Document:

Viscorp, Inc. Exhibit 10.4 1/18/2008

ESCROW AGREEMENT

THIS ESCROW AGREEMENT (“Agreement”) is made as of January 16, 2008 by and between Viscorp, Inc. (the “Company”); Time Poly Management Limited, a British Virgin Islands corporation (“Time Poly”); Happyvale Limited, a British Virgin Islands corporation (“Happyvale”); Fartop Management Limited, a British Virgin Islands corporation (“Fartop”); Cmark Holdings Co., Ltd., a corporation organized under the laws of the Cayman Islands (“Cmark”); the investors listed on Schedule A (the “Investors” and together with Cmark, Time Poly, Happyvale and Fartop, the “Management Team” and together with the Company, the “Parties”); and Leser, Hunter, Taubman & Taubman, with offices at 17 State Street, Suite 1610, New York, NY 10004 (the  “Escrow Agent”).

RECITALS:

(1)

Pursuant to that certain Securities Purchase Agreement, dated as of January 16, 2008, by and among the Company, the Investors set forth on the signature pages thereto, Charles Driscoll, Raygere Limited and Grandway Group Holdings Limited (the “Purchase Agreement”), a copy of which is attached hereto as Exhibit B and incorporated herein by reference, the Investors purchased $10,225,000 10% Notes, convertible into Six Million Three Hundred Ninety Thousand Six Hundred and Twenty Five  (6,390,625) shares of the Company’s Series A Convertible Preferred Stock (“Preferred Stock”), which is convertible into Six Million Three Hundred Ninety Thousand Six Hundred and Twenty Five  (6,390,625) shares of the Company’s Common Stock subject to adjustment pursuant to the Certificate of Designation of the Relative Rights and Preferences of the Series A Convertible Preferred Stock, for an aggregate of $10,225,000. Capitalized terms used in this Agreement without definition, have the meaning assigned to those terms in the Purchase Agreement; 

(2)

To induce the Investors to enter into the Purchase Agreement, the Management Team, which are the sole shareholders of the Company’s subsidiary - Raygere Limited, a British Virgin Islands company, has agreed to deposit that number of shares of Common Stock that they own equal to 10% of the sum of (A) the issued and outstanding shares of Common Stock as of the Closing Date, and (B) the aggregate number of the Conversion Shares under the Notes and/or the Series A Preferred Stock (collectively, the “Escrowed Shares”), as set forth in Exhibit A, in an escrow account immediately prior to the Closing, to be held by the Escrow Agent  for disbursement in accordance with the terms and conditions set forth herein, if the Company meets the specified Performance Thresholds, as hereinafter defined.  For purposes only of the calculations under Article 1.4, it is assumed that there shall be 2,208,720 Escrowed Shares; 

(3)

This Agreement constitutes the share escrow agreement alluded to in the Purchase Agreement pursuant to which the Escrow Agent shall receive and disburse the Escrowed Shares.  

NOW, THEREFORE, in consideration of the covenants and mutual promises contained herein and other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged and intending to be legally bound hereby, the parties agree as follows:

ARTICLE 1

TERMS OF THE ESCROW

1.1

 Appointment of Escrow Holder.  The parties hereby agree to have Leser Hunter Taubman & Taubman act as Escrow Agent whereby the Escrow Agent shall receive the Escrow Shares in escrow and distribute the same as set forth in this Agreement.  

1.2

Escrow Deposit

(a)

In accordance with the terms of the Purchase Agreement, immediately prior to the Closing, the Management Team shall deliver the Escrowed Shares to the Escrow Agent; 

(b)

The Escrow Agent shall hold the Escrowed Shares in the Escrow Account at all times until such Escrowed Shares are disbursed in accordance herewith.

1.3

Performance Threshold

If the Company does not achieve the specified percentage, which is based on a scale of 100%, of the following Performance Thresholds, the Escrowed Shares shall be disbursed to the Investors as set forth herein: 

(a)

Fiscal Year 2008 Performance Threshold – the Lessor of: Reported Net Income of at least $5.6 million or fully diluted EPS (share count includes all outstanding common shares, preferred shares, warrants and options) of $0.18 per share (the “2008 PT”); 

(b)

Fiscal Year 2009 Performance Threshold – the Lessor of: Reported Net Income of at least $7.2 million or fully EPS (share count includes all outstanding common shares, preferred shares, warrants and options) of $0.24 per share (the “2009 PT”).

