Document:

EXHIBIT
10.2

     

    EXECUTION
VERSION

     

    REGISTRATION
RIGHTS AGREEMENT

     

    This
REGISTRATION RIGHTS AGREEMENT, dated as of April 15, 2009 (the “Agreement”) by and
between China Recycling Energy Corporation, a Nevada corporation (the “Company”), on the one
hand, and Great Essential Investment, Ltd. (the “Investor”), on the
other hand.

     

    The
Agreement is made pursuant to that Share Purchase Agreement dated as of April
15, 2009 (the “Purchase Agreement”)
by and among the Company and its subsidiaries and the Investor, which provides
for, among other things, the issuance and sale 2,352,941 shares (the “Shares”)
of common stock, US$0.001 par value, of the Company (the “Shares”).

     

    As an
inducement to the Investor to enter into the Purchase Agreement, and in
satisfaction of one of the conditions to the obligations of the Investor
thereunder, the Company agrees with the Investor as follows:

     

    
      	
              
              

            	
              Section
      1.

            	
              Definitions.

            

    

     

    As used
in the Agreement, the following terms shall have the following
meanings:

     

    “Affiliate” means,
with respect to any Person, any other Person that (a) directly, or indirectly
through one or more intermediaries, controls, is controlled by or is under
common control with, such specified Person, (b) is an officer, director, general
partner, trustee or manager of such Person, or of a Person described in clause
(a) of this sentence, or (c) is a Relative of such specified Person or of an
individual described in clause (a) or (b) of this sentence.  As used
in this definition, “Relative” means with
respect to any individual, (i) such individual’s spouse, (ii) any direct
descendent, parent, grandparent, great grandparent or sibling (in each case,
whether by blood or adoption) of such individual or such individual’s spouse,
and (iii) any spouse of a Person described in clause (ii) of this
sentence.

     

    “Business Day” means
any day other than a Saturday or Sunday or any day on which banks in the State
of New York are required or authorized to be closed.

     

    “Commission” means the
Securities and Exchange Commission or any other agency at the time administering
the Securities Act.

     

    “Closing Date” has the meaning
set forth in the Subscription Agreement.

     

    “Common Stock” means
the common stock, $0.001 par value per share, of the Company.

     

    “Deemed Underwriter
Inspectors” shall
have the meaning set forth in Section

     

    “Effective Date” shall
have the meaning set forth in Section
2(a).

     

    
      
         

      

      
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    “Effectiveness Date”
means, with respect to the Registration Statement required to be filed pursuant
to Section 2
hereunder, the earlier of (a) the 120th calendar day following the Filing Date
(or 150th calendar day following the Filing Date in the event of a full review
by the Commission) and (b) the fifth (5th) Business Day following the date on
which the Company is notified by the Commission that the Registration Statement
will not be reviewed or is no longer subject to further review and
comments.

     

    “Effectiveness Period”
shall have the meaning set forth in Section
2(a).

     

    “Electing Holder”
shall have the meaning set forth in Section
3(a).

     

    “Event” shall have the
meaning set forth in Section
2(h).

     

    “Event Date” shall
have the meaning set forth in Section
2(b).

     

    “Exchange Act” means
the Securities Exchange Act of 1934, as amended, or any successor statute, and
the rules and regulations of the Commission promulgated thereunder, all as the
same shall be in effect from time to time.

     

    “Filing Date” means,
with respect to the Registration Statement required to be filed pursuant to
Section 2
hereunder, unless such other date is agreed to by the Holders, in its sole
discretion, the earlier of (A) the date on which such Registration Statement is
deemed to be filed initially with the Commission and (B) (i) the 120th calendar
day following the Holder’s exercise of a mandatory registration right pursuant
to Section 2(a)
hereof.

     

    “Free Writing
Prospectus” means a free writing prospectus as defined in Rule 405 under
the Securities Act.

     

    “Holders” means the
Investor or any transferee of such Registrable Shares and the rights under this
Agreement pursuant to Section 10
hereof

     

    “Issuer Free Writing
Prospectus” means an issuer free writing prospectus as defined in Rule
433 under the Securities Act.

     

    “Permitted Free Writing
Prospectus” shall have the meaning set forth in Section
6.

     

    “Person” shall be
construed in the broadest sense and means and includes a natural person, a
partnership, a corporation, an association, a joint stock company, a limited
liability company, a trust, a joint venture, an unincorporated organization and
any other entity and any federal, state, municipal, foreign or other government,
governmental department, commission, board, bureau, agency or instrumentality,
or any private or public court or tribunal.

     

    “Prospectus” means the
prospectus included in the Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable Shares
covered by the Registration Statement, and all other amendments and supplements
to the Prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference in such
Prospectus.

     

    
      
         

      

      
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    “Registrable Shares”
means shares of Common Stock which have registration rights pursuant to any
agreement with the Company, including the Restricted Shares.

     

    “Registration
Statement” means, as the context requires, the registration statement
required to be filed pursuant to Section 2 or Section 3 hereunder,
including any applicable Prospectus, amendments and supplements to the
registration statement or applicable Prospectus, including pre- and
post-effective amendments, and all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference in such
Registration Statement.

     

    “Restricted Shares”
means shares of Common Stock issued under the Purchase Agreement.  As
to any particular Restricted Shares held by a Holder, once issued, such
Restricted Shares shall cease to be Restricted Shares when (i) all such shares
of Common Stock have been disposed of pursuant to such effective registration
statement, (ii) all such shares of Common Stock are eligible to be sold or
distributed pursuant to Rule 144(k) in a single transaction by the Holders, or
(iii) they shall have ceased to be outstanding.

     

    “Rule 144” means Rule
144 promulgated under the Securities Act or any successor rule thereto or any
complementary rule thereto (including, without limitation, Rule
144A).

     

    “Rule 405” means Rule
405 promulgated by the Commission pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.

     

    “Rule 415” means Rule
415 promulgated by the Commission pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.

     

    “Rule 424” means Rule
424 promulgated by the Commission pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.

     

    “Rule 430A” means Rule
430A promulgated by the Commission pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.

     

    “Securities Act” means
the Securities Act of 1933, as amended, or any successor statute, and the rules
and regulations of the Commission thereunder, all as the same shall be in effect
from time to time.

     

    “Holders” has the
meaning set forth in the Preamble to this Agreement.

     

    
      
         

      

      
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    “Purchase Agreement”
has the meaning set forth in the Recitals to this Agreement.

     

    “Trading Day” means a
day on which the Common Stock is trading on a Trading Market.

     

    “Trading Market” means
the following markets or exchanges on which the Common Stock is listed or quoted
for trading on the date in question: the NASDAQ Capital Market, the American
Stock Exchange, the New York Stock Exchange, the NASDAQ Global Market, or the
OTC Bulletin Board.

     

    
      	
            	
              Section
      2.

            	
              Mandatory
      Registration.

            

    

     

    (a)           Subject
to Section 4.7 of the Purchase Agreement, upon the written request of the
Holders of not less than 5,000,000 Registrable Shares, the Company shall prepare
and file with the Commission a Registration Statement covering the resale of all
of the Registrable Shares for an offering to be made on a continuous basis
pursuant to Rule 415, or if Rule 415 is not available for offers or sales of the
Registrable Shares, for such other means of distribution of Registrable Shares
as the Holders may specify.  The Registration Statement required
hereunder shall be on Form S-3 (except if the Company is not then eligible to
register for resale the Registrable Shares on Form S-3, in which case the
Registration Statement shall be on another appropriate form in accordance
herewith).  If the Company is not eligible to register for resale the
Registrable Shares on Form S-3, the Company shall not be obligated to file more
than three (3) Registration Statements pursuant to this Section
2(a).

     

    Subject
to Section
2(b), the Company shall use its best efforts to cause the Registration
Statement to be declared effective under the Securities Act (unless it becomes
effective automatically upon filing) as promptly as possible after the filing
thereof (but such effectiveness date shall not be later than the Effectiveness
Date), and shall use its best efforts to keep such Registration Statement
continuously effective under the Securities Act (including the filing of any
necessary amendments, post-effective amendments and supplements) until such date
when there are no longer any Registrable Shares outstanding (the “Effectiveness
Period”).  The Company shall telephonically request
effectiveness of the Registration Statement (unless it becomes effective
automatically upon filing) as of 5:00 pm Eastern Standard Time on a Trading
Day.  The Company shall promptly notify the Holders via facsimile or
email of the effectiveness of a Registration Statement on the same Trading Day
that the Company telephonically confirms effectiveness with the Commission (if
possible, otherwise as soon as practicable on the following Trading Day), which
shall be the date requested for effectiveness of a Registration Statement (the
“Effective
Date”), unless the Registration Statement becomes automatically effective
upon filing, in which case the “Effective Date” shall be the date on which the
Registration Statement was filed.  The Company shall, by 9:30 am
Eastern Standard Time on the Trading Day immediately after the Effective Date,
file a Rule 424(b) prospectus with the Commission.

