Document:

YOU On Demand Holdings, Inc.: Exhibit 10.26 - Filed by newsfilecorp.com

CONTENT LICENSE AGREEMENT 

THIS CONTENT LICENSE AGREEMENT (this “Agreement”), dated as of
December 21, 2015 (the “Effective Date”), is entered into between Beijing Sun
Seven Stars Culture Development Limited, a P.R.C. company with an address at
Eastern Fangzheng Road, Southern Dongying Village, Hancunhe Town, Fangshan
District, Beijing City, P.R.C. (“Licensor”), and YOU ON DEMAND HOLDINGS,
INC., a Nevada corporation with an address at 375 Greenwich Street, Suite
516, New York, New York 10013 (“Licensee”). 

WHEREAS, Licensor and Licensee have agreed to enter into this
Agreement, pursuant to which Licensor shall license to Licensee certain video
programming on the terms and subject to the conditions contained in this
Agreement.

NOW, THEREFORE, in consideration of the foregoing, the mutual
promises and covenants herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
incorporating the above recitals with and into this Agreement, the parties
hereby agree as follows: 

TERMS AND CONDITIONS 

1.     Definitions.

(a)     “Additional Title” shall
have the meaning specified in Section 5. 

(b)     “Advertising” shall have the
meaning specified in Section 9. 

(c)     “Affiliate(s)” shall mean an
entity controlling, controlled by or under common control with a party.
"Control," for purposes of this definition, means direct or indirect ownership
or control of more than 50% of the voting interests of the subject entity.

(d)     “Confidential Information”
shall have the meaning specified in Section 14(a). 

(e)     “Indemnified Party” shall
have the meaning specified in Section 13. 

(f) “Indemnifying Party” shall
have the meaning specified in Section 13. 

(g) “Licensor Marks” shall have
the meaning specified in Section 11. 

(h) “Materials” shall have the
meaning specified in Section 4(b). 

(i)     “Mobile Sites” shall mean
any and all versions of the Licensee Sites optimized for delivery and/or
distribution via a wireless network.

1 

(j)     “Reports” shall have the
meaning specified in Section 8(b). 

(k)     “Share Consideration”
has the meaning specified in Section 10.

(l)     “Sites” shall mean any and
all websites, applications, products and other services through which Licensee
(itself or through a third party) delivers content via the public Internet or an
IP-based network, regardless of whether the device used to access such websites,
applications, products or other services is a laptop or desktop computer, mobile
device, tablet, mobile phone, set-top box, or other device. 

(m)     “Term” shall have the
meaning specified in Section 7. 

(n)     “Territory” shall mean
mainland China. 

(o)     “Titles” shall mean the
programming listed on Schedule A (as Schedule A may be amended in
accordance with Section 5 from time to time). 

(p)     “Users” shall mean all
subscribers to Licensee’s services. 

(q)     “VOD” shall mean a system
that allows for the exhibition of video programming chosen by a subscriber for
display on that subscriber’s video display unit on an on-demand basis, such that
a subscriber is able, at his or her discretion, to select the time for
commencement of exhibition, and shall include subscription VOD (“SVOD”),
transactional VOD (“TVOD”), ad-supported VOD (“AVOD”) and free VOD. 

2.     Rights Granted. 

(a)     License Grant. In exchange
for the Share Consideration, Licensor hereby grants to Licensee a non-exclusive,
royalty-free, perpetual and non-perpetual license (subject to the
duration and scope, and format limitations for which Licensor has the rights to
each Title as specified in Schedule A1-A6 of Schedule A) to: 

i.     license, exhibit, distribute,
reproduce, transmit, perform, display, and otherwise exploit and make available
each Title within the Territory in any language by VOD (including SVOD, TVOD,
AVOD and free VOD) for Internet, TV and mobile platforms (including, but not
limited to, OTT streaming services, Sites and Mobile Sites), subject to these
limitations for each of the Title in Schedule A1-A6: 

1)     For Titles
listed in Schedule A1-A2:

Licensor can only grant Licensee distribution rights to up to six (6) MSOs plus
two (2) of China’s Internet TV license holders or their OTT Internet-based video
partners by VOD (including SVOD, TVOD, AVOD and free VOD). China’s current Internet TV license holders include: CNTV
(中国网络电视台/未来电视), BesTV
(百视通), Wasu (华数),
Southern Media Cooperation (南方传媒), Hunan
TV (芒果 TV), China National Radio/Galaxy Internet TV (GITV)
(银河电视), and China
Radio International (中国国际广播电台); 

2 

2)     For Titles
listed in Schedule A3: 

For “天下女人”: No satellite TV broadcasting rights granted. Titles other than
“猜猜女人心”, “赏深越慕”, “职场新女性挑战行动”,
“ 杨澜访谈录” (自第192期及以后的节目),“人生相对论 ”, ”
天下女人”, and
“正青春” cannot be edited in any way; 

3)     For Titles
listed in Schedule A4: 

Other than the versions (dubbed or translated) in which the Titles in Schedule
A4 already exist in (and were delivered in), no further dubbing, translation, or
editing may be performed by any party on Schedule A4’s Titles. 

4)     For Titles
listed in Schedule A5 (except “Summer in February”): 

Limitations on Rights
Granted: the following distribution methods are permitted: non-theatrical,
public video, ship and hotel rights (all not earlier than the US theatrical
release); home video rental, home video sell through, and commercial video
rights (all not earlier than the US video release); cable TV (pay & free),
terrestrial TV (pay & free), satellite pay TV; internet TV (pay & free),
residential and non-residential pay-per-view, residential and non-residential
internet pay-per-view, VOD, near VOD, and internet VOD (all no earlier than the
corresponding exploitation in the USA). 

Contents are dubbed and subtitled in Cantonese and Mandarin
languages. Exploitation of the Title over the internet must adhere to the
following: 1) Distribution is limited to the dubbed or subtitled version,
provided the subtitles shall be burnt in with no option to remove them, 2)
Licensor must be notified prior to the first exhibition of the Title over the
internet, and 3) Authorization to use excerpts, stills, trailers and soundtrack
parts of the Title for the 3 promotion of the Title only on Licensor’s or Licensor’s
authorized agent’s web site online. 

Rights granted for “Summer in February”, shall adhere to
Section 2, not subject to the limitations in section 2(a)(i)(4).

ii.     copy and dub the Titles, and
authorize any person to do the foregoing Licensee shall also have the right to
make (or have made on its behalf) translations of the Titles with prior written
approval by Licensor and subject to the applicable limitations (if any) in
Section 2(a)(i); 

iii.     promote each Title in any manner
or media, including, without limitation, the right to use and license others to
use Licensor’s name, the title of, trailers created for and excerpts from such
Title (including but not limited to audio portions only), Materials and the
name, voice and likeness of and any biographical material concerning all persons
appearing in or connected with such Title for the purpose of advertising,
promoting and/or publicizing such Title, Licensee and the program service on
which the Title is exhibited subject to the applicable limitations (if any) in
Section 2(a)(i) ; 

iv.     use the Titles for (i) audience and
marketing testing, (ii) sponsor/advertiser screening, and (iii) reference and
file purposes, subject to the applicable limitations (if any) in Section
2(a)(i); and 

v.     include Licensee’s name, trademark
and logo in the Titles to identify Licensee as the exhibitor of the Titles. 

(b)     Sublicensing. Licensee shall
have the right to assign or sublicense any or all of its rights granted under
this Agreement, in whole or in part, to third parties exhibiting the Titles in
the ordinary course of Licensee’s business with prior written notice to Licensor
and subject to the applicable limitations (if any) in Section 2(a)(i). Except as
otherwise specified in the previous sentence, Licensee may not sublicense any of
its rights under Section 2(a) without Licensor’s prior written consent, which
shall not be unreasonably withheld or delayed.

(c)     Display of Titles. Licensee
agrees to display the Titles without material alteration to the content thereof.
Licensee may make non-material modifications or edits the format of the Titles
only for technical purposes with prior written approval by Licensor (such
approval not to be unreasonably withheld or delayed) and subject to the
applicable limitations (if any) in section 2(a)(i). Nothing in this Agreement
prevents Licensee from providing Users with the ability to use the Titles as
permitted by law or in a manner for which a license is not required. 

4 

(d)     Removal of Titles. If
Licensee receives written notice from Licensor that Licensor no longer has the
rights to provide a Title to Licensee, Licensee shall use commercially
reasonable efforts to remove such Title from Licensee’s services. Nothing in
this Agreement shall obligate Licensee to distribute, exhibit or otherwise use
any Title. In addition, should Licensee deem any aspect of any Title as either
inappropriate or otherwise objectionable or undesirable (whether for editorial,
legal, business or other reasons), Licensee reserves the right, but does not
assume the obligation, to discontinue distribution of such Title, without
liability and without limiting any rights or remedies to which Licensee may be
entitled, whether under this Agreement, at law, or in equity. 

(e)     Profit Participation. For content
listed in Schedule A6 of Schedule A (each a “Project”), Licensor will only grant
Licensee certain profit participation rights, for certain durations, as detailed
and set forth in Schedule A6 of Schedule A. Licensee will not have distribution
rights or any other rights to the content in Schedule A6 of Schedule A under
Section 2(a)-(d). If for any reason the A6 projects do not get produced, SSS
will substitute comparable projects, to be mutually approved. “Profit
Participation” means a portion of Profits equal to the amount designated in
Schedule A6 of Schedule A. “Profits” shall be defined and calculated as
follows:

i.     “Profits” shall mean Gross Revenue
received by Licensor in connection with the Project remaining after the
deduction therefrom of Fees, Expenses, and Third Party Royalties (each as
defined below).

ii.     “Gross Revenue” shall mean 100% of
all sums actually received by or credited to Licensor in connection with the
exploitation of the Project, for a period of 5 years from initial release, on a
worldwide basis from the distribution and exploitation of the Project or any
part thereof, provided that Gross Revenue shall not include (i) expenses in
connection with collecting such Gross Revenue; (ii) actual, verifiable, third
party, sales agency costs, fees and commissions which are mutually approved by
the parties; (iii) customary “off the tops,” including (without limitation)
claims, insurance, accounting or other professional service costs actually paid
by Producer or a reasonable reserve therefor.

iii.     “Fees” shall only apply to
non-television, non-Internet exploitation of the Project (e.g., DVD,
merchandise) and shall mean the actual, verifiable fee charged by a third party
licensing agent or distributor, and mutually agreed to by Licensee and
Licensor.

iv.     “Expenses” shall mean,
collectively, all costs, charges and expenses incurred and/or paid (including
without limitation residuals) in connection with the development, production,
distribution, marketing, advertising and promotion of the Project. Expenses may
include a producer or production fee to Licensor.

5 

v.     “Third Party Royalties” shall mean
any and all royalties and payments paid or payable to third parties for rights
and/or services in connection with the Project. 

 vi.     Licensee shall have equal
rights and access to all financial statements, records and/or data received from
any entity in connection with the Project. Licensor shall compile this
information (including information regarding approved budgets) on a annual basis
and provide to Licensee in summary form, the calculation of Profit Participation
for all of the parties, which shall be accompanied by the parties’ share
thereof, if any. Licensor will keep and maintain accurate books and records with
respect to the Project. Until one (1) year after the expiration of the Profit
Participation of each Project, the books and records will be available for
inspection by a certified accounting firm or CPA once per year upon reasonable
advance notice. Such books and records shall be made available at Licensor’s
normal place of business during normal business hours. If any examination of
Licensor’s books and records reveals that Licensor has failed to properly
account for any Profits owing to the parties, Licensor will promptly pay such
past due amounts. 

(f)     Editing of Titles. Any edits
to any Title will require the prior written approval by Licensor. 

3.     Licenses and Clearances. 

Licensor shall be solely responsible for the Titles and any and
all legal liability resulting from the Titles, excluding any legal liability
caused by Licensee’s breach of this Agreement or gross negligence with regards
to the Titles. Without limiting the generality of the foregoing, Licensor shall
be solely responsible for any and all royalties and other fees payable to any
applicable licensor(s) or any third party for distribution of the Titles by
Licensee (including, without limitation, residuals and clearances or other
payments to guilds or unions and rights for music clearances, such as
performance rights, synchronization rights and mechanical rights), and all other
fees, payments and obligations arising out of the activities contemplated by
this Agreement, and Licensee shall have no responsibility or liability for any
such royalties or fees. Licensor acknowledges that Licensee cannot and does not
undertake to review, and shall not be responsible for Users’ unauthorized use or
exploitation of, the Titles. Should Licensee become aware of Users’ unauthorized
use or exploitation of the Titles, Licensee shall immediately report such use to
Licensor. 

4.     Delivery Requirements; Customer
Service. 

(a)     Within fifteen (15) days after the
Effective Date or on December 31, 2015 (whichever is earlier), Licensor shall
(at Licensor’s sole expense), make the Titles available either online or by hard
drive to Licensee or the third-party vendor specified by Licensee to provide or deliver the Titles from Licensee’s or
its third-party vendor’s facilities. Delivery of the Titles shall be deemed
complete if Licensor makes the Titles available in accordance with the previous
sentence. If, from time to time, Licensee requests an alternate delivery method
for the Titles and/or the implementation of Licensee’s technical specifications
relating to the online delivery of the Titles, then Licensor will use
commercially reasonable efforts to comply with each such request.

6 

(b)     When Licensor delivers each Title
to Licensee, Licensor shall provide Licensee (at the place specified by
Licensee) with all available promotional materials for such Title, including,
but not limited to, captioned photographs, brochures, a synopsis and description
of such Title, a complete list of cast and credits, biographies of key
performers, and any electronic press kits, trailers or featurettes created for
such Title (collectively, the “Materials”).

(c)     In the event of technical problems
with any of the Titles, each party shall use commercially reasonable efforts to
notify the other and to remedy any such problems in a timely manner. 

(d)     Licensor will provide Licensee with
reasonable assistance in responding to User inquiries regarding the Titles.

5.     Additional Titles.

If, during the Term, Licensor develops or obtains the rights to
license any live action or animated feature-length motion picture (each an
“Additional Title”), Licensor shall give Licensee the first right of negotiation
for each Additional Title (i.e., the preferred vendor). Licensor will promptly
provide written notice to Licensee in which Licensor lists each Additional
Title. Should Licensee agree to be the vendor for an Additional Title, Licensor
and Licensee will negotiate in good faith to mutually agree upon the pricing and
terms for each Additional Title in an amendment to this Agreement. Licensor will
deliver each Additional Title in accordance with Section 4(a). Unless otherwise
expressly stated in such an amendment, each Additional Title listed in such an
amendment will be deemed a “Title” and Schedule A will be deemed amended to
include such Additional Title.

6.     Expansion of Licensee’s VOD
Services. 

Licensor will use its partners and media channels to expand
distribution of Licensee’s VOD services to more cable MSOs and all other
platforms for which Licensee is permitted to distribute the Titles under Section
2(a)(i).

7.     Term and Termination.

(a)     The Term of this Agreement (the
“Term”) shall commence on the Effective Date listed above and continue for
twenty (20) years, unless sooner terminated as provided in Section 7(b).

7 

(b)     This Agreement may be terminated at
any time by either party, effective immediately upon written notice, if the
other party: (i) becomes insolvent; (ii) files a petition in bankruptcy; or
(iii) makes an assignment for the benefit of its creditors. Either party may
terminate this Agreement upon written notice if the other party materially
breaches this Agreement and fails to cure such breach within thirty (30) days
after the date that it receives written notice of such breach from the
non-breaching party.

(c)     Sections 2(a), 2(b), 2(c), 2(d), 3,
and 11 shall survive the expiration or termination of this Agreement: (i) in
perpetuity with respect to Titles for which the licenses granted in Section 2(a)
are perpetual; and (ii) for the duration of the applicable license term
specified in Schedule A with respect to Titles for which the license term
specified in Schedule A extends beyond the expiration or termination of
this Agreement. Sections 1, 7, 8(a), 12, 13, 14, 15, 16 and 17 shall survive any
expiration or termination of this Agreement in perpetuity.

8.     Privacy and Data Collection;
Reports. 

(a)     All User information (including,
without limitation, any personally identifiable information and statistical
information regarding Users’ use and viewing of the Titles) generated, collected
or created in connection with the display of the Titles through Licensee’s
services shall be considered Confidential Information of Licensee, and all
right, title and interest in and to such information shall be owned by
Licensee.

(b)     Licensee will provide Licensor with
reports (“Reports”) containing statistical information collected by Licensee on
(i) Users’ use of the Titles, (ii) distribution channels used by Licensee for
the distribution of the Titles, (iii) sub-licensees to which the Titles were
sub-distributed by Licensee and (if permitted under Licensee’s agreements with
the sublicensees) any relevant reports received by Licensee from those
sublicensees, and (iv) any other information that the Licensor may request
Licensee to gather from time to time, subject to mutual approval. The Reports
will be delivered in a format that is mutually agreed upon by the parties. The
Reports and all information contained in the Reports shall be considered
Confidential Information of Licensee, and all right, title and interest in and
to such Reports and information shall be owned by Licensee. 

9.     Advertising.

The parties acknowledge and agree that Licensee’s services may
contain advertising, promotions and/or sponsorship material (collectively,
“Advertising”). Such Advertising shall be determined by Licensee in its sole
discretion and Licensee shall be entitled to retain all revenues resulting from
the sale of Advertising.

8 

10.     Consideration. 

No royalty or fees of any kind shall be owed by Licensee under
this Agreement. The consideration for the licenses granted by Licensor to
Licensee under this Agreement is the issuance of the IP Common Shares as defined
in the Amended and Securities Purchase Agreement, dated as of December 21, 2015,
by and among the Licensee and the Licensor (the “Share
Consideration”).

11.     Use of Licensor Marks. 

Licensor hereby grants Licensee a non-exclusive license to use
the logos, trademarks and service marks used by Licensor to identify the Titles
(collectively, “Licensor Marks”) in connection with the use of the Titles as set
forth in this Agreement. Licensee acknowledges and agrees that Licensee’s use of
the Licensor Marks shall inure to the benefit of Licensor. Should Licensor find
objectionable any use of the Licensor Marks by Licensee, Licensor shall have the
right to revoke, with respect to the objectionable use, the rights granted to
Licensee under this Agreement to use the Licensor Marks, and Licensee shall
promptly cease using the Licensor Marks in the manner found objectionable by
Licensor. 

12.     Representations and
Warranties. 

(a)     Licensor represents and warrants
that: 

i.     The execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on the part of Licensor and this Agreement constitutes a valid
and legally binding agreement of Licensor enforceable against Licensor in
accordance with its terms; 

ii.     It will not take or authorize any
action, or fail to take any action, by which any of the rights in any Title
granted herein may be impaired in any way; 

iii.     It has all rights and authority
necessary to fully perform its obligations and grant the rights granted under
this Agreement and all rights in and to the Titles and in and to all literary,
artistic, dramatic, intellectual property and musical material included therein
required for the exercise of rights granted in this Agreement without liability
of any kind to any third party; provided however, that this representation and
warranty shall not apply to non-dramatic performing rights in music to the
extent that they are controlled by SESAC, ASCAP or BMI or to the extent that
such music is in the public domain;

9 

iv.     Each Title is and will be protected
during the Term by copyright throughout the Territory; 

v.     There are no taxes, charges, fees,
royalties or other amounts owed to any party other than as set forth in this
Agreement for the exercise of rights granted in this Agreement and Licensor has
paid or will pay all charges, taxes, license fees and other amounts that have
been or may become owed in connection with the Titles or the exercise of any
rights granted under this Agreement; 

vi.     Licensor shall make all payments
which may become due to any union or guild and to any third parties who rendered
services in connection with the production of the Titles by virtue of the use
made of the Titles hereunder; 

vii.     No claim or litigation is pending
or threatened and no lien, charge, restriction or encumbrance is in existence
with respect to any Title that would adversely affect or impair any of the
rights granted under this Agreement; 

viii.     The Titles, Materials and
Licensor Marks will not violate or infringe any common law or statutory right of
any person or other entity including, without limitation, any contractual
rights, proprietary rights, trademark, service mark, copyright or patent rights,
or any rights of privacy or publicity; 

ix.     The Titles, Materials and the
Licensor Marks will not be unlawful, slanderous or libelous; and 

x.     To the extent that any Title makes
any claims or renders any instruction or advice, such claim, instruction or
advice shall comply with all federal, state and other applicable laws and
regulations and shall cause no harm to any person or entity following or acting
in accordance with such instruction or advice. 

