Document:

Exhibit 10.1

 

SHARE EXCHANGE
AGREEMENT

 

By and Among

 

Kandi Technologies, Corp.

 

and

 

KO NGA Investment Limited

 

and

 

GAO SHUPING

 

and

 

ZHENG XIUJIN

 

and

 

HU QIKUN

 

and

 

XU WENGE

 

and

 

LUO XIANSONG

 

and

 

LI QIAOHONG

 

and

 

WANG YINGXIONG

 

Dated as of February 13, 2012

 

    	 

    	 

    

 

SHARE
EXCHANGE AGREEMENT

 

This Share Exchange
Agreement is made effective as of the 13th day of February, 2012 by and among Kandi Technologies, Corp., a Delaware corporation,
with its primary office at Jinhua City Industrial Zone, Jinhua, Zhejiang Province, People’s Republic of China (“Kandi”);
KO NGA Investment Limited, a British Virgin Islands corporation, with its registration address at Portcullis TrustNet Chambers,
P.O. Box 3444, Road Town, Tortola, British Virgin Islands (“KO NGA”), and each of the individuals listed on
Schedule 1 attached hereto (individually, a “Seller” and collectively, the “Sellers”).

 

WHEREAS:

 

A.          The Sellers are
the owners of all of the issued and outstanding common shares in the capital of KO NGA; KO NGA is the sole owner of all share capital
of K S Asia Limited Group Limited, a Hong Kong corporation, (“K S Asia”), K S Asia is the sole owner and
shareholder of Yongkang K S Electric Limited, a Chinese company (“Yongkang”) and Yongkang is the sole owner
and shareholder of Yongkang Scrou Electric. Co., Ltd., a Chinese company (“Scrou”).

 

B.          Kandi has agreed
to issue common stock shares of Kandi to the Sellers as consideration for the purchase of all of the issued and outstanding
common shares of KO NGA held by the Sellers; and

 

C.          Upon the terms
and subject to the conditions set forth in this Agreement, the Sellers have agreed to sell all of the issued and outstanding common
shares of KO NGA to Kandi in exchange for common shares of Kandi.

 

NOW THEREFORE,
in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, covenant and agree as follows:

 

1.           DEFINITIONS

 

1.1         Definitions.
The following terms have the following meanings in this Agreement, unless the context indicates otherwise:

 

		(a)	“Agreement” shall mean this Agreement, and all the exhibits, schedules and other
documents attached or referred hereto, and all amendments and supplements, if any, hereto;

 

		(b)	“Closing” shall mean the completion of the Transaction, in accordance with Section
7 hereof, at which the Closing Documents shall be exchanged by the parties, except for those documents or other items specifically
required to be exchanged at a later time;

 

		(c)	“Closing Date” shall mean a date mutually agreed upon by the parties hereto
in writing and in accordance with Section 10.6 hereof following the satisfaction or waiver by Kandi and Sellers of the conditions
precedent set out in Section 5 hereof, respectively, provided that such date shall be no later than June 30, 2012 unless mutually
agreed to in writing by the Parties;

 

    	 

    	 

    

		(d)	“Closing Documents” shall mean the papers, instruments and documents required
to be executed and delivered at the Closing pursuant to this Agreement;

 

		(e)	“Exchange Act” shall mean the United States Securities Exchange Act of 1934,
as amended;

 

		(f)	“FINRA” means the Financial Industry Regulatory Authority;

 

		(g)	“Former Entity” means any entity other than K S Asia, Yongkang and Scrou that
has ever been owned by KO NGA or one of KO NGA’s subsidiaries.

 

		(h)	“GAAP” shall mean United States generally accepted accounting principles applied
in a manner consistent with prior periods;

 

		(i)	“Liabilities” shall include any direct or indirect indebtedness, guaranty, endorsement,
claim, loss, damage, deficiency, cost, expense, obligation or responsibility, fixed or unfixed, known or unknown, asserted choate
or inchoate, liquidated or unliquidated, secured or unsecured;

 

		(j)	“Kandi Shares” shall mean common stock shares of Kandi to be issued to the Sellers
by Kandi pursuant to this Agreement;

 

		(k)	“SEC” shall mean the United States Securities and Exchange Commission;

 

		(l)	“Securities Act” shall mean the United States Securities Act of 1933, as amended;

 

		(m)	“Taxes” shall mean all international, federal, state, provincial and local income
taxes, capital gains taxes, value-added taxes, franchise, personal property and real property taxes, levies, assessments, tariffs,
duties (including any customs duties), business license or other fees, sales, use and any other taxes relating to the assets of
the designated party or the business of the designated party for all periods up to and including the Closing Date, together with
any related charge or amount, including interest, fines, penalties and additions to tax, if any, arising out of tax assessments;
and

 

		(n)	“Transaction” shall mean the purchase of all of the issued and outstanding shares
of KO NGA by Kandi from the Sellers in consideration for the issuance of the Kandi Shares.

