Document:

<PAGE>

                                                                    Exhibit 10.2

                               FIRST AMENDMENT TO

                         AGREEMENT ON TRANSFER OF SHARES

                                       IN

                          ABLE NEW ENERGY CO., LIMITED

                                       BY

                            ULTRALIFE BATTERIES, INC.

                                       AND

                                 (HUANG DEYONG)

                                 (LI XIAOCHUN)

                                  (ZHU DEHONG)

<PAGE>

             First Amendment to the Agreement on Transfer of Shares

             FIRST AMENDMENT TO THE AGREEMENT ON TRANSFER OF SHARES

This First Amendment to the Agreement on Transfer of Shares (this "Amendment")
is made on this ____ day of __________ 2006 by and between:

ULTRALIFE BATTERIES, INC. (hereinafter referred to as the "PURCHASER"), a
corporation organised and existing under the laws of the State of Delaware and
having its principal office at 2000 Technology Parkway, Newark, New York 14513,
US.

and

(Huang Deyong, hereinafter referred to as "MR.HUANG"), a Chinese citizen whose
ID number is 230103670711321 and having domicile at B-7E, Huifangyuan, Xuefu
Road, Nanshan District, Shenzhen, Guangdong, China;

(Li Xiaochun, hereinafter referred to as "MR.LI"), a Chinese citizen whose ID
number is 110105197004075339 and having domicile at 8E, Building 2, Xiandaicheng
Huating, Chuangye Road, Nanshan District, Shenzhen, Guangdong, China;

(Zhu Dehong, hereinafter referred to as "MR.ZHU"), a Chinese citizen whose ID
number is 522101197204236013 and having domicile at B-7C, Qingchun Jiayuan, No.
205, Nanhai Road, Nanshan District, Shenzhen, Guangdong, China.

Mr. Huang, Mr. Li and Mr. Zhu hereinafter may be referred to collectively as the
"SELLERS" or individually as the "SELLER". The Purchaser and the Sellers may be
collectively referred to as the "PARTIES" or individually as a "PARTY".

                                    PREAMBLE

WHEREAS on January 25th 2006, the Parties entered into the Agreement on Transfer
of Shares (hereinafter referred to as the "STA") for the transfer of the entire
issued shares in Able New Energy Co., Limited;

WHEREAS the Parties agree that certain provisions of the STA requires for
clarification and amendment and intend to amend the STA pursuant to the terms
and conditions of this Amendment;

ACCORDINGLY the Parties hereby agree to this Amendment which shall become
effective as of the date hereof. Subject to the amendments expressly set out
herein, all terms and conditions of the STA shall continue to be valid and
effective.

                                        2

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             First Amendment to the Agreement on Transfer of Shares

ARTICLE 1

Unless the terms or context of this Amendment otherwise provide, the terms
herein shall bear the same meaning as defined in the STA.

ARTICLE 2

The following article shall be inserted after Article 11.6 of the STA and become
Article 11.7 thereof, with the original Article 11.7 accordingly numbered as
Article 11.8.

"11.7 In the event that the Closing takes place pursuant to Article 4.1 hereof
by the Condition Fulfilment Deadline, except for the reimbursement for the
Approved Expenses that have been waived in writing by the Purchaser for the
reason that such Approved Expenses are for its benefit and convenience, the
total amount of the reimbursement for the Approved Expenses that the Sellers
have received from the Escrow Agent pursuant to this Article by the Date of
Closing shall be credited to the part of Purchase Price payable to the Sellers
pursuant to Article 3.3(i) hereof. Accordingly, such reduced sum of Purchase
Price shall be payable to the Sellers pro rata to their shareholding ratio at
the Closing within thirty (30) days of the Closing Date."

IN WITNESS WHEREOF, each Party hereto has caused this First Amendment to the
Agreement on Transfer of Shares to be executed by its authorised
representatives:

Shenzhen, Guangdong Province, [date], 2006

By: ULTRALIFE BATTERIES, INC.

/s/ Philip M. Meek
--------------------------------------
Authorized Representative:

By: (HUANG DEYONG)

/s/ Huang Deyong
-------------------------------------

                                        3

<PAGE>

             First Amendment to the Agreement on Transfer of Shares

By: (LI XIAOCHUN)

/s/ Li Xiaochun
-------------------------------------

By: (ZHU DEHONG)

/s/ Zhu Dehong
-------------------------------------

                                        4<PAGE>

                                                                    Exhibit 10.3

                     AGREEMENT ON TRANSFER OF EQUITY SHARES

                                       IN

                          (ABLE NEW ENERGY CO., LTD.)

                                       BY

                         (ABLE NEW ENERGY CO., LIMITED)

                                       AND

                                 (HUANG DEYONG)

                                 (LI XIAOCHUN)

                                  (ZHU DEHONG)

<PAGE>

                     Agreement on Transfer of Equity Shares

                                TABLE OF CONTENTS

<TABLE>
<S>          <C>
Preamble

Article 1    Definitions and Interpretations
Article 2    Transfer of Shares
Article 3    Purchase Price and Payment
Article 4    Closing
Article 5    Non-competition
Article 6    Transitional Period
Article 7    Representations and Warranties of the Seller
Article 8    Representations and Warranties of the Purchaser
Article 9    Effectiveness
Article 10   Protection of the Purchaser's Interest
Article 11   Confidentiality
Article 12   Breach of Contract
Article 13   Settlement of Disputes
Article 14   Miscellaneous

Schedule 1   Employment Contract
Schedule 2   List of documents, Contracts and Agreements Provided by the
             Company and/or the Sellers to the Purchaser
</TABLE>

                                  Page 1 of 23

<PAGE>

                     Agreement on Transfer of Equity Shares

                     AGREEMENT ON TRANSFER OF EQUITY SHARES

This Agreement on Transfer of Equity Shares (this "Agreement") is made in
Shenzhen, Guangdong Province, People's Republic of China ("China") on this 25th
day of January 2006 by and between:

