Document:

Unassociated Document

    Exhibit 10.4

     

    EXCLUSIVE
OPTION AGREEMENT

    

    AMONG

    

    XI’AN
SOFTECH CO., LTD

    

    AND

    

    LI
TAO AND OTHER INDIVIDUALS

    

    XI’AN
TECHTEAM INVESTMENT HOLDING GROUP COMPANY

    

    SHENZHEN
CAPITAL GROUP CO., LTD

    

    XI’AN
HONGTU CAPITAL CO., LTD

    

    SHAANXI
YUANXING SECIENCE AND TECHNOLOGY CO., LTD

    

    AND

    

    XI’AN
KINGTONE INFORMATION TECHNOLOGY CO., LTD

     

    December 15, 2009

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXCLUSIVE
OPTION AGREEMENT

    

    This
Exclusive Option Agreement (the “Agreement) is entered into as
of  December 15, 2009 among the following Parties in Xi’an.

    

    Party A: Xi’an Softech Co.,
Ltd

    Registered
Address: 3/F of District A, the Industry Office Building, No.181 of Tai Bai
Southern Road, Xi’an City, China

    Legal
Representative: Wang Wan Jiao

    

    Party B: Li Tao and other
seventeen individuals (collectively, the “Individual Shareholders”), the
specific list of the Individual Shareholders is referred herero as Exhibit
A

    

    Party C:Xi’an TechTeam
Investment Holding Group Company

    Registered
Address: 3/F of District A, the Industry Office Building, No.181 of Tai Bai
Southern Road, Xi’an City, China

    Legal
Representative: Li Tao

    

    Party D: Shenzhen Capital
Group Co., Ltd

    Registered
Address: District B, 11/F OF Investment Mall, No.4009, Shennan Avenue, Futian
District, Shenzhen City

    Legal
Representative: Jin Hai Tao

    

    Party E: Xi’an Hongtu Capital
Co., Ltd

    Registered
Address: 7/F of Xi’an Tourism Mall, No.27, South two links, Beilin District,
Xi’an City

    Legal
Representative: Xia Fu Xi

    

    Party F: Shaanxi Yuanxing
Science and Technology Co., Ltd

    Registered
Address: 18/F of Xin Ji Yuan Square, Gaoxin Road, Xi’an City

    Legal
Representative: Chen Li Ke

    

    Party G: Xi’an Kingtone
Information Technology Co., Ltd

    Registered
Address: 3/F of District A, the Industry Office Building, No.181 of Tai Bai
Southern Road, Xi’an City, China

    Legal
Representative: Li Tao

    

    In this
Agreement, Party A, Party B, Party C, Party D, Party E, Party F and Party G are
called collectively as the
“Parties” and each of them is called as the “Party”. Party B, Party C,
Party D, Party E and Party F are collectively called as the “All
Shareholders”.

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    WHEREAS,

    

    1.         Party
A is a wholly foreign-owned enterprise incorporated under the laws of the
People’s Republic of China (the “PRC”);

    

    2.         Party
G is a company limited by shares incorporated in Xi’an and with business license
issued by the Xi’an Administration for Industry and Commerce;

    

    3.         As of the date of this Agreement, Party
B, Party C, Party D, Party E and Party F are shareholders of Xi’an Kingtone
Information Technology Co., Ltd (hereinafter referred to as “Kingtone
Information”) and
collectively legally hold all of the equity interest of Kingtone Information, of
which Party B holds 61.6%, Party C holds 25% Party D holds 7.42%, Party E holds
3.30%, Party F holds 2.68%.

    

    NOW, THEREFORE, the Parties
through mutual negotiations hereby enter into this Agreement according to the
following terms and conditions:

    

    
      Article
1    The
Grant and Exercise of Purchase Option

    

    

    1.1      Grant:
All Shareholders hereby grant Party A an irrevocable exclusive purchase option
to purchase all or part of the shares of Party G, currently owned by any of
Party B and Party C, Party D, Party E and Party F; Party G further hereby grant
Party A an irrevocable exclusive purchase option to purchase all or part of the
assets and business of Party G, in each case in accordance with Article 1.3 of
this contract (the “Option”). The aforesaid
purchase options are irrevocable and shall be exercised only by Party A (or the
qualified persons appointed by Party A). The term “person” used herein shall
include any entity, corporation, partnership, joint venture and
non-corporate organizations.

    

    1.2      Exercise
Procedures

    

    1.2.1              Party
A shall notify All Shareholders in writing prior to exercising its option (the
“Option Notice”
hereinafter).

