability of Multiwin and Coson.

 

25.

YAO Xiaohai and YAO Xiaohua covenant that they and their direct relatives (parents, spouse or children) will not engage in any business in the security and surveillance industry or related businesses in five years.

 

17

 

Exhibit V

Provisions for the Closing

 

1.

Responsibilities of the Transferee

 

(i)

The Transferee shall pay the Balance of the Total Transfer Price in accordance with the stipulations by Article 3.2.2 and submit the proof document of payment to the Transferor.

 

(ii)

The Transferee shall provide a consent letter executed by one person to be the director of Multiwin and two consent letters executed by two persons to be the directors of Coson.

 

2.

Responsibilities of the Transferor

 

After the Transferor confirms that its bank account specified by Article 3.2.2 hereof has received all the payment by the Transferee under Article 3.2.1, the Transferor shall deliver and arrange the following to the Transferee:

 

(i)

The transfer documents (executed by the registered shareholders of Multiwin) and instruments for sale along with stock certificate;
 

 

(ii)

The original of a resignation letter properly signed by the incumbent director of Coson in which she or he shall state that she or he will not make any claims against Coson.

 

(iii)

All account books, registration certificates, business registration certificates, articles of association, meeting records, statutory books, application forms, seals, offset printing, steel seals and all documents relevant to the company businesses (if any) of Multiwin controlled by the Transferor;

 

(iv)

The Transferor shall cause Multiwin and Coson to hold a board meeting to approve (1) the transfer of the Shares for Transfer relevant to Multiwin, and registration after payment of appropriate stamp taxes; (2) the appointment of the persons nominated by the Transferee who are qualified to be directors under laws as the new directors of Multiwin (1 director) and Coson (3 directors) under the written instruction of the Transferee; (3) upon the completion of the actions as provide in subsection (2) above, the resignation of incumbent directors of Coson; and (4) the suspension or change of the operations of the bank accounts of Multiwin and Coson, and the appointment of the person nominated by the Transferee (upon written instruction received from the Transferee at least two business days prior to such action) as the authorized signatories for the bank accounts of Multiwin and Coson;

 

18

 

(v)

The original copy of the executed minutes of the board meeting held for issues as set forth in subsection (iv) above;

 

(vi)

The documents in the custody of Coson (Please refer to the list of Appendix C); and

 

(vii)

Legal opinion reports issued by Hong Kong and Chinese counsel.

 

3.

The Transferor and Transferee shall make clear marks to the chops of Coson at the delivery of the chop and sign a delivery memorandum so as to identify the difference of the old and new chops of Coson.
 

 

19f1012gex4i_chinafib.htm

    Exhibit 4.1

    
      VT
ARABIC SERVICES, INC.

      2004
EQUITY INCENTIVE PLAN

       

      
        
        

      

      
        ARTICLE
1 

        PURPOSE

         

      

      The
purpose of this Plan is to promote the interests of VT Arabic Services, Inc.
(the "Company") and to
motivate, attract, and retain the services of persons upon whose judgment,
efforts, and contributions the success of the Company's business depends. The
plan is further intended to align the personal interests of such persons with
the interests of the shareholders of the Company through equity participation in
the Company's growth and success. Capitalized terms not otherwise defined in the
text are defined in Article 2.

       

      ARTICLE 2

      DEFINITIONS

       

             
The following words and phrases shall have the following meanings for purposes
of this Plan:

       

      (a) "Award" means any Option, or
any Restricted Stock Award or any other right or interest relating to Stock,
cash or property, granted to a Participant under the Plan.

       

      (b) "Award Agreement" means any
written agreement, contract, or other instrument or document evidencing an
Award.

       

      (c) "Board of Directors" means
the Board of Directors of the Company or, if the context so requires, a
Committee thereof appointed pursuant to Article 6.

       

      (d) "Cause" means (i) conviction
of any crime involving fraud or gross misconduct, (ii) noncompliance with
reasonable directives of the Board of Directors or its designees, (iii)
violation of Company rules, policies or procedures or of the Plan or any
applicable Award Agreement.

       

      (e) "Code" means the Internal
Revenue Code of 1986, as amended from time to time.

       

      (f) "Committee" means the
committee of the Board of Directors described in Article 6.

       

      (g)"Disability" means the
following: a Participant shall be disabled if he or she is unable to
perform the duties of his customary position of employment by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or which can be expected to last for a continuous period of not
less than 12 months. The Board of Directors may require such medical or other
evidence, as it deems necessary to judge the nature and permanency of the
Participant's condition.