(Able New Energy Co., Limited, hereinafter referred to as "PURCHASER"), a
company duly established and validly existing under the law of Hong Kong SAR
with its registered address at 12/F, AT Tower, 180 Electric Road, North Point,
Hong Kong SAR.

and

(Huang Deyong, hereinafter referred to as "MR.HUANG"), a Chinese citizen whose
ID number is 230103670711321 and having domicile at B-7E, Huifangyuan, Xuefu
Road, Nanshan District, Shenzhen, Guangdong, China;

(Li Xiaochun, hereinafter referred to as "MR.LI"), a Chinese citizen whose ID
number is 110105197004075339 and having domicile at 8E, Building 2, Xiandaicheng
Huating, Chuangye Road, Nanshan District, Shenzhen, Guangdong, China;

(Zhu Dehong, hereinafter referred to as "MR.ZHU"), a Chinese citizen whose ID
number is 522101197204236013 and having domicile at B-7C, Qingchun Jiayuan, No.
205, Nanhai Road, Nanshan District, Shenzhen, Guangdong, China.

Mr. Huang, Mr. Li and Mr. Zhu hereinafter may be referred to collectively as the
"SELLERS" or individually as the "SELLER". The Purchaser and the Sellers may be
collectively referred to as the "PARTIES" or individually as a "PARTY".

                                    PREAMBLE

WHEREAS, the Sellers are the sole shareholders of the Company (hereinafter
defined), more specifically with Mr. Huang holding 50% equity shares of the
Company, Mr. Li holding 25% equity shares of the Company and Mr. Zhu holding the
remaining 25% equity shares of the Company;

WHEREAS, the Company is active in the business of producing, marketing and
selling various lithium batteries in both Chinese domestic market as well as
export market;

WHEREAS, the Sellers intend to sell and transfer the entire equity interests in
the Company and the Purchaser intends to buy and acquire such interests.

                                  Page 2 of 23

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                     Agreement on Transfer of Equity Shares

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth,
the Parties hereto, intending to be legally bound hereunder, agree as follows:

                                    ARTICLE 1

                         DEFINITIONS AND INTERPRETATIONS

1.1  Definitions

     Unless the terms or context of this Agreement otherwise provide, the
     following terms shall have the meanings as set out below:

     "Able GmbH" shall mean a company established under the law of Germany with
     its legal address at Hannenstieg 22, 22175, Hamburg, Germany which is
     wholly owned by Mr. Li.

     "Amended Articles of Association" shall mean the amended articles of
     association of the Company, which will become effective as of the
     Effectiveness Date.

     "Business" shall mean the current business of manufacturing and sales of
     lithium batteries by the Company.

     "Business License" shall mean the revised business license of the Company
     which will be issued by the SZAIC following the Effectiveness Date and
     meeting the requirements set out in Article 4.1 (ii).

     "China" and "PRC" mean the People's Republic of China, for purpose of this
     Agreement, excluding Hong Kong, Taiwan and Macau.

     "Closing" shall mean the closing of the Transaction contemplated hereunder
     as described in Article 4.1, and the "Closing Date" or "Date of Closing"
     shall mean the date on which the Closing is effected as set out in Article
     4.1 hereof.

     "Company" shall mean the limited liability company named (Able New Energy
     Co., Ltd.), with its legal address at ABLE Industrial Zone, Xintang
     Village, Guanlan Town, Baoan District, Shenzhen, Guangdong Province, China.

     "Conditions" shall mean collectively all the conditions set out in Article
     4.1.

     "Condition Fulfilment Deadline" shall mean April 30, 2006 or such later
     date as the Purchaser may designate at its sole discretion.

                                  Page 3 of 23

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                     Agreement on Transfer of Equity Shares

     "Effectiveness Date" shall mean the date on which this Agreement becomes
     legally effective pursuant to Article 9.1 hereof.

     "Employment Contract" shall mean the Employment Contract to be entered into
     by the Company and each of the Key Employees a copy of which is attached
     hereto as Schedule 1 and which will become effective as of the Closing
     Date.

     "Encumbrance" shall mean a mortgage, charge, pledge, lien, option,
     restriction, right of first refusal, right of pre-emption, third-party
     right or interest, other encumbrance or security interest of any kind, or
     another type of preferential arrangement (including, without limitation, a
     title transfer or retention arrangement) having similar effect and any
     agreement or obligation to create or grant any of the aforesaid.

     "Examination and Approval Authority" shall mean the Bureau of Trade and
     Industry of Shenzhen Municipality or any other Chinese governmental
     authority which is competent to approve this Agreement, the Transaction
     contemplated hereunder and the Amended Articles of Association according to
     PRC laws and regulations.

     "Execution Date" shall mean the date on which this Agreement is signed by
     duly authorized representatives of all the Parties. Unless otherwise agreed
     by the Parties, the Execution Date shall not be later than January 28,
     2006.

     "Key Employees" shall mean Mr. Huang, Mr. Li and Mr. Zhu.

     "Landlord" shall mean the owner of the Current Premises or the Previous
     Premises, as the case may be.

     "Net Sales" shall mean the net revenue of the Company generated from sales
     of its products, net of any discount, rebate, commission, VAT or other
     sales tax.

     "New Premises" shall mean the premises located at Shanjiankeng, Xintang
     Town, Dashuikeng, Guanlan County, Bao'an District, Shenzhen, where the
     Company will relocate or has relocated from the Previous Premises for
     operation of the Business.

     "Previous Premises" shall mean the premises located at Block 4, Foreign
     Trade Industrial Zone, Guan Lan Town, Bao'An District, Shenzhen, which was
     previously occupied and used by the Company for the Business.

                                  Page 4 of 23

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                     Agreement on Transfer of Equity Shares

     "Purchase Price" shall mean the purchase price for the Transferred Shares
     that is payable by the Purchaser to the Sellers according to Article 3
     hereof.

     "SAB" shall mean (Shenzhen Able Battery Co., Ltd.(pound)(C), a limited
     liability company established and existing under the law of PRC of which
     Mr. Huang is a majority shareholder.

