Document:

EX-10.70 ASSET TRANSFER AGREEMENT, DATED MAY 17, 2

 

Exhibit 10.70

 

ASSET TRANSFER AGREEMENT

 

among

Shanghai Quanshi Advertisement Co., Ltd

New Allyes Information Technology (Shanghai) Co., Ltd.

Suyang Zhang

And

Hailong Zhu

 

 

ASSET TRANSFER AGREEMENT

This ASSET TRANSFER AGREEMENT (this “Agreement”), dated as of May 17, 2005, is entered into by and
between the following parties:

	(1)	 	Shanghai Quanshi Advertisement Co., Ltd (“Seller”)
	 
	 	 	Address: Room A70, Floor 28, No.369, Jiangsu Road, Changning District, Shanghai;
	 
	(2)	 	New Allyes Information Technology (Shanghai) Co., Ltd. (“Buyer”)
	 
	 	 	Address: Room 222301-639, No.14 Building, Pudong Software Park, No.498 Guoshoujing Road,
Zhangjiang High-Tech Park, Shanghai;
	 
	(3)	 	Suyang Zhang
	 
	 	 	ID card No.: 310107581124243
	 
	(4)	 	Hailong Zhu
	 
	 	 	ID card No.: 110108680408041
	 
	 	 	(Suyang Zhang and Hailong Zhu Shall be referred to as “Shareholders of Seller”)

WHEREAS:

The Seller is engaged in the business of the design, produce, agency and dissemination of
advertisement via website. The Seller desires to sell to the Buyer, and the Buyer desires to
purchase from the Seller, the assets in connection with the business of the Seller, upon the terms
and subject to the conditions set forth in this Agreement.

THEREFORE, the parties hereto hereby agree as follows:

1. Definition

	1.1	 	Unless otherwise stipulated in the provisions or in the context of this Agreement, the
following terms shall bear the meaning as follows:
	 
	 	 	“Transfer Assets” shall mean the Seller’s fixed assets and intellectual property
listed in Appendix II, but excluding Exclusive Assets.
	 
	 	 	“Closing” shall mean the completion of the sell and purchase of the Transfer Assets
pursuant to the Article 4;
	 
	 	 	“Closing Date” shall mean the date of Closing;

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	 	 	“Shareholder” shall mean all the registered shareholders of the Seller, i.e. Suyang
Zhang and Hailong Zhu;
	 
	 	 	“Restriction of Rights” shall mean all the pledge, mortgage, lien, security rights,
preemption, option or any other restriction of rights or third party rights or
any claim of rights (except for (i) lien raised or result from the repair or
other similar situation during the ordinary course of business, and (ii) general
ownership appointment and ownership reservation clause reached during the
ordinary course of business for the purchase of goods);
	 
	 	 	“Exclusive Assets” shall mean the fixed assets and intellectual property that shall
not be subject to purchase, the definition of such assets is set forth in
Appendix III;
	 
	 	 	“Parties” shall mean the parties to this Agreement and their respective successors or
assignees;
	 
	 	 	“PRC” shall mean the People’s Republic of China, for the purpose of
this Agreement, not including Hong Kong, Macao Special Administrative Region and
Taiwan;
	 
	 	 	“Warrant” shall mean all the representations, warrants and undertakings included or
in relation to the Article 6 and Appendix I; and,
	 
	 	 	“RMB” shall mean the legal currency of PRC.
	 
	1.2	 	The articles and appendix cited in this Agreement shall be the articles and appendix of this
Agreement (unless otherwise stipulated in the context). The context and appendix constitute
the whole Agreement.
	 
	1.3	 	The titles of the articles contained herein shall be for convenience only, and shall not
affect the interpretation of the provisions hereof.
	 
	1.4	 	If allowed by the context, the wording as of “Seller” and “Buyer” shall include the Seller
and Buyer’s respective successors, authorized representatives and the assignees with their
consent.

2. Sell of the Transfer Assets

	2.1	 	Restricted by the provisions of this Agreement, the Seller shall be the legal owner to sell
and cause the Buyer to obtain all the Transfer Assets without any restriction of rights
hereupon.

	2.2	 	Except for the assets and obligations clearly specified in the Agreement,

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	 	 	under this Agreement, the Buyer shall not be deemed to be transferred of other assets
or obligations from the Seller, nor be deemed to undertake any duty or obligations in
relation to such assets and obligations.

3. Consideration

	 	 	The Parties understand that the sell and purchase of the Transfer Assets under this
Agreement shall for the interest of the Parties; and the Parties acknowledge that the
consideration, which is full, non-gratuitous and made with good faith, for the
execution and the performance of this Agreement, has been accepted by the Parties.
Based on such understanding, the Parties agree that the consideration payable by the
Buyer under this Agreement shall be RMB 1.00 Yuan; and the Seller undertakes that,
except for the consideration stipulated above, it shall not, by virtue of any other
reason, request the Buyer to pay other consideration in respect of the execution and
the performance of this Agreement.