(b)     Licensee represents and warrants
that: 

i.     The execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on the part of Licensee and this Agreement constitutes a valid
and legally binding agreement of Licensee enforceable against Licensee in
accordance with its terms; 

ii.     It will use the Titles solely as
permitted under this Agreement; 

iii.    
It has the full right, capacity and authority to enter into this Agreement and
to perform all of its obligations hereunder; and 

iv. As of the Effective
Date, there is no claim, action, suit, investigation or proceeding relating to
or affecting Licensee pending or threatened, in law or in equity, or any other
circumstance which might adversely affect Licensee’s ability to perform all of
its obligations hereunder. 

10 

13.     Indemnification. 

Each party shall defend, indemnify and hold the other
party and its Affiliates, and their respective directors, officers, employees,
agents, successors, assigns, licensees and distributors harmless from and
against any and all judgments, settlements, damages, penalties, costs and
expenses (including, but not limited to, reasonable attorneys’ fees) arising out
of any third party claims relating to the Indemnifying Party’s breach or alleged
breach of any of its representations, warranties, covenants or obligations
hereunder. The party seeking indemnification (the “Indemnified Party”) will give
prompt notice to the indemnifying party (the “Indemnifying Party”) of any claim
for which the Indemnified Party seeks indemnification under this Agreement;
provided, however, that failure to give prompt notice will not relieve the
Indemnifying Party of any liability hereunder (except to the extent the
Indemnifying Party has suffered actual material prejudice by such failure). The
Indemnified Party will reasonably cooperate (at the Indemnifying Party’s
expense) in the defense of any claim for which the Indemnified Party seeks
indemnification under this Section 13. The Indemnified Party shall have the
right to employ separate counsel and to participate in (but not control) any
such action, but the fees and expenses of such counsel will be at the expense of
the Indemnified Party unless: (i) the employment of counsel by the Indemnified
Party has been authorized by the Indemnifying Party; (ii) the Indemnified Party
has been advised by its counsel in writing that there is a conflict of interest
between the Indemnifying Party and the Indemnified Party in the conduct of the
defense of the action (in which case the Indemnifying Party will not have the
right to direct the defense of the action on behalf of the Indemnified Party);
or (iii) the Indemnifying Party has not in fact employed counsel to assume the
defense of the action within a reasonable time following receipt of the notice
given pursuant to this Section 13, in each of which cases the fees and expenses
of such counsel will be at the expense of the Indemnifying Party. The
Indemnifying Party will not be liable for any settlement of an action effected
without its written consent (which consent will not be unreasonably withheld or
delayed), nor will the Indemnifying Party settle any such action without the
written consent of the Indemnified Party (which consent will not be unreasonably
withheld or delayed). The Indemnifying Party will not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the giving by the claimant or plaintiff to the
Indemnified Party a release from all liability with respect to the claim. 

14.     Confidentiality. 

(a)     Confidential Information.
“Confidential Information” means all non-public information about the disclosing
party’s business or activities that is marked or designated by such party as
“confidential” or “proprietary” at the time of disclosure or that reasonably
would be understood to be confidential given the circumstances of disclosure. Notwithstanding the foregoing, Confidential
Information does not include information that: (a) is in or enters the public
domain without breach of this Agreement; (b) the receiving party lawfully
receives from a third party without restriction on disclosure and without breach
of a nondisclosure obligation; (c) the receiving party rightfully knew prior to
receiving such information from the disclosing party; or (d) the receiving party
develops entirely independently of, and without any access or reference to or
use of, any Confidential Information communicated to the receiving party by the
disclosing party.

11 

(b)     Restrictions. Each party
agrees that, during the Term and for two (2) years thereafter: (i) it will not
disclose to any third party any Confidential Information disclosed to it by the
other party except as expressly permitted in this Agreement; (ii) it will only
permit access to Confidential Information of the disclosing party to those of
its employees or authorized representatives or advisors (including, without
limitation, the receiving party’s auditors, accountants, and attorneys) having a
need to know and who, prior to obtaining such access, are legally bound to
protect the disclosing party’s Confidential Information at least to the same
extent as set forth herein; (iii) it will use any Confidential Information
disclosed to it by the other party only for the purpose of performing its
obligations or exercising its rights under this Agreement and not for any other
purpose, whether for such party’s own benefit or the benefit of any third party;
(iv) it will maintain the confidentiality of all Confidential Information of the
other party in its possession or control; and (v) that (x) upon the expiration
or termination of this Agreement, or (y) at any time the disclosing party may so
request, it will deliver promptly to the disclosing party, or, at the disclosing
party’s option, it will destroy, all Confidential Information of the disclosing
party that it may then possess or have under its control. Notwithstanding the
foregoing, each party may disclose Confidential Information of the other party
to the extent required by a court of competent jurisdiction or other
governmental authority or otherwise as required by law, provided that such party
will, as soon as reasonably practicable, provide the disclosing party with
written notice of such requirement so that the disclosing party may seek a
protective order or other appropriate remedy. The receiving party and its
representatives will cooperate fully with the disclosing party to obtain any
such protective order or other remedy. If the disclosing party elects not to
seek, or is unsuccessful in obtaining, any such protective order or similar
remedy and if the receiving party receives advice from reputable legal counsel
confirming that the disclosure of Confidential Information is required pursuant
to applicable law, then the receiving party may disclose such Confidential
Information to the extent required; provided, however, that the receiving party
will use commercially reasonable efforts to ensure that such Confidential
Information is treated confidentially by each party to which it is disclosed.

15.     Disclaimers. 

EXCEPT AS EXPRESSLY STATED IN SECTION 12, THE PARTIES HEREBY
DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE, CONCERNING THE SUBJECT MATTER OF THIS
AGREEMENT.

12 

16.     Limitation of Liability.

EXCEPT FOR THE ABOVE INDEMNIFICATION OBLIGATIONS AND FOR
BREACHES OF SECTION 14, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES ARISING OUT OF THIS
AGREEMENT (INCLUDING, BUT NOT LIMITED TO, LOSS OF PROFITS), WHETHER IN AN ACTION
OR ARISING OUT OF BREACH OF CONTRACT, TORT OR ANY OTHER CAUSE OF ACTION EVEN IF
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 

17.     Miscellaneous. 

(a)     Governing Law. This
Agreement shall be governed by and construed in all respects in accordance with
the laws of the State of New York, without giving effect to any conflicts of
laws principles. 

(b)     Dispute Resolution. Any
dispute, controversy and/or difference which may arise out of or in connection
with or in relation to this Agreement, shall be solely and finally settled by
binding arbitration pursuant to then-current rules of the International Chamber
of Commerce. Such arbitration shall be held in New York, New York. The merits of
the dispute shall be resolved in accordance with the laws of the State of New
York, without reference to its choice of law rules. The tribunal shall consist
of three arbitrators, each of whom shall be knowledgeable in the subject matter
hereof. The arbitration shall be conducted in the English language, and all
documents shall be submitted in English or be accompanied by a certified English
translation. The arbitrators will provide a written explanation to the parties
of any arbitration award. The award thereof shall be final and binding upon the
parties hereto, and judgment on such award may be entered in any court or
tribunal having jurisdiction, and the parties hereby irrevocably waive any
objection to the jurisdiction of such courts based on any ground, including
without limitation, improper venue or forum non conveniens. The parties and the
arbitration panel shall be bound to maintain the confidentiality of this
Agreement, the dispute and any award, except to the extent necessary to enforce
any such award. The prevailing party, if a party is so designated in the
arbitration award, shall be entitled to recover from the other party its costs
and fees, including attorneys’ fees, associated with such arbitration. By
agreeing to this binding arbitration provision, the parties understand that they
are waiving certain rights and protections which may otherwise be available if a
dispute between the parties were determined by litigation in court, including,
without limitation, the right to seek or obtain certain types of damages
precluded by this arbitration provision, the right to a jury trial, certain
rights of appeal, and a right to invoke formal rules of procedure and evidence. Notwithstanding
anything to the contrary herein, each party shall be entitled, at any time,
without first resorting to the dispute resolution process set forth above, to
seek injunctive or other equitable relief from any court of competent
jurisdiction, wherever such party deems appropriate, in order to preserve or
enforce such party’s rights hereunder. 

13 

(c)     Non-Exclusivity. Nothing in
this Agreement limits or restricts Licensee from entering into any similar
agreements with any third party.

(d)     Severability. The invalidity
or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement. In the
event that any provision of this Agreement is determined to be invalid,
unenforceable or otherwise illegal, such provision shall be deemed restated, in
accordance with applicable law, to reflect as nearly as possible the original
intentions of the parties, and the remainder of the Agreement shall remain in
full force and effect. 

(e)     Waiver. No term or condition
of this Agreement shall be deemed waived, and no breach shall be deemed excused,
unless such waiver or excuse is in writing and is executed by the party against
whom such waiver or excuse is claimed. 

(f)     Entire Agreement. This
Agreement contains the entire agreement and understanding between the parties
with regard to the subject matter hereof, and supersedes all prior and
contemporaneous oral or written agreements and representations with respect to
such subject matter. This Agreement may be modified or amended only in a writing
signed by all parties. 

(g)     Jury Trial Waiver. THE
PARTIES SPECIFICALLY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY COURT WITH RESPECT
TO ANY CONTRACTUAL, TORTIOUS, OR STATUTORY CLAIM, COUNTERCLAIM, OR CROSS-CLAIM
AGAINST THE OTHER ARISING OUT OF OR CONNECTED IN ANY WAY TO THIS AGREEMENT,
BECAUSE THE PARTIES HERETO, BOTH OF WHOM ARE REPRESENTED BY COUNSEL, BELIEVE
THAT THE COMPLEX COMMERCIAL AND PROFESSIONAL ASPECTS OF THEIR DEALINGS WITH ONE
ANOTHER MAKE A JURY DETERMINATION NEITHER DESIRABLE NOR APPROPRIATE. 

(h)     Assignment. Neither party
may assign its rights, duties or obligations under this Agreement to any third
party in whole or in part, without the other party’s prior written consent,
except that (i) Licensee may assign its rights and obligations to this Agreement
to any of its Affiliate or subsidiaries with the prior written consent of the
Licensor, and (ii) Licensor may assign its rights and obligations in this
Agreement to its Affiliates or subsidiaries and either party may assign this
Agreement in its entirety to any purchaser of all or substantially all of its
business or assets pertaining to the line of business to which this Agreement
relates or to any Affiliate of the party without the other party’s approval. This Agreement will be binding upon, and
inure to the benefit of, the respective permitted assignees, transferees and
successors of each of the parties. 

14 

(i)     No Third Party
Beneficiaries. The parties acknowledge and agree that there are no third
party beneficiaries to this Agreement. 

(j)     Interpretation. In
interpreting the terms and conditions of this Agreement, no presumption shall be
interpreted for or against a party as a result of the role of such party in the
drafting of this Agreement. Sections headings are for convenience only and shall
not be used to interpret this Agreement. 

(k)     Notice. Any notice required
or permitted by this Agreement shall be in writing and shall be delivered as
follows, with notice deemed given upon receipt or refusal: (i) by overnight
courier service; (ii) hand delivery; or (iii) by certified or registered mail,
return receipt requested. Notice shall be sent to the addresses set forth below
or to such other address as either party may specify in a notice given under
this Section 17(k).

If to Licensee: 

You On Demand Holdings, Inc. 
375
Greenwich Street, Suite 516 
New York, New York 10013 
Attn: Board of
Directors

With a copy (which shall not constitute
notice or such other communication) to 
each of: 
Cooley LLP 
The Grace
Building 
1114 Avenue of the Americas 
New York, New York 10036-7798

Attn: William Haddad 

and 
Cooley LLP 
101 California
Street, 5th Floor 
San Francisco, California 94111-5800 
Attn: Garth
Osterman 

If to Licensor: 

Beijing Sun Seven Stars Culture
Development Limited 
Eastern Fangzheng Road 
Southern Dongying Village

15 

Hancunhe Town 
Fangshan District

Beijing City, P.R.C. 
Attn: Zhang Jie 

With a copy (which shall not constitute
notice or such other communication) to: 
Shanghai Sun Seven Stars Cultural
Development Limited 
686 WuZhong Road, Tower D, 9th Floor 
Shanghai, China
201103 
Attn: Polly Wang 

(l)     Press Releases. Unless
required by law, neither party will, without the prior written approval of the
other party, issue any press release or similar announcement relating to the
existence or terms of this Agreement. 

(m)     Counterparts. This Agreement
may be executed in counterparts, all of which when taken together shall be
deemed to constitute one and the same instrument. 

[Signature Page Follows]

 

16 

IN WITNESS WHEREOF and intending to be legally bound hereby,
the parties have executed this Content License Agreement as of the date first
set forth above. 

LICENSOR: 

BEIJING SUN SEVEN STARS CULTURE DEVELOPMENT LIMITED 

	By: 	/s/ Bruno Wu	 
	Name: 	Bruno Wu 	 
	Title: 	Chairman & CEO 	 

LICENSEE: 

YOU ON DEMAND HOLDINGS, INC. 

	By: 	/s/ Shane McMahon	 
	Name: 	Shane McMahon	 
	Title: 	Chairman	 

[SIGNATURE PAGE TO CONTENT LICENSE AGREEMENT] 

 

SCHEDULE A 

TITLES 

[Attached]YOU On Demand Holdings, inc.: Exhibit 10.27 - Filed by newsfilecorp.com

AMENDED AND RESTATED SHARE PURCHASE AGREEMENT 

BY AND BETWEEN 

TIANJIN ENTERNET NETWORK TECHNOLOGY LIMITED 

AND 

YOU ON DEMAND HOLDINGS, INC. 

DATED AS OF DECEMBER 21, 2015 

AMENDED AND RESTATED SHARE PURCHASE AGREEMENT 

THIS AMENDED AND RESTATED SHARE
PURCHASE AGREEMENT (this “Agreement”), dated as of December 21, 2015, is
entered into by and between TIANJIN ENTERNET NETWORK TECHNOLOGY LIMITED, a
P.R.C. company (“Seller”), and YOU ON DEMAND HOLDINGS, INC., a Nevada
corporation (“Buyer,” and together with Seller, each a “Party”
and, collectively, the “Parties”). 

WHEREAS, the Parties entered into
that certain Share Purchase Agreement, dated as of November 23, 2015 (the
“Original Agreement”); 

WHEREAS, Buyer is a party to that
certain Securities Purchase Agreement, dated as of November 23, 2015 (as amended
from time to time, the “Securities Purchase Agreement”), by and between
Beijing Sun Seven Stars Culture Development Limited, a P.R.C. company
(“Sun Seven Stars”), and Buyer; 

WHEREAS, pursuant to the
Securities Purchase Agreement, Buyer agreed to enter into the Original
Agreement; 

WHEREAS, pursuant to the Original
Agreement, Seller agreed to sell to Buyer, and Buyer agreed to purchase from
Seller, the Shares (as defined below), which constitute one hundred percent
(100%) of the capital stock of a to-be-formed P.R.C. company that will be named
Tianjin Sevenstarsflix Network Technology Limited (the “Company”); and

WHEREAS, following discussions
between the Parties, Seller and Buyer have determined to fully amend and restate
the Original Agreement to adjust the payment mechanics related to the Earn-Out
Shares (as defined below), and certain other related provisions of the
Agreement. 

NOW, THEREFORE, in consideration
of the foregoing, the mutual promises and covenants herein contained and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged and incorporating the above Recitals with and into this Agreement,
the Parties hereby agree as follows: 

ARTICLE I 
DEFINITIONS 

1.1      Definitions.
As used in this Agreement, the following terms have the following meanings: 

“Affiliate” of a specified
Person means any other Person, which, directly or indirectly, through one or
more intermediaries, controls, is controlled by, or is under common control with
such specified Person. For purposes of this definition, “control” of any Person
means possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting capital stock, by contract, or otherwise. 

“Agreement” has the
meaning provided in the Preamble. 

“Alternative Transaction”
has the meaning provided in Section 6.2. 

“Anti-Corruption Law”
means (i) any Law in any country that is related to combating bribery and
corruption and (ii) the United States federal Anti-Kickback Statute (42 U.S.C.
§1320a-7(b)), the federal False Claims Act (42 U.S.C. §1320a-7b(a)), and any
comparable Law of any state or local jurisdiction. 

“Applicable Stock Price”
means the average closing price of a share of Buyer Stock as reported on NASDAQ
for the period of twenty (20) consecutive trading days ending on (and including)
the second trading day prior to the Claim Determination Date. 

“Business” means the
contemplated business objectives of the Company set forth in Exhibit A
attached hereto, as well as any other business performed, conducted or proposed
to be conducted as of Closing by the Company. 

“Business Day” means any
day other than: (a) a Saturday or Sunday; or (b) a day on which banks are
required or authorized by Law to close in New York, New York.

“Business Net Income”
means net income of the Business as performed, conducted or proposed to be
conducted as of such time of earning or calculating net income, as recognized in
accordance with P.R.C. GAAP as consistently applied by the Company, excluding
revenue related to customer-reimbursed expenses.

“Buyer” has the meaning
provided in the Preamble. 

“Buyer Stock” means a
share Buyer’s common stock, $0.001 par value. 

“Bylaws” means the bylaws
or rules of self-governance (or other similar document) and all amendments
thereto adopted by the specified Person, in each case as in full force and
effect from time to time. 

“Cap” has the meaning
provided in Section 8.2(c).

“Charter” means the
articles or certificate of incorporation, articles of association (or other
documents of formation) and all amendments thereto adopted by the specified
Person, in each case as in full force and effect from time to time. 

“Claim” means suit,
action, investigation, allegation, proceeding, inquiry or other claim or legal
or administrative proceeding. 

“Claim Determination Date”
has the meaning provided in Section 8.5. 

“Closing” has the meaning
provided in Section 3.1. 

“Closing Date” has the
meaning provided in Section 3.1. 

“Closing Payment” has the
meaning provided in Section 2.2(a). 

- 2 - 

“Code” means the United
States federal Internal Revenue Code of 1986, as amended. 

“Company” has the meaning
provided in the Recitals. 

“Company Assets” has the
meaning provided in Section 4.7(j). 

“Company Benefit Plan”
means (a) any employment, change in control, retention, severance or similar
contract or arrangement (whether or not written) or any plan, policy, practice,
fund, program or contract or arrangement (whether or not written) providing for
compensation, bonus, profit-sharing, stock option, or other stock related rights
or other forms of incentive or deferred compensation, vacation benefits, fringe
benefits, insurance coverage (including any self-insured arrangements), health
or medical benefits, disability benefits, worker’s compensation, supplemental
unemployment benefits, severance benefits and post-employment or retirement
benefits (including compensation, pension, health, medical or life insurance or
other benefits), whether written or oral, that is maintained, administered,
sponsored or contributed to, by, or required to be contributed by the Company,
or with respect to which the Company could otherwise have any liability or
obligation, whether direct or indirect, absolute or contingent; and (b) any
defined benefit pension plan in respect of which the Company could incur
liability whether direct or indirect, absolute or contingent. 

“Company Contract” has the
meaning provided in Section 4.7(i). 