(c)

Each Performance Threshold shall be determined as of the date the Company’s audited financial statements for the corresponding fiscal year are required to be filed with the Securities and Exchange Commission pursuant to the reporting requirements of the Securities Exchange Act of 1934 (the “Exchange Act”), as amended (each such date for each of the applicable fiscal years being hereinafter referred to as the “Audit Date”); and, if the Company is not required to file reports pursuant to Section 13(a) or 15(d) of the Exchange Act, and therefore prepares and furnishes the documents required by Section 6 of the Registration Rights Agreement, the 

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Performance Threshold shall be determined in accordance with such prepared documents and at such time.

1.4

Escrow Release

The Company shall remit written instructions to the Escrow Agent and the Investors two (2) business days after the Audit Date, in the form of Exhibit C attached hereto and made a part hereof, or in a form and substance satisfactory to the Escrow Agent, directing the Escrow Agent to release the Escrowed Shares within five (5) business days of the Audit Date for each fiscal year, as specified therein and in accordance with the following guidelines (the “Release Notice”): 

(a)

One half of the Escrowed Shares (1,104,360) shall be allocated for each fiscal year (the “Yearly Shares”); any Escrowed Shares not distributed pursuant to the Release Notice regarding fiscal 2008, shall be held in Escrow and distributed in accordance herewith.

(b)

If the Company achieves 92% or less of the 2008 PT, then the Escrowed Shares shall be delivered as follows:  (i) the Investors shall receive 73,624 shares for each percentage by which such threshold was not achieved (pro rata based on the number of shares of Preferred Stock owned by such Investor at such date) up to a maximum of 1,104,360 shares; (ii) if less than 500,000 shares are distributed pursuant to the calculation set forth in Section 1.4(b)(i) above, then the Management Team shall receive a total of 500,000 shares less the number of shares distributed pursuant Section 1.4(b), to be distributed pro rata among the Management Team based upon the percentages set forth in Exhibit A.  

(c)

If the Company achieves 92% or less of the 2009 PT, then the Escrowed Shares shall be delivered as follows:  (i) the Investors shall receive 73,624 shares for each percentage by which such threshold was not achieved (pro rata based on the number of shares of Preferred Stock owned by such Investor at such date) up to a maximum of 1,104,360 shares, plus any additional shares not distributed pursuant to Section 1.4(b) 

(d)

If any Escrowed Shares remain in the Escrow Account after all of the disbursements are made pursuant to the 2009 Release Notice, the Escrow Agent shall return such remaining shares to the Management Team.

(e)

In the event that the Closing does not occur and written notice of same, signed by all of the parties hereto, is delivered to the Escrow 

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Agent or upon the written instructions of all of the parties hereto, the Escrowed Agent shall return the Escrowed Shares to the Management Team. 

(f)

Upon the Escrow Agent’s completion of its obligations under Section 1.4, this Agreement shall terminate and the Escrow Agent shall have no further liability hereunder.  

1.5

This Agreement may be altered or amended only with the written consent of all of the parties hereto.  Should any of the Parties attempt to change this Agreement in a manner, which, in the Escrow Agent’s discretion, shall be undesirable, the Escrow Agent may resign as Escrow Agent by notifying the Parties in writing five days in advance.  In the case of the Escrow Agent’s resignation or removal pursuant to the foregoing, his only duty, until receipt of notice from the Parties that a successor escrow agent has been appointed, shall be to hold and preserve the Escrow Shares that are in his possession.  Upon receipt by the Escrow Agent of said notice from the Parties of the appointment of a successor escrow agent, the name of a successor escrow account and a direction to transfer the Escrowed Shares, the Escrow Agent shall promptly thereafter transfer all of the Escrowed Shares that it is still holding in escrow, to said successor escrow agent.  Immediately after said transfer of the Escrowed Shares, the Escrow Agent shall furnish the Parties with proof of such transfer.  The Escrow Agent is authorized to disregard any notices, requests, instructions or demands received by it from the Parties after the Escrow Agent promptly transfers all of the Escrowed Shares that it is still holding in escrow, to the above said successor escrow agent. 

1.5   The Escrow Agent shall be reimbursed by the Parties for any reasonable expenses incurred in the event there is a conflict between the parties and the Escrow Agent shall deem it necessary to retain counsel, upon whose advice the Escrow Agent may rely. The Escrow Agent shall not be liable for any action taken or omitted by him in good faith and in no event shall the Escrow Agent be liable or responsible except for the Escrow Agent’s own gross negligence or willful misconduct.  The Escrow Agent has made no representations or warranties to the Parties in connection with this transaction. The Escrow Agent has no liability hereunder to either party other than to hold the Escrowed Shares and to deliver them under the terms hereof.  Each party hereto agrees to indemnify and hold harmless the Escrow Agent from and with respect to any suits, claims, actions or liabilities arising in any way out of this transaction including the obligation to defend any legal action brought which in any way arises out of or is related to this Agreement or the investment being made by Purchaser. The Parties, with the exception of the Company, acknowledge and represent that they are not being represented in a legal capacity by Leser Hunter Taubman & Taubman and have had the opportunity to consult with their own legal advisors prior to the signing of this Agreement. The Parties, with the exception of the Company, acknowledge that the Escrow Agent is not rendering securities advice to them with respect to this transaction or otherwise.  The Parties consent to the Escrow Agent acting in such capacity as legal counsel for the Company and waive any claim that such representation represents a conflict of interest on the part of the Escrow Agent.  The Parties understand that the Escrow Agent and the Company are relying explicitly on the foregoing provisions contained in this Section 1.5 in entering into this Agreement. 

