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Unassociated Document

    MEASUREMENT
      SPECIALTIES, INC.

    2008
      EQUITY INCENTIVE PLAN

    

    Section
      1. Purpose

     

    The
      purpose of the Measurement Specialties, Inc. 2008 Equity Incentive Plan (the
      “Plan”) is to enable Measurement Specialties, Inc. (the “Company”) to attract,
      retain, motivate and provide additional incentives to certain directors,
      officers, employees, consultants and advisors, whose contributions are essential
      to the growth and success of the Company, by enabling them to participate in
      the
      long-term growth of the Company through stock ownership.

     

    Section
      2. Definitions

     

    As
      used in the Plan:

    

    “Award”
      means a grant of an Option or Restricted Stock Units under the terms of this
      Plan.

    

    “Award
      Agreement” means the agreement between the Company and a Participant pursuant to
      which an Award is granted, and which specifies the terms and conditions of
      the
      Award.

     

    "Board"
      means the Board of Directors of the Company.

     

    "Cause"
      means the termination of a Participant's employment, consulting or advisory
      relationship with the Company or the termination of a Participant's membership
      on the Board because of the occurrence of any of the following events, as
      determined by the Board:

     

    (i) the
      Participant materially breaches or fails to perform any of his obligations
      as an
      employee or director of the Company;

     

    (ii) the
      Participant conducts his duties with respect to the Company in a manner that
      is
      improper or negligent; or

     

    (iii) the
      Participant fails to perform his obligations faithfully as provided in any
      employment agreement executed between the Company and the Participant or is
      otherwise terminated for “cause” as “cause” may be defined in such agreement,
      engages in habitual drunkenness, drug abuse, or commits a felony, fraud or
      willful misconduct which has resulted, or is likely to result, in material
      damage to the Company, or as the Board in its sole discretion may
      determine.

    

    “Change
      in Control” means any of the following events:

     

    (i) a
      change
      during any 12-month period in the ownership of the capital stock of the Company,
      whereby a corporation, partnership, other entity, person, or group acting in
      concert, as described in Section 14(d)(2) of the Exchange Act holds or acquires,
      directly or indirectly, beneficial ownership (within the meaning of Rule 13d-3
      under the Exchange Act) of a number of shares of capital stock of the Company,
      as the case may be, which constitutes more than fifty percent (50%) of the
      combined voting power of the Company’s then outstanding capital stock entitled
      to vote generally in the election of directors; or 

     

    (ii) the
      consummation of any merger, consolidation, share exchange or reorganization
      plan
      involving the Company, as the case may be, in which the Company, as applicable,
      is not the surviving entity, or the sale, lease, transfer, conveyance or other
      disposition, in one or a series of related transactions, of more than 50% of
      the
      combined assets of the Company to any corporation, partnership, other entity,
      person, or group acting in concert, as described in Section 14(d)(2) of the
      Exchange Act, other than to a wholly-owned subsidiary of the Company or to
      any
“affiliate” (as defined in Rule 12b-2 under the Exchange Act) of any of the
      foregoing; 

     

    
      
        
        

      

      
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    provided,
      that the following events shall not constitute a Change in Control:

     

    (i) the
      acquisition of shares of capital stock of the Company by the Company or any
      of
      their subsidiaries or “affiliates” (as defined in Rule 12b-2 under the Exchange
      Act);

     

    (ii) the
      acquisition of shares of capital stock of the Company by any employee benefit
      plan (or trust) sponsored or maintained by the Company; 

     

    (iii) any
      transfer of shares of capital stock by gift, devise or descent by a stockholder
      to a member of such stockholder’s family or to a trust established or maintained
      for the benefit of a stockholder or any member of his family; or

     

    (iv) the
      acquisition of shares of capital stock by any officer or employee of the Company
      pursuant to any stock option plan established by the Company.

     

    

    "Code"
      means the Internal Revenue Code of 1986, as amended, and the rules and
      regulations promulgated thereunder.

     

    "Committee"
      means the Compensation Committee of the Board (or any successor committee of
      the
      Board) or such other committee that is responsible for making recommendations
      to
      the Board (or for exercising authority delegated to it by the Board pursuant
      to
      Section 3 of the Plan, if any) with respect to the grant and terms of Awards
      under the Plan; provided, however, that (i) with respect to Awards to any
      employees who are officers of the Company or members of the Board for purposes
      of Section 16 of the Exchange Act, Committee means all of the members of the
      Compensation Committee who are "non-employee directors" within the meaning
      of
      Rule 16b-3 adopted under the Exchange Act, or any successor rule, (ii) with
      respect to Awards to any employees who are officers of the Company or members
      of
      the Board for purposes of Section 16 and who are intended to satisfy the
      requirements for "performance based compensation" within the meaning of
      Section 162(m)(4)(C) of the Code, the regulations promulgated thereunder,
      and any successors thereto, Committee means all of the members of the
      Compensation Committee who are "outside directors" within the meaning of
      Section 162(m) of the Code, and (iii) with respect to all Awards, the
      Committee shall be comprised of "independent" directors to the extent required
      by the listing requirements or rules of any stock exchange or quotation system
      on which the Common Stock may be listed or quoted.

      

    "Company"
      means Measurement Specialties, Inc., a New Jersey corporation, and any present
      or future parent or subsidiary corporations (as defined in Section 424 of the
      Code) or any successor to such corporations.

     

    "Common
      Stock" or "Stock" means the common stock, no par value per share, of the
      Company.

     

    "Disability"
      means permanent and total disability as defined in Section 22(e)(3) of the
      Code
      or, in the case of any employee with a written employment agreement,
“Disability” shall have the meaning ascribed to such term, if so defined in such
      written employment agreement.

     

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

     

    "Fair
      Market Value", with respect to Common Stock, shall be determined as
      follows:

     

    (i) If
      the Common Stock is at the time listed on any stock exchange or quotation
      system, the Fair Market Value shall be the closing selling price per share
      of
      Common Stock on the date in question on the stock exchange or determined by
      the
      Board to be the primary market for the Common Stock, as such price is officially
      reported on such exchange or system. If there is no closing selling price for
      the Common Stock on the date in question, then the Fair Market Value shall
      be
      the closing selling price on the last preceding date for which such quotation
      exists.

     

    
      
        
        

      

      
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    (ii) If
      the Common Stock is at the time traded on the Nasdaq Global Market, then the
      Fair Market Value shall be the closing selling price per share of Common Stock
      on the date in question as such price is quoted on the Nasdaq Global Market
      or
      successor system. If there is no closing selling price for the Common Stock
      on
      the date in question, then the Fair Market Value shall be the closing selling
      price on the last preceding date for which such quotation exists.

     

    (iii) If
      the Common Stock is not listed or traded on any stock exchange, quotation system
      or the Nasdaq System, the Fair Market Value shall be determined using a
      reasonable valuation method consistent with the final regulations issued under
      Section 409A of the Code.

     

    "Incentive
      Stock Option" means an option to purchase shares of Common Stock awarded to
      a
      Participant under the Plan which is designated as such or is otherwise intended
      to meet the requirements of Section 422 of the Code or any successor
      provision.

     

    "Non-Employee
      Director" means a member of the Board who is not an employee of the
      Company.

     

    "Non-Qualified
      Stock Option" means an option to purchase shares of Common Stock granted to
      a
      Participant under the Plan which is designated as such or is otherwise not
      intended to be an Incentive Stock Option.

      

    "Option"
      means an Incentive Stock Option or a Non-Qualified Stock Option.

     

    "Participant"
      means an eligible person selected by the Board to receive an Award under the
      Plan.

     

    "Plan"
      means the Measurement Specialties, Inc. 2008 Equity Incentive Plan.

    

    “Restricted
      Stock Units” means an Award granted hereunder and stated with reference to a
      specified number of shares of Common Stock, which entitles the Participant
      to
      receive shares of Common Stock or cash (as determined by the Board), upon the
      lapse of a Restriction Period and/or subject to such other conditions and
      criteria (including the attainment of Performance Goals) as the Board may
      determine at the time of the grant of the Award.

    

    “Restriction
      Period” means the period during which an Award is subject to forfeiture. A
      Restriction Period shall not lapse until all conditions imposed under the
      particular Award Agreement, and/or this Plan, have been fully
      satisfied.

     

    "Retirement"
      means termination of employment in accordance with the retirement provisions
      of
      any retirement plan maintained by the Company.

     

    Section
      3. Administration

    

    (a) The
      Plan shall be administered by the Board. Among other things, the Board shall
      have authority, subject to the terms of the Plan including, without limitation,
      the provisions governing participation in the Plan, to grant Awards, to
      determine the individuals to whom and the time or times at which Awards may
      be
      granted and to determine the terms and conditions of any Award granted
      hereunder. Subject to paragraph (d) of this Section 3, the Board may solicit
      the
      recommendations of the Committee with respect to any of the foregoing, but
      shall
      not be bound to follow any such recommendations.

     

    (b) Subject
      to the provisions of this Plan, the Board shall have authority to adopt, alter
      and repeal such administrative rules, guidelines and practices governing the
      operation of the Plan as it shall from time to time consider advisable, to
      interpret the provisions of the Plan and any Award and to decide all disputes
      arising in connection with the Plan. The Board's decisions and interpretations
      shall be final and binding. Any action of the Board with respect to the
      administration of the Plan shall be taken pursuant to a majority vote or by
      the
      unanimous written consent of its members.