       

       

      
        
          
          

        

        
          SOP-1

          
            

          

        

        
          
          

        

      

       

      VT Arabic Services, Inc.

      2004 EQUITY INCENTIVE PLAN 

      
        

      

       

      (h) "Effective Date" shall mean
September 17, 2004.

       

      (i) "Exchange Act" means the
Securities Exchange Act of 1934, as amended.

       

      (j) "Fair Market Value" means
with respect to Stock or any other property, the fair market value of such Stock
or other property determined by the Board of Directors in good faith using such
methods or procedures as may be established from time to time by the Board of
Directors. Unless otherwise determined by the Board of Directors, the Fair
Market Value of Stock as of any date shall be the mean between the bid and asked
quotations for the Stock on that date as reported by the National Association of
Securities Dealers Automated Quotation System (NASDAQ) or, if there are no bid
or asked quotations on such date, the mean between the bid and asked quotations
on the next preceding date for which quotations are available. If the Stock is
subsequently listed and traded upon a recognized securities exchange or shall be
quoted on a recognized national market system, the Fair Market Value shall be
the closing price on such date or, if no closing price is so reported for that
date, the closing price on the next preceding date for which a closing price was
reported.

       

      (k) "Incentive Stock Option"
means an Option that is intended to meet the requirements of Section 422
of the Code or any successor provision thereto.

       

      (1)            "Non-Qualified Stock Option"
means an Option that is not intended to be an

       

      Incentive
Stock Option.

       

      (m) "Option" means a right
granted to a Participant under Article 7 of the Plan to purchase Stock at a
specified price during specified time periods. An Option may be either an
Incentive Stock Option or a Non-Qualified Stock Option.

       

      (n) "Participant" means a person
who, as an employee, officer, director, consultant, independent contractor, or
adviser of the Company or any Subsidiary, has been granted an Award under the
Plan.

       

      (o) "Plan" means VT Arabic
Services, Inc. 2004 Equity Incentive Plan, as amended from time to
time.

       

      (p) "Restricted Stock Award"
means Stock granted to a Participant or offered for sale to a Participant
under Article 8.

       

      (q) "Retirement" means a Participant's termination
of employment with the Company after attaining any normal or early retirement
age specified in any pension, profit sharing, or other retirement program
sponsored by the Company, if any.

       

      (r) "Securities Act" means the
Securities Act of 1933, as amended.

       

      (s) "Stock" means Common Stock of
VT Arabic Services, Inc..

       

       

      
        
          
          

        

        
          SOP-2

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      (t) "Subsidiary" means any
corporation of which a majority of the outstanding voting stock or voting power
is beneficially owned directly or indirectly by the Company.

       

      (u) "Ten Percent Owner" means any
individual who, at the date of grant of an Incentive Stock Option, owns stock
possessing more than ten percent of the total combined voting power of all
classes of Stock of the Company or a Subsidiary. For purposes of determining
such percentage, the individual with respect to whom such percentage is being
determined shall be considered as owning the Stock owned, directly or
indirectly, by or for his brothers and sisters (whether by the whole or half
blood), spouse, ancestors, and lineal descendants; and Stock owned, directly or
indirectly, by or for a
corporation, partnership, estate, or trust, shall be considered as being
owned proportionately by or for its shareholders, partners, or
beneficiaries.

       

      (v) "Termination Date" means the
date on which the employment (or other service or relationship in the case of a
Participant who is not an employee of the Company) of a Participant terminates
for any reason or no reason.

       

      (w) "Transfer
Agent" means the
Transfer Agent appointed by the Board of Directors which could include the
Company acting as its own Transfer Agent.

       

      ARTICLE
3

      EFFECTIVE
DATE AND TERM

       

      3.1
Effective Date. The Plan was approved by the Board of Directors and stockholders
of the Company as of the Effective Date.

       

      3.2 Term.
This Plan shall terminate on the tenth anniversary of the Effective Date,
subject to Article 12.

       

      ARTICLE
4

      SHARES
SUBJECT TO THE PLAN

       

      4.1
Number of Shares. The aggregate number of shares of Stock reserved and available
for Awards shall initially be three million (3,000,000) shares of
Stock.

       

      4.2
Lapsed Awards. To the extent that an Award terminates, expires or lapses for any
reason, any shares of Stock subject to the Award will again be available for the
grant of an Award under the Plan provided the Participant has not received any
benefits of ownership of the Shares subject to the terminated expired or lapsed
Award, in each case to the full extent available pursuant to the applicable
rules and interpretations of the Exchange Act and Code.