“Company Contractor” has
the meaning provided in Section 4.7(f).

“Company Debt” means all
of the following, whether issued to, extended to, applicable to, incurred by, or
a contractual obligation of, the Company: (a) all obligations for borrowed money
or in respect of banker’s acceptances or letters of credit issued or created for
the account or benefit of the Company (for clarity, excluding unfunded letters
of credit), whether secured or unsecured, whether or not represented by bonds,
debentures, notes or other securities, and whether owing to banks, financial
institutions or otherwise; (b) all indebtedness of the Company created or
arising under any conditional sale or other title retention Contract with
respect to property acquired by such Person (even though the rights and remedies
of the seller or lender under such Contract in the event of default are limited
to repossession or sale of such property); (c) all indebtedness of the Company
secured by a purchase money mortgage or other lien to secure all or part of the
purchase price of the property subject to such mortgage or lien; (d) all
obligations under Leases which shall have been or must be, in accordance with
P.R.C. GAAP, recorded as capital Leases in respect of which any member of the
Company Group is liable as lessee; (e) all obligations under interest rate
protection agreements (valued on a market quotation basis); (f) all obligations
secured by a perfected lien or non-appealable judgment; (g) all indebtedness or
obligations of the types referred to herein of a third Person secured by any
Claim on any assets of any member of the Company Group, even though such member
of the Company Group has not assumed or otherwise become liable for the payment
thereof; (h) any Guaranty of a third Person in connection with any of the
foregoing, even though such member of the Company Group has not assumed or
otherwise become liable for the payment thereof; (i) all indebtedness to equity
or other security holders, including Sellers, payment obligations with respect
to stock appreciation rights, phantom stock obligations and similar obligations;
(j) indebtedness within the Company Group or any of its Affiliates; and (k) any
interest, fees and other expenses owed related to any of the foregoing, including
prepayment premiums or penalties, consent fees, or other amounts with respect to
such indebtedness becoming due as a result of the Transactions; but excluding
Company Transaction Costs. 

- 3 -

“Company Employee” has the
meaning provided in Section 4.7(e)(i).

“Company Transaction
Costs” means all of the unpaid fees, expenses and other similar amounts for
the provision of services prior to the Closing that have been or are expected to
be incurred on behalf of the Company on or prior to the Closing Date in
connection with or arising from the Transactions, and any fees of Seller’s
counsel, brokers or finders, accountants, investment bankers and other
professional advisors and any fees paid or payable to any Governmental Authority
or other Person by or on behalf of Seller or the Company, or any obligations for
which Buyer could become liable in any manner resulting from the consummation of
the Transactions (other than obligations solely incurred by Buyer in connection
with the Transactions). 

“Contracts” means
understandings, agreements, commitments, obligations, arrangements, indentures,
undertakings, deeds, mortgages, options, loans, Leases or licenses, written or
oral. 

“Direct Claim” has the
meaning provided in Section 8.4.

“Disclosure Schedules” has
the meaning provided in the introductory paragraph to Article IV. 

“Due Date” means the
applicable date that a Person is required to file a Tax Return, taking into
account all applicable extensions.

“Earn-Out Calculations”
has the meaning provided in Section 2.3(b)(i). 

“Earn-Out Calculation Delivery
Date” has the meaning provided in Section 2.3(b)(i). 

“Earn-Out Calculation
Objection Notice” has the meaning provided in Section 2.3(b)(ii).

“Earn-Out Calculation Statement” has the meaning provided in Section
  2.3(b)(i). 

“Earn-Out Disputed Items”
has the meaning provided in Section 2.3(b)(iii).

“Earn-Out Homes/Users Passed
Threshold” means: for the Earn-Out Year ending December 31, 2016, 50,000,000
Homes/Users Passed; for the Earn-Out Year ending December 31, 2017, 100,000,000
Homes/Users Passed; and for the Earn-Out Year ending December 31, 2018,
150,000,000 Homes/Users Passed. 

“Earn-Out Net Income
Threshold” means: for the Earn-Out Year ending December 31, 2016,
$4,000,000; for the Earn-Out Year ending December 31, 2017, $6,000,000; and for
the Earn-Out Year ending December 31, 2018, $8,000,000. 

“Earn-Out Shares” has the
meaning provided in Section 2.2(b).

- 4 -

“Earn-Out Share Award”
means 5,000,000 shares of Buyer Stock.

“Earn-Out Year” means each
of the fiscal years of the Company ending on December 31, 2016, 2017, and 2018.

“Enforceability
Exceptions” has the meaning provided in Section 4.2.

 “Formation
Documents” has the meaning provided in Section 4.7(a)(i).

“Fundamental
Representations” means the representations and warranties contained in
Section 4.1, Section 4.2, Section 4.5, Section 4.6,
Sections 4.7(a), (b), (c) and (n), Section 5.1, Section 5.2
and Section 5.5. 

“GAAP” means United States
generally accepted accounting principles, applied on a consistent basis, as
historically applied by a Person; in no event shall any change to GAAP occurring
after the date of this Agreement have any application to this Agreement or to
any calculations made (or to be made) under this Agreement. 

“Governmental Authority”
or “Governmental Authorities” means any federal, state, provincial,
county, municipal, regional or local government, foreign or domestic, or any
political subdivision thereof, and any entity, department, commission, bureau,
agency, authority, board, court or other similar body or quasi-governmental body
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to any government or other political subdivision
thereof. 

“Government Official”
shall mean any: (i) officer, employee or other Person acting for or on
behalf of any Governmental Authority or public international organization; or
(ii) holder of or candidate for public office, political party or official
thereof or member of a royal family or (iii) any other Person acting for or on
behalf of the foregoing. 

“Guaranty” collectively
means: (a) any guaranty of the payment or performance of any indebtedness or
other obligation of any obligor; (b) any other arrangement whereby credit is
extended to one obligor on the basis of any promise or undertaking of another
Person, whether that promise or undertaking is expressed in terms of an
obligation to pay the indebtedness of such obligor, or to purchase any
obligation owed by such obligor, or to purchase or lease assets under
circumstances that would enable such obligor to discharge one or more of its
obligations, or to maintain the capital, working capital, solvency or general
financial condition of such obligor, whether or not such arrangement is
disclosed in the balance sheet of such other Person or is referred to in a
footnote thereto; and (c) any other arrangement whereby the performance of
another Person is assumed. 

“Homes/Users Passed”
means, for any period of measurement, the number of homes and/or users who have
access through service providers to content provided by the Company, as
determined and calculated pursuant to and as set forth in Schedule 1 attached
hereto. 

“ICDR” has the meaning
provided in Section 10.1. 

“Indemnitees” has the
meaning provided in Section 8.1.

- 5 -

“Intellectual Property”
means: (a) Marks and rights thereto including, without limitation, registered
Marks, applications for Marks and common law Marks; (b) patents, patent
applications, patent disclosures and inventions, including continuations,
divisional, continuations-in-part, renewals and reissues for any of the
foregoing; (c) copyrights (registered or unregistered) and copyrightable works
and registrations and applications for the registration thereof; (d) mask works
and registrations and applications for registration thereof; (e) inventions,
discoveries, processes, trade secrets, know how, methods, designs, drawings
specifications, formulations, testing and standard operating procedures,
maintenance and servicing manuals, quality control manuals and procedures and
other intellectual property rights and intangible property, whether or not
patentable, and technology, engineering, drawings, art work, reports, design
information and practices, flow charts, diagrams, manuals, descriptive texts and
programs, underlying tapes, documentation, and business information maintained
in electronic format (the know-how) relating to the foregoing items; (f)
computer software, data, data bases and documentation thereof; (g) all rights
related to the Intellectual Property described in clauses (a) through (f) of
this definition; and (h) all other intellectual and industrial property rights
of any sort throughout the world, including all applications, registrations,
issuances and the like with respect thereto. 

“Internal Revenue Service”
or “IRS” means the United States Internal Revenue Service.

“Law” or “Laws”
means, at the applicable time, each provision of any then currently existing
federal, state, regional, provincial, local or foreign laws, including any
statute, standard, ordinance, act, code, order, rule, regulation, constitutional
provision, decree, promulgation or common law of any Governmental Authority, and
each term of any order, judgment, award or decree then currently existing of any
court, arbitrator or tribunal of any Governmental Authority. 

“Liens” means any and all
liens, charges, mortgages, pledges, easements, encumbrances, security interests,
matrimonial or community interests, tenancy by the entirety Claims, adverse
Claims, or any other title defects or restrictions of any kind. 

“Loss” or “Losses”
has the meaning provided in Section 8.1.

“Mark” means any
trademark, service mark, trade dress, trade name, internet website domain name,
logo and registered, assumed or fictitious names and all applications and
registrations therefor. 

“Material Adverse Effect”
means any event, change, circumstance or effect that is materially adverse to
the business, financial condition, assets, operations, liabilities, results of
operations, or prospects of the Company with respect to the Business, excluding,
however, any event, change, circumstance or effect resulting or arising solely
from: (a) changes in business or economic conditions affecting the P.R.C. or
global economy or capital or financial markets generally or changes in
conditions in the industries in which the Company operates; (b) national or
international political or social conditions, including the engagement by the
P.R.C. in hostilities, whether or not pursuant to the declaration of a national
emergency or war, or the occurrence of any military or terrorist attack upon the
P.R.C., or any of its territories, possessions, or diplomatic or consular
offices or upon any military installation, equipment or personnel of the P.R.C.;
or (c) financial, banking, or securities markets (including any disruption thereof and any decline in the price of any security or any
market index); (d) changes in accounting requirements or Law, or in each case,
in the interpretation thereof, after the date hereof (provided that such changes
set out on clauses (a) through (d) above do not affect the Company in a
materially disproportionate manner). 

- 6 -

“NASDAQ” means The Nasdaq
Stock Market Inc.’s National Market System. 

“NDA” has the meaning
provided in Section 11.15. 

“Neutral Arbitrator” has
the meaning provided in Section 2.3(b)(iii) . 

“Party” or
“Parties” have the meanings provided in the Preamble.

“Permit” or
“Permits” has the meaning provided in Section 4.7(l)(ii). 

“Permitted Lien” means (i)
statutory Liens for current Taxes not yet due and payable or being contested in
good faith by appropriate procedures and for which appropriate reserves have
been reflected in the Company’s financial statements in accordance with P.R.C.
GAAP; (ii) mechanics, carriers’, workmen’s, repairmen’s or other like Liens
arising or incurred in the ordinary course of business; or (iii) easements,
rights of way, zoning ordinances and other similar encumbrances affecting real
property. 

“Person” means an
individual, partnership, limited partnership, limited liability partnership,
corporation, limited liability company, association, trust, joint venture,
unincorporated organization, and any Governmental Authority or other legal
entity or organization of any kind. 

“Post-Closing Period”
means any taxable period beginning after the Closing Date.

“Post-Closing Taxes” means
(i) any and all Taxes imposed on any member of the Company Group for any taxable
year or period that begins after the Closing Date and, with respect to any
Straddle Period, the portion of such Straddle Period beginning after the Closing
Date (determined in accordance with Section 7.6(b)); and (ii) all
Excluded Taxes; provided, however, that Post-Closing Taxes shall
not include any Taxes for which Sellers are liable under this Agreement,
including, without limitation, Pre-Closing Taxes. 

“P.R.C.” means the
People’s Republic of China [and, for the purpose of this Agreement, shall
exclude Hong Kong, the Special Administrative Region of Macau, and Taiwan]. 

“P.R.C. GAAP” means P.R.C.
generally accepted accounting principles, applied on a consistent basis, as
historically applied by the applicable Person; in no event shall any change to
P.R.C. GAAP occurring after the date of this Agreement have any application to
this Agreement or to any calculations made (or to be made) under this Agreement.

“Pre-Closing Period” has
the meaning provided in Section 6.1. 

“Pre-Closing Period Tax
Return” means any Tax Return relating to a Pre-Closing Period. 

- 7 -

“Pre-Closing Taxes” means,
without duplication: (a) any and all Taxes of or imposed on any member of the
Company Group for any and all Pre-Closing Tax Periods; (b) any and all Taxes of
or imposed on any member of the Company Group for any and all portions of
Straddle Periods ending on the Closing Date (determined in accordance with
Section 7.6(b)); (c) any and all Taxes of an “affiliated group” (as
defined in Section 1504 of the Code) (or affiliated, consolidated, unitary,
combined or similar group under applicable state, local or foreign Law) of which
any member of the Company Group (or any predecessor of any member of the Company
Group) is or was a member on or prior to the Closing Date, including pursuant to
Treasury Regulations Section 1.1502 -6 (or any predecessor or successor thereof
or any analogous or similar state, local or foreign Law); (d) any and all
Transfer Taxes required to be paid by Sellers pursuant to Section 7.1;
(e) any and all Taxes of or imposed on Buyer or any of its Affiliates (including
any member of the Company Group) as a result of an inclusion under Section
951(a) of the Code (or any similar provision of state or local Law) attributable
to (i) “subpart F income,” within the meaning of Section 952 of the Code (or any
similar provision of state or local Law) received or accrued on or prior to the
Closing Date that is related or attributable to any member of the Company Group
or (ii) the holding of “United States property,” within the meaning of Section
956 of the Code (or any similar provision of state or local Law) on or prior to
the Closing Date that is related or attributable to any member of the Company
Group, in each case, determined as if the taxable years of the members of the
Company Group ended on the Closing Date; and (f) any and all Taxes required to
be deducted and withheld with respect to payments made by Buyer to Sellers (or
by any member of the Company Group to Sellers) (or in connection with the
Transactions, including the exercise of options or payment of stock) pursuant to
applicable Tax Laws in connection with the Transactions. Notwithstanding
anything to the contrary set forth herein, Pre-Closing Taxes means the amount of
Taxes which would have been payable or paid without taking into account any
carryback of any Tax attribute (including any net operating loss carryback)
arising in any Tax period ending after the Closing. 

“Pre-Closing Tax Period”
means any taxable period ending on or before the Closing Date.

“Proceeding” means any
judicial, administrative or arbitral actions, suits or proceedings (public or
private) by or before any Governmental Authority or before any arbitrator,
mediator or other alternative dispute resolution provider pursuant to any
collective bargaining agreement, contractual agreement or Law, and including any
audit or examination, or other administrative or court proceeding with respect
to Taxes or Tax Returns. 

“Promissory Note” means a
Convertible Promissory Note, in substantially the form attached hereto as
Exhibit B, with the principal amount of such Promissory Note inserted
therein as calculated pursuant to Section 2.3(c)(ii). 

“Proprietary Information”
has the meaning provided in Section 7.15 

“Purchase Price” has the
meaning provided in Section 2.2. 

“Regulatory Consents and
Notices” has the meaning provided in Section 4.4(b) . 

“Required Consents” has
the meaning provided in Section 3.2(f). 

- 8 -

“Required Vote” means the
affirmative vote of (i) the holders of a majority of the total votes cast in
person or by proxy at a meeting of Buyer’s shareholders or (ii) the holders of a
majority of the outstanding voting securities of Buyer entitled to vote on the
relevant matters, if such action is taken by written consent, is required under
the rules of NASDAQ to approve the sale and issuance of the Earn-Out Share
Award. 

“Restricted Period” means
a period commencing on the Closing Date and ending the day that is three (3)
years following the day upon which Seller no longer owns, directly or
indirectly, of record or beneficially, any share of the capital stock or other
equity securities of the Company, Buyer or any other Affiliate of Buyer. 

“Review Period” has the
meaning provided in Section 2.3(b)(ii). 

“Rules” has the meaning
provided in Section 10.1. 

“Securities Purchase
Agreement” has the meaning provided in the Recitals. 

“Seller” has the meaning
provided in the Preamble. 

“Shares” means all (100%)
of the issued and outstanding share capital of the Company.

“Straddle Period” means
any taxable year or period beginning on or before and ending after the Closing
Date. 

“Straddle Period Tax
Return” means any Tax Return relating to a Straddle Period. 

“Sun Seven Stars” has the
meaning provided in the Recitals. 

“Survival Period” has the
meaning provided in Section 8.2(a). 

“Tax” or “Taxes”
means any and all: (a) taxes, charges, withholdings, fees, levies, imposts,
duties and governmental fees or other like assessments or charges of any kind
whatsoever in the nature of taxes, imposed by any United States federal, state,
local or foreign or other Taxing Authority (including those related to income,
net income, gross income, receipts, capital, windfall profit, severance,
property (real and personal), production, sales, goods and services, use,
business and occupation, license, excise, registration, franchise, employment,
payroll (including social security contributions), deductions at source,
withholding, alternative or add-on minimum, intangibles, ad valorem, transfer,
gains, capital gains, stamp, customs, duties, estimated, transaction, title,
capital, paid-up capital, profits, premium, value added, recording, inventory
and merchandise, business privilege, federal highway use, commercial rent or
environmental tax, and any liability under unclaimed property, escheat, or
similar Laws); (b) interest, penalties, fines, additions to tax or additional
amounts imposed by any Taxing Authority in connection with (i) any item
described in clause (a), or (ii) the failure to comply with any requirement
imposed with respect to any Tax Return; and (c) liability in respect of any
items described in clause (a) and/or (b) payable by reason of contract
(including any Tax Sharing Agreement), assumption, transferee, successor or
similar liability (including bulk transfer or similar Laws), operation of law
(including pursuant to Treasury Regulations Section 1.1502 -6 (or any predecessor or successor thereof or any analogous or
similar state, local, or foreign Law)) or otherwise. 

- 9 -

“Tax Claim Notice” has the
meaning set forth in Section 7.7(a). 

“Tax Contest” has the
meaning set forth in Section 7.7(a). 

“Tax Return” means any
return, declaration, form, report, Claim, informational return (including all
Forms 1099) or statement required to be filed with any Governmental Authority
with respect to Taxes, including any schedule or attachment thereto or amendment
thereof. 

“Tax Sharing Agreement”
means any Tax indemnity agreement, Tax sharing agreement, Tax allocation
agreement or similar contract or arrangement, whether written or unwritten
(including, without limitation, any such agreement, contract or arrangement
included in any purchase or sale agreement, merger agreement, joint venture
agreement or other document). 

“Taxing Authority” or
“Tax Authorities” means, with respect to any Tax or Tax Return, any
Governmental Authority exercising Tax authority that imposes such Tax or
requires a Person to file such Tax Return and the agency (if any) charged with
the collection or assessment of such Tax or the administration of such Tax
Return, in each case, for such Governmental Authority. 

“Third Party Claim” means
any Claim which is asserted or threatened by a Person other than the Parties,
their successors and permitted assigns against any Indemnitee or to which any
Indemnitee is subject. 

“Third Party Consents and
Notices” has the meaning provided in Section 4.4(b).

“Transactions” means the
transactions contemplated by this Agreement, including, for the avoidance of
doubt, the purchase and sale of the Shares in accordance with this Agreement and
the payment of the Purchase Price, including any Earn-Out Payment. 

“Transfer Taxes” has the
meaning set forth in Section 7.1.

“Treasury Regulations”
means the Treasury Regulations promulgated under the Code, as such Treasury
Regulations may be amended from time to time. Any reference herein to particular
provision of the Treasury Regulations means, where appropriate, the
corresponding successor provision. 