     

    
      
        
        

      

      
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    (c) The
      Board may employ such legal counsel, consultants and agents as it may deem
      desirable for the administration of the Plan, and may rely upon any opinion
      received from any such counsel or consultant and any computation received from
      any such consultant or agent. The Board shall keep minutes of its actions under
      the Plan.

    

    (d)
      The
      Board
      may condition the payment of any Award or the lapse of any Restriction Period
      (or any combination thereof) upon the achievement of a Performance Goal (defined
      below) that is established by the Board. A “Performance Goal” shall mean an
      objective goal that must be met by the end of the Restriction Period specified
      by the Board based upon one or more of the following as applied to the Company,
      a subsidiary, an affiliate or a business unit thereof: (i) total
      stockholder return, (ii) total stockholder return as compared to total
      return of a publicly available index, (iii) net income, (iv) pretax
      earnings, (v) funds from operations, (vi) earnings before interest
      expense, taxes, depreciation and amortization, (vii) operating margin,
      (viii) earnings per share, (ix) return on equity, capital, assets and/or
      investment, (x) operating earnings, (xi) working capital,
      (xii) ratio of debt to stockholders equity, (xiii) expense reduction
      or containment, (xiv) revenue, or (xv) such other criteria as may be
      determined by the Board in its sole discretion. In addition to the foregoing,
      a
      Performance Goal may be the Participant’s achievement of a specified period of
      service with the Company, its subsidiaries, or its affiliates. The Board shall
      have discretion to determine the specific targets with respect to each of these
      categories of Performance Goals. Before paying an Award or permitting the lapse
      of any Restriction Period on an Award subject to this Section, the Board shall
      certify in writing that the applicable Performance Goal has been satisfied.
      Performance Goals for Awards to officers who are subject to the requirements
      and
      limitations of Section 162(m) of the Code, shall be established not later than
      ninety (90) days after the beginning of the applicable performance period (or
      at
      such other date as may be required or permitted for “performance-based”
compensation under Section 162(m) of the Code), and shall otherwise meet the
      requirements of said Code section, including the requirement that the outcome
      of
      the Performance Goal be substantially uncertain at the time
      established.

     

    (e)
      Subject to any limitations specified in this Plan and to applicable legal
      requirements the Board shall have the authority to delegate all or any portion
      of the authority granted to it under this Section 3 or elsewhere under the
      Plan
      to the Committee or the Chief Executive Officer of the Company. If such
      authority is so delegated by Board, the Committee or the Chief Executive
      Officer, as the case may be, shall have such rights and authority to make
      determinations and administer the Plan as are specified in the delegation of
      authority. To the extent that the Board delegates its authority as provided
      by
      this Section 3(e), all references in the Plan to the Board's authority to
      grant Awards and make determinations with respect thereto shall be deemed to
      include the Committee or the Chief Executive Officer, as the case may
      be.

     

    Section
      4. Eligibility

     

    All
      employees, consultants and advisors of the Company who are from time to time
      responsible for the management, growth and protection of the business of the
      Company, and all directors of the Company, shall be eligible to participate
      in
      the Plan. The Participants under the Plan shall be selected from time to time
      by
      the Board, in its sole discretion, from among those eligible, and the Board
      shall determine in its sole discretion the numbers of shares to be covered
      by
      the Award or Awards granted to each Participant. Options intended to qualify
      as
      Incentive Stock Options shall be granted only to key employees while actually
      employed by the Company. Non-Employee Directors, consultants and advisors shall
      not be entitled to receive Incentive Stock Options under the Plan.

      

    Section
      5. Shares of Stock Available for Awards

     

    (a)
      Subject to adjustment as provided in paragraph (e) below, the total number
      of
      shares of Common Stock available for Awards under the Plan shall be 1,400,000;
      provided that, of such aggregate number of shares, the number of shares of
      Common Stock available for Awards of Restricted Stock Units shall be limited
      to
      450,000. 

    

    
      
        
        

      

      
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    (b)
      The following limits (each an “Annual Award Limit”, and collectively, “Annual
      Award Limits”) shall, subject to adjustment as provided in paragraph (e) below,
      apply to grants of Awards under this Plan:

    

    (i) Options:
      The maximum aggregate number of shares of Common Stock subject to Options which
      may be granted in any one Plan Year to any one Participant shall be
      150,000.

    

    (ii) Restricted
      Stock Units: The maximum aggregate number of shares of Common Stock subject
      to
      Awards of Restricted Stock Units which may be granted in any one Plan Year
      to
      any one Participant shall be the Fair Market Value (determined on the date
      of
      grant) of 75,000 shares of Common Stock.

     

    (c)
      Any shares issued by the Company through the assumption or substitution of
      outstanding grants from an acquired company shall not reduce the shares
      available for Awards under this Plan. Any shares issued hereunder may consist,
      in whole or in part, of authorized and unissued shares or treasury shares.
      If
      any shares subject to any Award granted hereunder are forfeited or such Award
      otherwise terminates or is forfeited, the shares subject to such Award, to
      the
      extent of any such forfeiture or termination, shall again be available for
      Awards under this Plan. 

     

    (d)
      No Option shall be exercisable, no shares of Common Stock shall be issued,
      no
      certificates for shares of Common Stock shall be delivered and no payment shall
      be made under the Plan, except in compliance with all applicable laws. In this
      connection, it is intended generally that Awards granted under this Plan shall
      not constitute “non-qualified deferred compensation” as defined under Section
      409A of the Code. If, however, any Award is, or becomes, subject to any of
      the
      requirements of Section 409A of the Code, such Award, and the applicable Award
      Agreement, shall be interpreted and administered to be consistent with such
      requirements, and the Board shall be entitled, on a unilateral basis, to amend,
      reform, interpret and administer this Plan, such Award and such Award Agreement
      accordingly.

     

    (e) In
      the event that the Board determines, in its sole discretion, that any stock
      dividend, extraordinary cash dividend, creation of a class of equity securities,
      recapitalization, reclassification, reorganization, merger, consolidation,
      stock
      split, spin-off, combination, exchange of shares, warrants or rights offering
      to
      purchase Common Stock at a price substantially below Fair Market Value, or
      other
      similar transaction affects the Common Stock such that an adjustment is required
      in order to preserve the benefits or potential benefits intended to be granted
      under the Plan to Participants, the Board shall have the right to adjust
      equitably any or all of (i) the number of shares of Common Stock in respect
      of
      which Awards may be granted under the Plan to Participants, (ii) the number
      and
      kind of shares subject to outstanding Awards held by Participants, (iii) the
      exercise price with respect to any Awards held by Participants, (iv) the Annual
      Award Limits, (v) the amount and/or type of payment to be received under Awards,
      and, if considered appropriate, the Board may make provision for a cash payment
      with respect to any outstanding Awards held by a Participant, provided that
      the
      number of shares subject to any Award shall always be a whole
      number.

     

    Section
      6. Incentive Stock Options

     

    (a) Subject
      to Federal statutes then applicable and the provisions of the Plan, the Board
      may grant Incentive Stock Options and determine the number of shares to be
      covered by each such Award, the option price therefor, the term of such Award,
      the vesting schedule of such Award, and the other conditions and limitations
      applicable to the exercise of the Award. The terms and conditions of Incentive
      Stock Options shall be subject to and shall comply with Section 422 of the
      Code,
      or any successor provision, and any regulations thereunder. Anything in the
      Plan
      to the contrary notwithstanding, no term of the Plan relating to Incentive
      Stock
      Options shall be interpreted, amended or altered, nor shall any discretion
      or
      authority granted to the Board under the Plan be so exercised, so as to
      disqualify, without the consent of the Participant, any Incentive Stock Option
      granted under the Plan pursuant to Section 422 of the Code. The foregoing
      notwithstanding, any Award that fails to be an ISO shall remain outstanding
      according to its terms and shall be treated by the Company as a Non-Qualified
      Stock Option.

     

    
      
        
        

      

      
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    (b) The
      option price per share of Common Stock purchasable under an Incentive Stock
      Option shall not be less than 100% of the Fair Market Value of the Common Stock
      on the date of grant. If the Participant owns or is deemed to own (by reason
      of
      the attribution rules applicable under Section 424(d) of the Code) more than
      10%
      of the combined voting power of all classes of stock of the Company or any
      subsidiary or parent corporation of the Company and an Incentive Stock Option
      is
      granted to such Participant, the option price shall be not less than 110% of
      Fair Market Value of the Common Stock on the date of grant.

     

    (c) No
      Incentive Stock Option shall be exercisable more than ten (10) years after
      the
      date such option is granted. If a Participant owns or is deemed to own (by
      reason of the attribution rules of Section 424(d) of the Code) more than 10%
      of
      the total combined voting power of all classes of stock of the Company or any
      subsidiary or parent corporation of the Company and an Incentive Stock Option
      is
      granted to such Participant, such Option shall not be exercisable after the
      expiration of five (5) years from the date of grant.

     

    (d) Unless
      otherwise determined by the Board at the time of grant, in the event a
      Participant's employment terminates by reason of Retirement or Disability,
      any
      Incentive Stock Option granted to such Participant which is then outstanding
      may
      be exercised at any time prior to the expiration of the term of such Incentive
      Stock Option or within three (3) months in the case of Retirement and twelve
      (12) months in case of Disability (or such shorter period as the Board shall
      determine at the time of grant) following the Participant's termination of
      employment, whichever period is shorter.

     

    (e) Unless
      otherwise determined by the Board at the time of grant, in the event a
      Participant's employment is terminated by reason of death, any Incentive Stock
      Option granted to such Participant which is then outstanding may be exercised
      by
      the Participant's legal representative at any time prior to the expiration
      date
      of the term of the Incentive Stock Option or within twelve (12) months (or
      such
      shorter period as the Board shall determine at the time of grant) following
      the
      Participant's termination of employment, whichever period is
      shorter.