       

      4.3
Payments in Stock. Any shares of Stock tendered to or withheld by the Company in
connection with payment for Stock purchased pursuant to the Plan or withholding
taxes thereon shall be added back to the aggregate number of shares reserved and
available for Awards under

       

       

      
        
          
          

        

        
          SOP-3

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      the Plan
in each case to the fullest extent permitted under the applicable rules and
interpretations of the Exchange Act and Code.

       

      4.4 Stock
Distributed. Any Stock distributed pursuant to an Award may consist, in whole or
in part, of authorized and unissued Stock, treasury Stock, or Stock purchased on
the open market subject to applicable rules and interpretation of the Exchange
Act.

       

      ARTICLE
5

      ELIGIBILITY

       

      Awards
may be granted only to an individual who is an employee (including an employee
who also is a director or officer), officer, director, consultant, independent
contractor, or adviser of the Company or a Subsidiary, as determined by the
Board of Directors.

       

      ARTICLE
6

      ADMINISTRATION
AND AUTHORITY

       

      6.1
Administration. The Plan shall be administered by the Board of Directors or a
Committee appointed by the Board of Directors to administer the Plan at any time
or from time to time. Once appointed, the Committee shall continue to serve
until otherwise directed by the Board of Directors. From time to time, the Board
of Directors may increase the size of the Committee and appoint additional
members thereof; remove members (with or without cause), appoint new members
in substitution
therefor, and fill vacancies however caused.

       

      6.2
Authority. The Committee (or if authorized as Committee, the Board of Directors)
has the exclusive power, authority, and discretion to:

       

       

      
        (a) designate
Participants;

         

      

       

      
        

      

       

      
        (b) determine
the type or types of Awards to be granted to each
Participant;

      

       

      

      (c) determine
the number of Awards to be granted and the number of shares of Stock subject to
an Award;

       

      (d) prescribe
the form of each Award Agreement, which need not be identical for each
Participant;

       

      (e)            determine
the terms and conditions of any Award granted under the Plan, including
but not limited to, the exercise price, grant price, or purchase price, any
restrictions or limitations on the Award, any schedule for lapse of forfeiture
restrictions or restrictions on the exercisability of an Award and accelerations
or waivers thereof; and any modification or amendment of any Award previously
granted, based in each case on such considerations as the Board of Directors in
its sole discretion determines;

       

      
        
          
          

        

        
          SOP-4

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      (f) determine
whether, to what extent, and under what circumstances an Award may be settled
in, or the exercise price of an Award may be paid in, cash, Stock, other Awards,
or other property, or an Award may be canceled, forfeited, or
surrendered;

       

      (g) determine
whether, to what extent, and under what circumstances cash, Stock, other Awards,
other property, and other amounts payable with respect to an Award shall be
deferred either automatically or at the election of the holder thereof or of the
Board of Directors;

       

      (h) decide
all other matters that must be determined in connection with an
Award;

       

      (i) establish,
adopt, or revise any rules and regulations as it may deem necessary or advisable
to administer the Plan;

       

      (j) interpret
the Plan, any Award, and any Award Agreement in its discretion; and

       

      (k) make all
other decisions and determinations that may be required under the Plan or as the
Board of Directors deems necessary or advisable to administer the
Plan.

       

      6.3
Decisions Binding. All decisions, interpretations, and determinations by the
Board of Directors with respect to the Plan, any Award, and any Award Agreement
are final, binding, and conclusive on all parties.

       

      ARTICLE 7

      STOCK
OPTIONS

       

      7.1 Terms
and Conditions. The Board of Directors is authorized to grant Options to
Participants on the following terms and conditions:

       

      (a) Exercise
Price. The exercise price per share of Stock under an Option shall be determined
by the Board of Directors.

       

      (b) Payment.
Payment for Stock issued upon exercise of an Option shall be made in accordance
with Article 9 of the Plan.

       

      (c) Time and
Conditions of Exercise. The Board of Directors shall determine the time or times
at which an Option may be exercised in whole or in part, provided that no Option
may be exercisable prior to six months following the date of the grant of such
Option if and to the extent such limitation is necessary or required under Rule
16b-3, or successor authority, under the Exchange Act.