1.2      Interpretation.
In this Agreement (unless the context requires otherwise): 

(a)      All
references to statutory provisions shall be construed as meaning including
references to (i) any statutory modification, consolidation or re-enactment made
after the date of this Agreement and for the time being in force; (ii) all
statutory instruments or orders made pursuant to a statutory provision; and
(iii) any statutory provision of which these statutory provisions are a
consolidation, re-enactment or modification; 

(b)      Words
denoting the singular shall include the plural and words denoting any gender
shall include all genders; 

- 10 -

(c)      Headings,
subheadings, titles, subtitles to Articles, Sections, sub-sections, clauses and
paragraphs are for information only, and shall not form part of the operative
provisions of this Agreement or the annexures hereto and shall be ignored in
construing the same; 

(d)      References
to Recitals, Sections, Articles, clauses, schedules or exhibits are, unless the
context otherwise requires, references to Recitals, Sections, Articles, clauses,
schedules and exhibits to this Agreement; 

(e)      The words “include” and
“including” are to be construed without limitation; 

(f)      
The terms “hereof,” “herein,” “hereto,” “hereunder,” or similar expressions used
in this Agreement mean and refer to this Agreement and not to any particular
Section in this Agreement; 

(g)      All
references to Contracts, documents or other instruments include (subject to all
relevant approvals) a reference to that Contract, document or instrument as
amended, supplemented, substituted, novated, or assigned from time to time;

(h)
The word “or” is not exclusive and is deemed to have the meaning “and/or”; 

(i)      All
references to payments in this Agreement shall be payments in U.S. dollars; and

(j)      Any
capitalized term used but not defined in a schedule to this Agreement shall have
the meaning set forth in this Agreement. 

1.3      Disclosure
Schedules. The Parties acknowledge and agree that any exception to a
representation and warranty contained in this Agreement that is disclosed in any
section of the Disclosure Schedules under the caption referencing such
representation and warranty shall be deemed to also be an exception to each
other representation and warranty of the Company contained in this Agreement to
the extent that it would be reasonably apparent to Buyer that such exception is
applicable to such other representation and warranty.

ARTICLE II 
SALE, PURCHASE AND PURCHASE
PRICE

2.1      Sale
and Purchase. Subject to the satisfaction of the conditions precedent set
forth in Section 3.2 and Section 3.3, on the Closing Date (a)
Seller shall sell, transfer and assign to Buyer (or an Affiliate of Buyer) all
of Seller’s right, title and interest in the Shares, in exchange for the payment
by Buyer of the Purchase Price, and (b) Buyer (or an Affiliate of Buyer) shall
purchase and take delivery of the Shares from Seller. The Shares shall be sold,
transferred and delivered to Buyer (or an Affiliate of Buyer) by Seller at the
Closing free and clear of any and all Liens. 

- 11 -

2.2      Purchase
Price. The aggregate purchase price payable by Buyer as consideration for
the sale and transfer of the Shares, subject to adjustment and/or withholding as
contemplated herein, shall be as follows (the “Purchase Price”): 

(a)      $100
(the “Closing Payment”) shall be payable to Seller at the Closing by wire
transfer of immediately available funds to an account designated by Seller at
least two (2) Business Days prior to the Closing; and 

(b)      up
to a maximum of fifteen million (15,000,000) shares of Buyer Stock (the
“Earn-Out Shares”), payable subject to and in accordance with Section
2.3. 

2.3      Earn-Out.

(a)      Earn-Out
Thresholds. For each Earn-Out Year with respect to which (i) the number of
Homes/Users Passed is greater than or equal to the Earn-Out Homes/Users Passed
Threshold, or (ii) the Business Net Income is greater than or equal to the
Earn-Out Net Income Threshold, subject to Section 2.3(c)(ii), Buyer shall
issue to Seller an Earn-Out Share Award. Notwithstanding anything to the
contrary in this Agreement, “trial period” type contracts, between the Company
and content service providers, that are less than six (6) months in duration
shall not be counted toward the Homes/Users Passed. 

(b)      Procedures
for Determining Satisfaction of Earn-Out Thresholds. 

(i)     
On or before the date which is thirty (30) days following the end of each
Earn-Out Year (the “Earn-Out Calculation Delivery Date”), Seller shall
prepare and deliver to Buyer a written statement (the “Earn-Out Calculation
Statement”), to be reviewed and approved by the Buyer’s Board of Directors,
setting forth in reasonable detail its determination of the number of
Homes/Users Passed (as determined and calculated pursuant to and as set forth in
Schedule 1 attached hereto) and the Business Net Income for the Earn-Out
Year for which such Earn-Out Calculation Statement has been prepared (the
“Earn-Out Calculations”). Buyer shall provide any and all reasonable
assistance to Seller in preparing the calculations. 

(ii)      Buyer
shall have thirty (30) days after receipt of the Earn-Out Calculation Statement
(the “Review Period”) to review the Earn-Out Calculation Statement and
the Earn-Out Calculations set forth therein. Unless Buyer delivers written
notice to Seller setting forth the specific items disputed by Buyer on or prior
to the thirtieth (30th) day after the date of the Earn-Out Calculation Statement
(delivered in accordance with Section 11.2), Buyer will be deemed to have
accepted and agreed to the Earn-Out Calculation Statement and such Earn-Out
Calculation Statement (and the calculations contained therein) will be final,
binding and conclusive. During the Review Period, Buyer and its accountants and
representatives shall have the right to inspect the applicable books and records
of the Company and Seller during normal business hours at the Company’s or
Seller’s offices, as applicable, upon reasonable prior notice and for purposes
related to the determinations of number of Homes/Users Passed and the Business
Net Income. Prior to the expiration of the Review Period, Buyer may object to
the Earn-Out Calculations set forth in the Earn-Out Calculation Statement by
delivering a written notice of objection (an “Earn-Out Calculation Objection
Notice”) to Seller. The Earn-Out Calculation Objection Notice shall specify
the items in the applicable Earn-Out Calculation disputed by Buyer and shall describe in reasonable detail the
basis for such objection, as well as the amount in dispute. Buyer and Seller
shall negotiate in good faith to resolve the disputed items and agree upon the
resulting number of Homes/Users Passed and the Business Net Income.

- 12 -

(iii)      If
Buyer and Seller are unable to reach agreement within thirty (30) days after
such an Earn-Out Calculation Objection Notice has been given, all unresolved
disputed items (the “Earn-Out Disputed Items”) shall be promptly referred
to an international independent accounting firm of recognized standing mutually
acceptable to Buyer and Seller (the “Neutral Arbitrator”). The Neutral
Arbitrator shall act as an arbitrator to determine only the Earn-Out Disputed
Items and shall be directed to render a written report (such written report to
include a work sheet setting forth all material calculations used in arriving at
such determination and to be based solely on information provided to the Neutral
Arbitrator by Buyer and Seller) on the unresolved Earn-Out Disputed Items with
respect to the applicable Earn-Out Calculation as promptly as practicable, but
in no event greater than thirty (30) days after such submission to the Neutral
Arbitrator and to resolve only those unresolved disputed items set forth in the
Earn Out Calculation Objection Notice. If unresolved disputed items are
submitted to the Neutral Arbitrator, Buyer and Seller shall each furnish to the
Neutral Arbitrator such work papers, schedules and other documents and
information relating to the unresolved disputed items as the Neutral Arbitrator
may reasonably request. If any Party fails to submit a supporting brief
regarding any Earn-Out Disputed Item submitted to the Neutral Arbitrator within
the time set forth above or otherwise fails to give the Neutral Arbitrator
access as reasonably requested, then the Neutral Arbitrator shall render a
decision based solely on the evidence timely submitted and the access afforded
to the Neutral Arbitrator by Buyer and Seller. The Neutral Arbitrator shall
resolve the disputed items based solely on the applicable definitions and other
terms in this Agreement and the presentations by Buyer and Seller, and not by
independent review. In resolving each Earn-Out Disputed Item, the Neutral
Arbitrator may not assign a value to any Earn-Out Disputed Item greater than the
greatest value for such Earn-Out Disputed Item claimed by any Party or less than
the lowest value for such Earn-Out Disputed Item claimed by any Party. The
resolution of the dispute and the calculations of the number of Homes/Users
Passed and the Business Net Income shall be final and binding on the Parties
absent manifest error. All fees and expenses of the Neutral Arbitrator in
connection with its work on the disputed items as described in this Section
2.3(b)(iii) shall be allocated between Buyer, on the one hand, and Seller,
on the other hand, in the same proportion that the aggregate amount of such
disputed items so submitted to the Neutral Arbitrator that is unsuccessfully
disputed by each such Party (as finally determined by the Neutral Arbitrator)
bears to the total amount of such disputed items so submitted.

(c)      Issuance
of Earn-Out Share Award.

(i)      Subject
to Section 2.3(c)(ii), no later than thirty (30) days following the final
determination of the Earn-Out Calculations pursuant to Section 2.3(b) for
any Earn-Out Year, if either of the Earn-Out Homes/Users Passed Threshold or the
Earn-Out Net Income Threshold has been satisfied for the applicable Earn-Out
Year, Buyer shall issue to Seller, or an account or Affiliate designated by
Seller, an Earn-Out Share Award. 

(ii)      Notwithstanding
anything to the contrary in this Agreement, in the event Buyer has not obtained
the Required Vote, Buyer shall not issue an Earn-Out Share Award to Seller, or
any account or Affiliate designated by Seller, but instead shall issue to
Seller, or an account or Affiliate designated by Seller, in full satisfaction
of its obligations under this Section 2.2, a Promissory Note, with a
principal amount equal to the quotient obtained by multiplying 5,000,000 by the
Applicable Stock Price. Buyer shall issue any such Promissory Note no later than
five (5) business days following the final determination of the Earn-Out
Calculations pursuant to Section 2.3(b) for any Earn-Out Year, if (A)
either of the Earn-Out Homes/Users Passed Threshold or the Earn-Out Net Income
Threshold has been satisfied for the applicable Earn-Out Year; and (B) Buyer has
not obtained the Required Vote. 

- 13 -

(d)      Control
of the Company Post-Closing. Seller acknowledges that, after the Closing,
Buyer, directly or indirectly through an Affiliate, will own and control the
Shares and that, after the Closing, Buyer may vote the Shares in such manner as
it determines to be in its best interest in connection with the operation of the
Company and the Business; provided, however, that Buyer shall not, directly or
indirectly, take any action with the intent of (i) materially and negatively
impacting the Business, the number of Homes/Users Passed, or the Business Net
Income, or (ii) avoiding or reducing an Earn-Out Share Award or the issuance of
a Promissory Note, as applicable. 

(e)      Offset.
Notwithstanding anything to the contrary herein, the issuance of each Earn-Out
Share Award or Promissory Note, as applicable, is subject to Buyer’s offset and
reduction rights set forth in Article VIII.

2.4      Withholding.
Notwithstanding anything in this Agreement to the contrary, Buyer and each of
its Affiliates shall be entitled to deduct and withhold, or cause to be deducted
and withheld, from any amounts payable pursuant to this Agreement such amounts
as Buyer or any of its Affiliates reasonably determines is required to be
deducted and withheld with respect to the making of any such payment under any
applicable provision of state, local or foreign Tax Law. To the extent that
amounts are so deducted and withheld, such deducted and withheld amounts are to
be treated for all purposes of this Agreement as having been paid to the Person
in respect of which such deduction and withholding was made. To the extent Buyer
or any of its Affiliates deducts and withholds or causes to be deducted and
withheld any such amounts payable pursuant to this Agreement, Buyer and any such
Affiliate, as the case may be, shall remit (or cause to be remitted) to the
appropriate Taxing Authority all such amounts deducted and withheld or caused to
be deducted and withheld. 

ARTICLE III
CLOSING 

3.1      Closing.
The closing of the Transactions (the “Closing”) shall take place at the
offices of Cooley LLP, The Grace Building, 1114 Avenue of the Americas, New
York, New York 10013-7798, at 10:00 a.m., New York time, on the third (3rd)
Business Day following the satisfaction or waiver of the conditions set forth in
Section 3.2 and Section 3.3 (other than those conditions that by
their terms must be satisfied on the Closing Date, or at such place and on such
date and time as Buyer and Seller shall mutually agree (such date on which the
Closing occurs, the “Closing Date”)). The Closing may be conducted by
mail, courier or electronic means. 

3.2      Conditions
Precedent to Obligations of Buyer. The obligations of Buyer to consummate
the Transactions are subject to the satisfaction of the following conditions on
or before the Closing Date, unless specifically waived in writing
by Buyer prior to the Closing Date: 

- 14 -

(a)      Deliverables.
Seller shall deliver or cause to be delivered to Buyer the following documents
or instruments, which shall be in form and substance reasonably satisfactory to
Buyer: 

(i)      Certificates
with respect to the Company issued by the appropriate Governmental Authority of
the jurisdiction in which the Company was incorporated or formed and all other
jurisdictions in which the Company is qualified to do business, as of a date no
more than fifteen (15) days prior to the Closing Date, stating that the Company
is in good standing under the Laws of each such jurisdiction; 

(ii)      A
certificate from the corporate Secretary (or similar officer) of the Seller dated as of the Closing Date and
certifying that correct and complete copies of the Formation Documents are
attached thereto; 

(iii)      A
certificate from the corporate Secretary or similar officer of Seller dated as
of the Closing Date certifying that the conditions specified in Section
3.2(b) and Section 3.2(c) have been satisfied, which certificate
shall be deemed to be a representation and warranty made by Seller to Buyer on
the Closing Date for the purpose of inducing Buyer to consummate the
Transactions and with knowledge that Buyer is relying on such certificate in
determining to consummate the Transactions; 

(iv)      The
original share certificates (or satisfactory replacement certificates) for the
Shares, together with validly executed and duly stamped stock powers in favor of
Buyer, and an extract of the register of stockholders of the Company setting out
the name of Buyer as the holder of the Shares; 

(v)      Such
other instruments, certificates, consents or other documents as are reasonably
necessary to carry out the Transactions and to comply with the terms hereof, or
as required pursuant to the terms of this Agreement. 

(b)      Representations
and Warranties. The representations and warranties of Seller contained in
Article IV of this Agreement shall (i) have been true and correct on the
date of this Agreement and (ii) be (A) in the case of representations and
warranties that are qualified by materiality or any similar concept, true and
correct and (B) in all other cases, true and correct in all material respects,
in each case, on the Closing Date with the same force and effect as though made
on and as of the Closing Date (except that those representations and warranties
which address matters as of or for a particular date or time period shall remain
so true and correct in all material respects only as of such date or for such
time period). 

(c)      Compliance
with Covenants. Seller and the Company shall have duly performed and
complied in all material respects with all covenants, agreements and obligations
required by this Agreement to be performed or complied with by them on or prior
to the Closing. 

- 15 -

(d)      Injunctions.
No litigation, order, enforcement action or Claim shall be pending or threatened
against any Party seeking to enjoin, or to procure damages or fines as a result
of, the consummation or the proposed consummation of the Transactions. 

(e)      Absence
of Change. No fact, event or circumstance shall have occurred which has had
or would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. 

(f)      Consents
and Approvals. Seller shall have obtained and provided to Buyer all Third
Party Consents and Notices and all Regulatory Consents and Notices (the
“Required Consents”). All such Required Consents shall be in full force
and effect as of the Closing. 

(g)      Formation
of the Company. Seller shall have provided Buyer with copies of all of the
Formation Documents and Buyer shall be satisfied, in its sole discretion, that
the Company has been formed and its capital stock issued in compliance with all
applicable Laws. 

(h)      Company
Business. Seller shall have provided Buyer with evidence, including Company
Contracts and other documentation, demonstrating to the satisfaction of Buyer in
its sole discretion that the Company has Intellectual Property, assets,
agreements and other rights sufficient to commence, operate and exploit the
Business. 

3.3      Conditions
Precedent to Obligations of Seller. The obligations of Seller to consummate
the Transactions are subject to the satisfaction of the following conditions on
or before the Closing Date, unless specifically waived in writing by Seller
prior to the Closing Date: 

(a)       Deliverables. Buyer shall deliver or cause
  to be delivered to Seller the following documents or instruments, which shall be
  in form and substance reasonably satisfactory to Seller: 

(i)      The
Closing Payment, payable as contemplated by Section 2.2; 

(ii)      A
certificate from the corporate Secretary (or similar officer) of Buyer dated as
of the Closing Date and certifying that correct and complete copies of the
resolutions of the board of directors approving this Agreement and the
Transactions; and 

(iii)      A
certificate from the corporate Secretary (or similar officer) of Buyer dated as
of the Closing Date and certifying that the conditions specified in Section
3.3(b) and Section 3.3(c) have been satisfied, which certificate
shall be deemed to be a representation and warranty made by Buyer to Seller on
the Closing Date for the purpose of inducing Seller to consummate the
Transactions and with knowledge that Seller is relying on such certificate in
determining to consummate the Transactions. 

(b)      Representations
and Warranties. The representations and warranties of Buyer contained in
this Agreement shall be (A) in the case of representations and warranties that
are qualified by materiality or any similar concept, true and correct and (B) in
all other cases, true and correct in all material respects, in each case, on the
Closing Date with the same force and effect as though made on and as of the
Closing Date. 

- 16 -

(c)      Compliance
with Covenants. Buyer shall have duly performed and complied in all material
respects with all covenants, agreements and obligations required by this
Agreement to be performed or complied with by them on or prior to the Closing.

(d)      Injunctions.
No litigation, order, enforcement action or Claim shall be pending or threatened
against any Party seeking to enjoin, or to procure damages or fines as a result
of, the consummation or the proposed consummation of the Transactions. 

ARTICLE IV 
REPRESENTATIONS AND WARRANTIES
OF SELLER

Except as set forth in the
Disclosure Schedule delivered by Seller to Buyer prior to the execution and
delivery of this Agreement (and updated by Seller as provided herein) (the
“Disclosure Schedule”), Seller represents and warrants to Buyer (i) with respect
to the representations and warranties set forth in Sections 4.1 through
4.6, as of the date of this Agreement and as of the Closing Date, and
(ii) as of the Closing Date with respect to the representations and warranties
set forth in Section 4.7, as follows: 

4.1      Organization
of Seller. Seller is duly organized and validly existing under the Laws of
its jurisdiction of incorporation or organization, and has all requisite
corporate power and authority to own, lease and operate its assets, and to carry
on its business as presently conducted. 

4.2      Authorization
and Validity. This Agreement constitutes a legal, valid and binding
agreement and obligation of Seller, enforceable against Seller in accordance
with its terms subject to bankruptcy, insolvency, reorganization, moratorium and
similar Laws of general application relating to or affecting creditors’ rights
and to general equity principles (the “Enforceability Exceptions”). The
execution and delivery of this Agreement by Seller and the consummation by
Seller of the Transactions have been duly and validly authorized by all
necessary corporate action, and no other corporate proceedings on the part of
Seller are necessary to authorize this Agreement or to consummate the
Transactions. 

4.3      No
Governmental Claims or Proceedings. No Claim by any Governmental Authority,
or Proceeding initiated by any other Person, is pending or, to the Seller’s
Knowledge, has been threatened, against Seller which may affect the validity or
enforceability of this Agreement or the Transactions or the ability of Seller to
consummate this Agreement or the Transactions. 

4.4      Non-Contravention;
Consents. 

(a)      The
execution and delivery of this Agreement does not, and the consummation of the
Transactions, will not: (i) conflict with or result in a violation,
contravention or breach of any of the terms, conditions or provisions of the
Charter or the Bylaws of Seller; (ii) violate any Law applicable to Seller; or
(iii) subject to obtaining or delivering the Third Party Consents and Notices,
conflict with, or result in the breach of, or constitute a default under, or
permit or result in the termination, cancellation or acceleration (whether after
the giving of notice or the lapse of time or both) of any right or obligation of
Seller under, or result in the creation of any Liens upon any of the assets of
Seller or the Company under, or result in or constitute a circumstance which,
with or without notice or lapse of time or both, would constitute any of the
foregoing under, any Contract to which Seller or the Company is a party or by
which any of their assets are bound. 