     

    
      
         

      

      
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    (b)           If:
(1) the Registration Statement is not filed on or prior to the Filing Date (it
being understood that if the Company files the Registration Statement without
affording the Holders the opportunity to review and comment on the same as
required by Section
4(c), the Company shall not be deemed to have satisfied Section 2(b)(1)); or
(2) the Registration Statement does not become automatically effective or is not
declared effective by the Commission on or before the Effectiveness Date or (3)
after the Effective Date, a Registration Statement ceases for any reason to
remain continuously effective as to all Registrable Shares for which it is
required to be effective, or the Holders are not permitted to utilize the
Prospectus therein to resell such Registrable Shares in either event for thirty
(30) consecutive calendar days during any 12-month period (provided, no
suspension period may begin until at least twelve (12) months have passed since
any previous suspension period) (any such failure or breach being referred to as
an “Event,” and
for purposes of Section 2(b)(1) or
Section 2(b)(2)
the date on which such breach occurs, and for purposes of Section 2(b)(3) the
date on which such thirty (30) calendar day period is exceeded, being referred
to as an “Event
Date”), then in addition to any other rights or remedies the Holders may
have hereunder or under applicable law, the Holders shall receive from the
Company, on the Event Date and each thirty (30) day anniversary of the Event
Date until the applicable Event is cured with respect to each Restricted Share,
as liquidated damages and not as a penalty, cash in an amount equal to 1.0% of
the purchase price paid for the  shares of Common Stock purchased
under the Purchase Agreement (or a pro rata portion thereof if the period is
less than thirty (30) calendar days); provided, however, that in no
event shall the aggregate amounts paid as liquidated damages exceed 1.0% in any
thirty (30) calendar day period.  For purposes of the preceding
sentence, the applicable Event shall be deemed to be cured on: (x) in the case
of Section
2(b)(1), the date on which such Registration Statement is filed, (y) in
the case of Section
2(b)(2), the date on which such Registration Statement becomes effective
and (z) in the case of Section 2(b)(3), the
date on which such Registration Statement becomes effective again or any
Prospectus becomes usable again, as applicable.  Such payments shall
be made to the Investor in cash not later than three (3) Business Days following
the Event Date or end of each thirty (30) calendar day period, as
applicable.

     

    (c)           In
the event that, in the reasonable judgment of the Company, it is advisable to
suspend use of a Registration Statement or Prospectus therein due to pending
material developments or other events that have not yet been publicly disclosed
and as to which the Company believes public disclosure would be detrimental to
the Company, the Company shall notify the Holders to such effect, and, upon
receipt of such notice, the Holders shall immediately discontinue any sales of
Registrable Shares pursuant to such Registration Statement and/or Prospectus
until the Holders have received copies of a supplemented or amended prospectus
or until the holders are advised in writing by the Company that the then current
prospectus may be used and has received copies of any additional or supplemental
filings that are incorporated or deemed incorporated by reference in such
prospectus.  Notwithstanding anything to the contrary herein, the
Company shall not exercise its rights under the preceding sentence to suspend
sales of Registrable Shares for a period in excess of sixty (60) consecutive
calendar days during any 12-month period; provided, no
suspension period may begin until at least twelve (12) months have passed since
any previous suspension period.

     

    
      
         

      

      
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    (d)           The
Holders acknowledge that the SEC has recently given enhanced scrutiny to
registration statements attempting to register the resale of shares obtained by
purchasers in private placements and that such SEC reviews have resulted in
registrants being denied the use of Rule 415(a)(1)(i).  Accordingly,
the Holders agree that (i) the Company shall not be obligated to pay any amount
of liquidated damages under subsection (b) above
in the event a Registration Statement is not declared effective on or prior to
the Event Date solely as a result of or in connection with a determination by
the SEC that either the Company or the Holders are ineligible to rely on Rule
415(a)(l)(i) under the Securities Act with respect to the registration of any of
the Registrable Securities for resale by the Holders on a continuous or delayed
basis; provided, that the
Company shall thereafter use its commercially reasonable efforts to find
alternative methods to register the Registrable Securities with the SEC for
resale; and (ii) in the event the Company, after conducting a pre-filing
conference with the SEC, if possible, reasonably determines that it is unable
to, or it is inadvisable for the Company to attempt to, register all of the
Registrable Securities in a single Registration Statement, the Company may elect
to fulfill the registration requirements of this Agreement by registering the
Registrable Securities in two or more Registration Statements, provided that the
Company shall use its best efforts to file each subsequent Registration
Statement no later than the earlier of (A) 60 days following the date on which
the last of the Registrable Securities registered under the preceding
Registration Statement were sold or (B) 6 months following the date on which the
preceding Registration Statement was declared effective.

     

    
      	
            	
              Section
      3.

            	
              Incidental
      Registration.

            

    

     

    (a)           Subject
to Section 4.7 of the Purchase Agreement, if at any time from and after the date
hereof, the Company proposes to register any of its securities under the
Securities Act (other than (A) any registration of public sales or distributions
solely by and for the account of the Company of securities issued (x) pursuant
to any employee benefit or similar plan or any dividend reinvestment plan, or
(y) pursuant to a S-4 registration in connection with the acquisition of the
Company, or (B) pursuant to Section 2 hereof),
either in connection with a primary offering for cash for the account of the
Company or a secondary offering, the Company will, each time it intends to
effect such a registration, give written notice to all Holders at least ten (10)
but no more than thirty (30) business days prior to the expected initial filing
of a Registration Statement with the Commission pertaining thereto, informing
such Holders of its intent to file such Registration Statement, the expected
filing date, and of the Holders’ rights to request the registration of the
Registrable Shares held by such Holder (the “Company
Notice”).  Upon the written request of any Holder made within
ten (10) business days after any such Company Notice is given (which request
shall specify the Registrable Shares intended to be disposed of by such Holder
or its transferees and, unless the applicable registration is intended to effect
a primary offering of Shares for cash for the account of the Company, the
intended method of distribution thereof), the Company will use its reasonable
best efforts to effect the registration under the Securities Act of all
Registrable Shares which the Company has been so requested to register by such
Holders to the extent required to permit the disposition (in accordance with the
intended methods of distribution thereof or, in the case of a registration which
is intended to effect a primary offering for cash for the account of the
Company, in accordance with the Company’s intended method of distribution) of
the Registrable Shares so requested to be registered, including, if necessary,
by filing with the Commission a post-effective amendment or a supplement to the
Registration Statement or the related Prospectus or any document incorporated
therein by reference or by filing any other required document or otherwise
supplementing or amending the Registration Statement, if required by the rules,
regulations or instructions applicable to the registration form used by the
Company for such Registration Statement or by the Securities Act, any state
securities or blue sky laws, or any rules and regulations thereunder; provided, however, that if,
at any time after giving written notice of its intention to register any
securities and prior to the effective date of the Incidental Registration
Statement filed in connection with such registration, the Company shall
determine for any reason not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to each Holder and, thereupon, (A) in the case of a determination
not to register, the Company shall be relieved of its obligation to register any
Registrable Shares in connection with such registration (but not from its
obligation to pay the Registration Expenses incurred in connection therewith),
and (B) in the case of a determination to delay such registration, the Company
shall be permitted to delay registration of any Registrable Shares requested to
be included in such Registration Statement for the same period as the delay in
registering such other securities.  The registration rights granted
pursuant to the provisions of this Section 3(a) shall be
in addition to the registration rights granted pursuant to the other provisions
of this Agreement.

     

    
      
         

      

      
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    (b)           The
Company shall be required to include in the registration pursuant to this Section 3 the
percentage of the Registrable Shares held by the Holders in such registration as
will equal the fraction, (x) the numerator of which shall be the number of all
the Registrable Shares and (y) the denominator of which shall be the number of
shares of the outstanding capital stock of the Company on a fully-diluted basis,
in each case, immediately prior to the effectiveness of such registration
statement.  The number of Registrable Shares to be included in the
Incidental Registration shall be allocated pro rata among the Holders
thereof requesting inclusion in such registration on the basis of the number of
securities requested to be included by all such Holders.