 

1.2         Schedules.
The following schedules are attached to and form part of this Agreement:

 

	Schedule 1	 	List of Sellers
	Schedule 2	 	Regulation S. Certificate

  

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1.3         Currency.
All references to currency in this Agreement are to United States Dollars, unless expressly stated otherwise.

 

2.           OFFER,
PURCHASE AND SALE OF SHARES

 

2.1         Offer, Purchase
and Sale of Shares. Subject to the terms and conditions of this Agreement, the Sellers hereby covenant and agree to sell, assign
and transfer to Kandi, and Kandi hereby covenants and agrees to purchase from the Sellers, all of the issued and outstanding shares
of KO NGA.

 

2.2          Consideration.

 

		(a)	Parties agree that the aggregate value of all of the issued and outstanding shares of KO NGA is
RMB 50,052,387.66, which value is primarily derived from KO NGA’s indirect, wholly-owned operating entity Scrou, does not
ascribe any amount of value to any Former Entity, and is based upon the year end December 31, 2011 financial report of Scrou and
a valuation report by Jinhua Jincheng Assets Evaluation Co., Ltd on January 19, 2012;

 

		(b)	As consideration for the sale of all of the issued and outstanding shares of KO NGA by the Sellers
to Kandi, Kandi shall issue the Kandi Shares pro rata to the Sellers, or a Seller’s designee, based on each Seller’s
“percentage interest” as set forth on Schedule 1 hereto at an aggregate price for the Kandi Shares equal to RMB 50,052,387.66;
and

 

		(c)	The price per share for the Kandi Shares in connection with the issuance shall be the average closing
price per share for the Kandi stock traded on NASDAQ for the 10 consecutive trading days prior to the effective date of this Agreement
(the “Stock Price”). The exchange rate between U.S. Dollar and Chinese RMB in connection with this stock issuance shall
be the middle rate published by the People’s Bank of China on the effective day of this Agreement (the “Exchange Rate”).

 

		(d)	The number of Kandi Shares to which each Seller shall be entitled shall be equal to a number derived
by multiplying such Seller’s “percentage interest” (as set forth on Schedule 1) by RMB 50,052,387.66, then
dividing by the Exchange Rate, and then dividing by the Stock Price.

 

		(e)	A sample Kandi Share distribution which assumes this Agreement was signed on February 1, 2012
is set forth on Schedule 1; if the Agreement had been effective February 1, 2012, the Exchange Rate would have been 6.31 and
the Stock Price would have been $3.412.

 

2.3          Share Exchange
Procedure. The Sellers may exchange their certificates representing their shares of KO NGA by delivering such certificates
to Kandi duly executed and endorsed in blank (or accompanied by a duly executed stock power endorsed in blank), in proper form
for transfer, signature guaranteed, and, if applicable, with all stock transfer and any other required documentary stamps affixed
thereto and with appropriate instructions to allow the transfer agent to issue certificates for Kandi Shares, together with a Certificate
of Non-U.S. Shareholder (the “Regulation S. Certificate”), a copy of which is attached as Schedule 2 hereto.

 

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2.4         Fractional
Shares. Notwithstanding any other provision of this Agreement, no certificate for fractional Kandi Shares will be issued in
the Transaction. In lieu of any such fractional shares, if a Seller would otherwise be entitled to receive a fraction of a Kandi
Share upon surrender of the certificate(s) representing all of such Seller’s ownership of shares of KO NGA for exchange pursuant
to this Agreement, such Seller will be entitled to have such fraction rounded up to the nearest whole number of Kandi Shares and
will receive from Kandi a stock certificate representing same.

 

2.5         Closing Date.
The Closing will take place, subject to the terms and conditions of this Agreement, on the Closing Date.