     "SZAIC" shall mean the Shenzhen Administration for Industry and Commerce
     and/or a local branch thereof, as appropriate to the context.

     "Trademark" shall mean the trademark (ABLE' LOGO) which is registered under
     the name of SAB and will be legally transferred to the Company pursuant to
     a trademark transfer agreement to be entered into by SAB and the Company.

     "Transferred Shares" shall mean the 100% equity shares in the Company,
     which will be transferred from the Sellers to the Purchaser under the
     Transaction according to the terms and conditions hereunder.

     "Transaction" shall mean the transaction defined in Article 2.1 hereof.

     "U.S." shall mean the United States of America.

     "Warranties" shall mean collectively all the representations, warranties
     and undertakings set out in Article 7.1 hereof.

1.2  Interpretation

     Articles and headings are inserted for the purpose of convenience and
     reference only and shall not affect the interpretation or construction of
     this Agreement. Words denoting the singular shall, where applicable,
     include plural and vice versa. Reference to the masculine gender shall,
     where applicable, include the feminine gender and vice versa.

                                    ARTICLE 2

                               TRANSFER OF SHARES

2.1  Subject to the Conditions set forth in Article 4 hereof and with effect as
     of the Date of Closing, the Sellers hereby sell and transfer to the
     Purchaser and the Purchaser hereby buys and acquires from the Sellers, all
     of the rights, title and interests to and under the Transferred Shares as
     follows (the "TRANSACTION"):

                                  Page 5 of 23

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                     Agreement on Transfer of Equity Shares

     (i)  Mr. Huang sells and transfers to the Purchaser 50% equity interests of
          the Company;

     (ii) Mr. Li sells and transfers to the Purchaser 25% equity interests of
          the Company; and

     (iii) Mr. Zhu sells and transfers to the Purchaser 25% equity interests of
          the Company.

     Upon the completion of the Transaction, the Company will become 100% owned
     by the Purchaser and will be converted into a wholly foreign owned
     enterprise (WFOE).

2.2  The Sellers represent and warrant to, and covenant with, the Purchaser that
     at the Sellers' own cost and expense, they will execute and do or procure
     to be executed and done by any other necessary party all deeds, documents,
     acts and things necessary and appropriate to vest the ownership of the
     Transferred Shares to the Purchaser as may be necessary to give full effect
     to this Agreement.

                                    ARTICLE 3

                           PURCHASE PRICE AND PAYMENT

3.1  The total Purchase Price to be paid by the Purchaser for the Transferred
     Shares shall be the sum of USD $1,000,000. Of the Purchase Price, the
     following sum shall be paid to each of the Sellers:

     (i)  USD $500,000 shall be paid to Mr. Huang;

     (ii) USD $250,000 shall be paid to Mr. Li; and

     (iii) USD $250,000 shall be paid to Mr. Zhu.

3.2  The Purchaser shall make payment of the Purchase Price to each of the
     Sellers as set out in Article 3.1 within one (1) month from the Date of
     Closing.

3.3  Any and all sums which are payable to each of the Sellers hereunder shall
     be paid by the Purchaser to a RMB bank account maintained by the Seller
     respectively in China, as shall have been notified by such Seller in
     writing at least fourteen (14) days prior to the date of payment.

3.4  Each Seller shall be solely liable and responsible for any taxes, fees and
     public levies including, without limitation, profits tax, enterprise income
     tax, capital gains tax, value added taxes (VAT), business tax, and turnover
     tax, which may be levied or imposed by any tax, revenue or other government
     authorities in any part of the world, in connection with the sale and
     transfer of the corresponding portion of the Transferred Shares, or on the
     profit derived by such Seller from such sale

                                  Page 6 of 23

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                     Agreement on Transfer of Equity Shares

     and transfer. If the Purchaser is required under any applicable law or
     regulation to deduct or withhold tax with respect to the Purchaser Price or
     any part thereof payable to the Seller, the Purchaser shall be entitled to
     deduct the relevant amounts from the Purchase Price and to pay over the
     amounts deducted to the relevant tax, revenue or other government
     authorities, provided that the Purchaser shall deliver to the Seller
     official receipts or other documentary evidence showing that the amounts
     withheld have been paid to the relevant tax revenue or other governmental
     authorities, within 30 days of payment.

3.5  In the event that the Purchaser has any claim against any of the Sellers
     under this Agreement, it shall be entitled to deduct and set-off the
     relevant amount of any such claim from and against the portion of the
     Purchaser Price payable to any Seller. The Purchaser shall inform the
     Sellers about the grounds and amounts of the claim promptly.

                                    ARTICLE 4

                                     CLOSING

4.1  The Closing shall take place on the day when all the following conditions
     have been fulfilled:

     (i)  All necessary governmental approvals on the Transaction have been
          properly issued, including but not limited to the following:

          (a)  Written approval of this Agreement and the Transaction
               contemplated hereunder by the Examination and Approval Authority;

          (b)  Written approval of the Amended Articles of Association by the
               Examination and Approval Authority.

     (ii) The Business License of the Company has been issued meeting the
          following requirements:

          (a)  The legal form of Company has been changed to a wholly foreign
               owned enterprise (WFOE) with the Purchaser being the 100% owner
               of the Company;

          (b)  The legal representative of the Company has been changed to a
               nominee of the Purchaser.

                                  Page 7 of 23

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                     Agreement on Transfer of Equity Shares

          (c)  The operation term of the Company shall be not less than thirty
               (30) years commencing from the date of the issuance of the
               Business License.

     (iii) The Company's Board of Directors including the Chairman, Executive
          Director and Directors, the Supervisory Committee, and the General
          Manager which were nominated and/or appointed by the Sellers have
          resigned or been removed; and the new Board of Directors and new
          General Manager have been appointed by the Purchaser, such appointment
          having been approved by the Examination and Approval Authority and
          registered with the SZAIC accordingly;

     (iv) The Company has received all consents and approvals from third parties
          as may be necessary or as required by the relevant agreement or
          contracts to which the Company is a party in connection with the
          proposed change in the shareholding structure of the Company so as to
          ensure that the Company maintains on the same terms all its existing
          contractual and other rights after the Closing;

     (v)  Authorized representatives of the Purchaser have taken over from the
          Sellers and the Company all the originals of the Company's business
          license, other certificates, licenses, permits, legal and financial
          documents as well as all the company stamps and chops.