    

    1.2.2              The
next day upon receipt of the Option Notice, All Shareholders and Kingtone
Information, together with Party A (or the qualified person appointed by Party
A), shall promptly compile a whole set of documents (the “Transfer Documents”) to be
submitted to the government bodies for approving the shares or assets and
business transfer in connection with the Option exercise so that the shares or
assets and business transfer can be transferred, in whole or in
part.

    

    1.2.3              Upon
the completion of the compilation of all the Transfer Documents and the Transfer
Documents being confirmed by Party A, All Shareholders and Party G shall
promptly and unconditionally obtain, together with Party A (or the qualified
person appointed by Party A), all approvals, permissions, registrations,
documents and other necessary approvals to effectuate the transfer of the shares
and remaining assets and business of Party G in connection with the Option
exercise.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    1.3      Exercise
Condition: Party A may immediately exercise the option of acquiring the equity
interests in or remaining assets and business of Party G whenever Party A
considers it necessary to acquire Party G and it is doable in accordance with
PRC laws and regulations.

    

    
      Article
2    Acquisition

    

    

    Party A
and All Shareholders shall enter into relevant agreements regarding the price of
acquisition based on the circumstances of the exercise of option. Party A has
the discretion to decide the time and arrangement of the acquisition, provided
that the acquisition will not violate any PRC laws or regulations then in
effect.

    

    
      Article
3    Representations
and Warranties

    

    

    3.1      Each
party hereto represents to the other Parties that: (i) it has all the necessary
rights, powers and authorizations to enter into this Agreement and perform its
duties and obligations hereunder; (ii) All Shareholders warrant, represent and
guarantee that this Agreement, the Restructuring Exercise or the Listing shall
be in compliance with any and all applicable PRC laws and shall indemnify,
defend and hold harmless Party A and Party G for all fines, penalties, damages
or claims sustained by Party A or Party G arising out of Party B, Party C, Party
D, Party E and Party F’s violation of this section; and (iii) the execution or
performance of this Agreement shall not violate any contract or agreement to
which it is a party or by which it or its assets are bounded.

    

    3.2      All
Shareholders and Party G hereto represent to Party A that: With respect to the
equity interest held by All Shareholders in Party G, (i) Party B, Party C, Party D,
Party E and Party F are legally registered shareholders of party G and have paid
Party G the full amount of their respective portions of Party G's registered
capital required under the PRC laws; (ii) except Pledge of Equity
Agreement, signed by and between All Shareholders and Party A on December
15, 2009 in Xi’an, none of Party B, Party C, Party D, Party E and Party F
has mortgaged or pledged his/her shares of Party G, and noe of them has granted
any security interest or borrow against his/her shares of Party G in any form;
and (iii) none of Party B, Party C, Party D, Party E and Party has sold or will
sell to any third party its equity interests in Party G.

    

    3.3      With
respect to the assets of Party G which may be transferred to Party A at Party
A’s option hereunder, (i) Party G owns all such assets and has not mortgaged or
pledged or otherwise encumber such assets; and (ii) Party G has not sold or will
sell to any third party such assets.

    

    3.4      Party
G hereto represents to Party A that: (i) it is a company limited by shares duly
registered and validly existing under the PRC law; and (ii) its business
operations are in compliance with applicable laws of the PRC in all material
aspects.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      Article
4    Covenants

    

    

    The
Parties further agree as follows:

    

    4.1      Before
Party A has acquired all the equity/assets and business of Party G by exercising
the purchase option provided hereunder, Party G shall not:

    

    4.1.1     sell,
assign, mortgage or otherwise dispose of, or create any encumbrance on, any of
its assets, operations or any legal or beneficiary interests with respect to its
revenues (unless such sale, assignment, mortgage, disposal or encumbrance is
relating to its daily operation or has been disclosed to and agreed upon by
Party A in writing);

    

    4.1.2     enter
into any transaction which may materially affect its assets, liability,
operation, shareholders’ equity or other legal rights (unless such transaction
is relating to its daily operation or has been disclosed to and agreed upon by
Party A in writing); and

    

    4.1.3     distribute
any dividend to its shareholders in any manner.

    

    4.2      Before
Party A has acquired all the equity/assets/business of Party G by exercising the
purchase option provided hereunder, All Shareholders shall not:

    

    4.2.1     sell,
assign, mortgage or otherwise dispose of, or create any encumbrance on, any
of the equity held by them in Party G, except for the pledge of such shares made
according to the Pledge of Equity Agreement, signed by and between All
Shareholders and Party A on December 15, 2009 in Xi’an.