- 17 -

(b)      Except
for: (i) the approvals required to be obtained from, or notices given to, the
Governmental Authorities described on Schedule 4.4(b)(i) (the “Regulatory
Consents and Notices”); and (ii) the approvals required to be obtained
from, or notices given to, the third parties described on Schedule
4.4(b)(ii) (the “Third Party Consents and Notices”), no approval of
or notice to any Governmental Authority or other Person is required to be
obtained or given by Seller or the Company in connection with the performance of
this Agreement and the consummation of the Transactions. No later than five (5)
Business Days prior to the Closing Date, Seller shall provide Buyer with updated
copies of Schedules 4.4(b)(i) and 4.4(b)(ii) identifying any additional
Regulatory Consents and Notices and/or Third Party Consents and Notices that are
not set forth in such schedules as of the date hereof, which additional
Regulatory Consents and Notices and/or Third Party Consents and Notices shall be
included in the Required Consents; provided, however, for the avoidance of
doubt, that Seller’s provision of such updated schedules shall be disregarded
for the purposes of Section 3.2(b). 

4.5      No
Broker. None of Seller or the Company has employed or made or entered into
any Contract with any broker, finder or similar agent or any other Person or
firm in connection with the Transactions which may result in any liability to
the Company or Buyer. 

4.6      Full
Disclosure. No representation or warranty by Seller in this Agreement and no
statement contained in the Disclosure Schedules to this Agreement or any
certificate or other document furnished or to be furnished to Buyer pursuant to
this Agreement contains any untrue statement of a material fact, or omits to
state a material fact necessary to make the statements contained therein, in
light of the circumstances in which they are made, not misleading. 

4.7      The
Company and the Shares. 

(a)      Corporate
Organization. 

(i)      The
Company is duly organized and validly existing under the Laws of its
jurisdiction of incorporation or organization, and has all requisite corporate
power and authority to own, lease and operate its assets, and to carry on the
Business. The Company is duly qualified or licensed to transact business in each
of the jurisdictions where such qualification or licensing is required by reason
of the nature or location of the properties and assets owned, leased or operated
by it or the Business, except where the failure to be qualified or licensed
would not have a Material Adverse Effect. Buyer has been furnished complete and
correct copies of (i) the Charter and Bylaws of the Company, in each case, as
amended through the date hereof, and (ii) all other documents filed with any
Governmental Authority or other Person pursuant to applicable Law or otherwise
in connection with the incorporation or organization of the Company (the
documents referred to in clauses (i) and (ii), the “Formation
Documents”). 

(ii)      The
statutory books (including all registers and minute books) of the Company have
been kept in compliance in all material respects with the requirements of Laws and are up-to-date, and any records of resolutions adopted
by the stockholders and the board of directors of the Company Group are included
in the statutory books. The statutory books are in the possession (or under the
control) of the Company.

- 18 -

(iii)      The
Company is not in violation or default of any provision of the Formation
Documents. 

(b)     
Capitalization. Seller has delivered to Buyer, no later than five (5)
Business Days prior to the Closing Date, a schedule setting forth (i) the
authorized share capital of the Company and (ii) the ownership of the issued and
outstanding shares of the capital stock of the Company, in each case as of
immediately prior to the Closing. There are no authorized or outstanding
options, warrants, convertible or exchangeable securities, calls, subscriptions
or other rights relating to the capital stock of the Company or obligating the
Company to issue, transfer or sell any shares of the capital stock of the
Company or options, warrants or convertible or exchangeable securities with
respect to any share of capital stock of the Company. 

(c)     
Title to Shares. Seller is the legal and beneficial owner of the Shares
and has good and valid title to the Shares. The Shares represent all (100%) of
the issued and outstanding equity securities of the Company. The Shares: (x)
have been duly authorized and validly issued by the Company in compliance with
all applicable Laws and the Charter and Bylaws of the Company; and (y) are fully
paid-up and were not issued in contravention or conflict with any right of first
offer or refusal, pre-emptive or other rights. The Shares are owned by Seller
free of all Liens and, except for the restrictions contained in the Charter and
the Bylaws, or which may be imposed under applicable Law, are free from transfer
restrictions. 

(d)      Indebtedness;
Liabilities. The Company has no Company Debt or liabilities of any kind
(whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated and whether due or to become
due), except for liabilities under the Company Contracts and liabilities in
respect of Company Employees and the Company Benefit Plans. 

(e)      Company
Employees; Employee Benefit Plans.

(i)      Seller
has delivered to Buyer, no later than five (5) Business Days prior to the
Closing Date, a schedule that accurately sets forth, with respect to each
employee of the Company (including any employee of the Company who is on a leave
of absence or on layoff status, each, a “Company Employee”): the name of
such Company Employee, and the date as of which such Company Employee was
originally hired by the Company; such Company Employee’s title; the aggregate
dollar amount of the wages, salary, commissions, fringe benefits, bonuses,
profit-sharing payments and other payments or benefits of any type that such
Company Employee is eligible to receive; such Company Employee’s annualized
salary or hourly rate as of Closing Date; each Company Employee Benefit Plan in
which such Company Employee participates; the accrued vacation and/or paid time
off of such Company Employee as of the Closing Date; and with respect to any
Company Employee who is currently on a leave of absence (whether paid or
unpaid), the reasons for the leave of absence, the expected return date, if
known, and whether reinstatement is guaranteed by Contract or applicable Laws.

- 19 -

(ii)      Seller
has delivered to Buyer, no later than five (5) Business Days prior to the
Closing Date, a schedule that accurately sets forth each Company Benefit Plan.

(f)     
Company Contractors. Seller has delivered to Buyer, no later than five
(5) Business Days prior to the Closing Date, a schedule that accurately sets
forth, with respect to each independent contractor of the Company (each, a
“Company Contractor”): the name of such Company Contractor; a brief description
of the services such Company Contractor performs for the Company; and the terms
of compensation of such Company Contractor. 

(g)      Real
Property. The Company does not own or lease any real property.

(h)      Reserved. 

(i)      Company
Contracts. Seller has delivered to Buyer, no later than no later than five
(5) Business Days prior to the Closing Date, a schedule that accurately sets
forth: each Contract to which the Company is a party (each, a “Company
Contract”). Each Company Contract is in full force and effect and is valid,
binding and enforceable in accordance with its terms, subject to the
Enforceability Exceptions. Immediately following the Closing, each Company
Contract will be in full force and effect, and valid, binding and enforceable on
the same terms, subject to the Enforceability Exceptions. Neither the applicable
the Company nor, to Seller’s Knowledge, the counterparties to such Company
Contracts have committed any material breach of any of the terms and conditions
of any Company Contract. The Company Group has received written notice from any
third party indicating that it intends to terminate or refuse to renew or extend
any of the Company Contracts. No counterparty to a Company Contract has
repudiated or, to the Seller’s Knowledge, threatened to repudiate any provision
of any Company Contract. The consummation of the Transactions will not adversely
affect any Company Contract. 

(j)      Company
Assets. The Company has good title to, or a valid leasehold interest in or
license to, each item of tangible personal property used in the operation of the
Business (collectively, the “Company Assets”), in each case, free and
clear of any Liens except for Permitted Liens. The Company Assets are fit for
the purposes for which they are used or intended to be used in connection with
the Business. All of the Company Assets, owned or leased, have been well
maintained and are in good operating condition and repair (with the exception of
normal wear and tear), and are free from defects other than such defects as
would not interfere with the intended use thereof in connection with the
provision of the services to be provided by the Company. All of the Company
Assets shall be owned by or available for use by the Company immediately after
the Closing on terms and conditions identical to those under which such the
Company owned or used the Company Assets immediately prior to the Closing.
Seller has delivered to Buyer, no later than no later than five (5) Business
Days prior to the Closing Date, a schedule that accurately sets forth each
Company Asset. 

- 20 -

(k)     
Intellectual Property. 

(i)      Seller
has delivered to Buyer, no later than no later than five (5) Business Days prior
to the Closing Date, a schedule that accurately sets forth: (i) all material
software owned or licensed by any the Company (other than shrink wrap, click
wrap, and similar commercial off-the-shelf software), indicating as to each,
whether it is owned or licensed; (ii) any registration or application for
registration of patents, Marks (including internet domain names), and copyrights
owned by the Company, and; (iii) any material unregistered Marks owned by the
Company. The Company Group has the right to use and license the Company
Intellectual Property without payment of additional amounts or consideration
other than ongoing royalties or license payments, and the consummation of the
Transactions will not result in the loss or material impairment of any of the
Company Intellectual Property. There are no pending, and, to Seller’s Knowledge,
no person has threatened in writing to initiate any, attachment or disposal
proceedings against the Company Intellectual Property and, where the Company
Intellectual Property is not owned by the Company, the owner thereof has not
threatened in writing to terminate any rights attached to the use of such
Company Intellectual Property by the Company. To Seller’s Knowledge, (i) none of
the processes employed or the principal products and services contemplated to be
provided by the Company infringe, misappropriate, or otherwise violate the
Intellectual Property of any other Person, and (ii) none of the Company
Intellectual Property is being infringed, misappropriated, or otherwise violated
by any other Person or has been disclosed without proper authorization to any
other Person. 

(ii)      The
Company Intellectual Property, the use thereof, or the operation of the Business
by the Company, does not infringe, misappropriate or otherwise violate any
Intellectual Property of others. 

(iii)      None
of the Company, Seller or any of their Affiliates have granted to any other
Person any license or right to the commercial use of any of the Company
Intellectual Property. 

(l)      Compliance
with Laws. 

(i)      The
Company is operating and has at all times operated the Business in all material
respects in compliance with all applicable Laws. Without limiting the generality
of the forgoing, the Company has complied in all material respects with all
applicable Laws with respect to the Company Employees and Company Contractors,
the Company Benefit Plans, Intellectual Property, and Taxes. The Company has not
received written notice from any Governmental Authority alleging any failure by
it to comply with any Laws. There is no outstanding or, to the Seller’s
Knowledge, threatened, order, writ, injunction or decree of any Governmental
Authority or arbitration tribunal against or involving the Company, the
operation of the Business or the Shares. 

(ii)      The
Company owns and validly holds all licenses, authorizations, permissions,
permits, certificates, approvals, registrations, accreditations and exemptions
required to conduct the Business as presently conducted and to own, operate, or
use, as applicable, the Company Assets (collectively, the “Permits” and,
individually, a “Permit”). Seller has delivered to Buyer, no later than
no later than five (5) Business Days prior to the Closing Date, a schedule that accurately sets forth Permits of
the Company. All Permits are valid and subsisting in accordance with their terms
and are in full force and effect. The Company is in compliance with all Permits
and has not committed any act or omitted to take any action that is likely to
cause it to lose the benefit of or jeopardize the renewal of any Permit. There
are no Claims pending or, to Seller’s Knowledge, threatened that seek the
revocation, cancellation, suspension or any adverse modification of any Permits.
The Company has not received any written notice from any Governmental Authority,
accrediting body or any other Person regarding (A) any actual, alleged, possible
or potential violation of or failure by the Company to comply with any term or
requirement of any Permit or (B) any actual, proposed, possible or potential
revocation, withdrawal, suspension, cancellation or termination of, or
modification to, any Permit. All applications required to have been filed for
the renewal of the Permits have been duly filed on a timely basis with the
appropriate Governmental Authorities or accrediting bodies, and all other
filings required to have been made with respect to such Permits have been duly
made on a timely basis with the appropriate Governmental Authorities or
accrediting bodies. To Seller’s Knowledge, there is no reasonable basis to
expect that any Permits will not be reissued on identical terms as currently
existing, if required as a result of the execution of this Agreement and/or the
consummation of the Transactions. The Permits collectively constitute all of the
Permits necessary to permit the Company to lawfully conduct and operate the
Business and to permit the Company to own and use its assets. 

- 21 -

(m)     
Litigation. No Claim is pending or, to Seller’s Knowledge, threatened
against the Company or any of its respective directors or officers or affecting
its business, assets, properties or operations as currently conducted and there
are no judgments or orders in force or outstanding against the Company, any of
its assets or any of its directors or officers; and (ii) the Company has not
received any notice of any potential Claim which may affect the validity or
legality of this Agreement or the Transactions, or the ability of Seller or the
Company to consummate the Transactions and, to Seller’s Knowledge, there are no
facts or circumstances that could reasonably be expected to result in Seller or
the Company becoming subject to any such Claim. 

(n)      Anti-Corruption.

(i)      None
of the Company, nor any manager, member, director, officer, agent, consultant,
employee, distributor or other Person associated with or acting on behalf of the
Company (collectively, the “Relevant Persons”) has directly or indirectly
(i) violated, taken any act in furtherance of violating or committed any act
that could be deemed a violation of any provision of any Anti-Corruption Law,
(ii) used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expense relating to political activity or (iii) offered,
promised, provided, gifted, or received, directly or indirectly, anything of
value, including any bribe, payment, gift, rebate, payoff, influence payment,
kickback, business opportunity, or other remuneration or transfer of value, to
any person or entity for the purpose of: (A) improperly influencing or inducing
such Person to do or omit to do any act or to make any decision in an official
capacity or in violation of a lawful duty; (B) inducing such Person to influence
improperly his or her or its employer, public or private, or any Governmental
Authority, to affect an act or decision of such employer or Governmental
Authority, including to assist any Person in obtaining or retaining business; or
(C) obtaining or retaining business, securing any improper advantage for the
benefit of the Company, or improperly influencing any entity or person to affect or influence any act or decision in
order to assist in securing an advantage for the benefit of the Company. Each
Relevant Person has appropriately, and in reasonable detail, accounted for any
such payments, whether in the form of disbursements of the Company or requests
for reimbursements, that would allow for the accurate description of any
payments that are made to a government official and has not taken any steps to
hide any transactions that would violate any Law. 

- 22 -

(ii)      There
is no dispute, allegation, request for information, notice of potential
liability, or any other action regarding any actual or possible violation by the
Company of any Anti-Corruption Law pending or, to Seller’s Knowledge, threatened
against the Company, and no Relevant Person has been subject to an inquiry,
investigation, reference, notification, proceeding, report, decision, or other
legal proceeding with respect to the Company’s compliance with any
Anti-Corruption Law. 

(iii)      None
of the Relevant Persons is a Government Official or consultant to any Government
Official, and there is no existing family relationship between any Relevant
Person and any Government Official. 

(iv)      The
Relevant Persons have not directly or indirectly: (i) circumvented the internal
accounting controls of the Company; (ii) falsified any of the books, records or
accounts of the Company; or (iii) made false or misleading statements to, or
attempted to coerce or fraudulently influence, an accountant in connection with
any audit, review or examination of the financial statements of the Company.

ARTICLE V 
REPRESENTATIONS AND WARRANTIES OF
BUYER

Buyer represents and warrants to
the Company and Seller, as of the date of this Agreement and as of the Closing
Date, as follows: 

5.1      Organization
and Authority. Buyer is a company duly organized and validly existing under
the Laws of its jurisdiction of incorporation or formation and has full
corporate or equivalent power and authority necessary to enter into, and perform
its obligations under this Agreement and to consummate the Transactions. 

5.2      Authorization
and Validity. The execution, delivery and performance by Buyer of this
Agreement have been duly authorized by all requisite corporate or equivalent
actions on the part of Buyer, and this Agreement constitutes a legal, valid and
binding agreement and obligation of Buyer, enforceable against it in accordance
with its terms subject to the Enforceability Exceptions. 

5.3     
No Conflict; Consents. The execution and delivery of this Agreement does
not, and the consummation of the Transactions, will not: (a) conflict with or
result in a violation, contravention or breach of any of the terms, conditions
or provisions of the Charter or the Bylaws of Buyer; (b) violate or result in a
breach under any Contract, statute, regulation, rule, order, judgment, decree or
other legal requirement applicable to Buyer; or (c) require the consent,
approval or authorization of any third Person, including any Governmental
Authority. 

- 23 -

5.4      No
Governmental Proceedings or Litigation. No Claim by any Governmental
Authority is pending or, to the knowledge of Buyer, has been threatened against
Buyer which may affect the validity or enforceability of this Agreement or the
Transactions or the ability of Buyer to consummate this Agreement or the
Transactions. 

5.5      No
Broker. Buyer has not employed or made or entered into any Contract with any
broker, finder or similar agent or any other Person or firm with respect to the
Transactions which may result in any liability to the Company or any Seller.

5.6      No
Financing Contingency. Buyer has the financial capability to consummate the
Transactions and pay the Purchase Price pursuant to Section 2.2. Buyer
understands and agrees that its obligations hereunder are not in any way
contingent or otherwise subject to: (a) the consummation of any financing
arrangements or obtaining any financing; or (b) the availability of any
financing to Buyer or any of its Affiliates. 

ARTICLE VI 
PRE-CLOSING MATTERS

6.1      Conduct
of Business Prior to Closing. During the period between the date of this
Agreement until the earlier to occur of the termination of this Agreement in
accordance with Section 9.1 or the Closing Date (the “Pre-Closing
Period”), Seller shall use commercially reasonable efforts to: (i) cause the
Company to be formed and capitalized, and the shares of the Company’s capital
stock, including the Shares, to be issued, in accordance with all applicable
Laws; (ii) maintain the books of account, records and files of the Company in
accordance with all applicable Laws; and (iii) inform Buyer in writing of any
event or circumstance that has or would reasonably be expected to have, a
Material Adverse Effect, or which constitutes a breach of any representation,
warranty or covenant set forth herein, promptly, and in any event prior to the
Closing Date and within two (2) Business Days after the occurrence of any such
event or circumstances to Seller’s Knowledge. During the Pre-Closing Period,
except: (x) as specifically contemplated by this Agreement or any documents or
instruments executed in connection with the consummation of the Transactions or
(y) as provided on Schedule 6.1, the Company shall not, and Seller shall
cause the Company not to, absent the prior written consent of Buyer, which may
be withheld, conditioned or delayed by Buyer in its sole discretion: 

(a)      issue
or sell any equity securities or debt securities of the Company; 

(b)      directly
or indirectly purchase, redeem or otherwise acquire or dispose of any capital
stock of the Company; 

(c)      split,
combine or reclassify any of the outstanding shares or classes of capital stock
of the Company; 

(d)      adopt a plan of complete or
partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company; 

(e)     
declare, set aside or pay any dividend or other distribution; 

- 24 -

(f)      incur,
assume or guarantee any Company Debt or make any loans or advances to any
Person; 

(g)     
subject any of the Company assets (real, personal or mixed, tangible or
intangible) to any Lien, except for Permitted Liens; 

(h)     
permit or allow the sale, lease, transfer, abandonment, cancellation or
disposition of any of the Company assets (real, personal or mixed, tangible or
intangible, including the Company Intellectual Property); 

(i)      make
any commitments for capital expenditures; 

(j)      make
any amendments to the Charter or Bylaws of the Company; 

(k)     
make any material change in the Company accounting methods or practices, other
than as required by P.R.C. GAAP; 

(l)      enter into any partnership,
limited liability company or joint venture agreement; 

(m) waive or release any rights of
material value, or cancel, compromise, release or assign any material
indebtedness owed to the Company; 

(n)      cancel or terminate any
insurance policy naming the Company as a beneficiary or a loss payable payee
unless the same shall be replaced with one or more insurance policies providing
coverage reasonably comparable in scope and terms and Buyer has been provided
with prompt written notice of such cancellation or termination; 

(o) enter into any Contract by which
the Business or any of the assets or properties of the Company would be bound or
affected that restricts in any material respect the operation of the Business or
the Company’s assets or properties, from engaging in any line of business in any
geographic area or competing with any Person; 

(p)      enter into, terminate or make
any material amendment to any Contract; 

(q) compromise, settle, grant any
waiver or release relating to, or otherwise adjust, any Claim of the Company or
that imposes non-monetary relief; 

(r)      take
or omit to take any action which if taken or omitted prior to the date hereof
would constitute a breach of any of the representations or warranties set forth
in Article IV of this Agreement; 

(s)      enter
into any labor or collective bargaining agreement or make any commitment or
incur any liability to any labor organization relating to its employees; 

(t)      adopt
or authorize any Company Benefit Plan except as may be required by any
applicable Law, or: (i) establish or materially increase any benefit under any
Company Benefit Plan (except as may be required by any applicable Law); (ii)
increase or otherwise change the rate or nature of, or prepay, the compensation
(including wages, salaries and bonuses), or severance, that is paid or payable
to any employee; (iii) hire any employee; or (iv) enter into, renew or allow the
renewal of or entering into, any employment or consulting agreement; or 

- 25 -

(u)      agree
or commit to do any of the foregoing.