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1.6

The Escrow Agent shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably believed by the Escrow Agent to be genuine and to have been signed or presented by the proper party or parties.  The Escrow Agent shall not be personally liable for any act the Escrow Agent may do or omit to do hereunder as the Escrow Agent while acting in good faith, and any act done or omitted by the Escrow Agent pursuant to the advice of the Escrow Agent's attorneys-at-law shall be conclusive evidence of such good faith.

1.7

The Escrow Agent is hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or corporation, excepting only orders or process of courts of law and is hereby expressly authorized to comply with and obey orders, judgments or decrees of any court.  In case the Escrow Agent obeys or complies with any such order, judgment or decree, the Escrow Agent shall not be liable to any of the parties hereto or to any other person, firm or corporation by reason of such decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction.

1.8

The Escrow Agent shall not be liable in any respect on account of the identity, authorities or rights of the parties executing or delivering or purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder.

1.9

If the Escrow Agent reasonably requires other or further documents in connection with this Agreement, the necessary parties hereto shall join in furnishing such documents.

1.10

It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the documents, the Escrowed Shares held by the Escrow Agent hereunder, the Escrow Agent is authorized and directed in the Escrow Agent's sole discretion (a) to retain in the Escrow Agent's possession without liability to anyone all or any part of said documents, the Escrowed Shares until such disputes shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but the Escrow Agent shall be under no duty whatsoever to institute or defend any such proceedings or (b) to deliver the Escrowed Shares and any other property and documents held by the Escrow Agent hereunder to a state or federal court having competent subject matter jurisdiction and located in the State of New York in accordance with the applicable procedure therefor.

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ARTICLE 2

MISCELLANEOUS

2.1  

No waiver of any breach of any covenant or provision herein contained shall be deemed a waiver of any preceding or succeeding breach thereof, or of any other covenant or provision herein contained.  No extension of time for performance of any obligation or act shall be deemed any extension of the time for performance of any other obligation or act.

2.2

This Agreement shall be binding upon and shall inure to the benefit of the permitted successors and assigns of the parties hereto.

2.3 

This Agreement is the final expression of, and contains the entire agreement between, the parties with respect to the subject matter hereof and supersedes all prior understandings with respect thereto.  This Agreement may not be modified, changed, supplemented or terminated, nor may any obligations hereunder be waived, except by written instrument signed by the parties to be charged or by its agent duly authorized in writing or as otherwise expressly permitted herein.

2.4 

Whenever required by the context of this Agreement, the singular shall include the plural and masculine shall include the feminine.  This Agreement may be executed in two or more counterparts, all of which taken together shall constitute one instrument.  Execution and delivery of this Agreement by exchange of facsimile copies bearing the facsimile signature of a party shall constitute a valid and binding execution and delivery of this Agreement by such party.  Such facsimile copies shall constitute enforceable original documents.

2.5

The parties hereto expressly agree that this Agreement shall be governed by, interpreted under, and construed and enforced in accordance of the laws of the State of New York. The parties agree that any dispute arising under or with respect to or in connection with this Agreement, whether during the term of this Agreement or at any subsequent time, shall be resolved fully and exclusively in the federal or state courts resident in New York County, New York. 

   

2.6

Any notice required or permitted hereunder shall be given in a manner provided in the Notice Section contained in the Purchase Agreement to the address or contact information for the Parties set forth therein or, in the case of notice to the Escrow Agent, shall be sent by commercial overnight courier such as UPS or Fedex to the Escrow Agent at the address first written above.  

2.7

By signing this Agreement, the Escrow Agent becomes a party hereto only for the purpose of this Agreement; the Escrow Agent does not become a party to the Purchase Agreement or any related agreements.

2.8

Each party acknowledges and agrees that this Agreement shall not be deemed prepared or drafted by any one party.  In the event of any dispute between the Parties concerning this Agreement, the Parties agree that any rule of construction, to the effect that 

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any ambiguity in the language of the Agreement is to be resolved against the drafting party, shall not apply. 