     

    (c)           If
the registration pursuant to this Section 3 is
underwritten and in the good faith judgment of the managing underwriter the
inclusion of the Registrable Shares requested to be registered would interfere
with the successful marking of the offering, then the number of Registrable
Shares to be included in the offering will be reduced to such smaller number
with the participation in the offering to be in the following order of priority:
(1) first, the securities to which the Company proposes to sell for its own
account, (2) second, the shares of Registrable Shares requested by the Holders
to be included in such registration , pro rata among the Holders
thereof requesting inclusion in such registration on the basis of the number of
securities requested to be included by all such Holders, and (3) third, any
other securities requested to be included.

     

    
      	
            	
              Section
      4.

            	
              Preparation and
      Filing.

            

    

     

    If and
whenever the Company is under an obligation pursuant to the provisions of the
Agreement to effect the registration of any Registrable Shares, the Company
shall, as expeditiously as practicable:

     

    (a)           mail
a registration questionnaire to the Holders requesting information regarding
prospective selling shareholders as may be reasonably necessary to the Company’s
preparation of a registration statement.  The Holders shall have at
least ten (10) calendar days from the date on which registration questionnaire
is first mailed to the Holders to return a completed and signed registration
questionnaire to the Company.  The term “Electing Holder”
shall mean any Holder that has returned a completed and signed registration
questionnaire to the Company in accordance with this Section
3(a);

     

    
      
         

      

      
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    (b)           use
its best efforts to cause a registration statement that registers such
Registrable Shares to become and remain effective until all of such Registrable
Shares have been disposed of;

     

    (c)           furnish,
at least five (5) Business Days before filing of the Registration Statement or
other registration statement that registers such Registrable Shares, the
Prospectus or other prospectus relating thereto or any amendments or supplements
relating to such a registration statement or prospectus, to the Electing Holders
and any counsel of such holders copies of all such documents proposed to be
filed which documents shall be subject to review thereof.  If any such
Registration Statement refers to any Electing Holder by name or otherwise as the
holder of any securities of the Company, then such Electing Holder shall have
the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Electing Holder, to the effect that
the holding by such Electing Holder of such securities is not to be construed as
a recommendation by such Electing Holder of the investment quality of the
Company’s securities covered thereby or (ii) in the event that such reference to
such Electing Holder by name or otherwise is not required by the Securities Act
or any similar federal statute then in force, the deletion of the reference to
such Electing Holder in any amendment or supplement to the Registration
Statement filed or prepared subsequent to the time such reference ceases to be
required;

     

    (d)           prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to ensure the inclusion of all Registrable Shares in such applicable
registration statement and/or prospectus and as may be necessary to keep such
registration statement effective until all of such Registrable Shares have been
disposed of and to comply with the provisions of the Securities Act with respect
to the sale or other disposition of such Registrable Shares; cause the related
Prospectus or other prospectus to be amended oz supplemented by any required
prospectus supplement, and as so supplemented or amended to be filed pursuant to
Rule 424; and respond as promptly as reasonably possible to any comments
received from the Commission with respect to such Registration Statement or
other registration statement or any amendment thereto;

     

    (e)           notify
the Electing Holders immediately at any time when a prospectus relating to such
Registrable Shares or any document related thereto includes an untrue statement
of a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances then existing and, at the request of the Electing Holders
prepare and furnish to such Electing Holders a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the offerees of such shares, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing;

     

    
      
         

      

      
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    (f)           from
the date hereof until all of such Registrable Shares have been disposed of, the
Company shall promptly take such action as may be necessary, including preparing
a post-effective amendment or supplement to the Registration Statement or
Prospectus, or any document incorporated therein by reference, so that (i) each
of the Registration Statement and any amendment thereto and the Prospectus and
any amendment or supplement thereto (and each report or other document
incorporated by reference therein in each case) complies in all respects with
the Securities Act and the Exchange Act and the respective rules and regulations
thereunder, (ii) each of the Registration Statement and any amendment thereto
does not, when it becomes effective, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading and (iii) each of the Prospectus and any amendment or
supplement to the Prospectus does not at any time prior to the disposal of all
of such Registrable Shares include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading;

     

    (g)           notify
in writing the Electing Holders participating in such registration and their
counsel (i) of the receipt by the Company of any notification with respect to
any comments by the Commission with respect to such registration statement or
prospectus or any amendment or supplement thereto or any request by the
Commission for the amending or supplementing thereof or for additional
information with respect thereto, (ii) of the receipt by the Company of any
notification with respect to the issuance by the Commission of any stop order
suspending the effectiveness of such registration statement or prospectus or any
amendment or supplement thereto or the initiation or threatening of any
proceeding for that purpose, (iii) of the receipt by the Company of any
notification with respect to the suspension of the qualification of such
Registrable Shares for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purposes and (iv) of the existence of any fact or the
happening of any event that causes the Company to become an “ineligible issuer,”
as defined in Rule 405;

     

    (h)           use
its best efforts to register or qualify such Registrable Shares under such other
securities or blue sky laws of such jurisdictions as the Holders reasonably
request and do any and all other acts and things which may be reasonably
necessary or advisable to enable the Holders to consummate the disposition in
such jurisdictions of the Registrable Shares owned by the Holders; provided,
however, that the Company will not be required to qualify generally to do
business, subject itself to general taxation or consent to general service of
process in any jurisdiction where it would not otherwise be required to do so
but for this Section
4(h);

     

    (i)           without
limiting Section
4(h), use its best efforts to cause such Registrable Shares to be
registered with or approved by such other governmental agencies or authorities
as may be necessary by virtue of the business and operations of the Company to
enable the Electing Holders to consummate the disposition of such Registrable
Shares;

     

    (j)           use
its best efforts to avoid the issuance of, or, if issued, obtain the withdrawal
of (i) any order suspending the effectiveness of the Registration Statement, or
(ii) any suspension of the qualification (or exemption from qualification) of
any of the Registrable Shares for sale in any jurisdiction, at the earliest
practicable moment;

     

    (k)           furnish
to the Electing Holders such number of copies of a summary prospectus, if any,
or other prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as such Electing
Holders may reasonably request in order to facilitate the public sale or other
disposition of such Registrable Shares;

     

    
      
         

      

      
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    (1)           in
connection with any underwritten offering:

     

    (i)           use
its best efforts to obtain from its independent certified public accountants
comfort letters in customary form and at customary times and covering matters of
the type customarily covered by comfort letters and deliver such letters to any
applicable underwriters;

     

    (ii)           use
its best efforts to obtain from its counsel an opinion or opinions in customary
form and deliver such opinions to any applicable underwriters;

     

    (iii)           issue
and deliver customary officer’s and other closing certificates to any applicable
underwriters;

     

    (iv)           promptly
issue to any underwriter to which the Electing Holders may sell shares in such
offering, certificates evidencing such Registrable Shares;

     

    (v)           the
Company shall, if requested, promptly include or incorporate in a prospectus
supplement or post-effective amendment to the Registration Statement such
information as the applicable underwriters reasonably agree should be included
therein and to which the Company does not reasonably object and shall make all
required filings of such prospectus supplement or post-effective amendment as
soon as practicable after it is notified of the matters to be included or
incorporated in such prospectus supplement or post-effective
amendment;

     

    (m)           if
an Electing Holder is or is to be identified by the Commission or the NASD as an
“underwriter”, at the request of such Electing Holder, the Company shall (A)
furnish to such Electing Holder, on the date of the effectiveness of the
Registration Statement and thereafter from time to time on such dates as the
Holders may reasonably request (i) a comfort letter from the Company’s
independent certified public accountants at customary times in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the Holders, and
(ii) an opinion of counsel representing the Company for purposes of such
Registration Statement at customary times in form, scope and substance as is
customarily given in an underwritten public offering, addressed to the Holders,
and (B) permit such Electing Holder to participate in good faith in the
preparation of such registration or comparable statement and to require the
insertion therein of material, furnished to the Company in writing, which in the
reasonable judgment of such holder and its counsel should be included, subject
to review by the Company and their counsel after consultation with such
holder.  Notwithstanding anything herein to the contrary, no Electing
Holder shall be designated as an “underwriter” by the Company in any
Registration Statement without the consent of such Electing Holder;

     

    (n)           provide
a transfer agent and registrar (which may be the same entity and which may be
the Company) for such Registrable Shares;