     (vi) No material change has occurred in the Business which would or might,
          in the reasonable opinion of the Purchaser, materially and adversely
          affect the carrying out of the post-transaction Business by the
          Purchaser and/or the Company after the Closing;

     (vii) Any lease agreement between the Company or its shareholder on the one
          hand and the Landlord on the other hand for the Previous Premises has
          been properly terminated, and a written termination agreement has been
          entered to the satisfaction of the Purchaser;

     (viii) A new lease agreement for the New Premises has been entered into
          between the Company and the Landlord with terms and conditions
          satisfactory to the Purchaser, and properly registered with competent
          real property authority in the PRC;

     (ix) The following agreements have been properly terminated by the parties
          thereto and a written termination agreement has been entered into for
          each of the said agreements to the satisfaction of the Purchaser:

          (a)  The Exclusive Distributorship Agreement between the Company and
               ProBatt GmbH, a German company, on February 21, 2005;

                                  Page 8 of 23

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                     Agreement on Transfer of Equity Shares

          (b)  The Partnership Contract between the Company and Europa, a French
               company, on May 24, 2005;

          (c)  The Sales Representative Agreement between the Company and
               Electronic Technology Sales, a US Company, on July 7, 2005.

     (x)  Each of the Key Employees has entered into the Employment Contract
          with the Company.

     (xi) Able GmbH has changed its company name by removing the word "Able"
          without replacing it by any similar word and expression; a non-compete
          covenant shall have been duly executed by all the Sellers and Able
          GmbH in the form approved by the Purchaser, whereby they undertake to
          refrain from using the trade name "Able" in its business and from
          competing directly or indirectly with the Business;

     (xii) The Company has obtained all necessary approvals and permits with
          respect to environmental protection and safety production which are
          required for operation of the Business on the New Premises from the
          competent Chinese governmental authorities according to the national
          and local laws, rules and regulations;

     (x)  A trademark transfer agreement has been executed by SAB to transfer
          the Trademark to the Company and an exclusive license is granted to
          the Company for the use of the Trademark before such transfer is
          legally effective.

4.2  The Sellers shall use their best endeavors to procure the fulfillment of
     all the Conditions specified in Article 4.1, and shall deliver to the
     Purchaser the originals or certified true copies of those letters,
     certificates, documents and other documentary evidence proving the
     fulfillment of the Conditions. If at any time either the Seller becomes
     aware of a fact or circumstance that might prevent a Condition from being
     satisfied, it will immediately inform the Purchaser.

4.3  The date on which all the Conditions are or are deemed to be fulfilled
     shall be confirmed in writing by the Purchaser to the Sellers within seven
     (7) days after the date on which the originals or certified true copies of
     all the letters, certificates and documents provided for in Article 4.2
     have actually been received by the Purchaser. The Purchaser may, to such
     extent as it deems fit and is legally entitled to do so, at any time waive
     in writing any of the Conditions set out in Article 4.1 on such terms as it
     may decide.

4.4  If any of the Conditions (which have not previously been waived by the
     Purchaser) have not been satisfied on or before the Condition Fulfillment

                                  Page 9 of 23

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                     Agreement on Transfer of Equity Shares

     Deadline, then the Purchaser may on that date, at its option (but without
     prejudice to any other right or remedy it may have), by notice to the
     Sellers:

     (i)  waive the Conditions which have not been satisfied; or

     (ii) postpone the Condition Fulfilment Deadline to a date not later than
          June 30, 2006; or

     (iii) terminate this Agreement in which event the provisions of Article 11
          will apply.

                                    ARTICLE 5

                                 NON-COMPETITION

5.1  After the execution of this Agreement and for a period of three (3) years
     following the expiry or the termination of the Employment Contract, the
     Sellers shall not jointly or separately, assist or have an interest in
     (other than a passive investment of no more than 5% of the equity of the
     company in which the investment is made), or enter the employment of or act
     as an agent, advisor or consultant for, any person, in, or enter the
     employment of or act as an agent, advisor or consultant for, any person,
     entity or joint venture which is engaged in, or will be engaged in, any
     activity or business which will (a) engages in production and sales of
     products that are same as or similar to those of the Company; (b) contract,
     solicit or enters in contract or agreement with the Company's employees,
     customers, suppliers and other business contacts; (c) compete directly or
     indirectly with the business of the Company in any other manner.

5.2  Each of the Sellers acknowledges that the consideration for the above
     non-competition covenants has been included in the Purchase Price and upon
     his receipt of the Purchase Price pursuant to this Agreement he shall have
     also received the consideration for the non-competition covenants and shall
     not be entitled to claim for any compensation from the Purchaser.
     Nevertheless, the Parties agree that, in the event that the Employment
     Contract with any of the Sellers is early terminated by the Company prior
     to its expiry without the fault of such Seller, the Purchaser shall pay to
     such Seller extra compensation in the amount of the monthly salary of such
     Seller multiply by nine.

5.3  If any of the Sellers violates any of the obligations set out in this
     Article 5, any profits or remunerations gained by the Seller from the
     competition activities in violation to this Article should be forfeited to
     the Purchaser. In addition, for each case of violation the Seller shall be
     obligated to pay a penalty in the amount of US$ 10,000 to the Purchaser. If
     a violation is continued for more than four

                                 Page 10 of 23

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                     Agreement on Transfer of Equity Shares

     weeks, each four weeks of the continuation of the violation shall be deemed
     to constitute an independent violation.