 

2.6         Registered
Shares.

 

		(a)	In order to register the Kandi Shares issued pursuant to the terms and conditions set forth in
this Agreement, Kandi will a file a S-3 registration statement, if it is available to Kandi, or a post-effective amendment pursuant
to an effective shelf registration statement within 90 days of the Closing Date. If Kandi is not qualified for an S-3 registration
statement, then Kandi shall prepare and file an S-1 registration statement for the Kandi Shares issued pursuant to the terms and
conditions set forth in this Agreement within 120 days of the Closing Date.

 

		(b)	Each Seller acknowledges and agrees that the Kandi Shares are being issued pursuant to an exemption
from the prospectus and registration requirements of the Securities Act. As required by applicable securities laws, each of the
Sellers agrees to abide by all applicable resale restrictions and hold periods imposed by all applicable securities laws. Until
the Kandi Shares are registered pursuant to Section 2.6(a), all certificates representing the Kandi Shares issued will be endorsed
with the following legend pursuant to the Securities Act in order to reflect the fact that the Kandi Shares will be issued to the
Sellers pursuant to an exemption from the registration requirements of the Securities Act:

 

“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (A)
IN THE ABSENCE OF (I) A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER THE SECURITIES ACT OR (II) AN OPINION
OF COUNSEL TO THE HOLDER THAT SUCH REGISTRATION IS NOT REQUIRED OR (B) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A OF THE SECURITIES
ACT. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.”

 

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3.           REPRESENTATIONS
AND WARRANTIES OF SELLERS

 

As of the Closing, KO NGA and the Sellers,
jointly and severally, represent and warrant to Kandi, and acknowledge that Kandi is relying upon such representations and warranties,
in connection with the execution, delivery and performance of this Agreement, notwithstanding any investigation made by or on behalf
of Kandi, as follows:

 

3.1         Organization
of KO NGA and its subsidiaries.

 

		(a)	KO NGA and its subsidiaries are corporations duly organized, validly existing and in good standing
under the laws of their respective jurisdictions of incorporation and each has the requisite corporate power and authority to own,
lease and carry on its business as now being conducted. KO NGA and its subsidiaries are duly qualified to do business and are in
good standing as foreign corporations in each of the jurisdictions in which they own property, lease property, do business, or
are otherwise required to do so, where the failure to be so qualified would have a material adverse effect on the business of KO
NGA and its subsidiaries taken as a whole.

 

		(b)	All of the issued and outstanding shares of KO NGA common stock have been duly authorized, are
validly issued, were not issued in violation of any pre-emptive rights and are fully paid and non-assessable, are not subject to
preemptive rights and were issued in full compliance with the laws of the British Virgin Islands. There are no outstanding options,
warrants, subscriptions, conversion rights, or other rights, agreements, or commitments obligating KO NGA to issue any additional
shares of KO NGA Common Stock, or any other securities convertible into, exchangeable for, or evidencing the right to subscribe
for or acquire from KO NGA any shares of KO NGA Common Stock. There are no agreements purporting to restrict the transfer of the
KO NGA Common Stock, no voting agreements, shareholders’ agreements, voting trusts, or other arrangements restricting or
affecting the voting of the KO NGA Common Stock.

 

		(c)	The issued and outstanding shares of each of KO NGA’s subsidiaries have been duly authorized,
are validly issued, were not issued in violation of any pre-emptive rights and are fully paid and non-assessable, are not subject
to preemptive rights and were issued in full compliance with all applicable laws. There are no outstanding options, warrants, subscriptions,
conversion rights, or other rights, agreements, or commitments obligating KO NGA or any of its subsidiaries to issue any additional
common stock of any of KO NGA’s subsidiaries, or any other securities convertible into, exchangeable for, or evidencing the
right to subscribe for or acquire any shares of the common stock of any of KO NGA’s subsidiaries. There are no agreements
purporting to restrict the transfer of the common stock of any of KO NGA’s subsidiaries, no voting agreements, shareholders’
agreements, voting trusts, or other arrangements restricting or affecting the voting of the common stock of any of KO NGA’s
subsidiaries.

 

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3.2         Standing.
Each Seller is a natural person having legal capacity to enter into this Agreement and to perform the Sellers’ obligations
hereunder and to consummate the Transaction. Each of this Agreement and any collateral document to which any Seller is a party
has been duly executed and delivered by such Seller and constitutes a legal, valid and binding obligation of such Seller, enforceable
against such Seller in accordance with its terms.