(Signature Page to Follow)

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first set forth above.

Executed:

THE COMPANY

Viscorp, Inc.

By:
     _______________________________

Name: Guoqing Jiang

Title:  Chief Executive Officer

THE MANAGEMENT TEAM

TIME POLY MANAGEMENT LIMITED

By: ______________________________________

Name: Stewart Shiang Lor,

Title: Director

CMARK HOLDINGS CO. LTD.

By: ______________________________________

Name: Stewart Shiang Lor,

Title: Director

Happyvale Limited

By: ______________________________________

Name: Brian Pak Lun Mok,

Title: Director

Fartop Management Limited

By: ______________________________________

Name: Yinzi Tang,

Title: Director

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Escrow Agent

Leser, Hunter, Taubman & Taubman

________________________________

Name: Louis Taubman

Title: Partner

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ESCROW AGREEMENT

INVESTOR SIGNATURE PAGE:

[PRINT NAME OR NAME OF ENTITY]

X____________________________________________

By:

______________________________________

Name:

______________________________________

Title:

______________________________________

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Exhibit A

	 	 	 
	Shareholder Name 

	 	VSCO Shares

	Time Poly Management, Ltd.

	 	1,636,270 (78.0%) 

	Fartop Management Limited

	 	33,145 (1.58%)

 

	Cmark Holdings, Co., Ltd.

	 	355,155 (16.93%)

	Happyvale Limited

	 	73,213 (3.49%)  

 

	 	 	 
	 	 	 
	TOTAL

	 	2,097,783 (100%)

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Exhibit C

FORM OF ESCROW RELEASE NOTICE

Date: 

Leser, Hunter, Taubman & Taubman

17  State Street, Floor 16

New York, New York 10004

Dear Escrow Agent:

In accordance with the terms of Article 1 of the Escrow Agreement dated as of January __, 2008, (the “Escrow Agreement"), by and among Viscorp, Inc. (the “Company”); Time Poly Management Limited, a British Virgin Islands corporation (“Time Poly”); Happyvale Limited, a British Virgin Islands corporation (“Happyvale”); Fartop Management Limited, a British Virgin Islands corporation (“Fartop”); Cmark Holdings Co., Ltd., a corporation organized under the laws of the Cayman Islands (“Cmark” and together with Time Poly, Happyvale and Fartop, the “Management Team” and together with the Company, the “Parties”), and the Company hereby notifies the Escrow Agent of the following: 

1.

The Audit Date was ___________ __, 200__; and 

2.

The Company achieved __% of the Performance Threshold.  

Accordingly, please distribute the Escrowed Shares as follows: 

	Recipient Information

	 	Amount of Escrowed Shares to be delivered

	 	 	 
	 	 	 
	 	 	 
	 	 	 

Very truly yours,

VISCORP, INC.

By:_____________

Name:__________

Title:____________

12Viscorp, Inc. Exhibit 10.5 1/18/2008

EXECUTION COPY

SHARE TRANSFER AGREEMENT

BETWEEN

Stewart Shiang Lor

AND

Transferees

Date: January 16, 2008

THIS SHARE TRANSFER AGREEMENT (this "Agreement") is made on January 16, 2008 by and among Stewart Shiang Lor (the "Transferor") and each of the individuals listed in Schedule A hereto (collectively the "Transferees" and each a "Transferee"). 

The Transferor and the Transferees are collectively referred to as the "Parties" and each of them as a "Party".

Whereas, the Transferor is the sole shareholder of Time Poly Management Ltd. (the “Company”), which is one of the registered shareholders of the Raygere Limited, a British Virgin Islands Company, which intends to complete a business combination with a public shell company, traded on the Over the Counter Bulletin Board (the "Listed Company"), holding 50,000 Ordinary Shares in the Company as of the date of this Agreement.

Whereas, the Transferees have contributed to the wealth growth of the Transferor through the growth of the Company, the Listed Company and its PRC subsidiaries and affiliates (collectively with the Company, the “Group”).  In consideration of the Transferees’ contributions and as an incentive to the Transferees to continue their commitment to the Group, the Transferor has agreed to grant to each of the Transferees, and each Transferee has agreed to accept from the Transferor, an option (the “Option”) to purchase certain number of ordinary shares of the Company currently held by the Transferor (the "Option Shares") as set forth in Schedule A hereto, on the terms and subject to the conditions set out in this Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals, the mutual promises hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

1.

DEFINITIONS

1.1.