       

      (d) Evidence
of Option. All Options shall be evidenced by a written Award Agreement between
the Company and the Participant. The Award Agreement shall include such
provisions as may be specified by the Board of Directors.

      

       

      
        
          
          

        

        
          SOP-5

          
            

          

        

        
          
          

        

      

      VT Arabic Services, Inc.

      2004 EQUITY INCENTIVE PLAN 

      
        

      

       

       

      7.2
Incentive Stock Options. The terms of any Incentive Stock Options granted under
the Plan must comply with the following additional rules:

       

      (a) Employees
Only. Incentive Stock Options may only be granted to employees (including
officers and directors who are also employees) of the Company or a
Subsidiary.

       

      (b) Exercise
Price. The exercise price per share of Stock shall be set by the Board of
Directors, provided that the exercise price for any Incentive Stock Option may
not be less than the Fair Market Value as of the date of the grant.

       

      (c) Exercise.
In no event may any Incentive Stock Option be exercisable for more than ten
years from the date of its grant.

       

      (d) Individual
Dollar Limitation. The aggregate Fair Market Value (determined as of the
time an Award is made) of all shares of Stock with respect to which Incentive
Stock Options are first exercisable by any one Participant in any calendar year
may not exceed $100,000. Options granted in excess of this limitation shall be
deemed to be Non-Qualified Stock Options.

       

      (e) Ten
Percent Owners. An Incentive Stock Option may be granted to a Ten Percent Owner,
provided that at the time such option is
granted the exercise price per share of Stock shall not be less than 110% of the
Fair Market Value and such option by its terms is not exercisable after the
expiration of five years from the date of its grant.

       

      (f) Expiration
of Incentive Stock Options. No Award of an Incentive Stock Option may be made
pursuant to this Plan after the expiration of ten years from the Effective
Date.

       

      (g) Right to
Exercise. During a Participant's lifetime, an Incentive Stock Option may be
exercised only by the Participant.

       

      (h) Tax-Qualified
ISOP Options. All provisions of the Plan relating to Incentive Stock Options
shall be administered and interpreted in accordance, and so as to comply, with
the provisions of Section 422 of the Code.

       

      7.3
Termination of Participant. Notwithstanding the exercise periods set forth in
any Award Agreement, Options shall be subject to the following:

       

      (a) An Option
shall lapse ten years after it is granted, unless an earlier time is set in the
Award Agreement.

       

      (b) If a
Participant's employment is terminated due to Disability, Retirement, or for any
other reason other than for Cause, such Participant may exercise his or her
Incentive Stock Options only to the extent that such Incentive Stock Options
would have been exercisable on the Termination Date; provided, that such
exercise is made prior to the earlier of (i) the expiration of three months (one
year in the case of Disability) after the Termination Date or (ii) the
expiration date of the Option set forth in the Award Agreement. If a
Participant's employment is

      

      
        
          
          

        

        
          SOP-6

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      terminated
due to Cause, the Participant's Incentive Stock Options shall automatically
lapse and not be exercisable by the Participant, whether or not such Options
were vested.

       

      (c) Except as
otherwise provided in the Award Agreement or thereafter determined by the Board
of Directors in writing, if a Participant's employment, contractual or other
relationship with the Company is terminated due to Disability, Retirement, or
for any other reason other than for Cause, such Participant may exercise his or
her Non-Qualified Stock Options, only to the extent that such Options would have
been exercisable on the Termination Date; provided, that such exercise is made
within six months after the Termination Date, or such other time period as set
forth in the Award Agreement. If a Participant's employment, contractual or
other relationship is terminated due to Cause, the Participant's Non-Qualified
Stock Options shall automatically lapse and not be exercisable by the
Participant, whether or not such Options were vested.

       

      (d) If a
Participant dies before his or her Options lapse pursuant to this Section, then
the Participant's Options may be exercised, only to the extent that such Options
would have been exercisable on the date of the Participant's death; provided,
that such exercise is made prior to the earlier of (i) the first anniversary of
such Participant's death or (ii) the expiration date of the Option set forth in
the Award Agreement. Upon the Participant's death, any exercisable Options may
be exercised by the Participant's legal representative or
representatives.

       

      ARTICLE
8

       

      RESTRICTED
STOCK AWARDS

       

      8.1
Restricted Stock Awards. The Board of Directors is authorized to make Awards of
Restricted Stock to Participants either in the form of a grant of Stock or an
offer to sell Stock to a Participant, in such amounts and subject to such terms,
conditions and restrictions as may be selected by the Board of Directors. All
Awards of Restricted Stock shall be evidenced by an Award Agreement. An Award
Agreement may specify whether, and to what extent, holders of Restricted Stock
Awards shall have voting, dividend and other rights of holders of
Stock.