                                    ARTICLE 6

                        CONDUCT OF BUSINESS AFTER SIGNING

6.1  During the period between the Execution Date and the Closing Date
     ("Transitional Period"), the Purchaser shall have the right to send its
     representative ("Purchaser's Representative") to work on secondment at the
     Company and to direct the management and operations of the Company. The
     Purchaser's Representative shall have full access to financial, operation
     and other information of the Company. All salary and benefit costs of the
     Purchaser's Representative will be borne by the Purchaser.

6.2  The Sellers undertake that during the Transitional Period:

     (i)  The Purchaser shall be provided with unlimited access to the financial
          documents and information of the Company;

     (ii) The Company shall conduct their activities in the ordinary and usual
          course of business and consistent with their past customs and
          practices. Without the Purchaser's prior written consent they shall
          refrain from actions falling outside of their ordinary course of
          business.

     (iii) The Company shall refrain from obtaining any loan, credit or
          incurring liabilities of any sort which is higher than RMB 100,000
          (One Hundred thousand Renminbi) without prior written consent of the
          Purchaser;

     (iv) The Company shall refrain from the disposal of its assets and
          properties or create any pledge, mortgage or encumbrance over such
          assets and properties;

     (v)  The Company shall refrain from allotting or issuing any shares or any
          loan capital or securities or other rights convertible into shares or
          loan capital or distributing any profits or dividends.

6.3  In the event that any Seller or the Company failed to comply with the
     provisions under above (i) ~ (v), the Purchaser is entitled to: i)
     immediately terminate this Agreement without notice; in such case the
     Purchaser is under no obligation to make any payment; or ii) the Purchaser
     may deduct the losses or damages that is suffered by the Company or the
     Purchaser due to the breach from the Purchase Price provided herein.

                                 Page 11 of 23
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                     Agreement on Transfer of Equity Shares

6.4  The Sellers undertake to immediately take actions to liquidate, dissolve
     and deregister SAB after the signing of this Agreement. The legal
     procedures for dissolution of SAB shall be completed latest in six (6)
     months after the Execution Date.

6.5  The Sellers undertake to go through relevant PRC regulatory procedure to
     obtain the licenses and permits required for the use of any special
     equipment currently used by the Company such as the X-ray equipment
     immediately after the signing of this Agreement. Such license and permits
     shall be obtained within one month after the Date of Closing.

                                    ARTICLE 7

                  REPRESENTATIONS AND WARRANTIES OF THE SELLER

7.1  Each of the Sellers represents and warrants that, as of the Effectiveness
     Date as well as the Closing Date:

     (i)  The Company is duly organised, validly existing and in good standing
          under the laws of China. The Sellers have paid in the registered
          capital of the Company of RMB 1,000,000 (one million Renminbi).

     (ii) The Sellers are the sole legal and beneficial owners of the
          Transferred Shares, and are entitled to sell and transfer the full
          legal and beneficial ownership of the Transferred Shares to the
          Purchaser free from all Encumbrances and with all legal and beneficial
          rights now and hereafter relating to the Transferred Shares.

     (iii) There are no Encumbrances on, over or affecting any of the
          Transferred Shares and the assets of the Company. There is no
          agreement or commitment to give or create any such Encumbrance. No
          claim has been made by any person to be entitled to any such
          Encumbrance which has not been waived in its entirety or satisfied in
          full.

     (iv) Each of the Sellers has obtained all necessary consents, approvals or
          authorisation to execute and perform this Agreement required from any
          department in charge, or governmental authorities pursuant to any laws
          and regulations which he is subject to. Execution of this Agreement
          does not and will not constitute any breach or violation of any
          contract, agreement, corporate or regulatory documents, laws and
          regulations by which the Seller is bound.

                                 Page 12 of 23

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                     Agreement on Transfer of Equity Shares

     (v)  All licences, consents and other permissions and approvals required
          for carrying out the Business of the Company have been properly
          granted and are valid and in full force and effect; and the Company is
          not in default and has not received notice that it is in default with
          respect to the terms of any such licence, consent, permission or
          approval, or that any such licence, consent, permission or approval is
          likely to be revoked or which constitutes grounds for such revocation.

     (vi) All information and documents in relation to the Company that have
          been provided to the Purchaser for purpose of or in connection with
          this Agreement, including without limitation to those listed in
          Schedule 2, are true and accurate in all respects and are not
          misleading because of any omission or ambiguity or for any other
          reason.

     (vii) All the accounts, books, ledgers and financial and other records of
          the Company are complete and accurate in all material aspects and have
          been properly kept in accordance with the legal requirements and
          normal business practice, and are in the possession of the Company or
          under its control, and all transactions relating to the Business have
          been duly and correctly recorded therein and there are no inaccuracies
          or discrepancies of any kind contained or reflected in such accounts,
          books, ledgers and financial and other records and they are sufficient
          to give a true and accurate view of the state of the Company's affairs
          and to explain its transactions.

     (viii) The assets included in the books and accounts of the Company are the
          absolute property of the Company free from any mortgage, charge, lien,
          bill of sale or other encumbrance and are not the subject of any
          leasing, hiring or hire purchase agreement or agreement for payment on
          deferred terms or assignment or factoring or other similar agreement
          and all such assets are in the possession or under the control of the
          Company.

     (ix) As of the Date of Closing, total current assets of the Company minus
          total liabilities (including but not limited to payables and
          outstanding loans) are equal to at least RMB500,000.

     (x)  There has been no breach by the Seller or the Company or by any of
          their respective officers or employees (in their capacity as such) of
          any legislation or regulations affecting the Company or its business.

     (xi) There has been no breach by the Seller or the Company of any contract,
          agreement or covenant to which the Seller or the Company is a party;
          if any dispute arises under or in connection with such contract,
          agreement or

                                 Page 13 of 23

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                     Agreement on Transfer of Equity Shares

          covenant for matters that have taken place up to the Closing Date, the
          Sellers agree to indemnify the Purchaser and the Company, without
          delay, for all reasonable costs of settling such disputes.

     (xii) The Company has since December 31, 2005 carried on business in the
          ordinary and usual course and has not entered into any contract which
          is onerous in nature and may affect the Purchaser's decision to
          purchase the Transferred Shares.