    

    4.3      Before
Party A has acquired all the equity/assets/business of Party G by exercising the
purchase option provided hereunder, All Shareholders and/or Party G shall not
individually or collectively:

    

    4.3.1     supplement,
alter or amend the articles of association of Party G in any manner to
the extent that such supplement, alteration or amendment may have a material
effect on Party G's assets, liability, operation, shareholders’ equity or other
legal rights;

    

    4.3.2     cause
Party G to enter into any transaction to the extent such transaction
may have
a material effect on Party G's assets, liability, operation, shareholders’
equity or other legal rights (unless such transaction is relating to Party G's
daily operation or has been disclosed to and agreed upon by Party A in writing);
and

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    4.4      Non
Competition:

    

    When
Party A exercises the Option, each of Party B, Party C and Party D, Party E and
Party F irrevocably and unconditionally agree and undertake to Party A that it
will not without the prior written consent of Party A:

    

    (a)         be
directly or indirectly engaged or concerned (whether as an employee,
agent,
independent contractor, consultant, advisor or otherwise) in the conduct of any
business competing with Party A’s Business (the “Business”);

    (b)        carry
on for his, her or its own account either alone or in partnership or be
concerned as a director or shareholder in any company engaged in any business
competing with the Business;

    (c)         assist
any person, firm or company with technical advice or assistance in relation
to any business competing with the Business

    (d)        solicit
or entice away or attempt to solicit or entice away the custom of any person,
firm, company or organization who shall at any time have been a customer,
client, distributor or agent of Party A or in the habit of dealing with Party
A;

    (e)         solicit
or entice away or attempt to solicit or entice away from Party A any person who
is an officer, manager or employee of Party A whether or not such person would
commit a breach of his contract of employment by reason of leaving Party
A;

    (f)         in
relation to any trade, business or company, use any name in such a way as to be
capable of or likely to be confused with the name of Party A and shall use all
reasonable endeavors to procure that no such name shall be used by any other
person, firm or company;

    (g)        otherwise
be interested, directly or indirectly, in any business competing with the
Business.

    

    
      Article
5    Assignment
of Agreement

    

    

    5.1      All
Shareholders and Party G shall not transfer their rights and obligations under
this Agreement to any third party without the prior written consent of Party
A.

    

    5.2      Each
of Party B, Party C and Party D, Party E, Party F and Party G hereby agrees that
Party A shall have the right to transfer all of its rights and obligation under
this Agreement to any third party whenever it desires. Any such transfer shall
only be subject to a written notice sent to Party B, Party C and Party D, Party
E and Party F and Party G by Party A, and no any further consent from Party B,
Party C and Party D, Party E, Party F and Party G will be required.

    

    
      Article
6    Confidentiality

    

    

    The
Parties acknowledge and confirm that any oral or written materials exchanged by
the Parties in connection with this Agreement are confidential. The Parties
shall maintain the secrecy and confidentiality of all such materials. Without
the written approval by the other Parties, any Party shall not disclose to any
third party any relevant materials, but the following circumstances shall be
excluded:

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    6.1      The
materials is known or will be known by the public (except for any materials
disclosed to the public by the Party who receives such materials);

    

    6.2      The
materials are required to be disclosed under the applicable laws or the rules or
provisions of stock exchange; or

    

    6.3      The
materials disclosed by each Party to its legal or financial consultant relate to
the transaction contemplated under this Agreement, and such legal or financial
consultant shall comply with the confidentiality set forth in this Section. The
disclosure of the confidential materials by an employee of any Party shall be
deemed disclosure of such materials by such Party, and such Party shall be
liable for breaching the contract. This Article 6 shall survive this Agreement
even if this Agreement is invalid, amended, revoked, terminated or unenforceable
by any reason.

    

    
      Article
7    Breach
of Contract

    

    

    Any
violation of any provision hereof, any incomplete or mistaken performance of any
obligation provided hereunder, any misrepresentation made hereunder, any
material nondisclosure or omission of any material fact, or any failure to
perform any covenants provided hereunder by any Party shall constitute a breach
of this Agreement. The breaching Party shall be liable for any such breach
pursuant to the applicable laws.

    

    
      Article
8    Applicable
Law and Dispute Resolution

    

    

    8.1      Applicable
Law

    

    The
execution, validity, interpretation and performance of this Agreement and the
disputes resolution under this Agreement shall be governed by the laws of
PRC.

    

    8.2      Dispute
Resolution

    

    The
Parties shall strive to settle any dispute arising from the interpretation or
performance of this Agreement through friendly consultation. In case no
settlement can be reached through consultation within thirty (30) days after
such dispute is raised, each party can submit such matter to China International
Economic and Trade Arbitration Commission in accordance with its rules. The
arbitration award shall be final, conclusive and binding upon both
Parties.

    

    
      Article
9    Effectiveness
and Termination

    

    

    9.1      This
Agreement shall be effective upon the execution hereof by all Parties hereto and
shall remain effective thereafter.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    9.2      This
Agreement may not be terminated without the unanimous consent of all the Parties
except that Party A may, by giving thirty days prior notice to the other Parties
hereto, terminate this Agreement.