4. Closing

	4.1	 	Upon Closing, the Seller shall:

	 	4.1.1	 	Deliver to the Buyer any instruments or similar instruments and/or permission
(if any) in connection with the Transfer Assets to the satisfaction of the Buyer, in
order to the title to the Transfer Assets is duly transferred in the name of the Buyer.
	 
	 	4.1.2	 	Deliver to the Buyer any part of the Transfer Assets which can be actually
delivered.
	 
	 	4.1.3	 	Allow the Buyer to enter into the site where the Transfer Assets are kept to
occupy or move such Transfer Assets.

5. Obligation of the Seller

	5.1	 	In case that no breach to the Warrant, the Seller shall undertake:

	 	5.1.1	 	any indebtedness, duty and obligation on the Transfer Assets
existing before and on the Closing Date raised by virtue of any restriction of
rights, regardless of such obligation raised before or after the Closing Date;
and
	 
	 	5.1.2	 	any third party’s claim or obligation in respect of the Transfer
Assets result from any do or no-to-do by the Seller before or on the Closing Date.

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6. Warrant

	6.1	 	The Seller hereby represents warrants and undertakes to the Buyer in respect of the
factuality and accuracy of the Warrant.

	6.2	 	The Seller hereby acknowledges that the Buyer executes this Agreement due to its believing of
the Warrant under this Agreement and the Buyer executes this Agreement based on such Warrant.

	6.3	 	The Seller hereby warrants that at any time it shall indemnify the Buyer for and against any
loss, damage, interest, cost and expense, under the circumstances that such indemnification
will not restrict any rights of the Buyer or infringe any rights of claim of the Buyer based
on such rights; the above loss, damage, interest, cost and expense include any cost (including
legal cost), expenses or liability in connection with (i) any legal proceedings brought by the
claim filed by the Buyer for the branch of Guarantee or misleading Guarantee by the Seller, or
(ii) any claim, settlement and enforcement of judgment, regardless of the time for the Buyer’s
suffering of such losses.

	6.4	 	Each Warrant shall be separately made and independent to each other, unless clear contrarily
stipulated, each Warrant shall not be restricted by other Warrant or any provision of this
Agreement or be deduced from any Warrant or any provision of this Agreement.

	6.6	 	The interest under this Article can be transferred without restriction in a whole or
partially transferred by the one who enjoys the interest at the time of such transfer.

	6.6	 	Regardless of the Closing, any Warrant and any provision of this Agreement, which are not
completely performed, shall be remain effective.

7. Consent of the Shareholders of Seller

The Shareholders of the Seller agrees the transaction under this Agreement and further guarantee
that they will take any action as the holder of shares or the director or other manager (if any) to
cause the Closing of the transaction under this Agreement.

8. Use of Transferred Assets

Buyer hereby agrees that upon Closing, Seller can keep making use the Transferred Assets in
accordance with the Exclusive Service Agreement, and shall make
payment to the Seller of the depreciation fees of the fixed assets.

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9. Breach

	9.1	 	The Parties agree and confirm that, if any party (hereinafter the “Defaulting Party”)
breaches substantially any of the provisions herein or omits substantially to perform any of
the obligations hereunder, or fails substantially to perform any of the obligations under this
Agreement, such a breach or omission shall constitute a default under this Agreement
(hereinafter a “Default”), then any party of the Non-Defaulting Party (“Non-Defaulting Party”)
shall have the right to require the Defaulting Party to rectify such Default or take remedial
measures within a reasonable period. If the Defaulting Party fails to rectify such Default or
take remedial measures within such reasonable period or within ten (10) days of the other
Party’s notifying the Defaulting Party in writing and requiring it to rectify the Default,
then Non-Defaulting Party shall have the right at its own discretion to (1) terminate this
Agreement and require the Defaulting Party to indemnify it for all the damage; or (2) request
mandatory performance of the obligations of the Defaulting Party hereunder and require the
Defaulting Party to indemnify it for all the damage.

	9.2	 	Notwithstanding any other provisions herein, the validity of this Article shall stand
disregarding the suspension or termination of this Agreement.

10. Notice

	10.1	 	Any notice, request, demand and other correspondences made as required by or in accordance
with this Agreement shall be made in writing and delivered to the relevant Party.

	10.2	 	The abovementioned notice or other correspondences shall be deemed to have been delivered
when it is transmitted if transmitted by facsimile or telex; it shall be deemed to have been
delivered when it is delivered if delivered in person; it shall be deemed to have been
delivered five (5) days after posting the same if posted by mail.

