WARRANT
AMENDMENT

     

    This
WARRANT AMENDMENT (this “Amendment”) is dated as of April 30, 2010 by and among
Shengkai Innovations, Inc., a Florida corporation and formerly known as
“Southern Sauce Company, Inc.” (the “Company”), and  Vision
Opportunity China, LP, LLC (“Vision”).  Capitalized terms used herein
and not otherwise defined shall have the meanings ascribed to such terms in the
Warrant (as defined below).

     

    RECITALS

     

    WHEREAS,
the Company entered into a Securities Purchase Agreement with Vision (the
“Vision SPA”), dated June 10, 2008 and another Securities Purchase Agreement
with BlueRidge Investments, LLC (“BlueRidge”, and the agreement the “BlueRidge
SPA”) dated as of July 18, 2008, pursuant to which the Company conducted private
offerings solely to accredited investors pursuant to Rule 506 of Regulation D of
the Securities Act of 1933, as amended, of its series A preferred stock and
series A warrants; and

    


    WHEREAS,
pursuant to Sections 4(d), (e) and (f) of the Series A Warrant to purchase
shares of Common Stock of the Company that were delivered to the Purchaser (as
defined in the Vision SPA) pursuant to the Vision SPA (the “Warrant”), the
Purchaser had certain anti-dilution protection in the event the Company issues
any Additional Shares of Common Stock or Common Stock Equivalents at a price per
share less than the Warrant Price then in effect; and

     

    WHEREAS,
the Company has requested that the Majority Holders amend the Warrant to delete
Sections 4(d), (e) and (f) thereof; and agree that in lieu of such provisions
the Majority Holders of the Warrant shall have a right to pre-approve any
issuance of Additional Shares of Common Stock and Common Stock Equivalents at a
price less than the Warrant Price then in effect and give retroactive effect to
such amendment; and

    


    WHEREAS,
pursuant to Section 11 of the Warrant, no provision of the Warrant may be
amended without the written consent of the Company and the Majority Holders;
and

     

    NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as
follows:

     

    1.           Amendment. Pursuant
to Section 11 of the Warrant, the parties hereto hereby amend the Warrant, as of
the date hereof, by:

     

    (a) deleting Sections 4(d), (e) and
(f);

     

    (b) replacing Section 4(d) with the
following:

     

    “Issuance of Additional
Shares of Common Stock and Common Stock Equivalents.

    


    Until the
expiration of this Warrant, Issuer shall not issue any Additional Shares of
Common Stock or Common Stock Equivalents (otherwise than as provided in the
foregoing subsections
(a) through (c) of this Section 4), at a price per share less than the
Warrant Price then in effect or without consideration, without the prior written
consent of the Majority Holders.”

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    2.           Effect on Transaction
Documents.  Except as set forth above, the Securities Purchase
Agreement, the Warrant and any other documents related thereto, shall remain in
full force and effect and are hereby ratified and confirmed.

     

    3.           Effective Date of Warrant
Amendment. The parties agree that this Warrant Amendment shall be
effective retroactively as of the date the Warrant was first issued on June 10,
2008 (for Vision Warrants). Notwithstanding the foresaid, this agreement will
only take effect until the Company enters into a similar agreement with
BlueRidge whereby the BlueRidge agrees to remove the down round anti-dilution
provisions included in the warrants BlueRidge received pursuant to the BlueRidge
SPA.

     

    4.           Governing Law;
Jurisdiction. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed in the State of New York.

     

    5.           Counterparts. This
Amendment may be executed in two or more counterparts, all of which shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party.
A facsimile signature shall be
deemed to be an original signature for purposes of this
Amendment.

     

    6.           Severability. If any
provision of this Amendment shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Amendment or the validity or
enforceability of this Amendment in any other jurisdiction.

    


     

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    IN
WITNESS WHEREOF, the undersigned have executed this Amendment as of the date
first written above.

     

    
      
        	 	
                SHENGKAI
      INNOVATIONS, INC.

              
	 	 
	 	
                By:
      ____________________________

              
	 	
                Name:

              
	 	
                Title:
      Chief Executive Officer

              
	 	 
	 	 
      
	 	
                VISION
      OPPORTUNITY CHINA, LP

              
	 	 
      
	 	
                By:
      ____________________________

              
	 	
                Name:
      Adam Benowitz

              
	 	
                Title:
      Authorized Signatory