    

    
      Article
10    Miscellaneous

    

    

    10.1    Amendment,
Modification and Supplement

    

    Any
amendment and supplement to this Agreement shall be made by the Parties in
writing. The amendment and supplement duly executed by each Party shall be
deemed an integral part of this Agreement and shall have the same legal effect
as this Agreement.

    

    10.2    Entire
Agreement

    

    The
Parties acknowledge that this Agreement constitutes the entire agreement of the
Parties with respect to the subject matters therein and supersedes and replaces
all prior or contemporaneous agreements and understandings in oral or written
form.

    

    10.3    Severability

    

    If any
provision of this Agreement is adjudicated to be invalid or non-enforceable
according to relevant PRC laws of the PRC, such a provision shall be deemed
invalid only to the extent the PRC laws are applicable in China, and the
validity, legality and enforceability of the other provisions hereof shall not
be affected or impaired in any way. The Parties shall, through consultation
based on the principal of fairness, replace such invalid, illegal or
non-enforceable provision with valid provision so that any substituted provision
may bring the similar economic effects as those intended by the invalid, illegal
or non-enforceable provision.

    

    10.4    Headings

    

    The
headings contained in this Agreement are for the convenience of reference only
and shall not in any other way affect the interpretation, explanation or the
meaning of the provisions of this Agreement.

    

    10.5    Language
and Copies

    

    This
Agreement is written in Chinese and English and both the English version and
Chinese version shall have the same effect. This Agreement is executed in
twenty-four copies for each version; each Party holds one and each original copy
has the same legal effect.

    

    10.6    Successor

    

    This
Agreement shall bind and benefit the successor or the transferee of each
Party.

    

    (This
space intentionally left blank)

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    IN
WITNESS HEREOF, the Parties hereof have caused this Agreement to be executed by
their duly authorized representatives as of the date first written
above.

    

    
      
        
          
            	
                    PARTY
      A: Xi’an Softech Co., Ltd.

                  	 
      
	 
      	 
      
	
                    (Seal)

                  	 
      
	 
      	 
      
	
                    Legal
      Representative/Authorized Representative

                  	 
      
	 	 
	
                    (Signature):

                  	
                    /s/ Wang Wan Jiao

                  	 
      
	 
      	 
      	 
      
	
                    PARTY
      B:

                  	 
      
	 	 
	
                    Li
      Tao

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Li Tao

                  	 
      
	 
      	 
      	 
      
	
                    Chen
      Xue Tao

                  	 
      
	 
      	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Chen Xue Tao

                  	 
      
	 
      	 
      	 
      
	
                    Wang
      Wan Jiao

                  	 
      
	 
      	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Wang Wan Jiao

                  	 
      
	 
      	 
      	 
      
	
                    Wu
      Li

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Wu Li

                  	 
      

          

        

      

    

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    
      
        	
                Pu
      Wei

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Pu Wei

              	 
      
	 
      	 
      	 
      
	
                Zhang
      Yu Fan

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Yu Fan

              	 
      
	 
      	 
      	 
      
	
                Guo
      Ming

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Guo Ming

              	 
      
	 
      	 
      	 
      
	
                Zhang
      Wei

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Wei

              	 
      
	 
      	 
      	 
      
	
                Li
      Jian Ping

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Li Jian Ping

              	 
      
	 
      	 
      	 
      
	
                Qin
      Shu Ling

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Qin Shu Ling

              	 
      
	 
      	 
      	 
      
	
                Li
      Jing

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Li Jing

              	 
      

      

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    
      
        	
                Zhang
      Xiao Ming

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Xiao Ming

              	 
      
	 
      	 
      	 
      
	
                Zhang
      Xiao Bin

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Zhang Xiao Bin

                

              	 
      
	 
      	 
      	 
      
	
                Wang
      Wei

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Wang Wei

                

              	 
      
	 
      	 
      	 
      
	
                Zhang
      Peng

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Zhang Peng

                

              	 
      
	 
      	 
      	 
      
	
                Xi
      Peng Guo

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Xi Peng Guo

                

              	 
      
	 
      	 
      	 
      
	
                Chen
      Xian Ying

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Chen Xian Ying

                

              	 
      
	 
      	 
      	 
      
	
                Ma
      Jun

              	 
      
	 
      	 
      	 
      
	
                (Signature):

              	
                
                  /s/ Ma Jun

                

              	 
      

      

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                PARTY
      C: Xi’an TechTeam Investment Holding Group Company

                              
	 
      	 
      	 
      
	
                                (Seal)

                              	 
      
	 
      	 
      	 
      