11. Force Majeure

	 	 	If the performance or duly performance of one party is directly affected by earthquake,
typhoon, flood, war, computer virus, flaw in tool software, the attack of hacker on the
internet, change of policy and law and other event which is unforeseeable, unavoidable
and insurmountable, the party affected by the Force Majeure shall at once announce the
other party of the Force

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	 	 	Majeure by facsimile and, within thirty (30) days, provide the other party with the
detailed information of the Force Majeure and a valid evidencing document issued by the
relevant notarization organization, stating the reasons that the Agreement cannot be
performed or would be performed with delay. The Parties, by reference to the influence
of the Force Majeure for the performance of this Agreement, shall thereby make
consultation on whether or not to partially release the obligations of one party from
performing the Agreement, or to perform the Agreement in delay. The Parties shall be
released of any liabilities in respect of the economic losses result from the Force
Majeure.

12. General Provisions

	12.1	 	This Agreement shall be prepared in the Chinese language in four (4) original copies, with
each involved Party holding one (1) copy hereof.

	12.2	 	The formation, validity, execution, amendment, interpretation and termination of this
Agreement shall be subject to PRC Law.

	12.3	 	Any disputes arising hereunder and in connection herewith shall be settled through
consultations among the Parties, and if the Parties cannot reach an agreement regarding such
disputes within thirty (30) days of their occurrence, such disputes shall be submitted to
China International Economic and Trade Arbitration Commission Shanghai Branch for arbitration
in Shanghai in accordance with the arbitration rules of such Commission, and the arbitration
award shall be final and binding on all Parties.

	12.4	 	Each Party to this Agreement shall respectively bear the expense result from this Agreement
or incurred during the transaction under this Agreement.

	12.5	 	Regardless of the Closing, all the provisions of this Agreement shall remain completely
effective, unless the obligation under such provisions has been fully performed upon the
Closing.

	12.6	 	Any failure or delay by a Party in exercising any of its rights, powers and remedies
hereunder shall not lead to a waiver of such rights.

	12.7	 	Each provision contained herein shall be severable and independent from each of other
provisions, and if at any time any one or more articles herein become invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining provisions herein
shall not be affected as a result thereof.

	12.8	 	Upon Closing, when Buyer is obliged to answer the enquiry from tax authority or

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other authority, or report tax or negotiate tax duty, Seller shall provide Buyer with all
the help when Buyer request so, and Seller shall provide Buyer with all the information,
documents, accounting book and other business records.

	12.9	 	Once executed, this Agreement shall replace any other legal documents entered into by the
relevant Parties hereof in respect of the same subject matter hereof. Any amendments or
supplements to this Agreement shall be made in writing and shall take effect only when
properly signed by the Parties to this Agreement.
	 
	12.10	 	Without prior written consent by the other Party, any Party shall not transfer to any third
party any of its right and/or obligation under this Agreement. This Agreement will bind the
assets of the Parties, the personal representative, successor and assignee via consent, and
will guarantee the interest of the Parties, the personal representative, successor and
assignee via consent.

[The remainder of this page is left blank]

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[Signing Page]

IN WITNESS HEREOF, the following Parties have caused this Assets Transfer Agreement to be executed
as of the date and in the place first here above mentioned.

Shanghai Quanshi Advertisement Co., Ltd (Corporate Seal)

/s/ Hailong Zhu

Position: Authorized Representative

New Allyes Information Technology (Shanghai) Co., Ltd. (Corporate Seal)

/s/ Jiangang Wang

Position: Authorized Representative

Suyang Zhang

/s/ Suyang Zhang

Hailong Zhu

/s/ Hailong Zhu

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Appendix I

Warrant

1. Company Business

	1.1	 	The Seller is a limited company duly incorporated under PRC laws and is validly existing, is
not subject to any order or claim or resolution passed from the liquidator, and its assets has
not been detained, enforced or in the process of enforcement. No indebtedness shall be repaid
by the Seller; no one has appointed receiver or administrator in respect of all or part of the
business and the assets of the Seller; nor does any order have been made in relation to such
appointment.

	1.2	 	The Sell has the power to execute, deliver and perform this Agreement and has carried out
necessary activities to authorize such execute, deliver and perform. This Agreement creates
the legal, effective and binding obligation to the Seller, and such obligation is enforceable
pursuant to this Agreement.

2. Assets

	2.1	 	The Seller has good and tradable ownership to the Transfer Assets, all the Transfer Assets
are free from any restriction of rights, third party rights, and free from any payment
obligation under lease agreement and financial lease agreement, sell on credit agreement,
delay or documentary sale agreement, or free from other same rights or rights similar to the
rights above. All the Transferred Assets are in the possession of under control o the Seller.

	2.2	 	The use or transfer of the Transfer Assets will not in conflict with any laws, regulations or
other legally enforceable requirements.

3. General Trading Issues

	3.1	 	Seller does not know the following changes companied by the alteration of titles of
Transferred Assets prior to the Closing: the supplier, client and agent or any third party of
a contract to which Seller is a party will cease to be the supplier, client and agent or any
third party (whichever is applicable), or to the extent same to the above situation or
occurrence of the matter with similar nature, they are entitled to terminate the contract to
which Seller is a party.