       

      8.2
Issuance and Restrictions. Restricted Stock shall be subject to such
restrictions on transferability and other restrictions, including without
limitation "vesting" or forfeiture restrictions, as the Board of Directors may
impose. These restrictions may lapse separately or in combination at such times,
under such circumstances, in such installments, or otherwise, as the Board of
Directors determines at the time of the grant of the Award or
thereafter.

       

      8.3
Forfeiture. Except as otherwise determined by the Board of Directors at the time
of the grant of the Award or thereafter, upon termination of employment during
the applicable restriction period, Restricted Stock that is at that time subject
to restrictions shall be forfeited and reacquired by the Company; provided,
however, that the Board of Directors may provide in any Award Agreement that
restrictions or forfeiture conditions relating to Restricted Stock will be
waived in whole or in part in specified circumstances, and the Board of
Directors may in other cases waive in whole or in part restrictions or
forfeiture conditions relating to Restricted Stock.

      

      
        
          
          

        

        
          SOP-7

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      8.4
Payment and Certificates for Restricted Stock. If a Restricted Stock Award
provides for the purchase of Stock by a Participant, payment shall be made
pursuant to Article 9 of the Plan. Restricted Stock granted under the Plan may
be evidenced in such manner as the Board of Directors shall determine. To the
extent that an Award is granted in the form of newly issued Restricted Stock,
the Award recipient, as a condition to the grant of such an Award, shall be
required to pay to the Company in cash, cash equivalents or other legal
consideration an amount equal to the par value of such Restricted Stock. To the
extent that an Award is granted in the form of Restricted Stock from the
Company's treasury, no such cash consideration shall be required of the Award
recipients. If certificates representing shares of Restricted Stock are
registered in the name of the Participant, certificates must bear an appropriate
legend referring to the terms, conditions, and restrictions applicable to such
Restricted Stock, and the Company shall retain physical possession of the
certificate until such time as all applicable restrictions lapse.

       

      ARTICLE
9

      PAYMENT
FOR STOCK PURCHASES;

      WITHHOLDING
TAXES; RELOAD OPTIONS

       

      9.1
Payment. Payment for Stock purchased pursuant to the Plan may be made in cash
(by check) or, where expressly approved for the Participant by the Board of
Directors in an Award Agreement or otherwise in writing and where permitted by
law:

       

      (a) by
cancellation of indebtedness of the Company to the Participant;

       

      (b) by
surrender of (or attestation to the ownership of) Stock valued at Fair Market
Value on the date new Stock is purchased under the Plan; provided, however, that
such surrender or attestation shall not be permitted if such action would cause
the Company to recognize compensation expense (or additional compensation
expense) with respect to the Award for financial reporting
purposes;

       

      (c) by waiver
of compensation due or accrued to Participant for services
rendered;

       

      (d) by tender
of property acceptable to the Board of Directors;

       

      (e)           with
respect only to purchases upon exercise of an Option, and provided that
a

       

      public
market for the Stock then exists:

       

      (i)            through
a "same day sale" commitment from Participant and a broker- dealer
that is a member of the National Association of Securities Dealers (a "NASD Dealer") whereby Participant
irrevocably elects to exercise the Option and to sell a portion of the Stock so
purchased to pay for the exercise price (and any applicable withholding taxes),
and whereby the NASD Dealer irrevocably commits upon receipt of such Stock to
forward the exercise price and any such withholding taxes directly to the
Company's Transfer Agent;

       

       

      
        
          
          

        

        
          SOP-8

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

       

      (ii) through a
"margin" commitment from Participant and a NASD Dealer whereby Participant
irrevocably elects to exercise the Option and to pledge the Stock so purchased
to the NASD Dealer in a margin account as security for a loan from the NASD
Dealer in the amount of the exercise price (and any applicable withholding
taxes), and whereby the NASD Dealer irrevocably commits upon receipt of such
Stock to forward the exercise price and any such withholding taxes directly to
the Company's Transfer Agent; or

       

       

      (iii) through
any other "cashless exercise" procedure approved by the Board of Directors;
or

       

      (iv)            by
any combination of the foregoing, or any other method of payment

       

      acceptable
to the Board of Directors in its sole discretion.