     (xiii) Unless otherwise disclosed to the Purchaser in writing, the Company
          is not engaged (whether as plaintiff, defendant or otherwise) in any
          litigation or arbitration, administrative or criminal or other
          proceeding, and no litigation or arbitration, administrative or
          criminal or other proceedings against the Company is pending,
          threatened or expected, and there is no fact or circumstance likely to
          give rise to any such litigation or arbitration, administrative or
          criminal or other proceedings, or to any proceedings against any
          director, officer or employee (past or present) of the Company in
          respect of any act or default for which the Company might be
          vicariously liable.

     (xiv) The Company have not issued or granted, or made any commitment
          capable of being realised after the Execution Date to issue or grant,
          any guarantee, commercial paper, Encumbrance or other security to
          secure any current, contingent or future liability or obligation of
          the Seller or any third party.

     (xv) The Company has been in strict compliance with all the requirements
          under Chinese law with respect to environmental protection, public
          health, production safety and labor matters. No notices, complaints,
          demands or proceedings have been received, by the Company or the
          Seller, in relation to any of such issues. There is no condition
          requiring decontamination or other remedial action. If any dispute
          arises with the relevant authorities charged with the application of
          environmental protection, public health, production safety, labor
          matters and other relevant laws and regulations for matters that have
          taken place up to the Closing Date, the Seller agrees to indemnify the
          Purchaser, without delay, for all reasonable costs of settling such
          disputes, including any interests charged or penalty imposed.

     (xvi) Before the Closing Date, the land on which the Company has been
          located, including the relative surface water, does not have any toxic
          or noxious residues which violate the regulations of China as the
          Company has not carried out such operations as to cause contamination
          in the above places and in all events have carried out all necessary
          clean-up operations

                                 Page 14 of 23

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                     Agreement on Transfer of Equity Shares

          of the same land as a result of the activities of third parties and/or
          the previous owners of the land.

     (xvii) The Company has fully and in a timely manner met their obligations
          resulting from tax, labor and social insurance legislation with
          respect to the filing of returns and the payment of taxes; adequate
          provisions have been made for taxes, public levies and social security
          contributions anticipated and/or not yet paid. If any dispute arises
          with the tax authorities or other authorities charged with the
          application of tax, labor social security and other relevant laws and
          regulations for matters that have taken place up to the Closing Date,
          the Sellers agree to indemnify the Purchaser, without delay, for all
          reasonable costs of settling such disputes, including any interests
          charged or penalty imposed.

     (xviii) No claims have been asserted by any person or entity against the
          Company over the use of intellectual property rights including
          patents, trademarks, trade names, copyrights, technology, know-how or
          processes or challenging or questioning the validity or effectiveness
          of any such license or agreement. In case of any such claim, there is
          no legally valid basis to it. The use of any intellectual property
          rights by the Company does not infringe on the rights of any third
          party.

7.2  Each of the Sellers acknowledges and accepts that the Purchaser is entering
     into this Agreement in reliance upon each of the Warranties notwithstanding
     any investigations which the Purchaser, its agents or advisors may have
     made, and jointly and severally undertake to indemnify the Purchaser and
     the Company against any loss, damages, costs (including all legal costs on
     a solicitor and own client basis), expenses or other liabilities which the
     Purchaser may incur in connection with:

     (i)  any of the Warranties being untrue or misleading or breached;

     (ii) the settlement of any claim that any of the Warranties are untrue or
          misleading or have been breached and in which the Seller acknowledges
          or confirms (on a with or without liability basis) that there has been
          a breach of Warranties;

     (iii) any arbitration or legal proceedings in which the Purchaser or the
          Company claims that any of the Warranties are untrue or misleading or
          have been breached, and in which settlement is reached under which the
          Seller (on a with or without liability basis) acknowledges that a
          Warranty is untrue or misleading or has been breached, or arbitration
          award or judgment is given for the Purchaser or the Company provided
          that if the arbitrator or court makes a ruling as to the payment of
          costs by the parties, then that ruling shall apply in lieu of the
          provisions of this Article; and

                                 Page 15 of 23

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                     Agreement on Transfer of Equity Shares

     (iv) the enforcement and amount of any such settlement or arbitration award
          or judgment.

7.3  Each of the Warranties shall be construed as a separate Warranty and (save
     as expressly provided to the contrary) shall not be limited or restricted
     by reference to, or inference from, the terms of any other Warranty or any
     other terms of this Agreement.

7.4  Any rights to which the Purchaser may be or become entitled to by reason of
     any of the Warranties, and all remedies which may be available to the
     Purchaser in consequence of any of the Warranties being untrue or
     misleading or breached, shall ensure for the benefit of any subsidiary or
     parent or holding company of the Purchaser and, accordingly, any loss which
     is sustained by the Purchaser in consequence of any of the Warranties being
     untrue, misleading or breached, shall be deemed also to be a loss of such
     subsidiary or parent or holding company, and such subsidiary or parent or
     holding company may bring proceedings and exercise any other remedy on the
     footing that it has been the beneficial owner of the Transferred Shares at
     all times since Closing.

7.5  Each of the Sellers hereby undertakes that he will, periodically and
     whenever requested, whether before or after Closing, forthwith disclose in
     writing to the Purchaser any event, fact or circumstance which may become
     known to him after the date hereof and which is materially inconsistent
     with any of the Warranties, or which could reasonably be expected to
     materially affect a purchaser's valuation of the Transferred Shares or
     which may entitle the Purchaser to make any claim under this Agreement.

7.6  Any breach of any of the Warranties or indemnities made or given by the
     Seller hereunder occurring before Closing shall, in addition and without
     prejudice to any other rights or remedies available to the Purchaser,
     entitle the Purchaser to rescind this Agreement forthwith (provided, in the
     case of rescission only, that such breach is material) and/or to sue for
     any breach thereof on the basis set out in this Article 7.

7.7  The Warranties shall be deemed repeated on each day up to the Closing Date
     and again on Closing (by reference to the facts then subsisting).