	
                                Legal
      Representative/Authorized Representative

                              	 
      
	 	 
	
                                (Signature):

                              	
                                
                                  /s/ Li Tao

                                

                              	 
      
	 
      	 
      	 
      
	
                                PARTY
      D: Shenzhen Capital Group Co., Ltd

                              	 
      
	 	 
	
                                (Seal)

                              	 
      
	 
      	 
      	 
      
	
                                Legal
      Representative/Authorized Representative

                              	 
      
	 	 
	
                                (Signature):

                              	
                                /s/ Jin Hai Tao

                              	 
      
	 
      	 
      	 
      
	
                                PARTY
      E: Xi’an Hongtu Capital Co., Ltd

                              	 
      
	 	 
	
                                (Seal)

                              	 
      
	 
      	 
      	 
      
	
                                Legal
      Representative/Authorized Representative

                              	 
      
	 	 
	
                                (Signature):

                              	
                                /s/ Xia Fu Xi

                              	 
      
	 
      	 
      	 
      
	
                                PARTY F: Shaanxi Yuanxing Science and
      Technology Co., Ltd

                              
	 
      	 
      	 
      
	
                                (Seal)

                              	 
      
	 
      	 
      	 
      
	
                                Legal
      Representative/Authorized Representative

                              	 
      
	 	 
	
                                (Signature):

                              	
                                /s/ Li Ke Chen

                              	 
      

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    
      
        
          
            
              
                	
                        PARTY G: Xi’an Kingtone Information
      Technology Co., Ltd

                      
	 	 
	
                        (Seal)

                      	 
      
	 	 
	
                        Legal
      Representative/Authorized Representative

                      	 
      
	 	 
	
                        (Signature):

                      	
                        /s/ Li Tao

                      	 
      

              

            

          

        

      

    

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    Exhibit
A

     

    List
of Individual Shareholders

    

      
        
          
            
              
                	
                        Name

                      	 
      	
                        ID
      Card Number

                      	 
      	
                        Share
      Percentage

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Li
      Tao

                      	 
      	
                        610103196511281613

                      	 
      	
                        36.61%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Chen
      Xue Tao

                      	 
      	
                        61010319710930165X

                      	 
      	
                        8.93%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Wang
      Wan Jiao

                      	 
      	
                        610104198109266162

                      	 
      	
                        5.35%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Wu
      Li

                      	 
      	
                        610111620918202

                      	 
      	
                        1.09%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Pu
      Wei

                      	 
      	
                        610104196910302123

                      	 
      	
                        1.04%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Zhang
      Yu Fan

                      	 
      	
                        610103196508063244

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Guo
      Ming

                      	 
      	
                        610113195801080017

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Zhang
      Wei

                      	 
      	
                        610103197802122043

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Li
      Jian Pin

                      	 
      	
                        610103681102368

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Qin
      Shu Ling

                      	 
      	
                        610113195503020446

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Li
      Jing

                      	 
      	
                        420500197212035246

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Zhang
      Xiao Ming

                      	 
      	
                        610113195303102930

                      	 
      	
                        0.89%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Zhang
      Xiao Bin

                      	 
      	
                        612325197911180016

                      	 
      	
                        0.53%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Wang
      Wei

                      	 
      	
                        610627198201080055

                      	 
      	
                        0.38%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Zhang
      Peng

                      	 
      	
                        622101196712220017

                      	 
      	
                        0.36%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Xi
      Peng Guo

                      	 
      	
                        610431197601031334

                      	 
      	
                        0.36%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Chen
      Xian Ying

                      	 
      	
                        610112750201523

                      	 
      	
                        0.36%

                      
	 
      	 
      	 
      	 
      	 
      
	
                        Ma
      Jun

                      	
                          

                      	
                        612728196803210253

                      	
                          

                      	
                        0.36%

                      

              

            

          

        

      

      
        
           

        

        
          13Unassociated Document

    Exhibit 10.5

     

    PLEDGE
OF EQUITY AGREEMENT

     

    BETWEEN

    

    LI
TAO AND OTHER INDIVIDUALS

    

    XI’AN
TECHTEAM INVESTMENT HOLDING GROUP

     COMPANY

    

    SHENZHEN
CAPITAL GROUP CO., LTD

    

    XI’AN
HONGTU CAPITAL CO., LTD

    

    SHAANXI
YUANXING SECIENCE AND TECHNOLOGY CO., 

    LTD

     

    AND

     

    XI’AN
SOFTECH CO., LTD

     

    December
15, 2009

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    PLEDGE
OF EQUITY AGREEMENT

    

    This
Pledge of Equity Agreement (“the Agreement”) is executed
on December 15, 2009 in Xi’an by:

    

    Pledgeors
(hereinafter collectively referred to as “Party A”):