       

      9.2 Loan
Guarantees. The Board of Directors may, in its discretion, help the Participant
pay for Shares purchased under the Plan by authorizing a guarantee by the
Company of a third-party loan to the Participant.

       

      9.3 Tax
Withholding. The Company or any Subsidiary shall have the authority and the
right to deduct or withhold, or require a Participant to remit to the Company,
an amount sufficient to satisfy federal, state, and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any taxable event arising as a result of this Plan. Whenever, under the Plan,
payments in satisfaction of Awards are to be made in cash, such payment shall be
net of an amount sufficient to satisfy federal, state, and local withholding tax
requirements. With respect to withholding required upon any taxable event
relating to the issuance of Stock under the Plan, Participants may elect (the
"Election"), on or
prior to the date of such taxable event, to satisfy the withholding requirement,
in whole or in part, by having the Company or any Subsidiary withhold shares of
Stock having a Fair Market Value on the date of withholding equal to the amount
to be withheld for tax purposes. The Board of Directors may disapprove any
Election or may suspend or terminate the right to make Elections. An Election is
irrevocable. The Board of Directors may, at the time any Award is granted,
require that any and all applicable tax withholding requirements be satisfied by
the withholding of shares of Stock as set forth above.

       

      9.4
Reload Options. Award Agreements may contain a provision pursuant to which a
Participant who pays all or a portion of the exercise price of an Option or the
tax required to be withheld pursuant to an exercise of an Option by surrendering
shares of Stock pursuant to Sections 9.1 or 9.3, respectively, shall be
automatically granted an Option for the purchase of Stock equal to the number of
shares surrendered (a "Reload
Option"). The grant of the Reload Option shall be effective on the date
the Participant surrenders the shares of Stock in respect of which the Reload
Option is granted (the "Reload
Date"). The Reload Option shall have an exercise price equal to the Fair
Market Value of the Stock on the Reload Date, and shall have a term which is no
longer, and which shall lapse no later, than the original term of the underlying
option. If Stock otherwise available under an Incentive Stock Option is withheld
pursuant to

      

      
        
          
          

        

        
          SOP-9

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      Section
9.3, any Reload Option granted in connection with the withholding shall be
treated as a new Incentive Stock Option, subject to the rules set forth in
Section 7.2.

       

      ARTICLE
10

      PROVISIONS
APPLICABLE TO AWARDS

       

      10.1
Stand Alone, Tandem, and Substitute Awards. Awards granted under the Plan may,
in the discretion of the Board of Directors, be granted either alone or in
addition to, in tandem with, or in substitution for, any other Award granted
under the Plan. Awards granted in addition to or in tandem with other Awards may
be granted either at the same time as or at a different time from the grant of
such other Awards.

       

      10.2
Modification or Assumption of Awards. Within the limitations of the Plan, the
Board of Directors may modify, extend or assume outstanding Awards or may accept
the cancellation of outstanding Awards (whether granted by the Company or by
another issuer) in return for the grant of new Awards for the same or a
different number of shares and at the same or a different exercise price. The
foregoing notwithstanding, no modification of an Award shall, without the
consent of the Participant, alter or impair his or her rights or obligations
under such Award.

       

      10.3
Exchange Provisions. The Board of Directors may at any time offer to exchange or
buy out any previously granted Award for a payment in cash, Stock, or another
Award, based on the terms and conditions the Board of Directors determines and
communicates to the Participant at the time the offer is made.

       

      10.4 Term
of Award. The term of each Award shall be for the period as determined by the
Board of Directors, provided that in no event shall the term of any Incentive
Stock Option exceed a period of ten years from the date of its
grant.

       

      10.5 Form
of Payment for Awards. Subject to the terms of the Plan and any applicable law
or Award Agreement, payments or transfers to be made by the Company or a
Subsidiary on the grant or exercise of an Award may be made in such forms as the
Board of Directors determines at or after the time of grant, including without
limitation, cash, Stock, other Awards, or other property, or any combination,
and may be made in a single payment or transfer, in installments, or on a
deferred basis, in each case determined in accordance with rules adopted
by, and at the discretion of, the Board of Directors.