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	3.2	 	In terms of the Transfer Assets, the transferor parties or any other third party (the
transferor party might be liable on the third party’s behalf for its activity or breach) do
not carry out any activity which violates the criminal law or infringe the rights of others,
nor do those activity violate any other laws, regulations or other legally enforceable
requirements.

	3.3	 	The Seller is not subject to any investigation or inquiry by the governmental institution and
does not aware of any fact which will lead to such investigation or inquiry.

	3.4	 	No agreement or arrangement will restrict or negatively affect the transaction under this
Agreement or affect the ownership or the use or the disposal of the Transfer Assets by the
Seller, and no practice in connection with the Transferred Assets or affect the transfer and
engaged by the Seller, which will lead to invalid, illegal, non-enforceable, to-be registered,
to-be reported or violation of any anti-trust regulation worldwide (all the regulation in this
paragraph is called “anti-trust regulation”). Seller has never received any claim from any one
in respect of its violation of anti-trust regulation and never received any information,
investigation or dissent, or become the receipt or party to any decision, judgment, guarantee
or settlement in connection with anti-trust claims.

4. Accuracy of the Information

	4.1	 	All the information contains in the context and appendix of this Agreement is true and is not
misleading in any respect.

	4.2	 	The written information provided by the Seller or its professional consultant in respect of
the assets and business is true and accurate currently and at the time of such providing.

5. General Provision

The execution, delivery and performance of this Agreement will not violate, revoke and/or of any
contract to which Seller is a party and any its other asset to be restricted or cause any other
party to have the right to revoke the contract to which Seller is a party, or violate any law or
regulation affecting the assets and business or other order, decree, injection or direction issued
by any court, administrative institution or governing body.

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Appendix II

List of Transferred Assets

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Appendix III

Exclusive Assets

12EX-10.71 CALL OTPION AGREEMENT, DATED MAY 17, 2005

 

Exhibit 10.71

Confidential

Call Option Agreement

among

Hailong Zhu

New Allyes Information Technology (Shanghai) Co., Ltd

and

Shanghai Quanshi Advertisement Co., Ltd.

 

 

Call Option Agreement

This Call Option Agreement (this “Agreement”) is entered into in Shanghai of the People’s
Republic of China (the “PRC”) as of May 17, 2005 by and among the following Parties:

	(1)	 	Hailong Zhu, Resident of the PRC, holding the Identification Card of the PRC (No.
110108680408041), with the address at Room 2504, No.4 Building of Lijing Park, No.1 Lane of
Xujiahui Road, Shanghai (hereinafter “Shareholder”)
	 
	(2)	 	New Allyes Information Technology (Shanghai) Co., Ltd., a wholly-owned foreign enterprise
incorporated under the laws of China (hereinafter “Company”)
	 
	(3)	 	Shanghai Quanshi Advertisement Co., Ltd., a company of limited liabilities incorporated under
the laws of PRC (hereinafter “SH Quanshi”)
	 
	 	 	(Any sole party hereinafter shall be individually referred to as a “Party” and collectively,
the “Parties”.)

Whereas:

	(1)	 	Shareholder is the enrolled shareholders of SH Quanshi, legally holding a portion of 50% of
the equity interest in SH Quanshi, the equity structure proportion of SH Quanshi is listed in
the Appendix I as of the execution date of this Agreement.
	 
	(2)	 	The Shareholder and the Company concluded the Loan Agreement on April 20, 2005 and the Equity
Pledge Agreement on May 17, 2005.
	 
	(3)	 	The Shareholder intends to transfer to the company or the person(s) designated by it
(hereinafter “Designee(s)”), and the Designee(s) is willing to accept, all his respective
equity interest in SH Quanshi, to the extent not violating PRC Law.
	 
	(3)	 	In order to conduct the above equity transfer, the Shareholder agree to jointly grant the
Company an irrevocable call option for equity transfer (hereinafter the “Call Option”), under
which and to the extent permitted by PRC Law, the Shareholder shall on demand of the Company
transfer the Option Equity (as defined below) to the Company and/or the Designee(s) in
accordance with the provisions contained herein.

Therefore, the Parties hereby have reached the following agreement upon mutual consultations:

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Article 1 — Definition

	1.1	 	Except as otherwise construed in the context, the following terms in this Agreement shall be
interpreted to have the following meanings:

“PRC Law” shall mean the then valid laws, administrative regulations, administrative rules, local
regulations, judicial interpretations and other binding regulatory documents of the People’s
Republic of China.

“Designee(s)” shall mean individuals, companies, Chinese-foreign equity joint ventures, partnership
enterprises, trust or non-company organizations.

“Option Equity” shall mean, in respect of the Shareholder, all of the equity interest held thereby
in the SH Quanshi Registered Capital (as defined below).