     

    (f) Unless
      otherwise determined by the Board at or after the time of grant, in the event
      a
      Participant's employment shall terminate for Cause, any Incentive Stock Option
      granted to such Participant which is then outstanding shall be canceled and
      shall terminate.

     

    (g) Unless
      otherwise determined by the Board at or after the time of grant, in the event
      that a Participant's employment shall terminate for any reason other than death,
      Disability, Retirement or Cause, any Incentive Stock Option granted to such
      Participant which is then outstanding may be exercised as set forth in the
      applicable Award Agreement. In the absence of a specific term, any Incentive
      Stock Option outstanding upon such termination of employment may be exercised
      at
      any time prior to the expiration of the term of such option or within three
      months following Participant's termination of employment, whichever period
      is
      shorter.

     

    (h) The
      aggregate Fair Market Value of Common Shares first becoming subject to exercise
      as an Incentive Stock Option by a Participant who is an employee during any
      given calendar year shall not exceed the sum of One Hundred Thousand Dollars
      ($100,000.00). Such aggregate Fair market Value shall be determined as of the
      date such Option is granted.

     

    Section
      7. Non-Qualified Stock Options

     

    (a) Subject
      to the provisions of the Plan, the Board may grant Non-Qualified Stock Options
      and determine the number of shares to be covered by each such Option, the option
      price therefor, the term of such Option, the vesting schedule and the other
      conditions and limitations applicable to the exercise of the Non-Qualified
      Stock
      Options.

    

    
      
        
        

      

      
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    (b) The
      option price per share of Common Stock purchasable under a Non-Qualified Stock
      Option shall not be less than 100% of the Fair Market Value of the Common Stock
      on the date of grant.

     

    (c) No
      Non-Qualified Stock Option shall be exercisable more than ten (10) years after
      the date such option is granted.

     

    (d) Unless
      otherwise determined by the Board at the time of grant, in the event a
      Participant's employment or engagement by the Company or membership on the
      Board
      terminates by reason of Retirement or Disability, any Non-Qualified Stock Option
      granted to such Participant which is then outstanding may be exercised at any
      time prior to the expiration of the term of such Non-Qualified Stock Option
      or
      within three (3) months in the case of Retirement and twelve (12) months in
      case
      of Disability following the Participant's termination of employment, engagement,
      or service, whichever period is shorter.

     

    (e) Unless
      otherwise determined by the Board at the time of grant, in the event a
      Participant's employment or engagement by the Company or membership on the
      Board
      is terminated by reason of death, any Non-Qualified Stock Option granted to
      such
      Participant which is then outstanding may be exercised by the Participant's
      legal representative at any time prior to the expiration date of the term of
      the
      Non-Qualified Stock Option or within twelve (12) months following the
      Participant's termination of employment, whichever period is
      shorter.

     

    (f) Unless
      otherwise determined by the Board at or after the time of grant, in the event
      a
      Participant's employment or engagement by the Company or membership on the
      Board
      shall terminate for Cause, any Non-Qualified Stock Option granted to such
      Participant which is then outstanding shall be canceled and shall
      terminate.

     

    (g) Unless
      otherwise determined by the Board at or after the time of grant, in the event
      a
      Participant's employment or engagement by the Company or membership on the
      Board
      shall terminate for any reason other than death, Disability, Retirement or
      Cause, any Non-Qualified Stock Option granted to such Participant which is
      then
      outstanding may be exercised at any time prior to the expiration of the term
      of
      such Option or within three (3) months following Participant's termination,
      whichever period is shorter.

     

    Section
      8. Restricted Stock Units

     

    (a)
      Subject to the provisions of the Plan, the Board may grant Awards of Restricted
      Stock Units and determine the number of shares to be covered by each such Award,
      the Restriction Period, the applicable Performance Goals, whether the Award
      is
      payable in cash or shares of Common Stock, and other conditions and limitations
      applicable to such Awards.

     

    (b)
      Unless otherwise provided in the applicable Award Agreement, during the
      Restriction Period, the Participant shall not have any rights as a shareholder
      with respect to any shares of Common Stock underlying the Restricted Stock
      Units.

     

    (c)
      The Board may condition the expiration of the Restriction Period upon: (i)
      the
      Participant’s continued service over a period of time with the Company, its
      subsidiaries or its affiliates, (ii) the achievement of any other Performance
      Goals set by the Board, or (iii) any combination of the above conditions, as
      specified in the Award Agreement. If the specified conditions are not attained,
      the Participant shall forfeit the Award, or portion of the Award with respect
      to
      which those conditions are not attained, and the Award (including the underlying
      Common Stock) shall be forfeited. Notwithstanding any provision contained herein
      to the contrary, the Board, in its sole discretion, may grant Restricted Stock
      Units that are not subject to any Restriction Period.

    

    (d)
      At the end of the Restriction Period, if all applicable conditions have been
      satisfied, the Participant shall be entitled to receive a share of Common Stock
      for each share underlying the Restricted Stock Unit Award that is then free
      from
      restriction, or cash equal to the Fair Market Value of such shares of Common
      Stock, and such shares or cash shall be delivered to the Participant (or, where
      appropriate, the Participant's legal representative). The Board may, in its
      sole
      discretion, accelerate the vesting and delivery of Restricted Stock Units under
      circumstances determined by the Board to be appropriate.

     

    
      
        
        

      

      
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    (e)
      At the time of grant or upon the lapse of the Restriction Period of an Award
      of
      Restricted Stock Units, the Board shall determine the consideration permissible
      for the payment of the purchase price, if any, of the Award of Restricted Stock
      Units. The purchase price per share of Common Stock acquired pursuant to the
      Award of Restricted Stock Units shall be paid in one of the following ways:
      (i)
      in cash at the time of purchase; (ii) at the discretion of the Board, and to
      the
      extent legally permissible, according to a deferred payment or other similar
      arrangement with the Participant; (iii) by services rendered or to be rendered
      to the Company; or (iv) in any other form of legal consideration that may be
      legally permissible and acceptable to the Board in its sole
      discretion.

    

    (f)
      The applicable Award Agreement shall specify the right, if any, of a Participant
      to receive a distribution of the Restricted Stock Unit Award as a result of,
      or
      following, the Participant’s termination of employment or engagement by the
      Company or membership on the Board.

    

    Section
      9. Change
      in Control

    

    (a)
      In
      the event of a Change in Control, the Board may, on a Participant-by-Participant
      basis or on a broader Plan basis, take such action as the Board, in its sole
      discretion determines with respect to outstanding Awards. Such action by the
      Committee may include, without limitation, any one or more of the following:
      

     

    (i) accelerate
      the vesting of outstanding Awards issued under the Plan that remain
      unvested;

     

    (ii) fully
      vest and/or accelerate the Restriction Period of any Awards;

     

    (iii) terminate
      or cancel Awards in exchange for cash payments and/or provide limited
      opportunities to exercise such Awards prior to the effectiveness of such
      termination or cancellation;

     

    (iv) require
      that Awards be assumed by the successor entity, or that awards for shares or
      other interests in the successor entity having equivalent value be substituted
      for such Awards; or

     

    (v) take
      such
      other action as the Board shall determine to be reasonable under the
      circumstances in order to retain the original intent of the Awards.

     

    The
      application of the foregoing provisions shall be determined by the Board in
      its
      sole discretion. Any adjustment may provide for the elimination of fractional
      shares of Common Stock in exchange for a cash payment equal to the Fair Market
      Value of the eliminated fractional shares of Common Stock. Notwithstanding
      the
      foregoing provisions, the time for payment of any Award shall not be
      accelerated, and the exercisability of an Award shall not be extended to the
      extent such acceleration or extension would be contrary to the requirements
      of
      Section 409A of the Code, or result in the imposition of taxation and/or
      penalties under Section 409A of the Code.

     

    (b) The
      judgment of the Board with respect to any matter referred to in this Section
      9
      shall be conclusive and binding upon each Participant without the need for
      any
      amendment to the Plan.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

    Section
      10. General Provisions Applicable to Awards

    

    (a) Each
      Award under the Plan shall be evidenced by an Award Agreement delivered to
      the
      Participant specifying the terms and conditions thereof and containing such
      other terms and conditions not inconsistent with the provisions of the Plan
      as
      the Board considers necessary or advisable to achieve the purposes of the Plan
      and/or to comply with applicable tax and regulatory laws and accounting
      principles. For purposes of Plan interpretation the terms and conditions
      contained in any Award Agreement shall be deemed to have been determined by
      the
      Board at the time of grant.

      

    (b) Each
      Award may be granted alone, in addition to or in relation to any other Award.
      The terms of each Award need not be identical, and the Board need not treat
      Participants uniformly. Except as otherwise provided by the Plan or a particular
      Award, any determination with respect to an Award may be made by the Board
      at
      the time of grant or at any time thereafter.

     

    (c) The
      Board shall determine whether Awards are settled in whole or in part in cash,
      Common Stock, other securities of the Company, or other property, and may,
      in
      its discretion, permit “cashless exercises” and “net exercises” of Options
      pursuant to such procedures as may be established by the Board.

     

    (d) No
      shares shall be delivered pursuant to any exercise of an Option until payment
      in
      full of the option price therefor is received by the Company. Such payment
      may
      be made in whole or in part in cash or by certified or bank check or, to the
      extent permitted by the Board at or after the grant of the Option, (i) by means
      of a net exercise pursuant to procedures established by the Board, or (ii)
      by
      delivery of shares of Common Stock owned by the Participant valued at their
      Fair
      Market Value on the date of delivery, or (iii) such other lawful consideration
      as the Board may in its sole discretion determine.