       

      10.6
Limits on Transfer. No right or interest of a Participant in any Award may be
pledged, encumbered, or hypothecated to or in favor of any party other than the
Company or a Subsidiary, or shall be subject to any lien, obligation, or
liability of such Participant to any other party other than the Company or a
Subsidiary. Except as otherwise provided below, no Award shall be assignable or
transferable by a Participant other than by will or the laws of descent and
distribution or, except in the case of an Incentive Stock Option, pursuant to a
"domestic relations order" as defined in the Code or Title I of the Employee
Retirement Income Security Act, or the rules thereunder. In the Award Agreement
for any Award other than an Award that includes an Incentive Stock Option, the
Board of Directors may allow a Participant to assign or otherwise

      

      
        
          
          

        

        
          SOP-10

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      transfer
all or a portion of the rights represented by the Award to specified individuals
or classes of individuals, or to a trust benefiting such individuals or classes
of individuals, subject to such restrictions, limitations, or conditions as the
Board of Directors deems appropriate. At the discretion of the Board of
Directors, the Company may reserve to itself or its assignees in any Award a
right of first refusal to purchase any Stock which a Participant may propose to
transfer to a third party and/or a right to repurchase any and all Stock held by
a Participant upon the Participant's termination of employment or other
relationship with the Company or its Parent or Subsidiary for any reason,
including Death or Disability, at a price for such Stock as determined by the
Board of Directors.

       

      10.7
Lock-up Agreement. In addition to any other restrictions on transfer, a
Participant shall not, without the prior written consent of the Board of
Directors in its discretion, offer or sell any Stock acquired pursuant to the
Plan for at least 180 days after the closing of the initial public offering of
securities of the Company registered under the Securities Act, or in the event
that subsequent to such initial public offering the Stock is not listed and
traded upon a recognized securities exchange or quoted on a recognized national
market system, the closing of each offering of securities of the Company
registered under the Securities Act subsequent to such initial public offering
through and including the offering after which the Stock is listed and traded
upon such exchange or system.

       

      10.8
Stock Certificates. All Stock certificates delivered under the Plan are subject
to any stop-transfer orders and other restrictions as the Board of Directors
deems necessary or advisable to comply with federal or state securities laws,
rules, and regulations and the rules of any national securities exchange or
automated quotation system on which the Stock is listed, quoted, or traded. The
Board of Directors may place legends on any Stock certificate to reference
restrictions applicable to the Stock.

       

      ARTICLE
11

       

      CHANGES
IN CAPITAL STRUCTURE

       

      11.1
General; Adjustments. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Stock, a declaration of a dividend payable
in a form other than Stock in an amount that has a material effect on the price
of the Stock, a combination or consolidation of the outstanding Stock (by
classification or otherwise) into a lesser number of shares of Stock, a
recapitalization, a spin-off or a similar occurrence, the Board of Directors
shall make such adjustments as it, in its sole discretion, deems appropriate in
one or more of (a) the number of shares of Stock available for future Awards
under Article 4, (b) the limitations set forth in Article 4, (c) the number and
kind of shares of Stock covered by each outstanding Award or (d) the exercise
price under each outstanding Option and other Award in the nature of rights that
may be exercised. Except as provided in this Article 11, a Participant shall
have no rights by reason of any issue by the Company of stock of any class or
securities convertible into stock of any class, any subdivision or consolidation
of shares of stock of any class, the payment of any stock dividend or any other
increase or decrease in the number of shares of stock of any class.

      

      
        
          
          

        

        
          SOP-11

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      11.2
Dissolution or Liquidation. To the extent not previously exercised, Awards shall
terminate immediately prior to the dissolution or liquidation of the
Company.

       

      11.3
Reorganizations. In the event that the Company is a party to a merger,
consolidation or other reorganization, outstanding Awards shall be subject to
the agreement of merger, consolidation or reorganization. The Board of Directors
may cause such agreement to provide, without limitation, (a) for the
continuation of outstanding Awards by the Company (if the Company is a surviving
corporation), (b) for their assumption by the surviving corporation or its
parent or subsidiary, (c) for the substitution by the surviving corporation or
its parent or subsidiary of its own awards for such Awards, (d) for accelerated
vesting, accelerated expiration and/or lapse of restrictions, or (e) for
settlement in cash or cash equivalents. If the Board of Directors does not cause
such agreement to provide for one of the alternatives in (a), (b), (c), (d) or
(e) above, then all outstanding Options and other Awards in the nature of rights
that may be exercised shall become fully exercisable and all restrictions on
other Awards shall lapse, upon the effectiveness of the transactions
contemplated by such agreement.

       

      ARTICLE
12

      AMENDMENT,
MODIFICATION, AND TERMINATION

       

      12.1
General. With the approval of the Board of Directors, at any time and from time
to time, the Board of Directors may terminate, amend, or modify the Plan. An
amendment or modification of the Plan shall be subject to the approval of the
shareholders of the Company only to the extent required by applicable laws,
regulations and rules.