“SH Quanshi Registered Capital” shall mean the registered capital of SH Quanshi as of the execution
date of this Agreement, i.e., RMB1,000,000 which shall include any expanded registered capital as
the result of any capital increase within the term of this Agreement.

“Transferred Equity” shall mean the equity of SH Quanshi which the Company or Designee(s) has the
right to require the Shareholder to transfer to it or its designated entity or individual when the
Company or Designee(s) exercises its Call Option (hereinafter the “Exercise of Option”) in
accordance with Article 3.2 herein, the amount of which may be all or part of the Option Equity and
the details of which shall be determined by the Company or the Designee(s) at its sole discretion
in accordance with the then valid PRC Law and from its commercial consideration.

“Transfer Price” shall mean all the consideration that the Company or the Designee(s) is required
to pay to the Shareholder in order to obtain the Transferred Equity upon each Exercise of Option.

“Business Permits” shall mean any approvals, permits, filings, registrations etc. which SH Quanshi
is required to have for legally and validly operating its advertisement designing, producing,
agency, publishing and all such other businesses, including but not limited to the Business License
of the Corporate Legal Person, the Tax Registration Certificate and such other relevant licenses
and permits as required by the then PRC Law.

“SH Quanshi Assets” shall mean all the tangible and intangible assets which SH Quanshi owns or has
the right to use during the term of this Agreement, including but not limited to any immoveable and
moveable assets, and such intellectual property rights as trademarks, copyrights, patents,
proprietary know-how, domain names and software use rights.

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“Material Agreement” shall mean an agreement to which SH Quanshi is a party and which has a
material impact on the businesses or assets of SH Quanshi.

“Loan Agreement” shall mean the Loan Agreement entered into between the Shareholder and the
Company.

	1.2	 	The references to any PRC Law herein shall be deemed

	 	(1)	 	to include the references to the amendments, changes, supplements and reenactments of
such law, irrespective of whether they take effect before or after the formation of this
Agreement; and
	 
	 	(2)	 	to include the references to other decisions, notices or regulations enacted in
accordance therewith or effective as a result thereof.

	1.3	 	Except as otherwise stated in the context herein, all references to an Article, clause, item
or paragraph shall refer to the relevant part of this Agreement.

Article 2 – Grant of Call Option

	 	 	The Shareholder agrees to grant the Company or the Designee(s) hereby irrevocably and without
any additional conditions with a Call Option, under which the Company or the Designee(s) shall
have the right to require the Shareholder to transfer the Option Equity to the Company or the
Designee(s) in such method as set out herein and as permitted by PRC Law. The Company or the
Designee(s) also agrees to accept such Call Option.

Article 3 – Method of Exercise of Option

	3.1	 	To the extent permitted by PRC Law, the Company shall have the sole discretion to determine
the specific time, method and times of its Exercise of Option.
	 
	3.2	 	If the then PRC Law permits the Company or the Designee(s) to hold all the equity interest of
SH Quanshi, then the Company shall have the right to elect to exercise all of its Call Option
at once, where the Company or the Designee(s) shall accept all the Option Equity from the
Shareholder at once; if the then PRC Law permits the Company or the Designee(s) to hold only
part of the equity in SH Quanshi, the Company shall have the right to determine the amount of
the Transferred Equity within the extent not exceeding the upper limit of shareholding ratio
set out by the then PRC Law (hereinafter the “Shareholding Limit”), where the Company or the
Designee(s) shall accept such amount of the Transferred Equity from the Shareholder. In the
latter case, the Company shall have the right to exercise its Call Option at multiple times in
line with the gradual deregulation of PRC Law on the permitted Shareholding Limit, with a view
to ultimately acquiring all the Option Equity.

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	3.3	 	At each Exercise of Option by the Company, the Shareholder shall transfer their respective
equity in the SH Quanshi to the Company or the Designee(s) respectively in accordance with the
amount required by the Company. The Company or the Designee(s) shall pay the Transfer Price to
the Shareholder for the Transferred Equity accepted in each Exercise of Option.
	 
	3.4	 	In each Exercise of Option, the Company may accept the Transferred Equity by itself or
designate any third party to accept all or part of the Transferred Equity.
	 
	3.5	 	On deciding each Exercise of Option, the Company shall issue to the Shareholder a notice for
exercising the Call Option (hereinafter the “Exercise Notice”, the form of which is set out as
Appendix II hereto). The Shareholder shall, upon receipt of the Exercise Notice, forthwith
transfer all the Transferred Equity in accordance with the Exercise Notice to the Company or
the Designee(s) in such method as described in Article 3.3 herein.
	 