     

    (e) No
      Award shall be transferable by the Participant otherwise than (to the extent
      permitted under the applicable Award Agreement) by will or by the laws of
      descent and distribution, and all Awards shall be exercisable during the
      Participant's lifetime only by the Participant or the Participant's duly
      appointed guardian or personal representative.

     

    (f) The
      Board may at any time accelerate the vesting and exercisability or distribution
      of all or any portion of any Award, provided that such acceleration does not
      violate the provisions of Section 409A of the Code, or result in the imposition
      of any taxation and/or penalties under Section 409A of the Code.

     

    (g) The
      Participant shall pay to the Company, or make provision satisfactory to the
      Board for payment of, any taxes required by law to be withheld in respect of
      Awards under the Plan no later than the date of the event creating the tax
      liability. In the Board's sole discretion, a Participant may elect to have
      such
      tax obligations paid, in whole or in part, in shares of Common Stock, including
      shares retained from the Award creating the tax obligation. For withholding
      tax
      purposes, the value of the shares of Common Stock shall be the Fair Market
      Value
      on the date the withholding obligation is incurred. The Company may, to the
      extent permitted by law, deduct any such tax obligations from any payment of
      any
      kind otherwise due to the Participant.

     

    (h) For
      purposes of the Plan, the following events shall not be deemed a termination
      of
      employment of a Participant:

     

    (i) a
      transfer to the employment of the Company from a subsidiary or from the Company
      to a subsidiary, or from one subsidiary to another;

     

    (ii) an
      approved leave of absence for military service or sickness, or for any other
      purpose approved by the Company, if the Participant's right to reemployment
      is
      guaranteed either by a statute or by contract or under the policy pursuant
      to
      which the leave of absence was granted or if the Board otherwise so provides
      in
      writing; or

      

    (iii) unless
      provided otherwise by the Board, a transfer to the employment of an entity
      in
      connection with the purchase by such entity of substantially all of the assets
      of a business conducted by the Company or any subsidiary.

     

    Subject
      to clause (iii) of this paragraph (h), employees of a subsidiary of the Company
      shall be deemed to have terminated their employment on the date on which such
      subsidiary ceases to be a subsidiary of the Company.

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    Section
      11. Effective Date, Termination and Amendment

     

    (a)
      The
      Plan is effective on June 24, 2008, the date the Plan was approved by the Board,
      contingent, however, on approval of the Plan by the Company’s shareholders
      within 12 months of such date. The Plan shall remain in full force and effect
      until the earlier of December 31, 2018, or the date it is terminated by the
      Board. 

     

    (b)
      The
      Board shall have the power to amend, suspend or terminate the Plan at any time,
      provided that any such termination of the Plan shall not affect Awards
      outstanding under the Plan at the time of termination. Notwithstanding the
      foregoing, an amendment will be contingent on approval of the Company’s
      shareholders, to the extent required by law or by the rules of any stock
      exchange on which the Company’s securities are traded or if the amendment would
      (i) increase the benefits accruing to Participants under the Plan,
      (ii) increase the aggregate number of shares of Common Stock that may be
      issued under the Plan, or (iii) modify the requirements as to eligibility
      for participation in the Plan.

     

    (c)
      The
      Board may amend any outstanding Award in whole or in part from time to time.
      Any
      such amendment which the Board determines, in its sole discretion, to be
      necessary or appropriate to conform the Award to, or otherwise satisfy, any
      legal requirement (including without limitation the provisions of Code sections
      162(m) or 409A or the regulations or rulings promulgated thereunder), may be
      made retroactively or prospectively and without the approval or consent of
      the
      Participant. Additionally, the Board may, without the approval or consent of
      the
      Participant, make adjustments in the terms and conditions of an Award in
      recognition of unusual or nonrecurring events affecting the Company or the
      financial statements of the Company in order to prevent the dilution or
      enlargement of the benefits intended to be made available pursuant to the Award.
      In addition to the foregoing, the
      Board may amend, modify or terminate any outstanding Award held by a
      Participant, including substituting therefor another Award of the same or a
      different type, changing the date of exercise or realization, and converting
      an
      Incentive Stock Option to a Non-Qualified Stock Option, provided that the
      Participant's consent to each action shall be required unless the Board
      determines that the action, taking into account any related action, would not
      materially and adversely affect the Participant. Notwithstanding the foregoing,
      or any other provision of this Plan, the exercise price of an Option may not
      be
      changed after the Option is granted without approval of the Company’s
      shareholders.

     

    Section
      12. Miscellaneous

     

    (a) No
      person shall have any claim or right to be granted an Award, and the grant
      of an
      Award shall not be construed as giving a Participant the right to continued
      employment. The Company expressly reserves the right at any time to dismiss
      a
      Participant free from any liability or claim under the Plan, except as expressly
      provided in the applicable Award Agreement.

     

    (b)
      The Board may postpone any grant, exercise, vesting or payment of an Award
      for
      such time as the Committee in its sole discretion may deem necessary in order
      to
      permit the Company: (i) to effect, amend or maintain any necessary registration
      of the Plan or the shares of Common Stock issuable pursuant to the Award under
      applicable securities laws; (ii) to take any action in order to (A) list such
      shares of Common Stock or other shares of stock of the Company on a stock
      exchange if shares of Common Stock or other shares of stock of the Company
      are
      not then listed on such exchange, or (B) comply with restrictions or regulations
      incident to the maintenance of a public market for its shares of Common Stock
      or
      other shares of stock of the Company, including any rules or regulations of
      any
      stock exchange on which the shares of Common Stock or other shares of stock
      of
      the Company are listed; (iii) to determine that such shares of Common Stock
      in
      the Plan are exempt from such registration or that no action of the kind
      referred to in (ii)(B) above needs to be taken; (iv) to comply with any other
      applicable law, including without limitation, securities and tax laws; or (v)
      to
      otherwise comply with any prohibition on such acts or payments during any
      applicable blackout period. Additionally, the granting, exercise, vesting or
      payment of an Award shall be postponed during any period that the Company or
      any
      affiliate is prohibited from doing or permitting any of such acts under
      applicable law, including without limitation, during the course of an
      investigation of the Company or any affiliate, or under any contract, loan
      agreement or covenant or other agreement to which the Company or any affiliate
      is a party. The Company shall not be obligated by virtue of any terms and
      conditions of any Award Agreement or any provision of the Plan to recognize
      the
      grant, exercise, vesting or payment of an Award or to grant, sell or issue
      shares of Common Stock or make any such payments in violation of any law,
      including any securities or tax laws, or the laws of any government having
      jurisdiction thereof or any of the provisions hereof. Any such postponement
      shall not extend the term of the Award, and neither the Company nor its
      directors and officers nor the Committee shall have any obligation or liability
      to any Participant or to any other person with respect to shares of Common
      Stock
      or payments as to which the Award shall lapse because of such
      postponement.  

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (c)
      Nothing contained in the Plan shall prevent the Company from adopting other
      or
      additional compensation arrangements for its employees.

     

    (d) Subject
      to the provisions of the applicable Award, no Participant shall have any rights
      as a shareholder with respect to any shares of Common Stock to be distributed
      under the Plan until he or she becomes the holder thereof.

    

    (e)
      Nothing contained in this Plan, nor any Award granted pursuant to this Plan
      nor
      any Award Agreement, shall constitute or create any employment or other
      relationship, or confer upon any Participant any right to continued employment
      or service with the Company or any subsidiary or affiliate, nor interfere in
      any
      way with the right of the Company, a subsidiary or an affiliate to terminate
      the
      employment or service of any Participant at any time.

    

    (f)
      Nothing contained in this Plan, and no action taken pursuant to the provisions
      of the Plan, shall create or shall be construed to create a trust of any kind,
      or a fiduciary relationship between the Committee, the Company or its
      subsidiaries or affiliates, or their officers or other representatives or the
      Board, on the one hand, and the Participant, the Company, its subsidiaries
      or
      affiliates or any other person or entity, on the other.

     

    (g) Notwithstanding
      anything to the contrary expressed in this Plan, any provisions hereof that
      vary
      from or conflict with any applicable Federal or State securities laws (including
      any regulations promulgated thereunder) shall be deemed to be modified to
      conform to and comply with such laws.

     

    (h) No
      member of the Board shall be liable for any action or determination taken or
      granted in good faith with respect to this Plan nor shall any member of the
      Board be liable for any agreement issued pursuant to this Plan or any grants
      under it. Each member of the Board shall be indemnified by the Company against
      any losses incurred in such administration of the Plan, unless his action
      constitutes willful misconduct.

     

    (i) To
      the extent that State laws shall not have been preempted by any laws of the
      United States, the Plan shall be construed, regulated, interpreted and
      administered according to the other laws of the State of New
      Jersey.

     

    (j) Awards
      may be granted to employees of the Company who are foreign nationals or employed
      outside the United States, or both, on such terms and conditions different
      from
      those specified in the Plan as may, in the judgment of the Board, be necessary
      or desirable in order to recognize differences in local law or tax policy.
      The
      Board may also impose conditions on the exercise or vesting of Awards in order
      to minimize the Company's obligation with respect to tax equalization for
      employees on assignments outside their home country.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Executed
      effective as of June 24, 2008.