Defined Terms : In this Agreement (including the Recitals and the Schedules), unless the context otherwise requires, the following words and expressions shall have the following meanings:

“Alternate Exercise Price” means the exercise price to be paid by a Transferee to the Transferor in respect of the Option Shares issued to such Transferee as set forth opposite his/her name in Schedule A in the event that the Performance Targets (as defined herein) have not been met by the Group; 

	 	"Business Day" means a day (other than Saturdays, Sundays and public holidays) on which banks are generally open for business in China;

           

	 	"China" or "PRC" means the People's Republic of China;

           

	 	"Completion Date" means the date falling seven (7) Business Days after the service of the Exercise Notice by the Transferees on the Company;

           

	 	"Completion" means the completion of the sale to and purchase by the Transferees of the Option Shares under this Agreement, which shall not be later than November 15, 2008;

           

	 	"Distributions" means any cash proceeds arising from or in respect of, or in exchange for, or accruing to or in consequence of the Option Shares from the Effective Date to the Completion Date, including without limitation the Dividends.

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	 	"Dividends" means the dividends declared by the Company and accrued in respect of the Option Shares (whether or not such dividends shall have been paid and received by the Transferees);

           

	 	"Effective Date" means the date of this Agreement;

           

	 	"Exercise" means the exercise by a Transferee or his/her Nominee(s) of the Option pursuant to the terms of this Agreement;

           

	 	"Exercise Notice" means the notice substantially in the form set out in Part I of Schedule B;

           

	 	"Exercise Price" means the exercise price to be paid by a Transferee to the Transferor in respect of the Option Shares issued to such Transferee as set forth opposite his/her name in Schedule A;

           

	 	"Nominee" means such person nominated by a Transferee in the Transfer Notice to be the transferee of the Option or Option Shares;

           

	 	"Option Effective Dates" have the meaning ascribed to them in Clause 2.3;

           

	 	"Performance Targets" have the meaning ascribed to them in Clause 3;

           

	 	"RMB" means the lawful currency of China;

           

	 	“Acquisition” means the transaction wherein the Listed Company will acquire 100% equity interest (whether directly or through its subsidiaries) of the Chengdu Tianyin Pharmaceutical Co., Ltd. (成都天银制药有限公司); 

           

	 	"Transfer Notice" means the notice substantially in the form set out in Part II of Schedule B;

           

	 	"US$" or "United States Dollar" means the lawful currency of the United States of America.

"Euro €" means the lawful currency of the European Union. 

1.2.

Interpretation: Except to the extent that the context requires otherwise:

1.2.1

words denoting the singular shall include the plural and vice versa; words denoting any gender shall include all genders; words denoting persons shall include firms and corporations and vice versa; 

1.2.2

any reference to a statutory provision shall include such provision and any regulations made in pursuance thereof as from time to time modified or re-enacted whether before or after the date of this Agreement and (so far as liability thereunder may exist or can arise) shall include also any past statutory provisions or regulations (as from time to time modified or re-enacted) which such provisions or regulations have directly or indirectly replaced;

1.2.3

the words "written" and "in writing" include any means of visible reproduction; 

1.2.4

any reference to "Clauses", "Recitals" and "Schedules" are to be construed as references to clauses and recitals of, and schedules to, this Agreement; and

1.2.5

any reference to a time of day is a reference to China time unless provided otherwise.

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1.3.

Headings: The headings in this Agreement are inserted for convenience only and shall be ignored in construing this Agreement. 

2.

OPTION

2.1.

Option: In consideration of the contributions which the Transferees have made to the Group and their continuing commitment to the Group, the Transferor hereby irrevocably and unconditionally grants to each of the Transferees the Option for such Transferee to acquire from the Transferor, at the Exercise Price or the Alternative Exercise Price, at any time during the Exercise Period (defined below) any or all of the Option Shares set forth opposite his/her name in Schedule A hereto, free from all claims, liens, charges, pledges, mortgages, trust, equities and other encumbrances, and with all rights attaching thereto on the Completion Date. 

2.2.

Vesting Schedule: Subject to the terms and conditions hereto, the Option may be exercised, in whole or in part, in accordance with the following schedule:

The Option Shares subject to the Option shall vest at the rate of one-third (1/3) per Performance Period (as defined in Exhibit A).  

2.3.

Exercise Period: Once the Acquisition has been completed or abandoned pursuant to the terms of the definitive agreement regarding the Acquisition, the Option shall be exercisable in accordance with and on the dates set forth in Exhibit A (the “Option Effective Dates”). Subject to the vesting schedule set forth in Section 2.2 of this Agreement, the Option may be exercised by any Transferee (or his/her Nominee on behalf of the Transferee) at any time following the Option Effective Date (“Exercise Period”). 

2.4.

Nominees: Each of the Transferees may, at any time during the Exercise Period, at his/her sole discretion, nominate one or more person(s) (each a “Nominee”) to be the transferee(s) of whole or part of his/her Option, who shall hold and/or exercise the transferred Option on behalf of the Transferee.