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    (o)           otherwise
use its best efforts to comply with all applicable rules and regulations of the
Commission and make available to its security holders, as soon as reasonably
practicable, but in any event not later than eighteen months after (i) the
effective date (as defined in Rule 158(c) under the Securities Act) of the
Registration Statement, (ii) the effective date of each post-effective amendment
to the Registration Statement, and (iii) the date of each filing by the Company
with the Commission of an Annual Report on Form 10-K that is incorporated by
reference in the Registration Statement, an earnings statement of the Company
and its subsidiaries complying with Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);

     

    (p)           if
requested by an Electing Holder, the Company shall (i) as soon as practicable
incorporate in a prospectus supplement or post-effective amendment such
information as such Electing Holder reasonably requests to be included therein
relating to the sale and distribution of Registrable Shares, including, without
limitation, information with respect to the number of Registrable Shares being
offered or sold, the purchase price being paid therefor and any other terms of
the offering of the Registrable Shares to be sold in such offering; (ii) as soon
as practicable make all required filings of such prospectus supplement or
post-effective amendment after being notified of the matters to be incorporated
in such prospectus supplement or post-effective amendment; and (iii) as soon as
practicable, supplement or make amendments to any Registration Statement
reasonably requested by such holder;

     

    (q)           otherwise
use its best efforts to take all other steps necessary to effect the
registration of such Registrable Shares contemplated hereby; and

     

    (r)           in
connection with the due diligence efforts of any Electing Holder who is or is to
be identified as an “underwriter,” the Company shall make available for
inspection during business hours and upon reasonable advance request by (i) any
Electing Holder, (ii) counsel for such Electing Holder and (iii) one firm of
accountants or other agents retained by such Electing Holder (collectively, the
“Deemed Underwriter
Inspectors”), all Records, as shall be reasonably deemed necessary by
each Deemed Underwriter Inspector, and cause the Company’s officers, directors
and employees to supply all information which any Deemed Underwriter Inspector
may reasonably request.

     

    The
Company shall not permit any officer, director, underwriter, broker, or any
other Person acting on behalf of the Company to use any Free Writing Prospectus
in connection with the Registration Statement covering Registrable Shares,
without the prior written consent of the holders of a majority of the
Registrable Shares, which consent shall not be unreasonably withheld or
delayed.  Any consent to the use of a Free Writing Prospectus included
in an underwriting agreement to which the Electing Holders are parties shall be
deemed to satisfy the requirement for such consent.  The Holders, upon
receipt of any notice from the Company of any event of the kind described in
Sections 4(e)
or 4(g), shall
forthwith discontinue disposition of the Registrable Shares pursuant to the
registration statement covering such Registrable Shares until such holder’s
receipt of the copies of the supplemented or amended prospectus contemplated by
Sections 4(e)
or 4(g), and,
if so directed by the Company, the Holders shall deliver to the Company all
copies, other than permanent file copies then in such holder’s possession, of
the prospectus covering such Registrable Shares at the time of receipt of such
notice.

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    
      	
            	
              Section
      5.

            	
              Expenses.

            

    

     

    All
expenses incurred by the Company, and all expenses separately incurred by the
Holders, in complying with their obligations pursuant to the Agreement and in
connection with the registration and disposition of Registrable Shares,
including, without limitation, all registration and filing fees (including all
filing fees incident to filing with the NASD), fees and expenses of complying
with securities and blue sky laws, printing expenses, fees and expenses of the
Company’s counsel and accountants and the Holders’ counsel shall be paid by the
Company, including all underwriting fees and expenses (including legal expenses
and expenses of the Company’s other advisors); provided, however,
that all underwriting discounts and selling commissions applicable to the
Registrable Shares shall be borne by the Holders in the applicable underwritten
offering.

     

    
      	
            	
              Section
      6.

            	
              Indemnification.

            

    

     

    (a)           In
connection with any registration of any Registrable Shares under the Securities
Act pursuant to the Agreement, the Company shall indemnify and hold harmless the
Holders, its officers, directors, employees, members, partners, and advisors and
their respective Affiliates, each underwriter, broker or any other Person acting
on behalf of the Holders and each other Person, if any, who controls any of the
foregoing Persons within the meaning of the Securities Act against any losses,
claims, damages, liabilities, or actions joint or several (or actions in respect
thereof), to which any of the foregoing Persons may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or allegedly untrue statement of a material fact contained in
the registration statement under which such Registrable Shares were registered
under the Securities Act, any preliminary prospectus or final prospectus
contained therein or otherwise filed with the Commission, any amendment or
supplement thereto or any document incident to registration or qualification of
any Registrable Shares, or any Issuer Free Writing Prospectus, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading or, with respect to any prospectus, necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or any violation by the Company of the Securities Act or state
securities or blue sky laws applicable to the Company or relating to action or
inaction required of the Company in connection with such registration or
qualification under such state securities or blue sky laws; and shall reimburse
such Persons for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage, liability or
action (including any legal or other expenses incurred) arises out of or is
based solely upon an untrue statement or allegedly untrue statement or omission
or alleged omission made in said registration statement, preliminary prospectus,
final prospectus, amendment, supplement, Issuer Free Writing Prospectus or
document incident to registration or qualification of any Registrable Shares in
reliance upon and in conformity with written information furnished to the
Company by the Holders specifically for use in the preparation thereof or for
any Holder’s failure to deliver a prospectus, Issuer Free Writing Prospectus or
for selling any shares of Common Stock pursuant to such prospectus after the
Company has provided to the Holders written notice of the Company’s receipt of a
stop order relating to such Registration Statement or for selling any shares of
Common Stock pursuant to such prospectus after the Holders have received written
notice pursuant to Sections 4(e) or
4(g).

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    (b)           In
connection with any registration of Registrable Shares under the Securities Act
pursuant to the Agreement, each Electing Holder shall severally (based on the
percentage of all Registrable Shares included in such registration that were
owned by such holder) and not jointly and severally indemnify and hold harmless
the Company, each director of the Company, each employee and advisor of the
Company, each officer of the Company who shall sign such registration statement,
each underwriter, broker or other Person acting on behalf of the Holders, the
Affiliates of each of the foregoing, and each Person who controls any of the
foregoing Persons within the meaning of the Securities Act with respect to any
statement or omission from such registration statement, any preliminary
prospectus or final prospectus contained therein or otherwise filed with the
Commission, any amendment or supplement thereto or Issuer Free Writing
Prospectus or any document incident to registration or qualification of any
Registrable Shares, if such statement or omission was made in reliance upon and
in conformity with written information furnished to the Company or such
underwriter by such Electing Holder specifically for use in connection with the
preparation of such registration statement, preliminary prospectus, final
prospectus, amendment, supplement, document or Issuer Free Writing Prospectus;
provided,
however, that the maximum amount of liability in respect of such
indemnification shall be limited, in the case of each Electing Holder, to an
amount equal to the gross amount actually received by such Electing Holder from
the sale of Registrable Shares effected pursuant to such
registration.

     

    (c)           Promptly
after receipt by an indemnified party of notice of the commencement of any
action involving a claim referred to in this Section 5, such
indemnified party will, if a claim in respect thereof is made against an
indemnifying party, give written notice to the latter of the commencement of
such action.  The failure of any indemnified party to notify an
indemnifying party of any such action shall not (unless such failure shall have
a material adverse effect on the indemnifying party) relieve the indemnifying
party from any liability in respect of such action that it may have to such
indemnified party hereunder.  In case any such action is brought
against an indemnified party, the indemnifying party will be entitled to
participate in and to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be responsible for any
legal or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof; provided, however,
that if any indemnified party shall have reasonably concluded that there may be
one or more legal or equitable defenses available to such indemnified party
which are additional to or conflict with those available to the indemnifying
party, or that such claim or litigation involves or could have an effect upon
matters beyond the scope of the indemnity agreement provided hereunder, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party (but shall have the right to participate
therein with counsel of its choice) and such indemnifying party shall reimburse
such indemnified party and any Person controlling such indemnified party for
that portion of the fees and expenses of any counsel retained by the indemnified
party which is reasonably related to the matters covered by the indemnity
agreement provided hereunder.  If the indemnifying party assumes the
defense of a claim, the indemnified party shall agree to any settlement,
compromise or discharge of a claim that the indemnifying party may recommend
that has as the sole remedy monetary damages, that by its terms obligates the
indemnifying party to pay the full amount of the liability in connection with
such claim, and that has no finding or admission of any violation of any law or
regulation or of the rights of any Person and no effect on any other claims that
may be made against the indemnified party.  If the indemnifying party
is not entitled to, or elects not to, assume the defense of a claim, it will not
be obligated to pay the fees and expenses of more than one counsel with respect
to such claim.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

     

    (d)           If
the indemnification provided for hereunder is held by a court of competent
jurisdiction to be unavailable to an indemnified party with respect to any loss,
claim, damage, liability or action referred to herein, then the indemnifying
party, in lieu of indemnifying such indemnified party hereunder, shall
contribute to the amounts paid or payable by such indemnified party as a result
of such loss, claim, damage, liability or action in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with the statements
or omissions which resulted in such loss, claim, damage, liability or action as
well as any other relevant equitable considerations.  The relative
fault of the indemnifying party and of the indemnified party shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.  The parties agree that it would not be just and equitable
if contribution pursuant hereto does not take account of the equitable
considerations referred to herein.  No Person guilty or liable of
fraudulent misrepresentation shall be entitled to contribution from any
Person.