    

    1.           Li
Tao and other seventeen individuals (collectively, the “Individual Shareholders”), the
specific list of the Individual Shareholders is referred herero as Exhibit
A;

    

    2.           Xi’an
TechTeam Investment Holding Group Company, a limited liability company
registered in Xi’an, and the registration number of its legal and valid Business
License is 610131100003173;

    

    3.           Shenzhen
Capital Group Co., Ltd,a limited
liability company registered in Shenzhen, and the registration number of its
legal and valid Business License is 440301103269709;

    

    4.           Xi’an
Hongtu Capital Co., Ltd, a limited liability company registered in Xi’an, and
the registration number of its legal and valid Business License is
610100100085399;

    

    5.           Shaanxi
Yuanxing Science and Technology Co., Ltd, a limited liability company registered
in 610000100089857,;

    

    and

    

    Pledgee
(hereinafter referred to as “Party B”):

    

    6.           Xi’an
Softech Co., Ltd, a wholly foreign-owned enterprise registered in Xi’an; and the
registration number of its legal and valid Business License is
610100400006807;

    

    Whereas,

    

    1.            Party A consists of all of the
shareholders of Xi’an Kingtone Information Technology Co., Ltd (hereinafter
referred to as “Kingtone
Information”), who legally
hold all of the equity interest of Kingtone Information, of which the Individual
Shareholders hold 61.6%, Xi’an TechTeam Investment Holding Group Company holds
25% Shenzhen Capital Group Co., Ltd holds 7.42%, Xi’an Hongtu Capital Co., Ltd
holds 3.30%, Shaanxi Yuanxing Science and Technology Co., Ltd holds 2.68%,
representing 100% of the capital stock of Kingtone Information.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    2.            Party
B is a wholly-foreign owned enterprise incorporated and existing within the
territory of China in accordance with the law of the People’s Republic of China,
the registration number of its legal and valid Business License is
610100400006807, and the legal registered address is 3/F of District A, the
Industry Office Building, No.181 of Tai Bai Southern Road, Xi’an City,
China.

    

    3.            Xi’an
Kingtone Information Technology Co., Ltd is an enterprise limited by shares
which is incorporated and existing within the territory of China in accordance
with the law of the People’s Republic of China, the registration number of its
legal and valid Business License is 610131100001233 and the legal registered
address is the third floor of District A, the Industry Office Building, No.181
of Tai Bai Southern Road, Xi’an City, China.

    

    4.            Party
B intends to acquire all of the equity interests or assets of Kingtone
Information. Prior to the completion of such acquisition, Party B agrees to
provide exclusive technology service to Kingtone Information. In order to
protect the interests of Party B, Party A agrees to pledge the 100% of equity
interest of Kingtone Information they own to Party B.

    

    5.            Party
B accepts the pledge of the equity interest by Party A.

    

    Therefore,
in accordance with applicable laws and regulations of the People’s Republic of
China, the Parties hereto reach the Agreement through friendly negotiation on
the principle of equality and mutual benefit and abide by.

    

    
      Article
1    Guaranteed
Obligations

    

    

    The
equity interest is being pledged to guarantee all of the rights and interests
Party B is entitled to under all of the following listed agreements by and
between Party A and Party B:

    

    (a)       Entrusted
Management Agreement, by and among Party A, Kingtone Information and Party B on
December 15, 2009 in Xi’an;

     

    (b)       Exclusive
Technology Service Agreement, by and between Kingtone Information and Party B on
December 15,
2009 in Xi’an;

     

    (c)       Exclusive
Option Agreement by and among Party A, Kingtone Information and Party B on December 15, 2009
in Xi’an; and

     

    (d)       Shareholders’
Voting Proxy Agreement, by and between Party A and Party B on December 15, 2009
in Xi’an.

    

    
      Article
2    Pledged
Properties

    

    

    Party A
pledges, by way of first priority pledge, all of its rights, title and interest,
in, to and under all or any part of:

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    (a)      100%
of the equity interest in Kingtone Information;

    (b)      100%
of the registered capital (“Registered Capital”) of
Kingtone Information;

    (c)      all
investment certificates and other documents in respect of the Registered Capital
of Kingtone Information;

    (d)      all
money, dividends, interest and benefits at any time arising in respect of all
the equity interest and Registered Capital of Kingtone Information;
and

    (e)      all
voting rights and all other rights and benefits attaching to or accruing to the
equity interest or the Registered Capital of Kingtone Information to Party
B.

    

    
      Article
3    Scope
of Guaranteed Obligations

    

    

    The scope
of the guaranteed obligations is all rights and interests Party B is entitled to
in accordance with all the agreements signed by and between Party A and Party
B.