2.5.

Exercise Notice: The Option may be exercised by any Transferee or his/her Nominee(s), in whole or in part, at any time during the Exercise Period, by serving an Exercise Notice on theTransferor. 

2.6.

Exercise: The Transferor agrees that he shall, upon receipt of the Exercise Notice and payment of either the Exercise Price or the Alternative Exercise Price, depending on whether the Performance Targets have been met, issue to the Transferee(s) (or his/her Nominee(s), as the case may be) any and all of the Option Shares specified in the Exercise Notice, free from all claims, liens, charges, pledges, mortgages, trust, equities and other encumbrances, and with all rights now or hereafter attaching thereto.  The Option shall be exercisable only in compliance with PRC laws and regulations and the Transferee(s) (or his/her Nominee(s), as the case may be) shall complete any and all approval or registration procedures regarding the exercise of his/her Option at PRC competent authorities in accordance with applicable PRC laws and regulations.

2.7.

Transfer Notice: In case that any Transferee transfers any or all of his/her Option to one or more Nominee(s) in accordance with Clause 2.4 above, the Transferee shall serve a Transfer Notice on the Transferor.

2.8.

Transfer to Nominees: The Transferor agrees that he shall, upon receipt of the Transfer Notice, take all actions necessary to allow the Nominee(s) to be entitled to any or all of the Options specified in the Transfer Notice.

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Upon exercise by any Nominee(s) of the transferred Option on behalf of the Transferee, the Transferee shall serve the Exercise Notice on the Transferor in his/her own name for the exercising Nominee(s).  Upon receipt of such Exercise Option, the Transferor shall issue to such Nominee(s) any and all of the relevant Option Shares in the same manner as specified in Clause 2.6.

2.9.

Payment of Exercise Price: Upon Exercise of the Option in whole or in part, the exercising Transferee (or his/her Nominee(s), as the case may be) shall pay the Exercise Price to the Transferor.

  

2.10.

The Transferor’s Obligation upon Exercise: The Transferor agrees that upon the Exercise of any Option by any Transferee (or his/her Nominee(s)), he shall cause and procure the number of Option Shares provided in the Exercise Notice to be transferred to such exercising Transferee (or his/her Nominee(s)) within seven (7) Business Days after the date of the Exercise Notice.

3.

PERFORMANCE TARGET AND CONDITION PRECEDENT

3.1.

The obligation of the Transferor to effect the Option and the transfer of the Option Shares at the Exercise Price to an exercising Transferee upon his/her Exercise of the Option shall be subject to the fulfilment of the following conditions (the “Performance Targets”) set forth in Exhibit A hereto.  In the event that the Group does not achieve the Performance Targets specified in Exhibit A, then the Transferee may exercise the Option at the Alternative Exercise Price on the date at which the Option would have otherwise been exercisable had the Performance Targets been met.  

4.

INFORMATION, DISTRIBUTIONS AND ADJUSTMENTS

4.1.

Information: Each of the Transferees (the "Requesting Transferees") shall be entitled to request from the Transferor at any time before the Completion, a copy of any information received from the Group which may be in the possession of the Transferor and, upon such request, the Transferor shall provide such information to the Requesting Transferee(s).

4.2.

Distributions: The Transferor agrees that each of the Transferees shall be entitled to all the Distributions in respect of his/her Option Shares.  In the event that any such Distributions have been received by the Transferor for any reason, the Transferor shall, at the request of the relevant Transferee, pay an amount equivalent to the Distributions received by him/her to such Transferee at the time of the Option Exercise by the Transferee.

4.3.

Adjustments: If, prior to the Completion, the Company shall effect any adjustment in its share capital (such as share split, share dividend, share combination or other similar acts), then the number of Option Shares to be issued to the Transferee upon Exercise shall be adjusted accordingly to take into account such adjustment.

5.

COMPLETION

5.1.

Time and Venue: Completion of the sale and purchase of the Option Shares pursuant to the Exercise shall take place at such place decided by the exercising Transferee(s) on the Completion Date.

5.2.

Business at Completion: At Completion of each Exercise, all (but not part only) of the following shall be transacted:

5.2.1

the exercising Transferees shall pay the Exercise Price to the Transferor in cash; 

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5.2.2

the Transferor shall cause the Company to within seven (7) Business Days after the date of Exercise Notice, deliver to each of the exercising Transferees (or his/her Nominee(s), same below) the following documents and take all corporate actions necessary to give effect to such delivery:

(a)

a share certificate or share certificates in respect of the number of the Option Shares exercised by such exercising Transferee; 

(b)

a certified true copy of the register of members of the Company updated to show the entry of the exercising Transferee as the holder of the Option Shares so exercised; and

(c)

any other documents as the exercising Transferee may reasonably believe necessary to give effect to the issuance of the exercised Option Shares.