       

      12.2
Awards Previously Granted. No termination, amendment, or modification of the
Plan shall adversely affect in any material way any Award previously granted
under the Plan, without the written consent of the Participant.

       

      ARTICLE
13

      GENERAL
PROVISIONS

       

      13.1 No
Rights to Awards. No Participant or employee shall have any claim
to be granted any Award under the Plan, and neither the Company nor the
Board of Directors is obligated to treat Participants and employees
uniformly.

       

      13.2 No
Stockholder Rights. No Award gives the Participant any of the rights of a
shareholder of the Company unless and until shares of Stock are in fact issued
to such person in connection with such Award.

       

      13.3 No
Right to Employment. Nothing in the Plan or any Award Agreement shall interfere
with or limit in any way the "at will" nature of any Participant's employment or
other relationship with the Company or any Subsidiary, nor confer upon any
Participant any right to continue in the employment or any other relationship of
the Company or any Subsidiary, and the Company and each Subsidiary reserve the
right to terminate any Participant's employment or other relationship at any
time.

      

       

      
        
          
          

        

        
          SOP-12

          
            

          

        

        
          
          

        

      

      
        VT Arabic Services, Inc.

        2004 EQUITY INCENTIVE PLAN 

        
          

        

         

      

      13.4
Unfunded Status of Awards. The Plan is intended to be an "unfunded" plan for
incentive and deferred compensation. With respect to any payments not yet made
to a Participant pursuant to an Award, nothing contained in the Plan or any
Award Agreement shall give the Participant any rights that are greater than
those of a general creditor of the Company or any Subsidiary.

       

      13.5
Relationship to Other Benefits. No payment under the Plan shall be taken into
account in determining any benefits under any pension, retirement, savings,
profit sharing, group insurance, welfare or other benefit plan of the Company or
any Subsidiary.

       

      13.6
Expenses. The expenses of administering the Plan shall be borne by the Company
and its Subsidiaries.

       

      13.7
Titles and Headings. The titles and headings of the Articles and Sections in the
Plan are for convenience of reference only, and in the event of any conflict,
the text of the Plan, rather than such titles or headings, shall
control.

       

      13.8
Fractional Shares. No fractional shares of stock shall be issued and the Board
of Directors shall determine, in its discretion, whether cash shall be given in
lieu of fractional shares or whether such fractional shares shall be eliminated
by rounding up to the next whole number of shares.

       

      13.9
Securities Law Compliance. With respect to any person who is, on the relevant
date, obligated to file reports under Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Section 16 or its successors under the Exchange Act. To the extent
any provision of the Plan or any Award Agreement or any action by the Board of
Directors fails to so comply, it shall be void to the extent required by law and
voidable as deemed advisable by the Board of Directors.

       

      13.10
Government and Other Regulations. The obligation of the Company to make payment
of awards in Stock or otherwise shall be subject to all applicable laws, rules,
and regulations, and to such approvals by government agencies as may be
required. The Company shall be under no obligation to register under the
Securities Act, any of the shares of Stock paid under the Plan. If the shares of
Stock paid under the Plan may in certain circumstances be exempt from
registration under the Securities Act, the Company may restrict the transfer of
such shares in such manner as it deems advisable to ensure the availability of
any such exemption.

       

      13.11
Governing Law. The Plan and all Award Agreements shall be construed in
accordance with and governed by the laws of the State of Arizona.

       

      13.12
Nonexclusivity of the Plan. Neither the adoption of the Plan nor the submission
of the Plan to the shareholders of the Company for approval shall be construed
as creating any limitations upon the right and authority of the Board of
Directors to adopt such other incentive compensation arrangements (which
arrangements may be applicable either generally to a class or classes of
individuals or specifically to a particular individual or individuals) as the
Board of

      

      
        
          
          

        

        
          SOP-13

          
            

          

        

        
          
          

        

      

      VT Arabic Services, Inc.

      2004 EQUITY INCENTIVE PLAN 

      
        

      

       

       

      Directors
in its discretion determines desirable, including, without limitation, the
granting of stock options or other rights otherwise than under the
Plan.

       

       

      DATED:  September 17, 2004    

       

       

      BY:      /s/Lanny R. Lang      

          Lanny R. Lang,
Secretary

       

       

       

       

      SOP 14

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