     

    (e)           Notwithstanding
any other provision of this Section 6, in no
event will any Electing Holder be required to undertake any liability or
obligation under this Section 6 for an
aggregate amount in excess of the dollar amount of the proceeds (after deducting
any fees, discounts and commissions applicable thereto) received by such
Electing Holder from the sale of such Electing Holder’s Registrable Shares
giving rise to such liability or obligation (net of all expenses paid by such
holder in connection with any claim relating to this Section 5 and the
amount of any damages such holder has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged
omission).

     

    (f)           The
obligations of the Company under this Section 6 shall be in
addition to any liability that the Company may otherwise have to any indemnified
party and the obligations of any indemnifying party under this Section 6 shall be in
addition to any liability that such indemnifying party may otherwise have to the
Company.  The remedies provided in this Section 5 are not
exclusive and shall not limit any rights or remedies that may otherwise be
available to an indemnified party at law or in equity.

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    Section
7.      Free Writing
Prospectus.  Each Holder represents that it has not prepared or
had prepared on its behalf or used or referred to or distributed, and agrees
that it will not prepare or have prepared on its behalf or use or refer to or,
except as contemplated by the Agreement, distribute, any Free Writing Prospectus
with respect to the sale of its Registrable Shares pursuant to the Registration
Statement, in each case, without the prior written consent of the Company not to
be unnecessarily withheld and, in connection with any underwritten offering, the
underwriters.  Any such Free Writing Prospectus consented to by the
Company and the underwriters, as the case may be, is hereinafter referred to as
a “Permitted Free
Writing Prospectus.”  The Company represents and agrees that it
has treated and will treat, as the case may be, each Permitted Free Writing
Prospectus as an Issuer Free Writing Prospectus, including in respect of timely
filing with the Commission, legending and record keeping.

     

    
      	
            	
              Section
      8.

            	
              Exchange Act
      Compliance.

            

    

     

    The
Company shall comply with all of the reporting requirements of the Exchange Act
applicable to it and shall comply with all other public information reporting
requirements of the Commission which are conditions to the availability of Rule
144.  The Company shall cooperate with the Holders in supplying such
information as may be necessary for the Holders to complete and file any
information reporting forms presently or hereafter required by the Commission as
a condition to the availability of Rule 144.  The Company shall cause
its counsel to issue a legal opinion to the Company’s transfer agent if required
by the Company’s transfer agent to effect the removal of any legend to the
extent that such legend is permitted to be removed in accordance with the terms
of Rule 144, the Agreement and the other applicable rules and
regulations.

     

    
      	
            	
              Section 9.

            	
              Remedies.

            

    

     

    The
Company acknowledges and agrees that any failure by the Company to comply with
its obligations under the Agreement may result in material irreparable injury to
the Holders for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely and that, in the event
of any such failure, the Holders or any holder of Registrable Shares may obtain
such relief as may be required to specifically enforce the Company’s obligations
hereunder.  The Company further agrees to waive the defense in any
action for specific performance that a remedy at law would be
adequate.

     

    
      	
            	
              Section 10.

            	
              Benefits of Agreement;
      Third Party Beneficiaries.

            

    

     

    Except as
provided herein, the Agreement shall bind and inure to the benefit of the
Company, the Holders and subject to Section 10, the
respective successors and permitted assigns of the Company and the
Holders.

     

    
      
        	
              	
                Section 11.

              	
                Assignment.

              

      

    

     

    The
Holders may assign its rights hereunder to any purchaser or transferee of
Registrable Shares; provided, however,
that such purchaser or transferee shall, as a condition to the
effectiveness of such assignment, be required to execute a counterpart to the
Agreement agreeing to be treated as a Holder whereupon such purchaser or
transferee shall have the benefits and liabilities of, and shall be subject to
the restrictions contained in, the Agreement as if such purchaser or transferee
was originally included in the definition of a Holder herein and had originally
been a party hereto.

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    
       

      
        	
              	
                Section 12.

              	
                Entire
      Agreement.

              

      

    

     

    The
Agreement, and the other writings referred to herein or delivered pursuant
hereto, contain the entire agreement among the parties hereto with respect to
the subject matter hereof and supersede all prior and contemporaneous
arrangements or understandings with respect thereto.

     

    Section
13.    Other Registration
Rights.  The Company will not, on or after the date of the
Agreement, enter into any agreement with respect to its securities that is
inconsistent with the rights granted to the Holders in the Agreement or
otherwise conflicts with the provisions hereof The Company shall not permit any
securities other than the Registrable Shares to be included in any Registration
Statement without the prior written consent of the Holders and upon terms
reasonably acceptable to the Holders.

     

    
      	
            	
              Section
      14.

            	
              Notices.

            

    

     

    All
notices, requests, consents and other communications hereunder to any party
shall be deemed to be sufficient if contained in a written instrument delivered
in person or sent by telecopy, electronic transmission, nationally-recognized
overnight courier or first class registered or certified mail, return receipt
requested, postage prepaid, addressed to such party at the address set forth
below or such other address as may hereafter be designated in writing by such
party to the other parties:

     

    (i)           if
to the Company, to:

     

    Room 909,
Tower B

    Chang’an
Metropolis Center No. 

    88
Nanguanzheng Street Xi’an

    710068,
China

    Attention:  Mr.
Guohua Ku

    Tel: +86
(29) 8765-1096

    Fax: +86
(29) 8765-1099

     

    (ii)           if
to the Investor, to:

    

    Great
Essential Investment, Ltd

    Akara
Building, 24 De Castro Street

    Wickhams
Cay 1

    Road Town
Tortola

    British
Virgin Islands

    Attention:
Mr. Jinghe Dong

    Tel:  86-29-8187-8609

    Fax:
86-29-8187-8609

     

    All such
notices, requests, consents and other communications shall be deemed to have
been delivered (a) in the case of personal delivery or delivery by telecopy, on
the date of such delivery, (b) in the case of dispatch by nationally-recognized
overnight courier, on the next Business Day following such dispatch and (c) in
the case of email, upon receipt of acknowledgement of receipt (d) in the case of
mailing, on the fifth Business Day after the posting thereof.

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

     

    
      	
            	
              Section 15.

            	
              Modifications;
      Amendments; Waivers.

            

    

     

    The terms
and provisions of the Agreement may not be modified or amended except pursuant
to a writing signed by the Company and the Holders.  Any waiver of any
provision of the Agreement requested by any party hereto must be granted in
advance, in writing by the party granting such waiver.

     

    
      	
            	
              Section 16.

            	
              Counterparts;
      Facsimile Signatures.

            

    

     

    The
Agreement may be executed in any number of original or facsimile counterparts,
and each such counterpart hereof shall be deemed to be an original instrument,
but all such counterparts together shall constitute but one
agreement.

     

    
      	
            	
              Section 17.

            	
              Headings.

            

    

     

    The
headings of the various sections of the Agreement have been inserted for
convenience of reference only and shall not be deemed to be a part of the
Agreement.

     

    
      	
            	
              Section 18.

            	
              Governing
      Law.

            

    

     

    The
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without giving effect to any law or rule that would cause the
laws of any jurisdiction other than the State of New York to be
applied.

     

    
      	
            	
              Section 19.

            	
              Severability.

            

    

     

    It is the
desire and intent of the parties that the provisions of the Agreement be
enforced to the fullest extent permissible under the law and public policies
applied in each jurisdiction in which enforcement is
sought.  Accordingly, in the event that any provision of the Agreement
would be held in any jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of the Agreement or affecting the
validity or enforceability of such provision in any other
jurisdiction.  Notwithstanding the foregoing, if such provision could
be more narrowly drawn so as to not be invalid, prohibited, or unenforceable in
such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn,
without invalidating the remaining provisions of the Agreement or affecting the
validity or enforceability of such provision in any other
jurisdiction.