    

    
      Article
4    Pledge
Procedure and Registration

    

    

    Party A
shall process the registration procedures with Xi’an Administration for Industry
and Commerce concerning the pledged equity interest and ensure that all other
approval(s) from or registration with relevant PRC authorities is granted or
duly secured.

    

    
      Article
5    Transfer
of Pledged Equity Interest

    

    

    Party A
shall not transfer any of the pledged equity interest without the prior written
consent of Party B during the term of this agreement.

    

    
      Article
6    Effectiveness,
Modification and Termination

    

    

    6.1            This
Agreement shall go into effect when it is signed by the authorized
representatives of the Parties with seals affixed;

    

    6.2            Upon
the effectiveness of this Agreement and unless otherwise agreed upon by the
parties hereto, neither party may modify or terminate this Agreement. Any
modification or termination shall be in writing after both parties’
consultations. The provisions of this Agreement remain binding on both parties
prior to any written agreement on modification or termination.

    

    
      Article
7    Governing
Law

    

    

    The
execution, validity, interpretation and performance of this Agreement and the
disputes resolution under this Agreement shall be governed by the laws of
PRC.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    
      Article
8    Liability
for Breach of Agreement

    

    

    Upon the
effectiveness of this Agreement, the Parties hereto shall perform their
respective obligations under the Agreement. Any failure to perform the
obligations stipulated in the Agreement, in part or in whole, shall be deemed as
breach of contract and the breaching party shall compensate the non-breaching
party for the loss incurred as a result of the breach.

    

    
      Article
9    Settlement
of Dispute

    

    

    The
parties shall strive to settle any dispute arising from the interpretation or
performance of this Agreement through friendly consultation. In case no
settlement can be reached through consultation within thirty (30) days after
such dispute is raised, each party can submit such matter to China International
Economic and Trade Arbitration Commission in accordance with its rules then in
effect. The arbitration award shall be final, conclusive and binding upon both
parties.

    

    
      Article
10    Severability

    

    

    10.1            Any
provision of this Agreement that is invalid or unenforceable due to the laws and
regulations shall be ineffective without affecting in any way the remaining
provisions hereof.

    

    10.2            In
the event of the foregoing paragraph, the parties hereto shall prepare
supplemental agreement as soon as possible to replace the invalid provision
through friendly consultation.

    

    
      Article
11    Miscellaneous

    

    

    11.1            The
headings contained in this Agreement are for the convenience of reference only
and shall not in any other way affect the interpretation of the provisions of
this Agreement.

    

    11.2            The
Agreement shall be executed in twenty-five copies, both in Chinese and English.
Each party holds one Chinese and one English original, and the remaining shall
be kept for completing relevant procedures. Each copy shall have equal legal
force, and both the English version and Chinese version shall have the same
effect.

    

    (This
space intentionally left blank)

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    IN
WITNESS HEREOF, the Parties hereof have caused this Agreement to be executed by
their duly authorized representatives as of the date first written
above.

     

    
      
        
          
            	
                    PARTY
      A:

                  	 
      
	 	 
	
                    Li
      Tao

                  	 
      
	 	 
	
                    (Signature):

                  	
                    /s/ Li Tao

                  	 
      
	 
      	 
      
	
                    Chen
      Xue Tao

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Chen Xue Tao

                  	 
      
	 
      	 
      
	
                    Wang
      Wan Jiao

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Wang Wan
      Jiao    

                  	 
      
	 
      	 
      
	
                    Wu
      Li

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Wu Li

                  	 
      
	 
      	 
      
	
                    Pu
      Wei

                  	 
      
	 
      	 
      
	
                    (Signature):

                  	
                    /s/ Pu Wei

                  	 
      

          

        

      

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

    
      
        	
                Zhang
      Yu Fan

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Yu Fan

              	 
      
	 
      	 
      
	
                Guo
      Ming

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Guo Ming

              	 
      
	 
      	 
      
	
                Zhang
      Wei

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Wei

              	 
      
	 
      	 
      
	
                Li
      Jian Ping

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Li Jian Ping

              	 
      
	 
      	 
      
	
                Qin
      Shu Ling

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Qin Shu Ling

              	 
      
	 
      	 
      
	
                Li
      Jing

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Li Jing

              	 
      
	 
      	 
      
	
                Zhang
      Xiao Ming

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Xiao Ming

              	 
      

      

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    
      
        	
                Zhang
      Xiao Bin

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Zhang Xiao Bin

              	 
      
	 
      	 
      
	
                Wang
      Wei

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Wang Wei

              	 
      
	 
      	 
      
	
                Zhang
      Peng

              	 
      
	 
      	 
      
	
                (Signature):

              	
                
                  
                    /s/ Zhang Peng

                  