7.8  No claim shall be brought by the Purchaser for breach of any of the
     Warranties unless (i) the breach occurs during the period of 3 years
     following the Closing Date, and (ii) notice of such claim specifying in
     reasonable detail the breach to which the claim relates, the nature of the
     breach and the amount claimed (where ascertainable) has been received by
     the relevant Sellers not later than the expiry of the period of 38 months
     following the Closing Date.

                                 Page 16 of 23

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                     Agreement on Transfer of Equity Shares

7.9  The Sellers shall only be liable with respect to any claim under the
     Warranties if:

     (i)  the amount finally adjudicated or agreed as being payable with respect
          to such individual claim is in excess of US$ 1,000 or the equivalent
          amount thereof in any other currencies; and

     (ii) the aggregate amount finally adjudicated or agreed as being payable
          with respect to all such claims referred to in paragraph (i) above is
          in excess of US$ 10,000 or the equivalent amount thereof in any other
          currencies, in which event the Seller shall be liable for the whole
          amount and not merely for the excess.

7.10 If the Sellers shall pay to the Purchaser or the Company any amount by way
     of compensation or damages under a claim for breach of Warranties, and the
     Purchaser or the Company subsequently recovers from a third party any
     amount relating to such breach or claim, the Purchaser or the Company (as
     the case may be) shall repay to the Sellers such amount previously paid by
     them or so much thereof as does not exceed the amount recovered from the
     third party.

7.11 The provisions of Articles 7.8 to 7.10 shall not apply in the event of
     fraud or dishonesty on the part of any of the Sellers prior to the Closing
     Date.

7.12 If in respect of or in connection with any breach of any of the Warranties,
     any amount payable to the Purchaser or the Company by the Sellers is
     subject to taxation, the Sellers shall pay such additional amounts to the
     Purchaser or the Company so as to ensure that the net amount actually
     received by the Purchaser or the Company is equal to the full amount
     payable to the Purchaser or the Company under this Agreement.

7.13 If there is any breach of any of the Warranties or any provision of this
     Agreement by the Seller before the full payment of the Purchase Price, the
     Purchaser may, to the fullest extent afforded by PRC laws, without
     prejudice to any other rights that it may have, set off any loss or damage
     found to be suffered or incurred by it or the Company (or otherwise agreed)
     in connection with any such breach or set off any claim, against the
     Purchase Price.

                                    ARTICLE 8

                 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

8.1  The Purchaser represents and warrants that, as of the Effectiveness Date as
     well as the Closing Date:

                                 Page 17 of 23

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                     Agreement on Transfer of Equity Shares

     (i)  It is duly organised, validly existing and in good standing under the
          laws of Hong Kong SAR;

     (ii) It has obtained the consents, approvals or authorisation to enter into
          this Agreement required from its shareholders and/or board of
          directors pursuant to its articles of association, or required by law.
          Conclusion of this Agreement does not constitute a breach of any
          agreement or law by which the Purchaser is bound.

                                    ARTICLE 9

                                  EFFECTIVENESS

9.1  This Agreement shall become effective when it has been 1) signed by
     authorised representatives of all the Parties; and 2) duly approved by the
     Examination and Approval Authority in writing.

                                   ARTICLE 10

                                 CONFIDENTIALITY

10.1 For purpose of this Article, Confidential Information shall mean all
     information not in the public domain (and whether or not recorded in
     documentary form or on computer disc) including but not limited to:

     (i)  the business methods, corporate plans, management systems, finances,
          maturing new business opportunities or research and development
          projects of the Company;

     (ii) the marketing or sales of any products or services of the Company,
          including, without limitation, sales targets and statistics, market
          surveys and plans, sales techniques, price lists, contact details of
          customers or potential customers or any suppliers and potential
          suppliers to the Company, the nature of their business operations,
          their preferences, ability to pay and all confidential aspects of
          their business relationship with the Company; and

     (iii) any trade secrets, secret formulae, processes, inventions, designs,
          know-how, discoveries, technical specifications and other technical
          information relating to any product or service of the Company.

10.2 (i)  Before and after Closing, the Sellers:

          (a)  may not use or disclose to any person any Confidential
               Information belonging to the Company or otherwise relating to the
               Business which they have obtained during their operation; and

                                 Page 18 of 23

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                     Agreement on Transfer of Equity Shares

          (b)  will make every effort to prevent the use or disclosure of
               Confidential Information.

     (ii) Article 10.2(i) does not apply to:-

          (a)  disclosure of Confidential Information to a director or employee
               of the Purchaser or the Company whose function requires him to
               have the Confidential Information;

          (b)  disclosure of Confidential Information to a professional adviser
               for the purpose of advising the Sellers but only on terms that
               the provisions of Article 10 apply to the use or disclosure by
               such professional adviser of such Confidential Information;

          (c)  Confidential Information which has become public knowledge
               otherwise than, directly or indirectly, through the Sellers'
               breach of this Article 10; or

          (d)  disclosure of Confidential Information required by law or
               regulation (and then if and to the extent practicable only after
               consulting and taking into account the reasonable requirements of
               the Purchaser).

10.3 Each of the undertakings in this Article 10 is a separate and independent
     undertaking. If one or more of those undertakings is held to be void or
     unenforceable, the validity of the remaining undertakings will not be
     affected.

10.4 The Sellers agree that:-

     (i)  the restrictions and undertakings contained in Article 10 are
          reasonable and necessary for the protection of the Purchaser's
          legitimate interests in the goodwill of the Company; and

     (ii) if any such restrictions or undertakings are found to be void or
          voidable, but would be valid and enforceable if some part or parts of
          the restriction or undertaking were deleted, such restriction or
          undertaking will apply with such modifications as may be necessary to
          make it valid and enforceable.

10.5 The Parties acknowledge that since damages or an account of profits will
     not be an adequate remedy for a breach of the obligations in this Article
     10, the Purchaser is entitled to an injunction to prevent a breach or
     continued breach.