	3.6	 	The Shareholder hereby undertakes and guarantees that once the company issues the Exercise
Notice:

	 	(1)	 	it shall immediately hold or request to hold a shareholders’ meeting and adopt a
resolution through the shareholders’ meeting, and take all other necessary actions to
agree to the transfer of all the Call Option to the Company or the Designee(s) at the
Transfer Price;
	 
	 	(2)	 	it shall immediately enter into an equity transfer agreement with the Company or
the Designee(s) for transfer of all the Transferred Equity to the Company or the
Designee(s) at the Transfer Price; and
	 
	 	(3)	 	it shall provide the Company with necessary support (including providing and
executing all the relevant legal documents, processing all the procedures for government
approvals and registrations and bearing all the relevant obligations) in accordance with
the requirements of the Company and of the laws and regulations, in order that the
Company or the Designee(s) may take all the Transferred Equity free from any legal
defect.

	3.7	 	At the meantime of this Agreement, the Shareholder shall respectively enter into a power of
attorney (hereinafter the “Power of Attorney”, the form of which is set out as Appendix III
hereto), authorizing in writing any person designated by the Company to, on behalf of the
Shareholder, to enter into any and all of the legal documents in accordance with this
Agreement so as to ensure that the Company or the Designee(s) takes all the Transferred Equity
free from any legal defect. Such Power of Attorney shall be delivered for custody by the
Company and the Company may, at any time if necessary, require the Shareholder to enter into

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	 	 	multiple copies of the Power of Attorney respectively and deliver the same to the relevant
government department.

	3.8	 	The Transferred Price obtained by the Shareholder upon each Exercise of Option shall be first
used to repay the relevant loans of the Shareholder under the Loan Agreements.

Article 4 – Representations and Warranties

	4.1	 	The Shareholder hereby represents and warrants as follows:

	 	4.1.1	 	The Shareholder is a PRC citizen with full capacity, with full and independent
legal status and legal capacity to execute, deliver and perform this Agreement, and may
act independently as a litigant party.
	 
	 	4.1.2	 	The Shareholder has full power and authorization to execute and deliver this
Agreement and all the other documents to be entered into by it in relation to the
transaction referred to herein, and it has the full power and authorization to complete
the transaction referred to herein. This Agreement is executed and delivered by Personal
Shareholders legally and properly. This Agreement constitutes the legal and binding
obligations on Personal Shareholders and is enforceable on it in accordance with its
terms and conditions.
	 
	 	4.1.3	 	The Shareholder is the enrolled legal owner of the Option Equity as of the
effective date of this Agreement, and except the rights created by this Agreement, the
Shareholder shall cause the shareholders’ meeting not to approve any legal or beneficial
rights or interest of the equity to be deal by sale, transfer, mortgage or other ways or
to permit any other guarantees set up upon it. In accordance with this Agreement, the
Company or the Designee(s) may, after the Exercise of Option, obtain the proper title to
the Transferred Equity free from any lien, pledge, claim and other encumbrances and third
party rights.
	 
	 	4.1.4	 	SH Quanshi shall obtain complete Business Permits as necessary for its operations
upon this Agreement taking effect, and SH Quanshi shall have sufficient rights and
qualifications to operate within PRC the businesses of advertising and other business
relating to its current business structure. SH Quanshi has conducted its business legally
since its establishment and has not incurred any cases which violate or may violate the
regulations and requirements set forth by the departments of commerce and industry, tax,
culture, news, quality technology supervision, labor and social security and other
governmental departments or any disputes in respect of breach of contract.

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	4.2	 	The Company hereby represents and warrants as follows:

	 	4.2.1	 	The Company is a limited liability corporation duly registered and validly
existing under PRC Law, with independent status as a legal person; The Company has full
and independent legal status and legal capacity to execute, deliver and perform this
Agreement, and may act independently as a subject of actions.
	 
	 	4.2.2	 	The Company has full power and authorization to execute and deliver this Agreement
and all the other documents to be entered into by it in relation to the transaction
referred to herein, and it has the full power and authorization to complete the
transaction referred to herein.

Article 5 – Undertakings by the Shareholders

The Shareholder hereby undertakes:

	5.1	 	Within the term of this Agreement that he must take all necessary measures to ensure that SH
Quanshi is able to obtain all the Business Permits necessary for its business in a timely
manner and all the Business Permits remain in effect at any time.
	 
	5.2	 	The Shareholder hereby undertakes within the term of this Agreement that without the prior
written consent by the Company,

	 	5.2.1	 	the Shareholder shall not transfer or otherwise dispose of any Option Equity or
create any encumbrance or other third party rights on any Option Equity;
	 
	 	5.2.2	 	it shall not increase or decrease the SH Quanshi Registered Capital;
	 
	 	5.2.3	 	it shall not dispose of or cause the management of SH Quanshi to dispose of any
of the SH Quanshi Assets (except as occurs during the arm’s length operations);
	 
	 	5.2.4	 	it shall not terminate or cause the management of SH Quanshi to terminate any
Material Agreements entered into by SH Quanshi, or enter into any other Material
Agreements in conflict with the existing Material Agreements;
	 