     

    
      	 	 	 
	 	MEASUREMENT
              SPECIALTIES, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Mark
              Thomson
	 	 	 
	 	Title: 	Chief Financial
              Officer

    

     

    
      
        
        

      

      
        12Unassociated Document

     

    

    Exhibit
      10.1

    

    Equity
      Transfer Agreement

    

    

    

    

    

    

    September
      16, 2008

    

    Beijing

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    EQUITY
      TRANSFER AGREEMENT

    

    This
      Equity Transfer Agreement (the “Agreement”) is made and entered into on
      September 16, 2008 in Beijing by and among: 

    

    Transferee:
      

    

    Beijing
      Zhangcheng Culture and Media Co., Ltd., a
      company
      duly incorporated and existing under the laws of the People's Republic of China
      ( “Party A” or the “Transferee”), having its legal domicile at Room 717, Tower
      B, E-wing Center, No. 113 of Zhichunlu, Haidian District, Beijing,
      PRC.

    

    And

    

    Transferors:
      

    

    Sun
      Jian
      (Current Shareholder of Dalian Dajian Zhitong Information Service Co., Ltd.);
      

    Xin
      Yibo
      (Current Shareholder of Dalian Dajian Zhitong Information Service Co., Ltd.);
      and 

    Zhu
      Juntao (Current Shareholder of Dalian Dajian Zhitong Information Service Co.,
      Ltd.)

    (collectively
      “Party B” or the “Transferors”)

    

    Recitals

    

    1.
      WHEREAS the Transferors jointly formed Dalian Dajian Zhitong Information Service
      Co., Ltd. (the “Target Company”), a company duly incorporated and existing under
      the laws of the People’s Republic of China, engages in the businesses including,
      but not limited to, computer network consultation; computer hardware and
      software technology development, transfer, support and consultation; sales,
      installation and maintenance of electronic products; and call center within
      Dalian City.

    

    2.
      WHEREAS the registered capital of the Target Company is RMB one million (RMB
      1,000,000.00), and the Transferors are the all shareholders of the Target
      Company (their respective contribution amount and share proportion in the Equity
      Transfer are indentified on Exhibit 1 hereto) holding one hundred percent (100%)
      of the equity interests (of which Sun Jian is holding 60%, Xin Yibo 35% and
      Zhu
      Juntao 5%) in the Target Company as of the date herein. The Transferors agree
      to
      transfer to the Transferee eighty-five percent (85%) of the equity interests
      they hold in the Target Company, with the consideration specified in Section
      2.3
      and in accordance with other terms and conditions herein, and the Transferee
      agrees to purchase all equity interests pursuant to the terms and conditions
      herein.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.
      Additional conditions of the Share Transfer. The Transferors shall enter into
      the Cooperation Agreement of Dalian Taxi GPS Project with Dalian Taxi
      Association and shall satisfy the conditions set forth in Section .1 before
      the
      date of this Agreement. 

    

    NOW,
      THEREFORE, the Parties to this Agreement, through friendly consultation based
      on
      the principle of equality, willingness and mutual benefit, hereby agree as
      the
      follows in accordance with the terms and conditions herein:

    

    Article
      1 Definitions

    

    1.1
      In
      this Agreement, unless the context otherwise states, the following terms shall
      have the following meanings:

    

    (1)
      “China” shall mean the People's Republic of China (excluding Hong Kong SAR,
      Macau SAR and Taiwan);

    

    (2)
“RMB”
      shall mean the statutory currency of the People's Republic of
      China;

    

    (3)
      “Shares” shall mean the shareholder's equity right enjoyed by the current
      shareholders in proportion to their respective paid-up and actually invested
      registered capital pursuant to relevant legal documents as percentage of the
      registered capital in the Target Company;

    

    (4)
      “Equity Transfer” shall mean the Transferors' transfer of the eighty-five
      percent (85%) of the equity interests they hold in the Target Company in
      accordance with the terms and conditions herein;

    

    (5)
      “Transfer Price” shall mean the transfer price as specified in Section
      2.3;

    

    (6)
      “Transfer Completion Date” shall mean the definition as given in Section
      5.1;

    

    (7)
      “Current shareholders” shall mean the shareholders of the Target Company as
      specified in the Commercial Registration and the Articles of Association of
      the
      Target Company, which shall be all the current shareholders of the Target
      Company, before the Agreement is executed and becomes effective; and

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    (8)
      “Cooperation Agreement of Dalian Taxi GPS Project” shall refer to Exhibit 8
      attached hereto

    

    1.2
      The
“Agreement” shall mean the operative part of this Agreement, all exhibits and
      other documents agreed by both parties to be attached hereto as
      exhibits.

    

    1.3
      Articles, sections, subsections and exhibits shall respectively refer to the
      articles, sections, subsections and exhibits contained herein;

    

    1.4
      The
      headings contained herein are made for convenience and shall in no case affect
      the interpretation and understanding of the Agreement.

    

    Article
      2 Equity Transfer

    

    2.1
      Content of Equity Transfer

    

    2.1.1
      Equity Interest: one-time transfer, and all the shareholders waiver their right
      of first refusal. The Transferors shall make one-time Equity Transfer to the
      Transferee subject to the terms and manners set forth herein. All the
      shareholders of the Target Company have agreed to waiver their rights of first
      refusal in respect of such Equity Transfer.

    

    2.1.2
      Content of transferred equity: equity and relevant rights, upon the Equity
      Transfer by the Transferors , the Transferee shall have all the rights
      pertaining to such equity transferred in accordance with the Company Law and
      the
      articles of association of the Target Company. Such shareholder's rights shall
      mean all existing and prospective rights as pertaining to the equity
      transferred, including all rights as represented by eighty-five percent (85%)
      of
      all movable property and fixed assets, tangible and intangible assets owned
      by
      the Target Company as of the date of execution of the Agreement. 

    

    2.1.3
      The
      Transferee’s warranty to increase capital. The Transferee shall increase the
      registered capital of the Target Company by RMB9,000,000 upon the performance
      of
      the provisions as set forth in Section 4.1 hereunder. As a result, the
      registered capital of the Target Company will reach RMB10,000,000.

    

    2.2
      Authorization and approval of the Equity Transfer

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    2.2.1
      Adopted by the Board of Directors of the Target Company and approved at the
      shareholders meeting of the Target Company. Such Equity Transfer shall be
      approved by the Board of Directors and the shareholders of the Target Company.
      

    

    2.2.2
      Approval by the Board of Directors of the Transferee. The Transferee hereby
      warrants that such Equity Transfer has been approved by its Board of
      Directors.

    

    2.3
      Price. The consideration of the eighty-five percent (85%) shares to be
      transferred hereunder by the Transferors to the Transferee is RMB 1,980,000.00
      (the “Transfer Price”).

    

    2.4
      The
      Transferors hereby warrant that (a) all liabilities as of and before the date
      of
      the Agreement shall be borne by the shareholders of the Target Company and
      such
      liability shall include the subsequent costs and expenses for the 360 sets
      of
      equipments purchased by Party B; (b) the liabilities incurred before the date
      of
      this Agreement shall be paid off to the original shareholders, other enterprises
      and individuals by the Target Company. Such original shareholders, enterprises
      and individuals shall provide liabilities releasing documents issued by local
      competent notaries; and (c) the Transferors shall furnish the Transferee with
      the details of all creditor rights and their liabilities as of the date of
      the
      Agreement.

    

    2.5
      In
      case of any undisclosed liabilities, the Transferors shall assume the liability
      by paying such liabilities to the extent of one hundred percent (100%) of the
      amount in debt.

    

    2.6
      The
      Transferors agree to cause the Target Company to register with competent
      authorities the amended agreements and articles of association of the Target
      Company, submit to competent Administration for Industry and Commerce all
      necessary documents for alternation of ownership of the Target Company, and
      complete such alternation, thus making the Transferee as the majority
      shareholder of the Target Company.

     

    Article
      3 Payment

    

    3.1
      The
      Transferee shall pay RMB594,000.00, which is 30% of the Transfer Price to
      the
      Transferors within seven (7) days following the date of this Agreement. In
      the
      meanwhile, the Transferors shall complete the related registration procedure
      with competent administration of industry and commerce.

    

    3.2
      The
      Transferee shall pay RMB1,089,000, which is 55% of the Transfer Price to The
      Transferors within seven (7) days following the performance of the pre-closing
      conditions as set forth in Section 4.1. In addition, the Transferee shall
      deposit the remaining 15% of the Transfer Price to an escrow account designated
      by both Parties, which is RMB 297,000 in order to pay any undisclosed liability.
      The escrow period is one year. The Transferors shall be responsible for the
      part
      of liability which is over the deposit amount if there is any undisclosed
      liability exists, and if there is no such liability, the 15% escrow fund shall
      be released to the Transferors in a timely manner. 

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    3.3
      The
      Transferee shall increase the registered capital of the Target Company by
      RMB9,000,000 upon the performance of the provisions as set forth in Section
      4.1
      hereunder. As a result, the registered capital of the Target Company will reach
      RMB10,000,000.

    

    3.4
      After
      the transaction, the share structure of the Target Company would be: Beijing
      Zhangcheng Culture and Media Co., Ltd. holds 85% of the Target Company, Sun
      Jian
      holds 9%, Xin Yibo holds 5% and Zhu Juntao holds 1%.

    

    3.5
      Relevant taxes in respect of the Equity Transfer herein shall be paid by the
      Parties respectively in accordance with the laws.

    

    Article
      4 Preconditions for Equity Transfer

    

    4.1
      The
      Transferee shall perform its obligation of the payment of all Transfer Price
      subject to relevant provisions in the Agreement, provided that the following
      preconditions are all satisfied within three days from the effective date of
      the
      Agreement.