     

    Section
20.    Survival.  The
respective indemnities, agreements, representations, warranties and other
provisions set forth in the Agreement or made pursuant hereto shall remain in
full force and effect, and shall survive the transfer and registration of the
Registrable Shares of the Holders.

     

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement on the date first written above.

     

    
      
        
          	 
      	
                  CHINA
      RECYCLING ENERGY 

                  CORPORATION

                
	 
      	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Guohua Ku

                
	 
      	
                  Name:

                	
                  Guohua
      Ku

                
	 
      	
                  Title:

                	
                  Chief
      Executive Officer

                
	 
      	 
      	 
      
	 
      	
                  GREAT
      ESSENTIAL INVESTMENT, LTD.

                
	 
      	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Jinghe Dong

                
	 
      	
                  Name:

                	
                  Jinghe
      Dong

                
	 
      	
                  Title:

                	
                  Executive
      Director

                

        

      

    

     

    
      
         

      

      
        18Exhibit
10.1 - 2009 Incentive Compensation Plan

     

    NEXT 1 INTERACTIVE,
INC.

    

    2009
INCENTIVE COMPENSATION PLAN

    

    
      	
              1.

            	
              PURPOSE

            

    

    

    The
purpose of this 2009 Incentive Compensation Plan of NEXT 1 INTERACTIVE, INC., a
Nevada corporation (the “Company”), is to advance the interests of the Company
(as herein defined) by encouraging Eligible Employees (as herein defined) to
acquire shares of the Company, thereby increasing their proprietary interest in
the Company, encouraging them to remain associated with the Company and
furnishing them with additional incentive to advance the interests of the
Company in the conduct of their affairs.

    

    
      	
              2.

            	
              DEFINITIONS

            

    

    

    As used
herein, the following definitions shall apply:

    

    
      	
               
      

            	
              (a)

            	
              "Administrator"
      means the Board or a Committee of the Board duly appointed by the Board as
      the Administrator hereof.

            

    

    

    
      	
               
      

            	
              (b)

            	
              "Affiliate" and
      "Associate"
      shall have the respective meanings ascribed to such terms in the
      Securities Act.

            

    

    

    
      	
               
      

            	
              (c)

            	
              "Applicable
      Laws" means the legal requirements relating to the administration
      of incentive compensation plans, if any, under applicable provisions of
      federal securities laws, state corporate and securities laws, the
      Securities Act, the rules of any applicable stock exchange or national
      market system, and the rules of any foreign jurisdiction applicable to
      Awards granted to residents
therein.

            

    

    

    
      	
               
      

            	
              (d)

            	
              "Award" means
      the grant of Restricted Stock under the
Plan.

            

    

    

    
      	
               
      

            	
              (e)

            	
              "Award
      Agreement" means the written agreement evidencing the grant of an
      Award executed by the Company and the Grantee, including any amendments
      thereto.

            

    

    

    
      	
               
      

            	
              (f)

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

            

    

    

    
      	
               
      

            	
              (g)

            	
              "Cause" means,
      with respect to the termination by the Company or a Related Entity of the
      Grantee's Continuous Service, that such termination is for “Cause” as such
      term is expressly defined in a then-effective written agreement between
      the Grantee and the Company or such Related Entity, or in the absence of
      such then-effective written agreement and definition, is based on, in the
      determination of the Administrator, the
  Grantee's:

            

    

    

    
      	
               
      

            	
              (i)

            	
              refusal
      or failure to act in accordance with any specific, lawful direction or
      order of the Company or a Related
Entity;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              unfitness
      or unavailability for service or unsatisfactory performance (other than as
      a result of Disability);

            

    

    

    
      	
               
      

            	
              (iii)

            	
              performance
      of any act or failure to perform any act in bad faith and to the detriment
      of the Company or a Related Entity;

            

    

    

    
      	
               
      

            	
              (iv)

            	
              dishonesty,
      intentional misconduct or material breach of any agreement with the
      Company or a Related Entity; or

            

    

    

    
      	
               
      

            	
              (v)

            	
              commission
      of a crime involving dishonesty, breach of trust, or physical or emotional
      harm to any person.

            

    

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (h)

            	
              "Change in
      Control" means a change in
      ownership or control of the Company effected through either of the
      following transactions:

            

    

    

    
      	
               
      

            	
              (i)

            	
              the
      direct or indirect acquisition by any person or related group of persons
      (other than an acquisition by the Company or by a Company-sponsored
      employee benefit plan or by a person that directly or indirectly controls,
      is controlled by, or is under common control with, the Company) of
      beneficial ownership of securities possessing more than fifty percent
      (50%) of the
      total combined voting power of the Company's outstanding securities
      pursuant to a tender or exchange offer made directly to the Company's
      shareholders which a majority of the Continuing Directors who are not
      Affiliates or Associates of the offeror do not recommend such shareholders
      accept, or

            

    

    

    
      	
               
      

            	
              (ii)

            	
              a
      change in the composition of the Board over a period of thirty-six (36)
      months or less such that a majority of the Board members (rounded up to
      the next whole number) ceases, by reason of one or more contested
      elections for Board membership, to be comprised of individuals who are
      Continuing Directors.

            

    

    

    
      	
               
      

            	
              (i)

            	
              "Committee"
      means any committee appointed by the Board to administer the
      Plan.

            

    

    

    
      	
               
      

            	
              (j)

            	
              "Common Stock"
      means the common stock of the
Company.

            

    

    

    
      	
               
      

            	
              (k)

            	
              "Company" means
      NEXT 1 INTERACTIVE, INC., a Nevada
corporation.

            

    

    

    
      	
               
      

            	
              (l)

            	
              "Consultant"
      means any person (other than an Employee or solely with respect to
      rendering services in such person's capacity as a Director) who is engaged
      by the Company or any Related Entity to render consulting or advisory
      services to the Company or such Related
Entity.

            

    

    

    
      	
               
      

            	
              (m)

            	
              "Continuing
      Directors" means members of the Board who either (i) have been
      Board members continuously for a period of at least thirty-six (36) months
      or (ii) have been Board members for less than thirty-six (36) months and
      were elected or nominated for election as Board members by at least a
      majority of the Board members described in clause 2.(h)(ii) who were
      still in office at the time such election or nomination was approved by
      the Board.

            

    

    

    
      	
               
      

            	
              (n)

            	
              "Continuous
      Service" means that the provision of services to the Company or a
      Related Entity in any capacity of Employee or Consultant is not
      interrupted or terminated.  Continuous Service shall not be
      considered interrupted in the case of (i) any approved leave of absence,
      (ii) transfers between locations of the Company or among the Company, any
      Related Entity, or any successor, in any capacity of Employee, Director or
      Consultant, or (iii) any change in status as long as the individual
      remains in the service of the Company or a Related Entity in any capacity
      of Employee, Director or Consultant (except as otherwise provided in the
      Award Agreement).  An approved leave of absence shall include
      sick leave, military leave, or any other authorized personal
      leave.  No such leave may exceed ninety (90) days, unless
      reemployment upon expiration of such leave is guaranteed by statute or
      contract.

            

    

    

    
      	
               
      

            	
              (o)

            	
              "Corporate
      Transaction" means any of the
      following transactions:

            

    

    

    
      	
               
      

            	
              (i)

            	
              a
      merger or consolidation in which the Company is not the surviving entity,
      except for a transaction the principal purpose of which is to change the
      jurisdiction in which the Company is
organized;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              the
      sale, transfer or other disposition of all or substantially all of the
      assets of the Company (including the capital stock of the Company's
      subsidiary corporations) in connection with the complete liquidation or
      dissolution of the Company; or

            

    

    

    
      	
               
      

            	
              (iii)

            	
              any
      reverse merger in which the Company is the surviving entity but in which
      securities possessing more than fifty percent (50%) of the total combined
      voting power of the Company's outstanding securities are transferred to a
      person or persons different from those who held such securities
      immediately prior to such merger.

            

    

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (p)

            	
              "Director" means
      a member of the Board or the board of directors of any Related
      Entity.

            

    

    

    
      	
               
      

            	
              (q)

            	
              "Disability"
      means that a Grantee is unable to carry out the responsibilities and
      functions of the position held by the Grantee by reason of any medically
      determinable physical or mental impairment.  A Grantee will not
      be considered to have incurred a Disability unless he or she furnishes
      proof of such impairment sufficient to satisfy the Administrator in its
      discretion.