	 	5.2.5	 	it shall not appoint or cancel or replace any executive directors or members of
board of directors (if any), supervisors or any other management personnel of SH Quanshi
to be appointed or dismissed by the Shareholders;

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	 	5.2.6	 	it shall not announce the distribution of or in practice release any
distributable profit, dividend or share profit or cast affirmative votes regarding the
aforesaid distribution or release;
	 
	 	5.2.7	 	to maintain the ownership of SH Quanshi to all its assets, it shall sign all the
necessary or appropriate documents, take all the necessary or appropriate actions, file
any necessary or appropriate claim or make any necessary and appropriate defence to all
the claims;
	 
	 	5.2.8	 	it shall not amend the Articles of Association of SH Quanshi;
	 
	 	5.2.9	 	it shall ensure that SH Quanshi shall not lend or borrow any money, or provide
guarantee or engage in security activities in any other forms, or bear any substantial
obligations other than on the arm’s length basis.

	5.3	 	The Shareholder hereby undertakes that it must make all its efforts during the term of this
Agreement to develop the business of SH Quanshi, and ensure that the operations of SH Quanshi
are legal and in compliance with the regulations and that it shall not engage in any actions
or omissions which might harm the SH Quanshi Assets or its credit standing or affect the
validity of the Business Permits of SH Quanshi.

Article 6 — Confidentiality

	6.1	 	Notwithstanding the termination of this Agreement, the Shareholder shall be obligated to keep
in confidence the following information (hereinafter collectively the “Confidential
Information”):

	 	(i)	 	information on the execution, performance and the contents of this Agreement;
	 
	 	(ii)	 	the commercial secret, proprietary information and customer information in relation
to the Company known to or received by it as the result of execution and performance of
this Agreement; and
	 
	 	(iii)	 	the commercial secrets, proprietary information and customer information in
relation to SH Quanshi known to or received by it as the shareholder of SH Quanshi.

	 	 	The Shareholder may use such Confidential Information only for the purpose of performing its
obligations under this Agreement. The Shareholder shall not disclose the above Confidential
Information to any third parties without the written consent from the Company, or they shall
bear the default liability and indemnify the losses.

	6.2	 	Upon termination of this Agreement, the Shareholder shall, upon demand by the

8

 

	 	 	Company, return, destroy or otherwise dispose of all the documents, materials or software
containing the Confidential Information and suspend using such Confidential Information.

	6.3	 	Notwithstanding any other provisions herein, the validity of this Article shall not be
affected by the suspension or termination of this Agreement.

Article 7 – Term of Agreement

	7.1	 	This Agreement shall take effect as of the date of formal execution by the Parties and
terminate when all the Option Equity is legally transferred under the name of the Company and
the Designee(s) in accordance with the provisions of this Agreement.

Article 8 — Notice

	8.1	 	Any notice, request, demand and other correspondences made as required by or in accordance
with this Agreement shall be made in writing and delivered to the relevant Party.

	8.2	 	The abovementioned notice or other correspondences shall be deemed to have been delivered
when it is transmitted if transmitted by facsimile; it shall be deemed to have been delivered
when it is delivered if delivered in person; it shall be deemed to have been delivered five
(5) days after posting the same if posted by mail.

Article 9 – Liability for Breach of Contract

	9.1	 	The Parties agree and confirm that, if the Shareholder (hereinafter the “Defaulting Party”)
breaches substantially any of the provisions herein or omits substantially to perform any of
the obligations hereunder, or fails substantially to perform any of the obligations under this
Agreement, such a breach or omission shall constitute a default under this Agreement
(hereinafter a “Default”), then the Company shall have the right to require the Defaulting
Party to rectify such Default or take remedial measures within a reasonable period. If the
Defaulting Party fails to rectify such Default or take remedial measures within such
reasonable period or within ten (10) days of non-defaulting Party’s notifying the Defaulting
Party in writing and requiring it to rectify the Default, then non-defaulting Party shall have
the right at its own discretion to select any of the following remedial measures:

(1) to terminate this Agreement and require the Defaulting Party to indemnify it for all
the damage; or

(2) mandatory performance of the obligations of the Defaulting Party

9

 

	 	 	hereunder and require the Defaulting Party to indemnify it for all the damage.
	 
	9.2	 	The Parties agree and confirm that in no circumstances shall the Shareholder request the
termination of this Agreement for any reason, except otherwise stipulated by law or this
Agreement.
	 
	9.3	 	The rights and relieves prescribed in this Agreement are accumulative and don’t exclude
any other rights or relieves ruled by the laws.
	 
	9.4	 	Notwithstanding any other provisions herein, the validity of this Article shall stand
disregarding the suspension or termination of this Agreement.

Article 10 — Miscellaneous

	10.1	 	This Agreement shall be prepared in the Chinese language in 2 original copies, with each
involved Party holding one (1) copy hereof.
	 
	10.2	 	The formation, validity, execution, amendment, interpretation and termination of this
Agreement shall be subject to PRC Law.
	 