6.2      Exclusivity.
During the Pre-Closing Period, Seller shall, and shall cause the Company and the
respective Affiliates of Seller and the Company to, deal exclusively with Buyer
in connection with the proposed Transactions and Seller shall procure that none
of Seller, the Company or any of their respective Affiliates shall take or
permit any other Person on its behalf to take any action to, directly or
indirectly, without the prior written consent of Buyer: (a) solicit, initiate,
encourage or otherwise entertain any inquiries, proposals or offers from, any
Person (other than Buyer or one of its Affiliates) relating to any transaction
or series of related transactions involving (i) a merger, consolidation, share
exchange, conversion, recapitalization, refinancing, liquidation or acquisition
of the Company, (ii) a sale of any assets of the Company, (iii) a direct or
indirect acquisition or purchase of any capital stock or other equity interests
of the Company, or (iv) any similar transaction or business combination
involving the Company (each of the above, an “Alternative Transaction”);
(b) participate in any discussions or negotiations with, provide any information
to, or enter into any agreement with any Person (other than Buyer or one of its
Affiliates) in connection with an Alternative Transaction; or (c) accept any
proposal or offer from any Person (other than Buyer or one of its Affiliates)
relating to an Alternative Transaction. Seller will promptly notify Buyer if
Seller, the Company or any of their respective Affiliates receives any such
inquiries, proposals or offers and provide Buyer with a copy of any written
correspondence, proposals or offers. 

6.3     Commercially
Reasonable Efforts. Subject to the terms and conditions of this Agreement,
Seller and the Company, on the one hand, and Buyer, on the other hand, agree to
use their commercially reasonable efforts to take or cause to be taken and to do
or cause to be done all such actions and things as are necessary under the terms
of this Agreement or under applicable Laws, or as may be advisable or reasonably
requested by the other Party, as applicable, in order to consummate the
Transactions. None of the Company or Seller, on the one hand, and Buyer, on the
other hand, shall intentionally perform any act which, if performed, or if
omitted to be performed, would prevent or excuse the performance of this
Agreement by any Party or which would result in any representation or warranty
herein contained of a Party being untrue in any material respect as if
originally made on and as of the Closing Date. Without limiting the generality
of the foregoing, the Parties agree to take all commercially reasonable actions
necessary in order to obtain any consent or approval of any third party,
including without limitation, any Governmental Authority, which is required in
connection with this Agreement or any of the Transactions, and during the
Pre-Closing Period, Seller shall, and shall cause the Company to, shall take all
actions and use its commercially reasonable efforts to satisfy the conditions to
Closing set forth in Section 3.2. 

6.4      Mutual
Cooperation. Subject to the following sentence, each of the Parties shall
use its commercially reasonable efforts to: (a) cooperate in all respects with
each other in connection with any filing or submission with a Governmental
Authority in connection with the Transactions and in connection with any
investigation or other inquiry by or before a Governmental Authority relating to the Transactions, including
any Claim initiated by a private party; and (b) keep the other Party informed in
all material respects and on a reasonably timely basis of any material
communication received by such Party from, or given by such Party to any
Governmental Authority and of any material communication received or given in
connection with any Claim by a private party, in each case regarding any of the
Transactions. Nothing contained in this Agreement shall require or obligate any
Party to divest, restrict, alter or otherwise bind the use, ownership or
operation, as applicable, of its businesses, operations, organization or assets.

- 26 -

6.5      Access
to Information. Prior to the Closing, Seller and the Company shall and
Seller shall cause the Company to, permit Buyer and its representatives to have
reasonable access (at reasonable times, on reasonable prior notice and in a
manner so as not to interfere with the normal business operations of the
Company) to the personnel, properties, books, Contracts and other records and
documents of the Company. 

ARTICLE VII 
POST-CLOSING
MATTERS

7.1      Transfer
Taxes. Seller shall pay all transfer, real property transfer, documentary,
sales, use, stamp, duty, recording and similar Taxes (including any penalties,
interest and additions to Tax) incurred in connection with this Agreement and
the Transactions (together, “Transfer Taxes”). Buyer shall be responsible
for preparing and filing all Tax Returns or other applicable documents in
connection with all Transfer Taxes, to the extent permitted by applicable Law,
provided, however, that Seller and the Company shall cooperate with Buyer in the
preparation and filing of all Tax Returns or other applicable documents for or
with respect to Transfer Taxes, including timely signing and delivering such Tax
Returns, documents, and certificates as may be necessary or appropriate to file
such Tax Returns or establish an exemption from (or otherwise reduce) Transfer
Taxes. Notwithstanding anything to the contrary contained in this Agreement,
“Transfer Taxes” shall not include any Taxes required to be deducted and
withheld with respect to payments made by Buyer to Seller (under the Code or
Treasury Regulations thereunder or any applicable provision of state, local or
foreign Law) in connection with the transactions contemplated by this Agreement
(including any P.R.C. withholding Taxes). 

7.2      Conduct
of Business with Respect to Taxes. During the Pre-Closing Period: 

(a)      The
Company shall not, and Seller shall cause the Company not to, make, revoke or
amend any Tax election; change any annual accounting period; adopt or change any
method of accounting or reverse any accruals (except as required by a change in
Law or P.R.C. GAAP); file any amended Tax Returns; sign or enter into any
closing agreement or settlement agreement with respect to any, or compromise
any, Claim or assessment of any Tax liability; surrender any right to claim a
refund, offset or other reduction in liability; consent to any extension or
waiver of the limitations period applicable to any Claim or assessment, in each
case, with respect to Taxes; or act or omit to act where such action or omission
to act could reasonably be expected to have the effect of increasing any present
or future Tax liability or decreasing any present or future Tax benefit for the
Company, Buyer or its Affiliates; and 

- 27 -

(b)     
The Company shall, and Seller shall cause the Company to: (i) timely file all
Tax Returns required to be filed by it and all such Tax Returns shall be
prepared in a manner consistent with past practice and that is reasonably
acceptable to Buyer; (ii) timely pay all Taxes due and payable; and (iii)
promptly notify Buyer of any income, franchise or similar (or other material)
Tax Claim, investigation or audit pending against or with respect to the Company
in respect of any Tax matters (or any significant developments with respect to
ongoing Tax matters), including material Tax liabilities and material Tax refund
claims. 

7.3     
Cooperation on Tax Matters. Seller and Buyer shall reasonably cooperate,
and shall cause their respective Affiliates, officers, employees, agents,
auditors and representatives reasonably to cooperate, in preparing and filing
all Tax Returns of the Company relating to any Pre-Closing Tax Period or
Straddle Period, including maintaining and making available to each other all
records necessary in connection with Taxes of the Company relating to any
Pre-Closing Tax Period or Straddle Period, and in resolving all disputes and
audits with respect to all such Pre-Closing Tax Periods and Straddle Periods in
accordance with Section 7.7. Buyer recognizes that Seller may need
access, from time to time, after the Closing Date, to certain accounting and Tax
records and information held by the Company to the extent such records and
information pertain to events occurring on or prior to the Closing Date;
therefore, Buyer agrees that from and after the Closing Date, Buyer shall, and
shall cause the Company to, retain and maintain such records and information
until the later of: (a) six (6) years following the Closing Date; and (b) the
applicable statute of limitations with respect to the Tax for which such records
or information relate, and allow Seller to inspect, review and make copies of
such records and information as Seller reasonably requests from time to time
during normal business hours and after appropriate prior notification. Subject
to Section 7.7, Buyer will not file, and will cause the Company not to
file, any amended Tax Return, Tax election or change in accounting method, in
each case, for any Pre-Closing Period of the Company which would cause an
increase in Taxes of the Company for any period for which Seller is liable for
the payment of Taxes. 

7.4      Preparation
and Filing of Pre-Closing Period Tax Returns for the Company. Seller shall,
at the cost and expense of Seller, prepare, or cause to be prepared all
Pre-Closing Period Tax Returns required to be filed by or on behalf of the
Company. All such Pre-Closing Period Tax Returns shall be prepared and filed in
a manner that is consistent with the prior practice of the Company, except as
required by applicable Law. Drafts of all such Pre-Closing Period Tax Returns
shall be delivered to Buyer for its review and approval at least thirty (30)
days prior to the Due Date of any such Pre-Closing Period Tax Return; provided,
however, that such approval shall not be unreasonably withheld, conditioned or
delayed. If Buyer disputes any item on such Pre-Closing Period Tax Return, it
shall notify Seller (by written notice within fifteen (15) days of receipt of
such draft of such Pre-Closing Period Tax Return) of such disputed item (or
items) and the basis for its objection. If Buyer does not object by written
notice within such period, the amount of Taxes shown to be due and payable on
such Pre-Closing Period Tax Return shall be deemed to be accepted and agreed
upon, and final and conclusive, for purposes of this Section 7.4. Buyer
and Seller shall act in good faith to resolve any dispute prior to the Due Date
of any such Pre-Closing Period Tax Return. If Buyer and Seller cannot resolve
any disputed item, the item in question shall be resolved by Neutral Arbitrator
as promptly as practicable (in accordance with the provisions of this Section
7.4), whose determination shall be final and conclusive for purposes of this
Section 7.4. The Neutral Arbitrator shall be instructed to use every
reasonable effort to complete their services within thirty (30) days after
submission of the dispute to them and in any case, as soon as practicable
after such submission. The fees and expenses of the Neutral Arbitrator in
connection with its work pursuant to this Section 7.4 shall be allocated
between Buyer, on the one hand, and Seller, on the other hand, in the same
proportion that the aggregate amount of the disputed item(s) so submitted to the
Neutral Arbitrator that is unsuccessfully disputed by each such Party (as
finally determined by the Neutral Arbitrator) bears to the total amount of such
disputed items so submitted. Seller shall timely file all such Pre-Closing
Period Tax Returns; provided, however, if any such Pre-Closing
Period Tax Return is filed after the Closing and Seller is not authorized to
execute and file such Pre-Closing Period Tax Return by applicable Law, Buyer
shall execute and file (or cause to be filed) such Pre-Closing Period Tax Return
(as finally determined pursuant to this Section 7.4) with the appropriate
Taxing Authority. Seller shall pay all Pre-Closing Taxes due and payable in
respect of all Pre-Closing Period Tax Returns of the Company; provided, however, that if any Pre-Closing Period Tax Return is due after the
Closing and is to be filed (or caused to be filed) by Buyer, Seller shall pay
(in immediately available funds) to Buyer the amount of all Pre-Closing Taxes
due and payable with respect of such Pre-Closing Period Tax Return (determined
pursuant to this Section 7.4) no later than three (3) Business Days prior
to the earlier of the date such Pre-Closing Period Tax Return is filed or the
Due Date of such Pre-Closing Period Tax Return, and Buyer shall timely pay the
amount of such Pre-Closing Taxes reflected on such Tax Return, provided further,
however, that if Seller has disputed any item on such Pre-Closing Period Tax
Return or the determination of the Pre-Closing Taxes in accordance with this Section 7.4 and such dispute has not yet been resolved, Seller shall be
obligated at such time to pay only so much of such Pre-Closing Taxes as are not
in dispute, and upon the resolution of such dispute, Seller shall promptly pay
(in immediately available funds) to Buyer any further amount owing in accordance
with this Section 7.4. Amounts required to be paid by Seller pursuant to
this Section 7.4 that are not paid on or prior to the date specified
herein shall accrue interest at the simple rate of 8% per annum until paid in
full. In the event that such Pre-Closing Period Tax Return reflects any refund,
the provisions of Section 7.8 (Tax Refunds) shall control.

- 28 -

7.5      Preparation
and Filing of Straddle Period Tax Returns for the Company. Buyer shall, at
its expense, prepare and timely file, or cause to be prepared and timely filed,
all Straddle Period Tax Returns required to be filed by the Company. All
Straddle Period Tax Returns shall be prepared and filed in a manner that is
consistent with the prior practice of the Company, except as required by
applicable Law. Buyer shall deliver or cause to be delivered drafts of all
Straddle Period Tax Returns to Seller for its review and approval at least
thirty (30) days prior to the Due Date of any such Straddle Period Tax Return
and shall notify Seller of Buyer’s calculation of Seller’s share of the Taxes of
the Company for such Straddle Period (determined in accordance with Section
7.6); provided, however, that such approval by Seller of any such Straddle
Period Tax Returns and such calculations of Seller’s share of the Tax liability
for such Straddle Period (determined in accordance with Section 7.6)
shall not be unreasonably withheld, conditioned or delayed. If Seller disputes
any item on such Straddle Period Tax Return, it shall notify Buyer (by written
notice within fifteen (15) days of receipt of such Straddle Period Tax Return
and calculation) of such disputed item (or items) and the basis for its
objection. If Seller does not object by written notice within such period, such
draft of such Straddle Period Tax Return and calculation of Seller’s share of
the Taxes for such Straddle Period shall be deemed to have been accepted and
agreed upon, and final and conclusive, for purposes of this Section 7.5.
Buyer and Seller shall negotiate in good faith to resolve any such dispute prior
to the Due Date of such Straddle Period Tax Return. If Buyer and Seller cannot
resolve any disputed item, the item in question shall be resolved by the Neutral Arbitrator as
promptly as practicable (in accordance with the provisions of this Section
7.5), whose determination shall be final and conclusive for purposes of this Section 7.5. The Neutral Arbitrator shall be instructed to use every
reasonable effort to complete their services within thirty (30) days after
submission of the dispute to them and in any case, as soon as practicable after
such submission. The fees and expenses of the Neutral Arbitrator in connection
with its work pursuant to this Section 7.5 shall be allocated between
Buyer, on the one hand, and Seller, on the other hand, in the same proportion
that the aggregate amount of the disputed item(s) so submitted to the Neutral
Arbitrator that is unsuccessfully disputed by each such Party (as finally
determined by the Neutral Arbitrator) bears to the total amount of such disputed
items so submitted. No later than three (3) Business Days prior to the earlier
of the date a Straddle Period Tax Return of the Company is filed or the Due Date
of such Straddle Period Tax Return, Seller shall pay (in immediately available
funds) to Buyer the amount of all Pre-Closing Taxes required to be paid with
respect to such Straddle Period Tax Return (determined pursuant to this Section 7.5); provided, however, that if Seller has disputed any item on
such Pre-Closing Period Tax Return or the determination of the Pre-Closing Taxes
in accordance with this Section 7.5 and such dispute has not yet been resolved,
Seller shall be obligated at such time to pay only so much of such Pre-Closing
Taxes as are not in dispute, and upon the resolution of such dispute, Seller
shall promptly pay (in immediately available funds) to Buyer any further amount
owing in accordance with this Section 7.5. Amounts required to be paid by
Sellers to Buyer pursuant to this Section 7.5 that are not paid on or
prior to the date specified herein shall accrue interest at the simple rate of
8% per annum until paid in full. In the event that such Straddle Period Tax
Return reflects any refund, the provisions of Section 7.8 (Refunds) shall
control. 

- 29 -

7.6      Computation
of Tax Liabilities. To the extent permitted or required, the taxable year of
the Company that includes the Closing Date shall close as of the end of the
Closing Date. Whenever it is necessary to determine the liability for Taxes for
a Straddle Period relating to: 

(a)      Taxes
not described in Section 7.6(b) (e.g., Taxes imposed on a periodic basis,
such as real property and other ad valorem Taxes), the determination of Taxes of
the Company for the portion of the Straddle Period ending on and including the
Closing Date shall be deemed to be the amount of such Taxes for the entire
Straddle Period multiplied by a fraction, the numerator of which is the number
of days in the Straddle Period ending on the Closing Date and the denominator of
which is the number of days in the entire Straddle Period; and 

(b)      (i)
Taxes based on the income or receipts for a Straddle Period, (ii) Taxes imposed
in connection with any sale or other transfer or assignment of property
(including all sales and use Taxes) for a Straddle Period, and (iii) withholding
Taxes relating to a Straddle Period, the determination of the Taxes of the
Company for the portion of the Straddle Period ending on and including, and the
portion of the Straddle Period beginning and ending after, the Closing Date
shall be calculated by assuming that the Straddle Period consisted of two (2)
taxable periods, one which ended at the close of the Closing Date and the other
which began at the beginning of the day following the Closing Date and items of
income, gain, deduction, loss or credit of the Company for the Straddle Period
shall be allocated between such two (2) taxable years or periods on a “closing
of the books basis” by assuming that the books of the Company were closed at the
close of the Closing Date; provided, however, that exemptions,
allowances or deductions that are calculated on an annual basis (including, but
not limited to, depreciation and amortization deductions) will be allocated between the period
ending on the Closing Date and the period after the Closing Date in proportion
to the number of days in each such period. 

- 30 -

7.7      Tax
Contests. 

(a)      Buyer
shall deliver a written notice to Seller promptly following any demand, Claim,
or notice of commencement of a Claim, proposed adjustment, assessment, audit,
examination or other administrative or court Proceeding with respect to Taxes of
the Company for which Seller may be liable (“Tax Contest”) and shall
describe in reasonable detail (to the extent known by Buyer) the facts
constituting the basis for such Tax Contest, the nature of the relief sought,
and the amount of the claimed Losses (including Taxes), if any (the “Tax
Claim Notice”), provided, however, that the failure or delay
to so notify Seller shall not relieve Seller of any obligation or liability that
Seller may have to Buyer, except to the extent that Seller demonstrates that
Seller is materially and adversely prejudiced thereby. 

(b)      With
respect to Tax Contests for Taxes of the Company for a Pre-Closing Tax Period,
Seller may elect to assume and control the defense of such Tax Contest by
written notice to Buyer within thirty (30) days after delivery by Buyer to
Seller of the Tax Claim Notice. If Seller elects to assume and control the
defense of such Tax Contest, Seller: (i) shall bear its own costs and expenses;
(ii) shall be entitled to engage its own counsel; and (iii) may (A) pursue or
forego any and all administrative appeals, Proceedings, hearings and conferences
with any Taxing Authority, (B) either pay the Tax claimed or sue for refund
where applicable Law permits such refund suit, or (C) contest, settle or
compromise the Tax Contest in any permissible manner; provided,
however, that Seller shall not settle or compromise (or take other
actions described herein with respect to) any Tax Contest without the prior
written consent of Buyer (such consent not to be unreasonably withheld, delayed
or conditioned); provided, further, that Seller shall not settle
or compromise (or take other actions described herein with respect to) any Tax
Contest without the prior written consent of Buyer (which consent may be
withheld in the sole discretion of Buyer) if such settlement or compromise would
reasonably be expected to adversely affect the Tax liability of Buyer or any of
its Affiliates (including the Company) for any Tax period ending after the
Closing Date. If Seller elects to assume the defense of any Tax Contest, Seller
shall: (x) keep Buyer reasonably informed of all material developments and
events relating to such Tax Contest (including promptly forwarding copies to
Buyer of any related correspondence, and shall provide Buyer with an opportunity
to review and comment on any material correspondence before Seller sends such
correspondence to any Taxing Authority); (y) consult with Buyer in connection
with the defense or prosecution of any such Tax Contest; and (z) provide such
cooperation and information as Buyer shall reasonably request, and Buyer shall
have the right, at its expense, to participate in (but not control) the defense
of such Tax Contest (including participating in any discussions with the
applicable Tax Authorities regarding such Tax Contests). 