6.

CONFIDENTIALITY

The transaction contemplated hereunder and any information exchanged between the Parties pursuant to this Agreement will be held in complete and strict confidence by the concerned Parties and their respective advisors, and will not be disclosed to any person except: (i) to the Parties’ respective officers, directors, employees, agents, representatives, advisors, counsel and consultants that reasonably require such information and who agree to comply with the obligation of non-disclosure pursuant to this Agreement; (ii) with the express prior written consent of the other Party; or (iii) as may be required to comply with any applicable law, order, regulation or ruling, or an order, request or direction of a government agency; provided, however, that the foregoing shall not apply to information that: (1) was known to the receiving Party prior to its first receipt from the other Party; (2) becomes a matter of public knowledge without the fault of the receiving Party; or (3) is lawfully received by the Party from a third person with no restrictions on its further dissemination.

7.

TRANSFEROR’S UNDERTAKINGS

Without the prior written consent of all the Transferees, the Transferor shall vote his shares in the Company such that the Company shall not, (i) issue or create any new shares, equity, registered capital, ownership interest, or equity-linked securities, or any options or warrants that are directly convertible into, or exercisable or exchangeable for, shares, equity, registered capital, ownership interest, or equity-linked securities of the Company, or other similar equivalent arrangements, (ii) alter the shareholding structure of the Company, (iii) cancel or otherwise alter the Option Shares, (iv) amend the register of members or the memorandum and articles of association of the Company, (v) liquidate or wind up the Company, or (vi) act or omit to act in such a way that would be detrimental to the interest of the Transferees in the Option Shares.  The Transferor shall cause the Company to disclose to the Transferees true copies of all the financial, legal and commercial documents of the Company and the resolutions of the shareholders and the board of directors.

8.

MISCELLANEOUS 

8.1.

Indulgence, Waiver Etc: No failure on the part of any Party to exercise and no delay on the part of such Party in exercising any right hereunder will operate as a release or waiver thereof, nor will any single or partial exercise of any right under this Agreement preclude any other or further exercise of it or any other right or remedy.

8.2.

Effective Date and Continuing Effect of Agreement: This Agreement shall take effect from the Effective Date.  All provisions of this Agreement shall not, so far as they have not been performed at Completion, be in any respect extinguished or affected by Completion or by any 

5

other event or matter whatsoever and shall continue in full force and effect so far as they are capable of being performed or observed, except in respect of those matters then already performed.

8.3.

Successors and Assigns: This Agreement shall be binding on and shall ensure for the benefit of each of the Parties' successors and permitted assigns. Any reference in this Agreement to any of the Parties shall be construed accordingly.

8.4.

Further Assurance: At any time after the date of this Agreement, each of the Parties shall, and shall use its best endeavors to procure that any necessary third party shall, execute such documents and do such acts and things as any other Party may reasonably require for the purpose of giving to such other Party the full benefit of all the provisions of this Agreement.

8.5.

Remedies: No remedy conferred by any of the provisions of this Agreement is intended to be exclusive of any other remedy which is otherwise available at law, in equity, by statute or otherwise, and each and every other remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law, in equity, by statute or otherwise. The election of any one or more of such remedies by any Party shall not constitute a waiver by such Party of the right to pursue any other available remedies.

8.6.

Severability of Provisions: If any provision of this Agreement is held to be illegal, invalid or unenforceable in whole or in part in any jurisdiction, this Agreement shall, as to such jurisdiction, continue to be valid as to its other provisions and the remainder of the affected provision; and the legality, validity and enforceability of such provision in any other jurisdiction shall be unaffected.

8.7.

Governing Law: This Agreement shall be governed by, and construed in accordance with, the laws of the British Virgin Islands. 

8.8.

Dispute Resolution: In the event of any dispute, claim or difference (the "Dispute") between any Parties arising out of or in connection with this Agreement, the Dispute shall be resolved in accordance with the following: 

(a)

Negotiation between Parties; Mediations.  The Parties agree to negotiate in good faith to resolve any Dispute.  If the negotiations do not resolve the Dispute to the reasonable satisfaction of all parties within thirty (30) days, subsection (b) below shall apply.

(b)

Arbitration.  In the event the Parties are unable to settle a Dispute in accordance with subsection (a) above, such Dispute shall be referred to and finally settled by arbitration at Hong Kong International Arbitration Centre in accordance with the UNCITRAL Arbitration Rules (the “UNCITRAL Rules”) in effect, which rules are deemed to be incorporated by reference into this subsection (b).  The arbitration tribunal shall consist of three arbitrators to be appointed according to the UNCITRAL Rules.  The language of the arbitration shall be English.