    

    (1)
      The
      Transferors have completed all procedures of laws and alternation of
      registration with competent Administration for Industry and Commerce in respect
      of the Equity Transfer to the Transferee;

    

    (2)
      The
      Transferors have provided the shareholder resolution and the resolution of
      Board
      of Directors of the Target Company to approve the Equity Transfer;

    

    (3)
      The
      Transferors have singed a declaration to release the Transferee of any
      liabilities and undisclosed liabilities before the Transfer Completion
      Date;

    

    (4)
      The
      Transferors shall terminate the GPS Sales Contract(s) (including verbal
      agreements) that the Target Company entered into before the date of this
      Agreement, and shall be responsible for any damages incurred by such
      termination. 

    

    (5)
      The
      Target Company has furnished all exhibits as set forth in this
      Agreement;

    

    (6)
      The
      Target Company and Dalian Taxi Management Department have entered into the
      Cooperation Agreement of Dalian Taxi GPS Project, which shall include the
      following major provisions: 

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (a)
      The
      Target Company has obtained the exclusive advertising rights of “Taxi Media” in
      Dalian, including but not limited to LED, LCD, roof light, rear window, guard
      rail, seat cover, and advertising areas inside and outside the taxi;

    

    (b)
      The
      Target Company has obtained the exclusive operating rights of real-time data
      in
      the on-line GPS system of Dalian taxis.

    

    4.2
      The
      Transferee shall have the right in its discretion to waive any and all
      preconditions as set forth in Section 4.1. Such decision of waiver shall be
      made
      in writing.

    

    4.3
      If
      any of the preconditions set forth in Section 4.1 is not fulfilled within the
      specified time and such precondition is waived by the Transferee, then the
      Agreement shall be terminated automatically; and any right, obligation and
      responsibility under the Agreement shall become invalid and no longer binding
      on
      both parties, and the Transferors shall not claim any Transfer Price against
      the
      Transferee under the Agreement, and shall, no later than 7 working days after
      the termination of the Agreement, refund in full amount of the Transfer Price
      the Transferee has already paid to the Transferors pursuant to this Agreement
      ,
      together with any interest accrued from the payment during such
      period.

    

    4.4
      If
      the Agreement is terminated pursuant to Section 4.3 and the equity transfer
      has
      been registered, then the parties agree that they shall work together with
      necessary efforts to cause such equity interest to be transferred from the
      Transferee back to the Transferors. 

    

    Article
      5
      Equity Transfer Completion Date

    

    5.1
      The
      Agreement shall come into force when signed by the authorized representatives
      of
      both Parties and the Transferee shall be entitled to the transferred equity
      interest and become the majority shareholder of the Target Company upon
      completion of all legal procedures for alteration and registration required
      for
      transferring the equity interest. However, the rights and obligations shall
      not
      be finally fulfilled until the preconditions set forth in Article 4are satisfied
      during the specified time period under Section 4.1 and the Transfer Price is
      fully paid to the Transferors by the Transferee. 

    

    Article
      6
      Structure of Corporate Governance

    

    6.1
      Upon
      the execution of the Agreement, the Transferee has the right to appoint a
      financial controller to the Target Company. The common seal, special seal for
      contact, special financial seal and the private seal of the legal representative
      shall be kept by the financial controller appointed by the
      Transferee.

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    6.2  Upon
      the
      completion of the equity transfer, the Board of Directors of the company shall
      consist of 5 members who are respectively designated by each Party according
      to
      equity proportion.

    

    6.3  Upon
      the
      completion of the equity transfer, the structure of corporate governance is
      subject to relevant regulations of the Company Law .

    

    Article
      7
      Representation and Warranties of the Transferee

    

    7.1
      Representation and Warranties of the Transferee shall be true, complete and
      accurate.

    

    7.2
      The
      Transferee has the full power, rights and capacities for execution, delivery
      and
      performance of the Agreement, and can act as the subject of litigation. The
      Transferee's execution and performance of the Agreement shall not violate any
      relevant laws and regulations or government order, nor breach any contract
      or
      agreement binding upon the Transferee or its assets thereof.

    

    7.3
      Legality of the Equity Transfer payments. The Transferee hereby warrants that
      its Equity Transfer payments for subscription for the Transferors' equity
      interest in the Target Company are legal, and it has full power and capacity
      to
      make the Equity Transfer payment to the Transferors in accordance with the
      terms
      and conditions of the Agreement.

    

    Article
      8
      Representation and Warranties of The Transferors 

    

    8.1
      The
      Transferors hereby represent and warrant as follows to the
      Transferee:

    

    8.1.1
      Authorization. Authorized representative of the Transferors has all the
      necessary rights and authorization for execution and performance of the
      Agreement and fulfillment of the transactions contemplated by the Agreement.
      The
      Agreement shall be binding upon the Transferors and the Target
      Company.

    

    8.1.2
      No
      Conflict. The execution and performance of the Agreement does not breach,
      conflict with the articles of association or bylasws of the Target Company,
      nor
      violate any mandatory stipulations of China's laws and regulations; the
      Transferors and the Target Company have acquired all necessary consent or
      authorization from a third party in respect of the transactions
      hereunder.

    

    8.1.3
      Duly existing. The Target Company is a limited liability company duly
      incorporated and existing under relevant laws.

    

    8.1.4
      Investment. The Target Company does not as of the date of this Agreement, invest
      in or operate, including but not limited to, any subsidiaries, branch companies,
      representative offices or branches; or any other entity controlled directly
      or
      indirectly by the Company or any other entity in which the Company holds
      shares.

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    8.1.5
      Financial statements. The financial statements (including balance sheet, profit
      & loss statement and cash flow statement) for the period ended August 31,
      2008 (“Balance Sheet Date”) in Exhibit 2 represent the real, complete and
      accurate operation state and financial position of the Target Company in related
      periods and on related base day. All the Target Company's audit accounts and
      management accounts (including transfer accounts) have been kept in compliance
      with China's relevant finance and accounting system in conjunction with the
      real
      condition of the Company, which represent the real and fair financial position
      and operation state of the Company during the period of relevant accounts.
      The
      Target Company's financial records and data are in full compliance with China's
      laws and regulations and the principles of Chinese Accounting
      Standard.

    

    8.1.6
      Undisclosed liabilities. The normal liabilities of the Target Company shall
      not
      have any material and adverse effect on the Company or its shareholders. In
      addition, the Target the Company does not have any other liabilities not
      represented in the balance sheet nor has the Target Company ever furnished
      other
      parties with security of guaranty or any pledge, mortgage or any other security
      interests with respect to any of its material assets.

    

    8.1.7
      Capital structure. The capital structure of registered capital of the Target
      Company in its the articles of association and its amendment with filing and
      registration with the Administration for Industry and Commerce is consistent
      with that in the articles of association and its amendment provided by The
      Transferors to The Transferee, which represents the complete and accurate
      capital structure of the Target Company prior to the date of this Agreement.
      Except as set forth above, , no shares of capital stock or other voting
      securities of the Target Company are issued, reserved for issuance or
      outstanding. 

    

    8.1.8
      Absence of Certain Changes or Events. From the Balance Sheet Date to the date
      of
      this Agreement, , unless otherwise specified in the Agreement and approved
      by
      Party A in written form, during such period there has not been: 

    

    (a)
      any
      repayment of the liabilities in advance by the Target Company;

    

    (b)
      any
      security of guaranty or any mortgage, pledge or any other security interest
      created by the Target Company; 

    

    (c)
      any
      exemption of its creditor's rights upon others or waiver of its rights of
      claim;

    

    (d)
      any
      amendment to any existing contracts or agreements;

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    (e)
      any
      bonus granted to any executive officers, directors, employees, sales
      representatives, agents or advisors or any increase of their income in any
      other
      form, or the salaries of the five persons with the highest salary in the
      Company, CEO, president, COO and CFO by an aggregate of 10% within any period
      of
      twelve months;

    

    (f)
      any
      incurrence of loss (whether or not the insurance has bought), or deterioration
      of relationship with the Target Company’s suppliers, customers or employees,
      which may lead to materially adverse impact on the Target Company;

    

    (g)
      any
      change of the method of accounting calculation, accounting policy or principles,
      or rules and regulations of financial accounting of the Target
      Company;

    

    (h)
      any
      transfer, or any license granted to others for the use of the intellectual
      property of the Target Company except for the process during the course of
      the
      Company's normal business;

    

    (i)
      any
      material change with respect to conventional sales or accounting method,
      employing policy, or related rules and regulations;

    

    (j)
      any
      materially adverse change with respect to the Target Company's financial
      position; or any other transactions rather than the regular business incurring
      responsibilities;

    

    (k)
      any
      resolutions at shareholders' meeting or board resolutions of the Target Company
      which are different from those approved at annual general meeting with respect
      to the Target Company’s routine businesses, except for those made particularly
      for the performance of the Agreement;

    

    (l)
      (i)
      any sale, mortgage, pledge, lease, transfer or disposition of assets out of
      its
      normal business scope of which the underlying transaction value reaches over
      RMB
      30,000, (ii) any disposition of any fixed asset or approval of the disposal
      of
      its fixed asset by others, giving up the control over the assets of the Target
      Company, entry into any contract which may result in the fixed assets
      expenditure, or incurrence of any other responsibilities, except for those
      incurred in the ordinary course of business; (iii) any expenditure over RMB
      30,000 that is out of the Target Company’s ordinary course of business, or
      purchase of any tangible or intangible assets (including the equity interest
      in
      any company);

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    (m)
      any
      transaction or action that is not within the ordinary course of the Target
      Company’s business; or 

    

    (n)
      any
      action or inaction which may lead to the above events

    

    8.1.9
      Tax. The Target Company has filed all tax returns required by the laws and
      regulations, and has paid all the tax payables.