(c)      In
connection with any Tax Contest that relates to Taxes of the Company for a
Pre-Closing Tax Period that: (i) Seller does not timely elect to control
pursuant to Section 7.7(b); or (ii) Seller fails to diligently defend,
such Tax Contest shall be controlled by Buyer (and Seller shall reimburse Buyer
for all reasonable costs and expenses incurred by Buyer relating to a Tax
Contest described in this Section 7.7(c)) and Seller agrees to cooperate
with Buyer in pursuing such Tax Contest. In connection with any Tax Contest that
is described in this Section 7.7(c) and controlled by Buyer, Buyer shall: (x) keep
Seller informed of all material developments and events relating to such Tax
Contest (including promptly forwarding copies to Seller of any related
correspondence and shall provide Seller with an opportunity to review and
comment on any material correspondence before Buyer sends such correspondence to
any Taxing Authority); (y) consult with Seller in connection with the defense or
prosecution of any such Tax Contest; and (z) provide such cooperation and
information as Seller shall reasonably request, and, at his own cost and
expense, Seller shall have the right to participate in (but not control) the
defense of such Tax Contest (including participating in any discussions with the
applicable Tax Authorities regarding such Tax Contests). 

- 31 -

(d)      In
connection with any Tax Contest for Taxes of the Company for any Straddle
Period, such Tax Contest shall be controlled by Buyer; provided, that
Buyer shall not settle or compromise (or take such other actions described
herein with respect to) any Tax Contest without the prior written consent of
Seller, with such consent not to be unreasonably withheld, conditioned or
delayed. Buyer shall: (x) keep Seller informed of all material developments and
events relating to such Tax Contest (including promptly forwarding copies to
Seller of any related correspondence and shall provide Seller with an
opportunity to review and comment on any material correspondence before Buyer
sends such correspondence to any Taxing Authority); (y) consult with Seller in
connection with the defense or prosecution of any such Tax Contest; and (z)
provide such cooperation and information as Seller shall reasonably request,
and, at its own cost and expense, Seller shall have the right to participate in
(but not control) the defense of such Tax Contest (including participating in
any discussions with the applicable Tax Authorities regarding such Tax
Contests). 

(e)      Notwithstanding
anything to the contrary contained in this Agreement, the procedures for all Tax
Contests shall be governed exclusively by this Section 7.7 (and not
Section 8.3) . 

7.8      Tax
Refunds. Buyer may, at its option, cause the Company to elect, where
permitted by applicable Law, to carry forward or carry back any Tax attribute
carryover that would, absent such election, be carried back to a Pre-Closing Tax
Period or Straddle Period. Buyer shall promptly notify Seller of and pay (or
cause to be paid) to Seller: (a) any refund of Taxes paid by the Company for any
Pre-Closing Tax Period actually received by the Company; or (b) a portion of any
refund of Taxes paid by the Company for any Straddle Period (such portion to be
allocated consistent with the principles set forth in Section 7.8 hereof)
actually received by the Company, in each case, net of any Tax liabilities or
increase in Tax liabilities imposed on Buyer or the Company (or any Affiliate
thereof) resulting from such refund; provided, however, that
Seller shall not be entitled to any refund to the extent such refund relates to
a carryback of a Tax attribute from any period ending after the Closing Date.
Buyer shall pay (or cause to be paid) the amounts described in the second
sentence of this Section 7.8 within thirty (30) days after the actual
receipt of the Tax refund giving rise to Buyer’s obligation to make payment
hereunder with respect thereto. At the request of Seller, Buyer shall reasonably
cooperate with Seller in obtaining any such refunds for which Seller is entitled
pursuant to this Section 7.8, including through the filing of amended Tax
Returns or refund claims as prepared by Seller, at the expense of Seller;
provided, however, that any such amended Tax Return shall be
prepared by Seller, Seller shall deliver or cause to be delivered drafts of any
such amended Tax Return to Buyer for its review prior to the time such amended
Tax Return may be filed and any such amended Tax Return shall be subject to the consent of
Buyer, which consent shall not be unreasonably withheld, conditioned or delayed;
and provided, further, that Buyer shall not be required to cooperate with Seller
in obtaining such refunds (or, notwithstanding anything to the contrary
contained herein, consent to the filing of such amended Tax Return) if such
refund could reasonably be expected to adversely affect Buyer or the Company (or
any Affiliate thereof) in any Straddle Period or Post-Closing Period.

- 32 -

7.9      Adjustments
to Purchase Price in Connection With Taxes. Buyer and Seller agree to treat
any amounts payable after the Closing by Seller to Buyer (or by Buyer to Seller)
pursuant to this Agreement as an adjustment to the Purchase Price, unless a
final determination by the appropriate Taxing Authority or court causes any such
payment not to be treated as an adjustment to the Purchase Price for Tax
purposes. 

7.10     
Payments in Connection with Taxes. Notwithstanding anything to the
contrary contained in this Agreement (but subject to this Article VII),
payment by Seller of any amount due related or attributable to Taxes or Tax
Returns pursuant to this Agreement shall be made within five (5) Business Days
following written notice by Buyer that payment of such amounts to the
appropriate Taxing Authority is due (or, in connection with this Agreement, is
required to be paid by Seller to Buyer or are the responsibility of Seller in
whole or in part); provided, however, that Seller shall not be
required to make any payment earlier than three (3) Business Days before it is
due (without regard to any extensions for filing the applicable Tax Return) to
the appropriate Taxing Authority. Amounts required to be paid by Seller for
Taxes, or otherwise, that are not paid on or prior to the date specified herein
shall accrue interest at the simple rate of 8% per annum until paid in full.

7.11      Non-Compete.

(a)      Seller
hereby acknowledges that (i) in addition to disposing of Seller’s ownership
interest in the Shares as set forth in this Agreement, Seller is selling all the
goodwill of the Company associated with or attributable to the Shares, (ii)
Seller has contributed to the development of the goodwill of the Company, and
(iii) the Parties have agreed upon the Purchase Price to specifically include
and reflect such sale of goodwill. In consideration of the sale of Seller’s
ownership in the Shares, including the sale of all goodwill, Seller agrees that,
during the Restricted Period, Seller shall not, and shall cause its affiliates
where Seller owns more than a 51% controlling interest in, not to, without the
express written consent of Buyer, anywhere within mainland China, compete
directly with the products or services sold or offered by the Company.
Notwithstanding the restrictions set forth above, nothing herein shall prohibit
Seller or any of its Affiliates from making investments in the ordinary course
of business in the securities of any Person that are listed on any national
stock exchange or NASDAQ. 

7.12      Non-Solicitation.
Seller agrees that, during the Restricted Period, Seller shall not, and shall
cause its Affiliates not to, directly or indirectly, (i) solicit any employee of
the Company or any of its controlled Affiliates for employment, or solicit,
suggest, induce or encourage any employee of the Company or any of its
controlled Affiliates to seek employment or business opportunities other than
with the Company or its Affiliates, or (ii) solicit, induce or attempt to induce
any customer, consultant, independent contractor, vendor, supplier, or partner
of the Company or any of its controlled Affiliates to terminate, diminish, or
materially alter in a manner harmful to the Company or any of its controlled
Affiliates its relationship or their relationships with the Company or any of
its controlled Affiliates.

- 33 -

7.13      Further
Assurances. From and after the Closing, as and when required by any Party,
each Party will execute and deliver, or cause to be executed and delivered, all
such documents and instruments and will take, or cause to be taken, at the
requesting Party’s expense, all such further or other actions, as such other
Party may reasonably deem necessary or desirable to consummate the Transactions.

7.14      Reserved.

7.15     
Proprietary Information. From and after the Closing, Seller shall not
disclose or make use of (except to pursue rights under this Agreement), and
shall cause all of its Affiliates not to disclose or make use of, any knowledge,
information or documents of a confidential or proprietary nature or not
generally known to the public with respect to the Business, Buyer or any of its
Affiliates (including the Company following the Closing) or the businesses of
any of the foregoing (including the financial information, technical information
or data relating to the Company’s products and services and the names of
customers of the Company, as well as filings and testimony (if any) presented in
the course of any proceeding pursuant to Article X and any award and the
tribunal’s reasons therefor relating to the same) (such knowledge, information
or documents, “Proprietary Information”); provided, however, that the
term “Proprietary Information” does not include information that (a) was, is or
becomes public knowledge other than through improper disclosure by Seller or an
Affiliate of Seller, or (b) is lawfully acquired by Seller or an Affiliate of
Seller from and after the Closing from sources which are not prohibited from
disclosing such information by a legal, contractual or fiduciary obligation.
Seller and its Affiliates may disclose Proprietary Information as requested or
required by (y) any applicable Law or (z) oral questions, interrogatories,
requests for information or documents, subpoena, civil investigative demand or
similar process; provided, however, that (i) Seller shall give prompt notice of
such requirement to Buyer, (ii) Seller or its Affiliates, as applicable, shall
disclose only such portion of the Proprietary Information as it is advised by
counsel is required to be disclosed, and (iii) if available, Seller or its
Affiliates, as applicable, will use its reasonable best efforts to obtain
reasonable assurance that confidential treatment will be accorded such disclosed
Proprietary Information.

ARTICLE VIII 
INDEMNIFICATION

8.1     
Indemnification by Seller. Subject to the limitations set forth in this
Article VIII, Seller hereby agrees to hold harmless and reimburse Buyer
and its successors and assigns and each of the foregoing’s stockholders,
officers, directors, employees and agents (collectively, the
“Indemnitees”) from and against any and every Claim, action, loss,
liability, damage, cost, expense (including reasonable attorneys’ fees),
deficiency, penalty, award, judgment, fine, Taxes, notice of violation, notice
of liability or charge and any Claims in respect thereof (including amounts paid
in settlement and reasonable costs of investigation and legal fees and expenses)
(collectively, “Losses”), Indemnitees incur or sustain that are based
upon, related to, result from or arise out of: 

- 34 -

(a)      any
breach or inaccuracy of any representation or warranty of Seller or the Company
contained in Article IV of this Agreement; 

(b)     
any breach of, or failure to perform or observe, any covenant, agreement or
obligation to be performed by the Company (to the extent to be performed prior
to the Closing) or Seller pursuant to this Agreement; 

(c)      any
Pre-Closing Taxes; and 

(d)      any
Company Transaction Costs that are not paid in full prior to the Closing. 

8.2     
Limitations on Liability. 

(a)      Survival.
The representations and warranties contained in Article IV of this
Agreement shall survive the Closing for the twenty-four (24) month period
following the Closing (the “Survival Period”), provided,
however, that (i) the Fundamental Representations shall survive and
continue indefinitely, (ii) no such limitation will apply in the event that the
applicable breach is the result of fraud or intentional misrepresentation and
(iii) if written notice of a Claim for Losses based upon breach of an applicable
representation or warranty has been given to Seller prior to the expiration of
the Survival Period, then the applicable representation(s) and/or warranty(ies)
shall survive as to such Claim until such Claim has been fully resolved. The
Parties hereto specifically and unambiguously intend that the survival periods
that are set forth in this Section 8.2(a) (other than with respect to
clause (i) above), for the representations and warranties contained herein shall
replace any statute of limitations for such representations or warranties that
would otherwise be applicable. Any covenant or agreement contained herein to be
performed prior to or after the Closing shall survive the Closing indefinitely.

(b)     
Reserved. 

(c)     
Seller’s Cap. Notwithstanding anything to the contrary in this Article
VIII, the total aggregate monetary liability of Seller under this Article
VIII shall not exceed (i) the value of the aggregate number of Earn-Out
Shares received by Seller pursuant to Section 2.3 or upon conversion of
any Promissory Note, as determined using the Applicable Stock Price, and (ii)
the principal amount of the Promissory Notes issued to Seller pursuant to
Section 2.3, and any accrued interest thereon (collectively in the
aggregate, the “Cap”); provided, however, that the Cap
shall not apply to limit any Losses arising out of fraud or intentional
misrepresentations. 

(d)      Duty
to Mitigate. Each Indemnitee shall take, and cause its Affiliates to take,
all commercially reasonable steps to mitigate any Loss upon becoming aware of
any event or circumstance that would be reasonably expected to, or does, give
rise thereto.

(e)      Exclusive
Remedy. Subject to the provisions regarding specific performance set forth
in Section 11.8, the remedies set forth in this Article VIII shall
be the sole and exclusive remedies of the Parties with respect to this Agreement
or any other document required to be delivered hereby or the Transactions
contemplated hereby or thereby; provided, however, that in the
event of a termination of this Agreement, or if the Closing does not otherwise occur, the Parties reserve all rights and remedies as
a result of any breach of this Agreement, except as otherwise provided in this
Agreement. 

- 35 -

8.3      Third
Party Claims. 

(a)      In
the event that any Third Party Claim is asserted or commenced against a
Indemnitee with respect to which such Indemnitee is entitled to indemnification
under this Section 8.3, the Indemnitee shall: (A) promptly notify Seller
of its existence, setting forth in writing with reasonable specificity the facts
and circumstances of which such Indemnitee received notice; and (B) specify the
basis hereunder upon which the Indemnitee’s Claim for indemnification is
asserted. 

(b)      Except
as herein provided, the Indemnitee shall not, and Seller shall, have the right
to contest, defend, litigate or settle such Third Party Claim, if the defense of
a Third Party Claim is so tendered and within thirty (30) days thereafter Seller
accepts such tender and acknowledges in writing without qualification its
indemnification obligation hereunder, subject only to the limitations on
indemnification set forth in this Agreement, including Section 8.2. The
Indemnitee shall have the right to be represented by counsel at its own expense
in any such contest, defense, litigation or settlement conducted by the
Indemnitor. Seller shall lose its right to contest, defend, litigate and settle
the Third Party Claim if it shall fail to diligently contest the Third Party
Claim. So long as Seller has not lost its right to contest, defend, litigate and
settle as herein provided, Seller shall have the right to contest, defend and
litigate the Third Party Claim and shall have the right to enter into any
settlement of any Third Party Claim; provided, that such settlement includes an
unconditional written release from all liability in respect of such Third Party
Claim; provided, further, that Seller may not enter into any settlement of any
Third Party Claim without the prior written consent (which consent shall not be
unreasonably withheld, conditioned or delayed) of the Indemnitee if pursuant to
or as a result of such settlement: (A) injunctive or other equitable relief
would be imposed against the Indemnitee; (B) such settlement would or could
reasonably be expected to lead to any liability or create any financial or other
obligation on the part of the Indemnitee; or (C) such settlement would adversely
affect the conduct of the Business. Seller shall not be entitled to assume
control of a Third Party Claim and shall pay the reasonable fees and expenses of
counsel retained by the Indemnitee if: (X) the Third Party Claim relates to or
arises in connection with any criminal proceeding, action, indictment or
allegation; (Y) the Third Party Claim seeks injunctive or other equitable
relief, or Buyer reasonably believes that the Third Party Claim, if adversely
determined, would impair in any respect the financial condition, business,
operations, reputation or prospects of Buyer, the Indemnitee, or the Company; or
(Z) the interests of the Indemnitee in the Third Party Claim is or can
reasonably be expected to be adverse to the interests of Seller. If the
Indemnitee has assumed control of the defense of a Third Party Claim pursuant to
the foregoing sentence, it shall not agree to any settlement without the consent
of Seller (which consent shall not be unreasonably withheld, conditioned or
delayed), provided that Seller has acknowledged in writing without qualification
its indemnification obligation hereunder, subject only to the limitations on
indemnification set forth in this Agreement, including Section 8.2.
Subject to any applicable limitations set forth in Section 8.2, all
expenses (including attorneys’ fees) incurred by the Indemnitor in connection
with the foregoing shall be paid by Seller. If an Indemnitee is entitled to
indemnification against a Third Party Claim, and Seller fails to accept a tender
of the defense of a Third Party Claim pursuant to this Section 8.3(b), or
if, in accordance with the foregoing, Seller shall lose its right to contest, defend,
litigate and settle such a Third Party Claim, the Indemnitee shall have the
right, without prejudice to its right of indemnification hereunder, in its
discretion exercised in reasonable good faith and upon the advice of counsel, to
contest, defend and litigate such Third Party Claim, and may settle such Third
Party Claim, either before or after the initiation of litigation, at such time
and upon such terms as the Indemnitee deems fair and reasonable. If, pursuant to
the preceding sentence, the Indemnitee so contests, defends, litigates or
settles a Third Party Claim for which it is entitled to indemnification
hereunder, the Indemnitee shall be reimbursed by Seller for the reasonable
attorneys’ fees and other expenses of contesting, defending, litigating and
settling the Third Party Claim which are incurred from time to time, promptly
following the presentation to Seller of itemized bills for such attorneys’ fees
and other expenses, subject, however, to any applicable limitations set forth in Section 8.2. Seller and any Indemnitee shall reasonably cooperate with
one another in the contest, defense or litigation of any Third Party Claim.

- 36 -

(c)      Notwithstanding
anything to the contrary contained in this Agreement, the procedures for all Tax
Contests shall be governed exclusively by Section 7.7 and not this
Section 8.3. 

8.4      Direct
Claims. Any claim by an Indemnitee on account of a Loss which does not
result from a Third Party Claim (a “Direct Claim”) shall be asserted by
the Indemnitee giving the Seller written notice thereof. Such notice by the
Indemnitee shall describe the Direct Claim in reasonable detail, shall include
copies of all material written evidence thereof and shall indicate the estimated
amount, if reasonably practicable, of the Loss that has been or may be sustained
by the Indemnitee. Seller shall have fifteen (15) days after Seller’s receipt of
such notice to respond in writing to such Direct Claim. During such fifteen
(15)-day period, the Indemnitee shall allow Seller and its professional advisors
to investigate the matter or circumstance alleged to give rise to the Direct
Claim, and whether and to what extent any amount is payable in respect of the
Direct Claim and the Indemnitee shall assist Seller’s investigation by giving
such information and assistance (including access to the Company’s premises and
personnel and the right to examine and copy any accounts, documents or records)
as Seller or any of its professional advisors may reasonably request. If Seller
does not so respond within such fifteen (15)-day period, Seller shall be deemed
to have acknowledged and agreed that the applicable Indemnitee is entitled to
indemnification hereunder in respect of such Direct Claim. 

8.5      Satisfaction
of Indemnification Claims. If Seller shall acknowledge and agree in writing,
or it is finally determined pursuant to the dispute resolution procedures set
forth in Article X hereof, that an Indemnitee is entitled to
indemnification hereunder in respect of Losses incurred by such Indemnitee (the
date of such acknowledgement and agreement or determination, the “Claim
Determination Date”), Seller shall make payment in respect of such Losses
within five (5) days following the Claim Determination Date (i) by delivering to
such Indemnitee that number of shares of Buyer Stock equal in value to the
amount of the Losses to be indemnified hereunder or, at the option of Buyer,
(ii) by reducing the principal amount of the Promissory Notes outstanding, and
any interest accrued thereon, by the amount of such Losses. Further, at the
option of Buyer, the indemnifiable Losses of any Indemnitee may be satisfied by
Buyer withholding from any future Earn-Out Share Award to which Seller is
entitled that number of Earn-Out Shares equal in value to the amount of the
indemnifiable Losses of such Indemnitee. For purposes of calculating the number
of shares of Buyer Stock necessary to satisfy the Losses of an Indemnitee as described in this
Section 8.5, each share of Buyer Stock shall be valued using the
Applicable Stock Price.

- 37 -

8.6      Treatment
of Indemnification Payments. For all purposes hereunder, any indemnification
payments made pursuant to this Article VIII of this Agreement shall, to
the extent permitted by applicable Law, be treated as an adjustment to the
Purchase Price. 