            

    

    

    
      	
               
      

            	
              (r)

            	
              "Eligible
      Employee" means any person who is an Employee or a
      Consultant.

            

    

    

    
      	
               
      

            	
              (s)

            	
              "Employee" means
      any person, including an Officer or Director, who is a full-time or
      part-time employee of the Company or any Related
  Entity.

            

    

    

    
      	
               
      

            	
              (t)

            	
              "Fair Market
      Value" means, as of any date, the value of Common Stock determined
      as follows:

            

    

    

    
      	
               
      

            	
              (i)

            	
              Where
      there exists a public market for the Common Stock, the Fair Market Value
      shall be (A) the average closing price for a Share for the last seven
      (7) market trading days prior to the time of the determination (or, if no
      closing price was reported on those days, on the last seven trading days
      on which a closing price was reported) on the stock exchange determined by
      the Administrator to be the primary market for the Common Stock or the
      NASDAQ National Market, whichever is applicable or (B) if the Common
      Stock is not traded on any such exchange or national market system, the
      average of the closing bid and asked prices of a Share on the NASDAQ Small
      Cap Market for the seven (7) days prior to the time of the determination
      (or, if no such prices were reported on those days, on the last seven days
      on which such prices were reported), in each case, as reported in The Wall Street Journal
      or such other source as the Administrator deems reliable;
    or

            

    

    

    
      	
               
      

            	
              (ii)

            	
              In
      the absence of an established market for the Common Stock of the type
      described in 2(t)(i) above, the Fair Market Value thereof shall be
      determined by the Administrator in good
faith.

            

    

    

    
      	
               
      

            	
              (u)

            	
              "Grantee" means
      an Eligible Employee who receives an Award pursuant to an Award Agreement
      under the Plan.

            

    

    

    
      	
               
      

            	
              (v)

            	
              "Insider"
      means:

            

    

    

    
      	
               
      

            	
              (i)

            	
              a
      Director or Senior Officer of the
Company;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              a
      Director or Senior Officer of a person that is itself an Insider or
      Subsidiary of the Company;

            

    

    

    
      	
               
      

            	
              (iii)

            	
              a
      person that has:

            

    

    

    
      	
               
      

            	
              A.

            	
              direct
      or indirect beneficial ownership
of,

            

    

    

    
      	
               
      

            	
              B.

            	
              control
      or direction over, or

            

    

    

    
      	
               
      

            	
              C.

            	
              a
      combination of direct or indirect beneficial ownership of and control or
      direction over

            

    

    

    
      	
               
      

            	
              securities
      of the Company carrying more than 10% of the voting rights attached to all
      the Company's outstanding voting securities, excluding, for the purpose of
      the calculation of the percentage held, any securities held by the person
      as underwriter in the course of a distribution,
  or

            

    

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (iv)

            	
              the
      Company itself, if it has purchased, redeemed or otherwise acquired any
      securities of its own issue, for so long as it continues to hold those
      securities.

            

    

    

    (w)           "Officer" means a
person who is an officer, including a Senior Officer, of the Company or a
Related Entity within the meaning prescribed to under the Securities Act and the
rules and regulations promulgated thereunder.

    

    
      	
               
      

            	
              (w)

            	
              "Parent" means a
      "parent corporation", whether now or hereafter existing, which holds a
      majority of the voting shares of the
Company.

            

    

    

    
      	
               
      

            	
              (x)

            	
              "Plan" means
      this 2009 Incentive Compensation Plan as approved by the Company’s Board
      of Directors.

            

    

    

    
      	
               
      

            	
              (y)

            	
              "Related Entity"
      means any Parent, Subsidiary and any business, corporation, partnership,
      limited liability company or other entity in which the Company, a Parent
      or a Subsidiary holds a substantial ownership interest, directly or
      indirectly.

            

    

    

    
      	
               
      

            	
              (z)

            	
              "Restricted
      Stock" means Shares issued under the Plan to the Grantee for such
      consideration, if any, and subject to such restrictions on transfer,
      rights of first refusal, repurchase provisions, forfeiture provisions, and
      other terms and conditions as established by the
      Administrator.

            

    

    

    
      	
               
      

            	
              (aa)

            	
              "Securities Act"
      means the Securities Act of 1933, as
amended.

            

    

    

    
      	
               
      

            	
              (bb)

            	
              "Senior Officer"
      means:

            

    

    

    
      	
               
      

            	
              (i)

            	
              the
      chair or vice chair of the Board, the president, a vice-president, the
      secretary, the treasurer or the general manager of the
      Company;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              any
      individual who performs functions for a person similar to those normally
      performed by an individual occupying any office specified in paragraph
      2(bb)(i) above, and

            

    

    

    
      	
               
      

            	
              (iii)

            	
              the
      five (5) highest paid employees of the Company, including any individual
      referred to in paragraph 2(bb)(i) or 2(bb)(ii) and excluding a
      commissioned salesperson who does not act in a managerial
      capacity.

            

    

    

    
      	
               
      

            	
              (cc)

            	
              "Share" and
      “Shares”
      mean shares of the Common Stock of NEXT 1 INTERACTIVE,
  INC.

            

    

    

    
      	
               
      

            	
              (dd)

            	
              "Subsidiary"
      means a "subsidiary corporation", whether now or hereafter existing, as
      determined by British Columbia corporate
law.

            

    

    

    
      	
               
      

            	
              (ee)

            	
              "Related Entity
      Disposition" means the sale, distribution or other disposition by
      the Company of all or substantially all of the Company's interests in any
      Related Entity effected by a sale, merger or consolidation or other
      transaction involving that Related Entity or the sale of all or
      substantially all of the assets of that Related
  Entity.

            

    

    

    
      	
              3.

            	
              ADMINISTRATION

            

    

    

    
      	
            	
              (a)

            	
              Plan
      Administrator

            

    

    

    
      	
               
      

            	
              (i)

            	
              Administration with
      Respect to Eligible Employees.  With respect to grants of
      Awards to Eligible Employees, the Plan shall be administered by (A) the
      Board or (B) a Committee designated by the Board, which Committee shall be
      constituted in such a manner as to satisfy the Applicable
      Laws.  Once appointed, such Committee shall continue to serve in
      its designated capacity until otherwise directed by the
    Board.

            

    

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (ii)

            	
              Administration
      Errors.  In the event an Award is granted in a manner
      inconsistent with the provisions of this subsection 4(a), such Award shall
      be presumptively valid as of its grant date to the extent permitted by the
      Applicable Laws.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Powers of the
      Administrator.  Subject to Applicable Laws and the
      provisions of the Plan (including any other powers given to the
      Administrator hereunder), and except as otherwise provided by the Board,
      the Administrator shall have the authority, in its
    discretion:

            

    

    

    
      	
               
      

            	
              (i)

            	
              to
      select the Eligible Employees to whom Awards may be granted from time to
      time hereunder;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              to
      determine whether and to what extent Awards are granted
      hereunder;

            

    

    

    
      	
               
      

            	
              (iii)

            	
              to
      determine the amount of consideration to be covered by each Award granted
      hereunder;

            

    

    

    
      	
               
      

            	
              (iv)

            	
              to
      approve forms of Award Agreements for use under the
  Plan;

            

    

    

    
      	
               
      

            	
              (v)

            	
              to
      determine the terms and conditions of any Award granted
      hereunder;

            

    

    

    
      	
               
      

            	
              (vi)

            	
              to
      suspend the right of an Eligible Employee to receive an Award for any
      reason that the Administrator considers in the best interest of the
      Company;

            

    

    

    
      	
               
      

            	
              (vii)

            	
              to
      establish additional terms, conditions, rules or procedures to accommodate
      the rules or laws of applicable foreign jurisdictions and to afford
      Grantees favourable treatment under such laws; provided, however, that no
      Award shall be granted under any such additional terms, conditions, rules
      or procedures with terms or conditions which are inconsistent with the
      provisions of the Plan; and

            

    

    

    
      	
               
      

            	
              (viii)

            	
              to
      take such other action, not inconsistent with the terms of the Plan, as
      the Administrator deems
appropriate.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Effect of
      Administrator's Decision.  All decisions, determinations
      and interpretations of the Administrator shall be conclusive and binding
      on all persons.  However, the Board reserves the right to
      override such decisions, determinations and interpretations of the
      Administrator.

            

    

    

    
      	
              4.

            	
              ELIGIBILITY

            

    

    

    Awards
may be granted to Eligible Employees. An Eligible Employee, who has been granted
an Award may, if otherwise eligible, be granted additional Awards.

    

    
      	
              5.