    

    8.1.10
      Asset. The Company has the full power and right to own and use all their assets.
      Details about this are set out in Exhibit 5 of Disclosure List.

    

    8.1.11
      Fixed assets. The Target Company has clear and lawful property rights over
      its
      fixed assets, and has furnished the Transferee with relevant supporting
      documents in respect of the title and use right of the Target Company’s fixed
      assets. There is no mortgage, security of guaranty or any third party’s claim
      over such fixed assets.

    

    8.1.12
      The Transferors hereby warrant that all the duplicated documents of the
      existing, effective written contracts of the Target Company have been furnished
      to the Transferee, which are true copies of the originals, and that such
      contracts are valid and duly operative. In addition, the Target Company does
      not
      have any of the following contracts, agreements or documents binding upon the
      Target Company or to which the Target Company is a party, or violation of the
      terms and conditions or obligations of such contracts, agreements or documents,
      which:

    

    (a)
      are
      not made in the ordinary course of business;

    

    (b)
      are
      not made on a fair base;

    

    (c)
      result in the Target Company's loss or prejudice to the Company's
      interests;

    (d)
      can
      not be implemented with reasonably adequate efforts and expenditure;
      or

    

    (e)
      limit
      the Target Company's free operation.

    

    8.1.13
      Intellectual property. Unless otherwise disclosed in the Disclosure List, the
      Target Company has the legal title of or rights to use all the intellectual
      properties being used by the Company (including but not limited to patent,
      trademark, copyright, know-how, domain name and business secret), and the Target
      Company has acquired all the necessary authorization or license of the
      intellectual property with regard to a third party's intellectual property
      during its operation (including but not limited to the intellectual property
      license for the services with regard to providing value-added services). The
      Target Company does not infringe upon any others' intellectual property rights,
      business secret, know-how or similar rights, and is not involved in any claim,
      dispute or proceedings, which remain unresolved or may occur, against the Target
      Company due to the infringement upon any third party's intellectual property
      rights, business secret, know-how or similar rights. The Company has officially
      registered its trademark, patent, software copyright and domain name with
      relevant authorities.

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    8.1.14
      Litigation. There is no any of the following events which may have materially
      adverse impact on the Target Company, or have adverse impact on the execution,
      validity and enforceability of the Agreement and the Equity Transfer thereof,
      whether it is implemented, remain unresolved or may occur:

    (a)
      penalty, ban or order against the Target Company from government
      authorities;

    

    (b)
      proceedings or dispute against the Target Company such as civil, criminal and
      administrative actions and arbitration, etc.

    

    8.1.15
      Compliance. The Target Company's current operation is in full compliance with
      the existing laws and regulations, rules and other provisions issued by relevant
      administrations of China, and the code of telecom operators (collectively “Laws
      and Regulations”), and the Target Company does not violate any of such Laws and
      Regulations which may lead to material and adverse impact on the Target
      Company's operation or its assets.

    

    8.1.16
      Employees.

    

    (a)
      All
      the employees of the Target Company abide by relevant applicable labor
      laws;

    

    (b)
      There
      are not any labor disputes or potential labor disputes between the Target
      Company and its employees and former employees;

    

    (c)
      The
      Target Company does not have any economic compensation, payable but not paid,
      to
      pay due to terminating the labor contracts, or similar obligation to pay the
      indemnity or compensation costs with regard to employment;

    

    (d)
      The
      Target Company has fully paid and/or withheld employees' social insurance fund
      or welfares in accordance with relevant laws and regulations, including
      endowment insurance, housing fund, medical insurance, unemployment insurance
      and
      other payable insurance or welfare as per relevant laws and the agreements,
      and
      therefore does not have any existing or potential disputes concerning such
      social insurance and welfares.

    

    8.2
      Special representations and warranties. In addition to the general
      representation and warranties set forth above, the Transferors and the Target
      Company further represent and warrant as follows:

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    8.2.1
      all
      the documents including account books, records of equity changes, financial
      statements and other records of the Target Company have been kept subject to
      business rules and controlled by the Target Company, and all the principal
      transactions in connection with the Target Company's operation have been
      recorded in an accurate and regular way;

    

    8.2.2
      as
      of the date of this Agreement, , all the documents of the Target Company
      including the minutes of board meetings and shareholders' meetings and
      shareholder list have been kept safely, in which all necessary events required
      by such documents are recorded well and truly;

    

    8.2.3
      ever since the Balance Sheet Date, (1) except for the normal operation, there
      are not any events giving rise to advanced debt maturity; (2) except for the
      normal operation, there are not any assets of the Target Company disposed or
      out
      of the Target Company's control, and the Target Company has not reached any
      agreement which might give rise to additional financial expenditure, nor have
      any responsibility thereof;

    

    8.2.4
      the
      Target Company has submitted to tax authorities all required information; and
      up
      to the date of the Agreement, the Company does not have any disputes with tax
      authorities regarding tax responsibility or potential tax responsibility or
      tax
      incentives;

    

    8.2.5
      the
      Target Company has the financial documents for normal taxing and tax payment,
      and all the necessary supporting documents for tax incentives with the approval
      by relevant government departments;

    

    8.2.6
      except for the employee benefit, social and endowment insurance in accordance
      with the Labor Law of the People's Republic of China and relevant provisions,
      the Target Company does not provide any other incumbent, retire or elderly
      welfares or insurance.

    

    8.3
      Good
      Title. The Transferors are the record owners of the equity interest of the
      Target Company, and upon the execution of the Agreement, there is no mortgage,
      pledge, security interest , lien, impediment or other limits in any form on
      such
      equity interest, and the Transferors hold the equity interest only for its
      own
      account rather than proxy holding for any other third party.

    

    8.4
      Information disclosure. All the documents, material facts and information,
      provided to the Transferee by the Transferors and the Target Company prior
      and
      after the execution of the Agreement, are true, accurate, without omission
      and
      not misleading.

    

    8.5
      Further Promises of the Target Company and The Transferors.

    

    8.5.1
      Company operation. During the period from the execution of the Agreement up
      to
      the alternation registration with Administration for Industry and Commerce
      accepted by the Parties, unless as is specified in the Agreement and the
      Exhibits to the Agreement or approved by the Transferee in written form, the
      Transferors and the Target Company promise that they shall:

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    (a)be
      operating in a normal way. They will continue to develop its relationship with
      customers so that the Target Company's reputation and operation will not suffer
      materially adverse impact after the transfer of equity;

    

    (b)
      pay
      the due payables and other liabilities in the ordinary course of business,
      and
      shall not make any unusual transactions thus incurring unusual liabilities.
      Except for the ordinary course of business, the Target Company shall not repay
      the loan, or disburse trade payables in advance or delay;

    

    (c)
      perform the contracts, agreements, or other documents in respect of the Target
      Company's assets and business in a timely manner;

    

    (d)
      not
      reconcile or waive, alter its request or other rights without the written
      approval by the Transferee, except for the ordinary course of
      business;

    

    (e)
      make
      their best efforts to maintain the legal operation of the Target Company, and
      shall not separate, nor merger with any third party or acquire the assets or
      business of a third party;

    

    (f)
      not
      breach the representations and warranties set forth in the Agreement through
      action or inaction;

    

    (g)
      inform the Transferee in writing of relevant events, facts, conditions, changes
      or other cases which have had or might have materially adverse impact on the
      Target Company in a timely manner; and

    

    (h)
      handle the tax affairs of the Target Company as usual in full compliance with
      relevant laws and regulations.

    

    8.5.2
      Information collection. During the period from the execution of the Agreement
      up
      to the alternation registration with Administration for Industry and Commerce,
      the Transferors shall provide, at the reasonable request of the Transferee
      and
      its representatives, all relevant documents of the Target Company to the
      Transferee and its representatives during office hours, including but not
      limited to all necessary accounts, records, contracts, technical documentation,
      personnel information, management situation and other documents to the lawyer,
      accountant and other representatives designated by the Transferee; in order
      to
      assist the Transferee in reviewing the documents in respect of the Target
      Company's properties, assets and business and those mentioned in the Agreement,
      The Transferors shall permit the Transferee to meet or contact the customers
      and
      creditors of the Target Company. The Transferors agree that the Transferee
      have
      the full rights to conduct detailed due diligence investigations in respect
      of
      the Target Company's financial position, asset conditions and operation status
      at any time prior to the Equity Transfer.

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    Article
      9
      Liability for Breach of Agreement

    

    9.1
      Any
      breach of or failure to perform its representation, warranties, obligations
      or
      responsibilities by one party shall constitute a default. The breaching party
      shall take effective measures to rectify the breaches within no more than 5
      working days following the day when the breach of contract takes place and
      shall
      indemnify the non-breaching party for any of its loss in relation to the breach
      of contract. A liquidated damage equivalent to 50% of the Transfer Price is
      payable by the breaching party to the non breaching party.

    

    9.2
      Unless otherwise specified in the Agreement, in case of any other additional
      expenses, responsibilities or loss incurred to the other party due to the
      default of one party, the defaulting party shall indemnify the innocent party
      for such expenses, responsibilities or losses (including but not limited to
      interests and counsel fees, paid or lost due to the default). The total amount
      of the indemnification the defaulting party has to pay to the innocent party
      shall be equal to the loss due to such default activity.