ARTICLE IX 
TERMINATION

9.1      Termination.
This Agreement may be terminated at any time prior to the Closing as follows:

(a)      By
the mutual written consent of Buyer and Seller; 

(b)     
Automatically upon the termination of the Securities Purchase Agreement; 

(c)      By
Seller (if none of Seller or the Company are then in breach of any material term
of this Agreement), if Buyer shall: (i) fail to perform in any material respect
its agreements contained in this Agreement required to be performed on or prior
to the Closing Date; or (ii) materially breaches any of its representations,
warranties or covenants contained in this Agreement, which failure or breach is
not cured within twenty (20) days after Seller has notified Buyer in writing of
his intent to terminate this Agreement pursuant to this Section 9.1(c);

(d)      By
Seller, upon written notice to Buyer, if the Closing has not occurred on or
before January 31, 2016 for any reason other than delay or nonperformance of
Seller or the Company; 

(e)      By
Buyer (if Buyer is not then in breach of any material term of this Agreement),
if Seller or the Company shall: (i) fail to perform in any material respect any
of its agreements contained in this Agreement required to be performed on or
prior to the Closing Date; or (ii) materially breach any of its representations,
warranties or covenants contained in this Agreement, which failure or breach is
not cured within twenty (20) days after Buyer has notified Seller in writing of
Buyer’s intent to terminate this Agreement pursuant to this Section
9.1(e); 

(f)      By
Buyer, upon written notice to Seller, if the Closing has not occurred on or
before January 31, 2016 for any reason other than delay or nonperformance of
Buyer; or 

(g)     
By Seller, on the one hand, or by Buyer, on the other hand, if there shall be
any final, non-appealable, order, writ, injunction or decree of any Governmental
Authority of competent jurisdiction binding on Seller or the Company, or on
Buyer, which prohibits or restrains such other Person from consummating the
Transactions. 

9.2     
Effect on Obligations. In the event of the termination of this Agreement
pursuant to Section 9.1, no Party will have any liability under this
Agreement to any other Party, except: (a) that nothing herein shall relieve any
Party from any liability for any breach of any of the representations,
warranties, covenants and agreements set forth in this Agreement; (b) the provisions of Article X and Article XI shall survive
such termination; and (c) Buyer, on the one hand, and Seller and the Company, on
the other hand, shall be required to continue to comply with the obligations set
forth in the NDA pursuant to Section 11.15. 

- 38 -

ARTICLE X 
DISPUTE RESOLUTION

All disputes arising under this
Agreement or any other document referenced in this Agreement, except as provided
in Section 2.3, Section 7.4 and Section 7.5, shall be
settled in accordance with this Article X; provided,
however, that nothing in this Article X shall preclude any Party
from seeking injunctive relief in a court of competent jurisdiction in
accordance with Section 11.8 hereof. 

10.1      Arbitration.
The Parties will make a good faith effort to resolve any dispute, controversy or
Claim arising out of or relating to this Agreement amongst themselves for a
period of thirty (30) days. If the Parties are unable to reach a mutually
acceptable resolution of such dispute, controversy or Claim within such thirty
(30)-day period, the matter shall be submitted to and settled by binding
arbitration administered by the International Centre for Dispute Resolution
(“ICDR”) in accordance with its International Arbitration Rules (the
“Rules”). If ICDR is unable or unwilling to arbitrate the matter, the
matter shall be settled by arbitration conducted in accordance with the Center
for Public Resources Rules for Non-administered Arbitration of Business Disputes
before a neutral advisor selected by the Center for Public Resources from its
National CPR Panel. The arbitration shall be governed by the United States
Arbitration Act, 9 U.S.C. §§ 1-16, and judgment upon the award rendered by the
arbitrators may be entered by any court having jurisdiction thereof. The number
or arbitrators shall be one (1). The place of arbitration shall be in the New
York, New York. The language of the arbitration shall be English. 

10.2      Good
Faith. The parties covenant and agree that they will participate in any such
arbitration in good faith. This Section 10.2 applies equally to requests
for temporary, preliminary or permanent injunctive relief, and shall not be
deemed to be waived by any action by any Party to seek temporary or preliminary
injunctive relief by court proceedings. 

10.3      Procedure.
In connection with any arbitration proceeding, the arbitrator shall have the
power to order the production of documents by each party thereto and any
third-party witnesses. In addition, each party may take up to three depositions
as of right, and the arbitrator may in its discretion allow additional
depositions upon good cause shown by the moving party. However, the arbitrator
shall not have the power to order the answering of interrogatories or the
response to requests for admission. In connection with any arbitration, each
party shall provide to the other, no later than seven (7) Business Days before
the date of the arbitration, the identity of all persons that may testify at the
arbitration and a copy of all documents that may be introduced at the
arbitration or considered or used by a party’s witness or expert. The
arbitrator’s decision and award shall be made and delivered within forty-five
(45) days of the selection of the arbitrator. The arbitrator’s decision shall
set forth a reasoned basis for any award of damages or finding of liability. The
arbitrator shall have the right to require one party to such arbitration to bear
all or a portion of the expenses of the other party(ies) to the arbitration.

- 39 -

10.4      Consent
to Jurisdiction. Each of the Parties (i) hereby irrevocably submits to the
jurisdiction of the state courts in the State of Delaware, any United States
District Court of competent jurisdiction and any foreign court of competent
jurisdiction for the purpose of enforcing the award or decision in any
arbitration proceeding pursuant to Section 10.1 or in any action seeking
injunctive relief, and (ii) hereby waives, and agrees not to assert, by way of
motion, as a defense, or otherwise, in any such suit, action or proceeding, any
Claim that it is not subject personally to the jurisdiction of the above-named
courts, that its property is exempt or immune from attachment or execution
(except as protected by applicable law), that the suit, action or proceeding is
brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper or that this Agreement or the subject matter hereof may
not be enforced in or by such court, and hereby waives and agrees not to seek
any review by any court of any other jurisdiction which may be called upon to
grant an enforcement of the judgment of any such court. Each of the parties
hereto hereby consents to service of process by registered mail pursuant to the
notice provisions in Section 11.2. Each of the parties hereto agrees that
its submission to jurisdiction and its consent to service of process by mail are
made for the express benefit of the other parties hereto. Final judgment against
any Party in any such action, suit or proceeding may be enforced in other
jurisdictions by suit, action or proceeding on the judgment, or in any other
manner provided by or pursuant to the laws of such other jurisdiction. 

ARTICLE XI 
MISCELLANEOUS

11.1      Costs.
Regardless of whether the Transactions are consummated, except as otherwise
provided in this Agreement, each Party shall be responsible for, and shall bear,
its own costs and expenses (including any broker’s or finder’s fees) incurred in
connection with this Agreement and the Transactions. 

11.2      Notices.
Any notice or other communication required or which may be given hereunder shall
be ineffective unless given in writing and shall be deemed duly given: (a) when
delivered in person; (b) when transmitted via electronic mail if the sender on
the same day sends a confirming copy of such notice by a recognized overnight
delivery service (charges prepaid); (c) when transmitted via telecopy (or other
facsimile device) to the number set out below if the sender on the same day
sends a confirming copy of such notice by a recognized overnight delivery
service (charges prepaid); (d) the day following the date (except if not a
Business Day, then the next Business Day) on which the same has been delivered
with charges prepaid to a reputable national overnight air courier service; or
(e) the third (3rd) Business Day following the day on which the same
is mailed by certified (with the sender’s receipt postmarked by a postal
employee), registered (in either case, with a copy by ordinary first class mail)
or express mail, postage prepaid. All notices or other communications shall be
given to the intended recipient as follows: 

If to Seller:

Tianjin Enternet Network Technology
Limited 
Room 305-54, 3rd Floor, D Building 
Integrated Services Area,
Tianjin Development Zone (South Port Industrial Zone) 
Tianjin City, P.R.C.

- 40 -

Attn: Zhang Jie 
Email:
Jie.Zhang@sunsevenstars.com

With a copy (which shall not constitute
notice or such other communication) to: 

Shanghai Sun Seven Stars Cultural
Development Limited 
686 WuZhong Road, Tower D, 9th Floor 
Shanghai, China
201103 
Attn: Polly Wang 
Email: Polly.wang@sunsevenstars.com 

If to Buyer:

You On Demand Holdings, Inc. 
375
Greenwich Street, Suite 516
New York, New York 10013 
Attn: Xuesong Song

Email: Song@cmmobi.com
Fax No.: 86+10-8586-2775 

With a copy (which shall not constitute
notice or such other communication) to each of:

Cooley LLP 
The Grace Building

1114 Avenue of the Americas 
New York, New York 10036-7798
Attn:
William Haddad 
Email: whaddad@cooley.com 
Fax No.: (212) 479-6275

and

Cooley LLP 
101 California Street,
5th Floor 
San Francisco, California 94111-5800
Attn: Garth Osterman

Email: gosterman@cooley.com 
Fax No.: (415) 693-2222 

The designation of the person to be so notified or the address
of such person for the purposes such notice may be changed from time to time by
notice hereunder. 

11.3      Entire
Agreement. This Agreement, together with the Disclosure Schedules any
Contract, certificate, instrument, or other document contemplated by this
Agreement, constitutes the entire agreement among the Parties concerning
the subject matter hereof and supersedes any and all prior written agreements
and any and all prior or contemporaneous oral agreements or understandings
relating to the subject matter hereof. All negotiations between the Parties are
superseded by the documents set forth in the first sentence of this Section
11.3, and there are no representations, warranties, promises, understandings
or agreements, oral or written, as to either of the Parties or the Company in
relation to the subject matter hereof between the Parties other than those
expressly set forth or expressly incorporated herein. 

- 41 - 

11.4      Waivers
and Amendments. Except as otherwise provided herein, this Agreement may not
be amended, modified, superseded, canceled, renewed or extended, nor may any
term or condition hereof be waived, except by a written instrument or document,
which states that it is amending, modifying, superseding, cancelling, renewing,
extending, or waiving a term or condition of, this Agreement, as the case may
be, signed by Buyer and Seller or, in the case of a waiver, signed by the Party
sought to be charged therewith. No waiver by any Party of the breach of any
provision hereof shall be deemed to constitute a waiver of any continuing or
subsequent breach of such provision or any other provision hereof. No failure or
delay by any Party in exercising any right, power, privilege or remedy hereunder
will operate as a waiver thereof. The rights and remedies expressly granted
hereunder shall be cumulative with respect to, and shall not be deemed to
exclude, any other rights and remedies to which any Party shall be entitled at
Law or in equity. 

11.5     
Binding Effect; Assignment. Except as provided below, this Agreement and
all of the terms and provisions hereof shall be binding upon, and shall inure to
the benefit of and be enforceable by, the Parties and their respective
successors, assigns, heirs, executors, administrators and personal
representatives, except that no assignment of all or any part of this Agreement
or any right or obligation hereunder may be assigned by any Party without the
prior written consent of other Party (which consent may be withheld in the sole
discretion of such other Party), and any attempted assignment without such
consent shall be void and of no force or effect. Notwithstanding the foregoing,
Buyer may assign its rights and obligations hereunder to any Affiliate without
the prior approval of Seller. 

11.6      Reserved.

11.7      Governing
Law. This Agreement shall be construed in accordance with and governed by
the internal Laws of the State of Delaware without giving effect to any choice
or conflict of Law provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of Laws of any jurisdiction
other than those of the State of Delaware. 

11.8      Specific
Performance. Each of the Parties acknowledges and agrees that the other
Party would be damaged irreparably in the event any of the provisions of this
Agreement are not performed in accordance with their specific terms or otherwise
are breached. Accordingly, each of the Parties agrees that the other Party will
be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Agreement and to enforce specifically this Agreement and the
terms and provisions of this Agreement in any action instituted in any court
having jurisdiction over the Parties and the matter, in addition to any other
remedy to which they may be entitled, at Law or in equity. Each Party agrees to waive the defense that a
remedy at law would be adequate in any action for specific performance under
this Section 11.8. 

- 42 -

11.9      Waiver
of Jury Trial. EACH OF THE PARTIES WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER, OR IN
CONNECTION WITH THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
VERBAL OR WRITTEN STATEMENT, OR ACTION OF ANY PARTY. 

11.10     
Construction. The Parties have participated jointly in the negotiation
and drafting of this Agreement. In the event of an ambiguity or question of
intent or interpretation arises, this Agreement will be construed as if drafted
jointly by the Parties and no presumption or burden of proof will arise favoring
or disfavoring any Party by virtue of the authorship of any provision of this
Agreement. 

11.11     
Agreement Severable. This Agreement shall be deemed to be severable, so
that if the application of any provision (or any portion thereof) hereof to any
Person or circumstances shall be determined by a court of competent jurisdiction
to be invalid, illegal or unenforceable, all remaining provisions hereof shall
continue to remain valid and in full force and effect in accordance with their
terms, so long as the economic and legal substance of the Transactions is not
affected in any manner materially adverse to any Party. Upon such determination
that any term or other provision is invalid, illegal or unenforceable, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in an acceptable
manner in order that the Transactions are consummated as originally contemplated
to the greatest extent possible. 

11.12      Counterparts.
This Agreement may be executed and delivered in counterparts (and delivered by
facsimile, electronic mail or other electronic exchange), each of which shall be
deemed to be an original as against any Party whose signature appears thereon,
and all of which shall together constitute one and the same instrument. This
Agreement shall be binding when one or more counterparts hereof, individually or
taken together, shall bear the signatures of both of the Parties reflected on
this Agreement as the signatories. 

11.13      No
Third Party Beneficiaries. this Agreement shall not confer any rights or
remedies upon any Person other than the Parties, the Indemnitees and their
respective heirs, representatives, successors and permitted assigns. 

11.14      Public
Announcements. None of Buyer, the Company, or Seller (or any of their
respective Affiliates) shall make any public announcement or communication or
issue any circular in connection with the existence or the subject matter of
this Agreement without the prior written approval of all the other Parties (such
approval not to be unreasonably withheld, conditioned or delayed). The
restriction in this Section 11.14 shall not apply to the extent that the
public announcement, communication or circular is required by Law, by any stock
exchange or any regulatory or supervisory body or authority of competent
jurisdiction to which the Party is subject or submits, whether or not the
requirement has the force of law. If this exception applies, the Party making
the public announcement or communication or issuing the circular shall use its
reasonable efforts to consult with the other parties in advance as to its form,
content and timing. 

- 43 -

11.15     
Confidentiality. That certain Confidentiality and Non-Disclosure
Agreement, dated as of August 14, 2015, by and between Seven Stars Media and
Entertainment Company and Buyer (the “NDA”) is incorporated herein by
reference and shall remain in full force and effect until the earlier of: (a)
the Closing; or (b) the date on which the NDA is terminated or expires in
accordance with its terms. 

[SIGNATURES APPEAR ON FOLLOWING PAGE]

- 44 -

IN WITNESS WHEREOF and intending
to be legally bound hereby, the Parties have executed this Amended and Restated
Share Purchase Agreement as of the date first set forth above.

SELLER: 

	TIANJIN ENTERNET NETWORK TECHNOLOGY LIMITED

	  	
      

	By: 	
      /s/ Bruno Wu

	Name: 	
      Bruno Wu

	Title: 	
      

BUYER: 

	YOU ON DEMAND HOLDINGS, INC. 
	  	  
	By: 	/s/
      Shane McMahon
	Name: 	Shane
      McMahon
	Title: 	Chairman 

[Signature Page to Amended and Restated Share Purchase
Agreement] 

SCHEDULE 1 

HOMES/USERS PASSED

	1. 	
      MSO / Cable Digital TV Network: content (including, but
      not limited to: single films, TV series, programs, channel, etc) included
      in the basic package or value-added paid package (including value- added
      package on top of basic package) of local MSO carriers. Homes/Users Passed
      calculation is based on the number of basic package users plus the number
      of value-added package subscribers. Homes/Users Passed calculation shall
      be based on data provided by the MSOs.

	 	 	 
	2. 	
      IPTV (including but not limited to: the three major
      telecom carriers, dedicated IPTV, dedicated OTT and controlled public OTT
      integrated into user systems of telecom carriers, etc): content (including
      but not limited: to single films, TV series, programs, channels, etc)
      included in basic package or value-added paid package (including
      value-added package on top of basic package) of IPTV carriers, either
      directly or through 3rd party providers. Homes/Users Passed calculation is
      based on the number of basic package users plus the number of value-added
      package subscribers. Homes/Users Passed calculation shall be based on data
      provided by the IPTV carriers and service providers.

	 	 	 
	3. 	
      Smart TV / Internet TV (including, but not limited to
      “Home Entertainment Equipment”, such as: independently sold public OTT
      set-top boxes, game machines, other home entertainment equipment connected
      with integrated public OTT platforms, etc): content (including but not
      limited: to single films, TV series, programs, channels, etc) bundled with
      the Home Entertainment Equipment, or accessible via an APP pre-installed
      or downloaded onto the Home Entertainment Equipment. Homes/Users Passed
      will be determined by the number Home Entertainment Equipment units
      shipped plus the number of times the APP is downloaded. Homes/Users Passed
      calculation shall be based on data provided by the respective
      platforms.

	 	 	 
	4. 	
      Mobile (including but not limited to: handset-makers
      pre-installed APPs, APP downloads, and mobile video platforms of the three
      major telecom carriers): contents (including but not limited: to single
      films, TV series, programs, channels, etc) included in basic package or
      value-added paid package (including value-added package on top of basic
      package) of:

	 	 	 
		a) 	
      For dedicated video platforms of three major telecom
      carriers: Homes/Users Passed calculation is based on the number of basic
      package users plus the number of value-added package subscribers of mobile
      video platforms of the carriers. Homes/Users Passed calculation shall be
      based on data provided by the mobile video platforms of the telecom
      carriers.

	 	 	 
		b) 	
      For handset-makers pre-installed APPs and public APP
      downloads: Homes/Users Passed will be determined by the number units
      shipped plus the number of times the APP is downloaded. Homes/Users Passed
      number calculation shall be based on data provided by the handset-makers
      and APP providers.

	 	 	 
	5. 	
      OTT - Paying users of Video Websites: content (including,
      but not limited to: single films, TV series, programs, channels, etc.)
      included in basic package or value-added paid package (including
      value-added package on top of basic package) of paid services provided by
      partner video websites. Homes/Users Passed calculation is based on number
      of basic package users plus value- added package subscribers. Homes/Users
      Passed calculation shall be based on data provided by the video
      websites.

EXHIBIT A 

Company Objectives

	• 	
      The Company’s intends to become a new generation leader
      in pay media in operating a state of the art pay content virtual network
      operator (VNO). 

	  	
      

	• 	
      The Company intends the prioritize building business
      values centering around the content Virtual Network Operator (VNO) with
      content cloud, ubiquitous distribution and consumer data management and
      service. 

	  	
      

	• 	
      The Company intends to develop distribution access to all
      of China’s cable TV networks, telecom, OTT and mobile platforms.

	  	
      

	• 	
      The Company intends to offer a branded pay content
      service delivered to consumers ubiquitously through all of its platform
      partners, tracks and shares consumer payments and other behavior data,
      operates a customer management and data based services and develops mobile
      social TV based costumer management ecosystem. 

	  	
      

	• 	
      Through its shareholder and strategic partner Chang Yuan
      Guo Xun, who is the exclusive digital copy right registration agent
      authorized by the National Copy Right Bureau, a division of State
      Administration of Radio, Film and Television, the Company intends to
      provide exclusive digital copyright registration service for video
      content, offer a digital rights management (DRM) enabled third party
      content delivery service with access to all media platform operators.
    

	  	
      

	• 	
      The Company also intends to form partnerships with
      hundreds of content providers and to develop the capability to provide
      premium content in film, television, game and video e-commerce content.
      

	  	
      

	• 	
      The Company also intends to expand its unique VNO service
      outside of mainland China in the near future. 

- 2 -

EXHBIIT B 

Promissory Note 

[attached]

- 3 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00256-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00256-of-00352.parquet"}]]