            	
              TERMS AND CONDITIONS
      OF AWARDS

            

    

    

    
      	
               
      

            	
              (a)

            	
              Type of
      Awards.  The Administrator is authorized under the Plan
      to issue Restricted Stock to an Eligible Employee that is not inconsistent
      with the provisions of the Plan.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Designation of
      Award.  Each Award shall be designated in the Award
      Agreement.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Conditions of
      Award.  Subject to the terms of the Plan and Applicable
      Laws, the Administrator shall determine the provisions, terms, and
      conditions of each Award including, but not limited to, the Award vesting
      schedule, forfeiture provisions, form of payment (cash, Shares, or other
      consideration) upon settlement of the Award, and satisfaction of any
      performance criteria.  The performance criteria established by
      the Administrator may be based on any one of, or combination of, economic
      value added, market value added, achievement of individual or corporate
      objectives, or other measures of performance selected by the
      Administrator.  Partial achievement of the specified criteria
      may result in a payment or vesting corresponding to the degree of
      achievement as specified in the Award
Agreement.

            

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (d)

            	
              Acquisitions and Other
      Transactions. The Administrator may issue Awards under the Plan in
      settlement, assumption or substitution for, outstanding awards or
      obligations to grant future awards in connection with the Company or a
      Related Entity acquiring another entity, an interest in another entity or
      an additional interest in a Related Entity whether by merger, stock
      purchase, asset purchase or other form of
  transaction.

            

    

    

    
      	
               
      

            	
              (e)

            	
              Deferral of Award
      Payment. The Administrator may establish one or more programs under
      the Plan to permit selected Grantees the opportunity to elect to defer
      receipt of consideration upon an Award, satisfaction of performance
      criteria, or other event that absent the election would entitle the
      Grantee to payment or receipt of Shares or other consideration under an
      Award.  The Administrator may establish the election procedures,
      the timing of such elections, the mechanisms for payments of, and accrual
      of interest or other earnings, if any, on amounts, Shares or other
      consideration so deferred, and such other terms, conditions, rules and
      procedures that the Administrator deems advisable for the administration
      of any such deferral program.

            

    

    

    
      	
               
      

            	
              (f)

            	
              Separate
      Programs.  The Administrator may establish one or more
      separate programs under the Plan for the purpose of issuing particular
      forms of Awards to one or more classes of Grantees on such terms and
      conditions as determined by the Administrator from time to
      time.

            

    

    
      	
               
      

            	 

    

    
      	
               
      

            	
              (g)

            	
              Transferability of
      Awards.  Awards shall be transferable to the extent
      provided in the Award Agreement.

            

    

    

    
      	
               
      

            	
              (j)

            	
              Time of Granting
      Awards.  The date of grant of an Award shall for all
      purposes be the date on which the Administrator makes the determination to
      grant such Award, or such other date as is determined by the
      Administrator. Notice of the grant determination shall be given to each
      Employee or Consultant to whom an Award is so granted within a reasonable
      time after the date of such grant.

            

    

    

    
      	
               
      

            	
              (k)

            	
              Termination of
      Continuous Service.  If Continuous Service is terminated
      by the Company or a Related Party for “Cause,” or by a Grantee
      voluntarily, any unvested benefits under the Plan shall automatically
      expire.  If Continuous Service is terminated by retirement,
      death or Disability of a Grantee, or by the Company for other than Cause,
      unvested benefits will be earned in accordance with the vesting schedule
      in the Award Agreement.

            

    

    

    
      	
               
      

            	
              (l)

            	
              Shares
      Reserved.

            

    

    

    
      (a)       
Pool. The
aggregate number of shares of Restricted Stock that may be issued under this
Plan will not exceed ONE
MILLION SHARES (1,000,000) (the “Pool”).

    

    

    
      (b)       
Adjustments upon Changes in Stock.
In the event of any change in the outstanding Stock of the Company as a
result of a stock split, reverse stock split, stock dividend, recapitalization,
combination or reclassification, appropriate proportionate adjustments will be
made in:  (i) the aggregate number of shares of Stock in the Pool that
may be issued hereunder; (ii) other rights and matters determined on a per share
basis under this Plan hereunder.  Any such adjustments will be made
only by the Board, and when so made will be effective, conclusive and binding
for all purposes with respect to this Plan. No such adjustments will be required
by reason of the issuance or sale by the Company for cash or other consideration
of additional shares of its Stock or securities convertible into or exchangeable
for shares of its Stock.

    

    

    
      
        	
                6.

              	
                CONDITIONS UPON
      ISSUANCE OF SHARES

              

      

    

    

    Shares
shall not be issued pursuant to an Award unless such Award and the issuance and
delivery of such Shares pursuant thereto shall comply with all Applicable Laws,
and shall be further subject to the approval of counsel for the Company with
respect to such compliance.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    
      	
              7.

            	
              CORPORATE
      TRANSACTIONS/CHANGES IN CONTROL/RELATED ENTITY
      DISPOSITIONS

            

    

    

    Except as
may be provided in an Award Agreement the Administrator shall have the
authority, exercisable either in advance of any actual or anticipated Corporate
Transaction, Change in Control or Related Entity Disposition or at the time of
an actual Corporate Transaction, Change in Control or Related Entity Disposition
at the time of the grant of an Award under the Plan or any time while an Award
remains outstanding, to provide for the full automatic vesting of one or more
outstanding unvested Awards under the Plan and the release from restrictions on
transfer and repurchase or forfeiture rights of such Awards in connection with a
Corporate Transaction, Change in Control or Related Entity Disposition, on such
terms and conditions as the Administrator may specify.  The
Administrator also shall have the authority to condition any such Award vesting
or release from such limitations upon the subsequent termination of the
Continuous Service of the Grantee within a specified period following the
effective date of the Corporate Transaction, Change in Control or Related Entity
Disposition. The Administrator may provide that any Awards so vested or released
from such limitations in connection with a Change in Control or Related Entity
Disposition shall remain fully vested or released until the termination of the
Award. Effective upon the consummation of a Corporate Transaction, all
outstanding Awards under the Plan shall terminate unless assumed by the
successor company or its parent.

    

    
      	
              8.

            	
              EFFECTIVE DATE AND
      TERM OF PLAN

            

    

    

    The Plan
shall become effective as of April 22, 2009. It shall continue in effect until
April 21, 2019 unless sooner terminated.

    

    
      	
              9.

            	
              AMENDMENT, SUSPENSION
      OR TERMINATION OF THE PLAN

            

    

    

    
      	
               
      

            	
              (a)

            	
              The
      Board may at any time amend, suspend or terminate the Plan. To the extent
      necessary to comply with Applicable Laws, the Company shall obtain
      shareholder approval of any Plan amendment in such a manner and to such a
      degree as required.

            

    

    

    
      	
               
      

            	
              (b)

            	
              No
      Award may be granted during any suspension of the Plan or after
      termination of the Plan.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Any
      amendment, suspension or termination of the Plan (including termination of
      the Plan under Section 10(a), above) shall not affect Awards already
      granted, and such Awards shall remain in full force and effect as if the
      Plan had not been amended, suspended or terminated, unless mutually agreed
      otherwise between the Grantee and the Administrator, which agreement must
      be in writing and signed by the Grantee and the
  Company.

            

    

    

    
      	
              10.

            	
              NO EFFECT ON TERMS OF
      EMPLOYMENT/CONSULTING
RELATIONSHIP

            

    

    

    The Plan
shall not confer upon any Grantee any right with respect to the Grantee's
Continuous Service, nor shall it interfere in any way with his or her right or
the Company's right to terminate the Grantee's Continuous Service at any time,
with or without Cause.

    

    
      	
              11.

            	
              NO EFFECT ON
      RETIREMENT AND OTHER BENEFIT
PLANS

            

    

    

    Except as
specifically provided in a retirement or other benefit plan of the Company or a
Related Entity, Awards shall not be deemed compensation for purposes of
computing benefits or contributions under any retirement plan of the Company or
a Related Entity, and shall not affect any benefits under any other benefit plan
of any kind or any benefit plan subsequently instituted under which the
availability or amount of benefits is related to level of
compensation.

    

    
      	
              12.

            	
              GOVERNING
      LAW

            

    

    

    The Plan
shall be governed by the laws of the State of Nevada and the Federal laws of the
United States applicable therein; provided, however, that any Award Agreement
may provide by its terms that it shall be governed by the laws of any other
jurisdiction as may be deemed appropriate by the parties thereto.

    

    ***

    
      
         

      

      
        7

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