    

    9.3
      The
      original shareholders of the Transferor shall assume the joint and several
      liabilities for any debt occurred prior to the Purchasing Date which causes
      subsequent disputes.

    

    9.4
      In
      case the defaulting party refuses to rectify its breaching within 3 months
      after
      the occurrence, the non defaulting party has the right to terminate this
      Agreement and such termination does not waive any liability of the defaulting
      party for its breach of contract.

    

    Article
      10 Information Disclosure and Confidentiality

    

    10.1
      Unless otherwise specified in the Agreement, the terms and conditions hereunder
      in respect of Equity Transfer (including all terms and conditions hereunder,
      the
      Exhibits and any other relevant documents) are confidential and shall not be
      disclosed to any third party. If required by relevant laws, the disclosing
      party
      shall discuss with the other party the disclosure and submission of relevant
      information within reasonable time prior to the disclosure and
      submission.

    

    10.2
      Unless otherwise specified in the Agreement, the Parties shall make their best
      efforts to keep secret any business information, material facts and relevant
      documents in any form, which are related to the Parties hereto due to the
      performance of the Agreement.

    

    10.3
      The
      Parties shall cause their respective directors, executive officers and other
      employees, and the directors, executive officers and other employees of
      affiliated companies to perform the confidentiality obligation set forth in
      this
      Article.

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    10.4
      In
      case the Agreement is terminated for any reason, the provisions in this Article
      shall maintain their original validity.

    

    Article
      11 Supplement, Modification, Amendment and Termination

    

    11.1
      After the execution of the Agreement, supplemental agreements may be entered
      into in writing upon mutual consultation, which shall take effect upon the
      due
      execution of the Parties hereto.

    

    11.2
      The
      Agreement may be modified or amended upon mutual consultation. Any modification
      or amendment to the Agreement shall be in writing, which shall take effect
      upon
      due execution of the Parties hereto.

    

    11.3
      Termination. The Agreement may be terminated as follows: 

    

    11.3.1
      The Parties make written agreements to terminate the Agreement and define the
      effective date of termination;

    

    11.3.2
      One party shall inform the other party in writing of the termination of the
      Agreement within ten (10) working days prior to the effective date of
      termination which shall be contained in the notification, in the event that:
      

    

    (a)
      the
      other party's representation or warranties are found not true or have material
      omission when made or on the Execution Date; or 

    

    (b)
      the
      other party fails to perform the terms, promises and obligations in accordance
      with the Agreement, and fails to take effective remedial actions within ten
      (10)
      days upon receipt of written notification from the party.

    

    11.3.3
      Where the Equity Transfer set forth in Article 3 hereunder can not be closed
      within one (1) month following the effective date of this Agreement, the
      Transferee shall have the right to terminate the Agreement. 

    

    11.4
      Validity of termination.

    

    11.4.1
      In
      the event that the Agreement is terminated as per any clause aforementioned,
      the
      Agreement shall be null and void;

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    11.4.2
      Upon the termination of the Agreement, the Parties shall adhere to the
      principles of equity, fairness and credit and return to the other party the
      considerations obtained pursuant to the Agreement, making their best efforts
      to
      seek restitution in integrum;

    

    11.4.3
      Upon the termination of the Agreement, all rights and obligations of the Parties
      under the Agreement shall be terminated, and either party shall not demand
      any
      claim against the other party in respect of the Agreement and its termination,
      except for the responsibilities set forth in Article 9 of the
      Agreement.

    

    Article
      12 Force Majeure

    

    12.1
      Any
      delay in or failure of performance by either party of all or any of their
      obligations under this Agreement shall not constitute a breach hereunder if,
      and
      to the extent that such delays or failures are caused by Force Majeure, provided
      that necessary remedial measures shall be taken to reduce the damage under
      proper condition.

    

    12.2
      The
      affected party shall inform the other party(ies) of the occurrence of Force
      Majeure in writing within three (3) work days after the occurrence of Force
      Majeure, and furnish the other party(ies) with descriptions of Force Majeure
      and
      proving documents issued by local competent notaries for such failure of or
      delay in performance of all or any of its obligations within fifteen (15) work
      days after the occurrence of the Force Majeure. The Parties may determine
      whether to terminate the Agreement, or partially exempt the performance of
      the
      Agreement, or prolong the performance of the Agreement. In the event that the
      Parties can not reach an agreement within sixty (60) days after the occurrence
      of Force Majeure or events, the party affected by Force Majeure or events has
      the full right to terminate the Agreement, and any party shall not be liable
      for
      the loss caused to other party(ies) thereof.

    

    12.3
      The
      Force Majeure means objective events or circumstances, unpredictable,
      unavoidable and uncontrollable, which includes earthquake, typhoon, flood,
      fire,
      war and other unpredictable, unavoidable and uncontrollable Acts of Gods, and
      change of any laws, rules and regulations, promulgation of new laws, rules
      and
      regulations, or any government act leading to direct influence on the
      performance of the Agreement or failure to perform the terms and conditions
      hereunder.

    

    Article
      13 Applicable Laws and Dispute Settlement

    

    13.1
      The
      execution, validity, interpretation, performance and dispute settlement
      hereunder shall be governed by and construed in accordance with the laws of
      China. In case of certain items in respect of the Agreement not stipulated
      in
      promulgated laws and regulations of China, such items shall be construed and
      performed as per generally accepted international business practice complying
      within the laws and regulations of China.

    

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    13.2
      Any
      disputes arising out of the performance of the Agreement or in connection with
      the Agreement shall be settled via friendly consultation; either party may
      submit any dispute failing friendly settlement to competent courts of China
      for
      judgment.

    

    Article
      14 Notice and Delivery

    

    14.1
      Any
      effective notice or other communications relating to the Agreement between
      the
      Parties (“Notice”) shall be in writing (including fax and e-mail) and posted,
      sent by a courier or addressed to that notified party at the address or
      telephone number hereunder with the name of attention on the
      Notice.

    

    To
      the
      Transferee:

    Attn.:
      Xia Shudong

    Addr:
      Room 717, Tower B, E-wing Center, No. 113 of Zhichun Road, Haidian District,
      Beijing, PRC

    Post
      code: 10086

    Tel:
      010-82671299, 13501215622

    

     The
      Transferors:

    Attn.:
      

    Addr:
      

    Post
      code: 

    Tel:
      

    

    14.2
      The
      service time for the Notice shall be determined by the following: 

    

    14.2.1
      The Notice shall be deemed to have been received if it is personally delivered
      or sent by a courier and the notified party issues the receipt; those without
      the notified party's receipt shall not be deemed to have been duly served
      on;

    

    14.2.2
      Notices, which can be sent by post and shall be delivered through registered
      express or EMS, shall be deemed to have been received by the notified party
      on
      the seventh day after the date of dispatch;

    

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    14.2.3
      The Notice sent by fax or e-mail is deemed as given upon the date on the receipt
      of fax notice or e-mail, and the confirmation date by the notified party is
      the
      delivery date.

    

    14.3
      In
      case of any change of the above address or telephone number of either party
      (as
      the “Change Party”), the Change Party shall notify other parties within seven
      (7) days after the change. Where the Change Party fails to notify other parties
      of such change in a timely way, it shall bear any loss or damages incurred
      to
      other parties thereof.

    

    Article
      15 Miscellaneous

    

    15.1
      The
      supplementary Exhibits to the Agreement are integral part of the Agreement,
      and
      shall have the same legal binding force with the Agreement; in case of
      discrepancy between the Exhibits and the text of the Agreement, the text of
      the
      Agreement shall prevail.

    

    15.2
      In
      case any provision under the Agreement and the Exhibits is found invalid or
      not
      enforceable in accordance with applicable laws, such provision shall be deemed
      as non-existence from the beginning and the remaining provisions maintain
      effective; the Parties may define new provisions through consultation to bring
      about the original intention of such provision to the great extent.

    

    15.3
      The
      Agreement shall also be binding upon the successors and transferees of the
      Parties, and such successors and transferees may have and hold the shares
      hereunder.

    

    15.4
      The
      Transferee may assign and transfer its rights, shares and obligations hereunder
      to its affiliated companies, wholly-owned subsidiaries and its holding company's
      wholly-owned subsidiaries.

    

    15.5
      Except for the aforesaid provisions in Sections 15.3 and 15.4, any party shall
      not assign or transfer any of its rights or obligations hereunder.

    

    15.6
      Unless otherwise specified in the Agreement, the failure of one party to
      exercise its performance of its rights, power and privilege does not constitute
      its waiver of such rights, power and privilege, and single or partial exercise
      of such rights, power and privilege shall not prevent its exercise of any other
      rights, power and privilege.

    

    15.7
      The
      Agreement shall be effective with the official seals and the signature by the
      legal representative or duly authorized representative of the
      Parties.

    

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    15.8
      The
      Agreement is made into six (6) copies of equal validity with the Transferee
      holding two (2) copies, the other Parties one (1) copy each and one (1) copy
      for
      competent Administration for Industry and Commerce. 

    

    

    [Signature
      page follows]

     

    

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
      by
      duly authorized representatives of the Parties on the date first written
      above.

    

    The
      Transferee: Beijing
      Zhangcheng Culture and Media Co., Ltd
      Co.,
      Ltd. (seal)

    

    Authorized
      representative:/s/
      Shudong Xia

    Shudong
      Xia

    Execution
      date: September
      16, 2008

     

    
 

    The
      Transferors: (seal):

    

    Authorized
      representative: /s/
      Xin Yibo

    Xin
      Yibo

    Execution
      date: September
      16, 2008

     

    
      
        
        

      

      
        19

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