                

              	 
      
	 
      	 
      
	
                Xi
      Peng Guo

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Xi Peng
      Guo    

              	 
      
	 
      	 
      
	
                Chen
      Xian Ying

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Chen Xian Ying

              	 
      
	 
      	 
      
	
                Ma
      Jun

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Ma Jun

              	 
      

      

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    
      
        	
                Xi’an
      TechTeam Investment Holding Group Company

              	 
      
	 
      	 
      
	
                (Seal)

              	 
      
	 
      	 
      
	
                Legal
      Representative/Authorized Representative

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Li Tao

              	 
      
	 
      	 
      
	
                Shenzhen
      Capital Group Co., Ltd

              	 
      
	 
      	 
      
	
                (Seal)

              	 
      
	 
      	 
      
	
                Legal
      Representative/Authorized Representative

              	 
      
	 
      	 
      
	
                (Signature):

              	
                      
                  /s/ Jin Hai
      Tao

                

              	 
      
	 
      	 
      
	
                Xi’an
      Hongtu Capital Co., Ltd

              	 
      
	 
      	 
      
	
                (Seal)

              	 
      
	 
      	 
      
	
                Legal
      Representative/Authorized Representative

              	 
      
	 
      	 
      
	
                (Signature):

              	
                      
                  /s/ Xia Fu
      Xi

                

              	 
      
	 
      	 
      
	
                Shaanxi
      Yuanxing Science and Technology Co., Ltd

              	 
      
	 
      	 
      
	
                (Seal)

              	 
      
	 
      	 
      
	
                Legal
      Representative/Authorized Representative

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Li Ke Chen

              	 
      

      

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    
      
        	
                PARTY
      B: Xi’an Softech Co., Ltd

              	 
      
	 
      	 
      
	
                (Seal)

              	 
      
	 
      	 
      
	
                Legal
      Representative/Authorized Representative

              	 
      
	 
      	 
      
	
                (Signature):

              	
                /s/ Wang Wan Jiao

              	 
      

      

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    Exhibit
A

     

    List
of Individual Shareholders

     

    
      
        
          
            
              
                
                  	
                          Name

                        	 	
                          ID
      Card Number

                        	 	 	
                          Share
      Percentage

                        	 
	 
      	 	 	 	 	 	 
	
                          Li
      Tao

                        	 	 	610103196511281613	 	 	 	36.61	%
	 
      	 	 	 	 	 	 	 	 
	
                          Chen
      Xue Tao

                        	 	 	61010319710930165X  
      	 	 	 	8.93	%
	 
      	 	 	 	 	 	 	 	 
	
                          Wang
      Wan Jiao

                        	 	 	610104198109266162	 	 	 	5.35	%
	 
      	 	 	 	 	 	 	 	 
	
                          Wu
      Li

                        	 	 	610111620918202	 	 	 	1.09	%
	 
      	 	 	 	 	 	 	 	 
	
                          Pu
      Wei

                        	 	 	610104196910302123	 	 	 	1.04	%
	 
      	 	 	 	 	 	 	 	 
	
                          Zhang
      Yu Fan

                        	 	 	610103196508063244	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Guo
      Ming

                        	 	 	610113195801080017	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Zhang
      Wei

                        	 	 	610103197802122043	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Li
      Jian Pin

                        	 	 	
                          610103681102368

                        	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Qin
      Shu Ling

                        	 	 	
                          610113195503020446

                        	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Li
      Jing

                        	 	 	
                          420500197212035246

                        	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Zhang
      Xiao Ming

                        	 	 	
                          610113195303102930

                        	 	 	 	0.89	%
	 
      	 	 	 	 	 	 	 	 
	
                          Zhang
      Xiao Bin

                        	 	 	
                          612325197911180016

                        	 	 	 	0.53	%
	 
      	 	 	 	 	 	 	 	 
	
                          Wang
      Wei

                        	 	 	610627198201080055	 	 	 	0.38	%
	 
      	 	 	 	 	 	 	 	 
	
                          Zhang
      Peng

                        	 	 	
                          622101196712220017

                        	 	 	 	0.36	%
	 	 	 	 	 	 	 	 	 

                

              

            

          

        

      

    

    
      
        
          
            	
                    Xi
      Peng Guo

                  	 	
                    ID
      Card Number

                  	 	 	 	0.36	%
	 
      	 	 	 	 	 	 	 
	
                    Chen
      Xian Ying

                  	 	 	
                    610103196511281613

                  	 	 	 	0.36	%
	 
      	 	 	 	 	 	 	 	 
	
                    Ma
      Jun

                  	 	 	61010319710930165X   
      	 	 	 	0.36	%

          

        

      

    

     

    
      
         

      

      
        11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}]]