	10.3	 	Any disputes arising hereunder and in connection herewith shall be settled through
consultations among the Parties to the dispute, and if the Parties to the dispute cannot reach
an agreement regarding such disputes within [thirty (30)] days of their occurrence, such
disputes shall be submitted to China International Economic and Trade Arbitration Commission
Shanghai Branch for arbitration in Shanghai in accordance with the arbitration rules of such
Commission, and the arbitration award shall be final and binding on all Parties to the
dispute.
	 
	10.4	 	Any rights, powers and remedies empowered to any Party by any provisions herein shall not
preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws
and other provisions under this Agreement, and the exercise of its rights, powers and remedies
by a Party shall not preclude its exercise of its other rights, powers and remedies by such
Party.
	 
	10.5	 	Any failure or delay by a Party in exercising any of its rights, powers and remedies
hereunder or in accordance with laws (hereinafter the “Party’s Rights”) shall not lead to a
waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights
shall not preclude such Party from exercising such rights in any other way and exercising the
remaining part of the Party’s Rights.
	 
	10.6	 	The titles of the Articles contained herein shall be for reference only, and in no
circumstances shall such titles be used in or affect the interpretation of the provisions
hereof.

10

 

	10.7	 	Each provision contained herein shall be severable and independent from each of other
provisions, and if at any time any one or more articles herein become invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining provisions herein
shall not be affected as a result thereof.
	 
	10.8	 	Upon execution, this Agreement shall substitute any other legal documents previously executed
by the Parties on the same subject. Any amendments or supplements to this Agreement shall be
made in writing and shall take effect only when properly signed by the Parties to this
Agreement.
	 
	10.9	 	Without prior written consent by the Company, the Shareholder shall not transfer to any third
party any of its right and/or obligation under this Agreement, the Company shall have the
right to transfer to any third party designated by it any of its right and/or obligation under
this Agreement after notice to the Shareholder.
	 
	10.10	 	This Agreement shall be binding on the legal successors of the Parties.

[The remainder of this page is left blank]

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IN WITNESS HEREOF, the following Parties have caused this Call Option Agreement to be executed as
of the date and in the place first here above mentioned.

Hailong Zhu

/s/ Hailong Zhu

New Allyes Information Technology (Shanghai) Co., Ltd.

Signature by Authorized Representative:

/s/ Jiangang Wang

Shanghai Quanshi Advertisement Co., Ltd.

Signature by Authorized Representative:

/s/ Hailong Zhu

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Appendix I:

Section I-Basic Information of SH Quanshi

	 	 	 	 	 
	Company Name

	 	 	Shanghai Quanshi Advertisement Co., Ltd

	 
	 	 	 	 
	Registered Capital (RMB)

	 	 	1,000,000	 
	 
	 	 	 	 
	Equity Structure
	 	 	 	 

	 	 	 	 	 	 	 	 	 
	Name of the Shareholder

	 	Capital Contribution (RMB)
	 	Equity Structure

	Suyang Zhang

	 	 	500,000	 	 	 	50	%
	 
	 	 	 	 	 	 	 	 
	Hailong Zhu

	 	 	500,000	 	 	 	50	%
	 
	 	 	 	 	 	 	 	 
	Total

	 	 	1,000,000	 	 	 	100	%

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Appendix II:

Format of the Option Exercise Notice

To: [Hailong Zhu]

As our company and you signed an Call Option Agreement as of May 17, 2005 (hereinafter the “Option
Agreement”), and reached an agreement that you shall transfer the equity you hold in Shanghai
Quanshi Advertisement Co., Ltd. (hereinafter the “SH Quanshi”) to our company or any third parties
designated by our company on demand of our company to the extent as permitted by PRC Law and
regulations,

Therefore, our company hereby gives this Notice to you as follows:

Our company hereby requires to exercise the Call Option under the Option Agreement and [our
company]/[name of company/individual] designated by our company shall accept the equity you hold
accounting for 50% of SH Quanshi Registered Capital (hereinafter the “Proposed Accepted Equity”).
You is required to forthwith transfer all the Proposed Accepted Equity to [our company]/[name of
designated company/individual] upon receipt of this Notice in accordance with the agreed terms in
the Option Agreement.

Best regards,

New Allyes Information Technology (Shanghai) Co., Ltd..

(Chop)

Authorized Representative:                     

Date:                     

14

 

Appendix III:

Form of the Power of Attorney

I, Hailong Zhu, hereby irrevocably entrust                                          [with his/her identity card number of
                                        ] , as the authorized representative of me/the company, to sign the Equity
Transfer Agreement and other relevant legal documents between me and                      regarding the
Equity Transfer of Shanghai Quanshi Advertisement Co., Ltd.

	 	 	 	 	 
	 

	 	Signature:
                          	 	 
	 

	 	Date:                                    
	 	 
 
	 

	 	 	 	 
 

15

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