8.9.

Counterparts: This Agreement may be signed in any number of counterparts, all of which taken together shall constitute one and the same instrument.  Any Party hereto may enter into this Agreement by signing any such counterpart.

[SIGNATURE PAGE FOLLOWS]

6

IN WITNESS WHEREOF the Parties hereto have executed this Agreement on the date first above written.

The Transferor

By: _____________________

Stewart Shiang Lor 

The Transferee

	  

By: ____________________­­­­­­­­­­_______         

Name: Mr. Guoqing Jiang (江国庆)

	 

By: _____________________

Name: Mr. Yong Zhan (詹勇)

	 

By: ___________________________

Name: Mr. Xintao You (游心涛)

	 

By: _____________________

Name: Ms. Li Zhou (周莉)

	 

By: ___________________________

Name: Mr. Daqiao Zhang (张大桥)

	 

By: _____________________

Name: Mr. Hongcai Li (李洪才)

 

[SIGNATURE PAGE TO INCENTIVE OPTION AGREEMENT]

EXHIBIT A

PERFORMANCE TARGETS

A. 

The Group shall have generated a gross revenue of 

(i) at least RMB 26,000,000 for three months commencing from January 1, 2008 to March 31, 2008 (the “March Performance Period”); 

(ii) at least RMB 26,500,000 for three months commencing from April 1, 2008 to June 30, 2008 (the “June Performance Period”); 

(iii) at least RMB 27,000,000 for three months commencing from July 1, 2008 to September 31, 2008 (the “September Performance Period” and together with the March Performance Period and the June Performance Period, the “Performance Period”).

B.

The Option Effective Date for each Performance Period shall be that date that is forty five (45) days following the last day of each such Performance Period. 

SCHEDULE A

Transferees and Option Shares

	Transferees

	ID Card Number

	Number of 

Option Shares

	Exercise Price

	Alternate Exercise Price

	Mr. Guoqing Jiang

江国庆

	321111196703070812

	38,429

	US$330,487 

	US$660,975 

	Mr. Xintao You

游心涛

	510102196203255317

	3,837

	US$32,998

	US$65,996

	Mr. Yong Zhan

詹 勇

	610103196911153610

	3743

	US$32,193

	US$64,387

	Ms. Li Zhou

周 莉

	51011119580915116X

	2714

	US$23,340

	US$46,680

	Mr. Daqiao Zhang

张大桥

	321102680917191

	1126

	US$9,688

	US$19,376

	Mr. Hongcai Li

李洪才

	510213197310083775

	150

	US$1,293

	US$2,586

1

SCHEDULE B 

Part I

Form of Exercise Notice

To

:

Stewart Shiang Lor (the “Transferor”)

From

:

[  ] (the “Transferee”)

We refer to the Share Transfer Agreement (the "Share Transfer Agreement") dated December 28, 2007 made between the Transferee and the Company.  Terms defined in the Option Agreement shall have the same meanings as used herein.

We hereby give you notice that we require you to sell to us / [Nominees' names] in accordance with the terms and conditions of the Share Transfer Agreement, the following Option Shares at the Exercise Price set out below, subject to the terms and conditions set out in the Share Transfer Agreement. Completion shall take place at [    ] on [                ] at the office of [    ].

	Transferee

	Option Shares

	Exercise Price/Alternative Exercise Price

	 	 	 

Dated [   ]  

Yours faithfully

___________________________

Name:

Title:

For and on behalf of 

[Transferee]

Party II

Form of Transfer Notice

To

:

Stewart Shiang Lor (the “Transferor”)

From

:

[  ] (the “Transferee”)

We refer to the Share Transfer Agreement (the "Share Transfer Agreement") dated December 28, 2007 made between the Transferee and the Company.  Terms defined in the Option Agreement shall have the same meanings as used herein.

We hereby give you notice that we will transfer to [Nominees' names] the following portion of the Option, expressed in terms of the number of Option Shares represented by the portion of the Option transferred in accordance with the terms and conditions of the Share Transfer Agreement,.

	Transferee

	Nominees

	Option Shares Represented

	Mr. Guoqing Jiang

	 	 
	Mr. Xintao You

	 	 
	Mr. Yong Zhan

	 	 
	Ms. Li Zhou

	 	 
	Mr. Daqiao Zhang

	 	 
	Mr. Hongcai Li

	 	 

Dated [     ] 

Yours faithfully

___________________________

Name:

Title:

For and on behalf of 

[Transferee]

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