                                   ARTICLE 11

                                   TERMINATION

11.1 If this Agreement is terminated pursuant to Article 4.4, 6.3 and 7.6, then:

                                 Page 19 of 23

<PAGE>

                     Agreement on Transfer of Equity Shares

          (a)  all rights and obligations of the Parties will cease immediately
               upon termination except that termination will not affect the then
               accrued rights and obligations of the Parties (including the
               right to damages for the breach, if any, giving rise to the
               termination) and any other pre-termination breach by any of the
               Parties;

          (b)  the Parties shall, to their best efforts, coordinate to reverse
               the Transaction to the effect that this Agreement has never been
               executed by the Parties.

                                   ARTICLE 12

                               BREACH OF CONTRACT

12.1 In the event of any failure by any Party to perform any of its or his
     material obligations hereunder, or any representations and warranties set
     forth herein are inaccurate, untrue, or misleading, it shall constitute a
     breach of this Agreement ("Breach"). The Party in breach of this Agreement
     shall fully indemnify the non-breaching Party for any and all damages and
     losses suffered by the non-breaching Party as a result of the Breach.

12.2 The Party in breach shall have thirty (30) days within which to cure any
     Breach upon written notice of the non-breaching Party indicating the
     Breach. If a cure is not effected within the above time period, then the
     non-breaching Party shall be entitled to be compensated for all damages and
     losses related to and/or resulting from such breach, provided however that
     the non-breaching Party shall not be entitled to receive punitive or
     non-consequential damages.

12.3 In case of any breach of this Agreement by any of the Sellers, the
     Purchaser shall be entitled to deduct and set-off its damages and losses
     from and against the Purchaser Price. If the unpaid part of Purchase Price
     is not enough to cover such damages and losses, the Seller shall further
     compensate the Purchaser for the remaining amount of damages and losses.

                                   ARTICLE 13

                             SETTLEMENT OF DISPUTES

13.1 Any dispute, controversy or claim arising out of or relating to this
     Agreement, or the breach, termination or invalidity of this Agreement,
     shall be settled by arbitration in accordance with the UNCITRAL Arbitration
     Rules which are in force at the relevant time (and as the same may be
     amended by the remainder of this provision). The place of arbitration shall
     be in Hong Kong at the Hong Kong International Arbitration Centre. The
     Purchaser shall be entitled to appoint one arbitrator, the Sellers shall be
     jointly entitled to appoint one

                                 Page 20 of 23

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                     Agreement on Transfer of Equity Shares

     arbitrator, and the third arbitrator shall be appointed by Hong Kong
     International Arbitration Centre and serve as the chairman of the
     arbitration panel. The language to be used in such arbitration proceedings
     shall be English.

13.2 The arbitral award shall be final and binding on all the Parties
     (regardless of whether they are parties to the arbitration proceedings or
     not), and may be enforced by any court or judicial authority having
     competent jurisdiction over the party or its assets against whom the
     arbitral award is to be enforced.

13.3 Upon and after the submission of any dispute to arbitration, the Parties
     shall continue to exercise their remaining respective rights, and fulfil
     their remaining respective obligations under this Agreement, except insofar
     as the same may relate directly to the matters in dispute.

                                   ARTICLE 14

                                  MISCELLANEOUS

14.1 This Agreement and the rights of the Parties hereunder shall be construed
     and interpreted in accordance with the laws of the People's Republic of
     China. If there are no relevant Chinese laws, then standard international
     commercial practice shall apply.

14.2 Each of the Sellers shall be jointly and severally liable for any duties
     and responsibilities of the Sellers hereunder, including the
     representations and warranties made by the Sellers. In case of breach of
     any provisions of the Agreement, or any of the Sellers' representations and
     warranties is found to be mistaken or inaccurate, the Purchaser may claim
     against any and all of the Sellers at its sole discretion.

14.3 Each Party shall be responsible for the costs incurred by itself during or
     in connection with the drafting, negotiating and execution of this
     Agreement including costs for its legal and financial advisors, the costs
     and expenses incurred for conducting asset valuation, obtaining approvals,
     permits that it is required to obtain.

14.4 This Agreement supersedes all and any previous agreements or arrangements
     between the Parties relating to the sale and purchase of the Transferred
     Shares, and no future variation shall be effective unless made in writing,
     signed by each of the Parties and approved by the Examination and Approval
     Authority.

                                 Page 21 of 23

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                     Agreement on Transfer of Equity Shares

14.5 If at any time any provision of this Agreement is or become illegal,
     invalid or unenforceable in any respect, the remaining provision hereof
     shall in no way be affected or impaired thereby.

14.6 The attached schedules shall form an integral part of this Agreement. This
     Agreement constitutes the entire agreement between the Parties. There are
     not and shall be deemed not to be any verbal statements or undertakings
     between the Parties.

14.7 Except for any agreement made by the Parties in writing to the contrary, no
     failure or delay to exercise any right, power, priority or remedy under
     this Agreement will be deemed as waiver of such right, power, priority or
     remedy. Nor will any single or partial exercise of any right, power,
     priority or remedy preclude any other or further exercise of that or any
     other right, power, priority or remedy.

14.8 This Agreement is signed in eight (8) originals and each Party shall hold
     one (1) original and four (4) originals may be submitted to the Examination
     and Approval Authority. This Agreement is written in English and Chinese
     language and both language versions shall be equally valid.

(The rest of this page is intentionally left blank)

                                 Page 22 of 23

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                     Agreement on Transfer of Equity Shares

IN WITNESS WHEREOF, each Party hereto has caused this Agreement to be executed
by its authorised representatives:

Shenzhen, Guangdong Province, January 25, 2006

By: (ABLE NEW ENERGY CO., LIMITED)

/s/ John D. Kavazanjian
--------------------------------------
Authorized Representative:

By: (HUANG DEYONG)

/s/ Huang Deyong
--------------------------------------

By: (LI XIAOCHUN)

/s/ Li Xiaochun
--------------------------------------

By: (ZHU DEHONG)

/s/ Zhu Dehong
--------------------------------------

                                 Page 23 of 23

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