 

3.3         Ownership of
Equity. Each Seller (i) has good and valid title to and beneficial ownership of the number of shares of capital stock of the
KO NGA (the “Shares”) set forth opposite such Seller’s name on Schedule 1 free and clear of all liens,
pledges, security interests and encumbrances, (ii) has not granted any option, warrant or other right in or to any of the Shares,
and (iii) is not a party to any voting trust, voting agreement or shareholder agreement with respect to the Shares.

 

3.4          Authority.
KO NGA has all requisite corporate power and authority to execute and deliver this Agreement and any other document contemplated
by this Agreement (collectively, the “KO NGA Documents”) to be signed by KO NGA and to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The execution and delivery of each of the KO NGA Documents by
KO NGA and the consummation by KO NGA of the transactions contemplated hereby have been duly authorized by its board of directors
and no other corporate or shareholder proceeding on the part of KO NGA is necessary to authorize such documents or to consummate
the transactions contemplated hereby. This Agreement has been, and the other KO NGA Documents when executed and delivered by KO
NGA as contemplated by this Agreement will be, duly executed and delivered by KO NGA and this Agreement is, and the other KO NGA
Documents when executed and delivered by KO NGA, as contemplated hereby will be, valid and binding obligations of KO NGA enforceable
in accordance with their respective terms, except:

 

		(a)	as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors’ rights generally;

 

		(b)	as limited by laws relating to the availability of specific performance, injunctive relief, or
other equitable remedies; and

 

		(c)	as limited by public policy.

 

3.5         Legal Proceedings.
There are no suits, actions, claims, proceedings or investigations pending or, to the knowledge of Sellers, threatened against,
relating to or involving any Seller or KO NGA that would or would reasonably be expected to impair the ability of any Seller or
KO NGA to perform its respective obligations hereunder or prevent or delay the consummation of the Transaction.

 

3.6          Corporate Records
of KO NGA and its subsidiaries. The corporate records of KO NGA and its subsidiaries, as required to be maintained by them
pursuant to all applicable laws, are accurate, complete and current in all material respects, and the minute books of KO NGA and
its subsidiaries are, in all material respects, correct and contain all records required by all applicable laws in regards to all
proceedings, consents, actions and meetings of their respective boards of directors.

 

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3.7          Non-Contravention.
Neither the execution, delivery and performance of this Agreement, nor the consummation of the Transaction, will:

 

		(a)	conflict with, result in a violation of, cause a default under (with or without notice, lapse of
time or both) or give rise to a right of termination, amendment, cancellation or acceleration of any obligation contained in or
the loss of any material benefit under, or result in the creation of any lien, security interest, charge or encumbrance upon any
of the material properties or assets of KO NGA and its subsidiaries under any term, condition or provision of any loan or credit
agreement, note, debenture, bond, mortgage, indenture, lease or other agreement, instrument, permit, license, judgment, order,
decree, statute, law, ordinance, rule or regulation applicable to KO NGA or any of its subsidiaries, or any of their respective
material property or assets;

 

		(b)	violate any provision of the Articles of Incorporation, Bylaws or any other documents of KO NGA
or any of its subsidiaries or any applicable laws; or

 

		(c)	violate any order, writ, injunction, decree, statute, rule, or regulation of any court or governmental
or regulatory authority applicable to KO NGA or its subsidiaries or any of their respective material property or assets.

 

3.8         Actions and
Proceedings. There is no basis for and there is no action, suit, judgment, claim, demand or proceeding outstanding or pending,
or threatened against or affecting KO NGA and its subsidiaries or which involves any of the business, or the properties or assets
of KO NGA and its subsidiaries that, if adversely resolved or determined, would have a material adverse effect on the business,
operations, assets, properties, prospects, or conditions of KO NGA and its subsidiaries taken as a whole (a “Material
Adverse Effect”). There is no reasonable basis for any claim or action that, based upon the likelihood of its being asserted
and its success if asserted, would have such a Material Adverse Effect.

 

3.9          Compliance.

 

		(a)	Each of KO NGA and its subsidiaries is in compliance with, is not in default or violation in any
material respect under, and has not been charged with or received any notice at any time of any material violation of any statute,
law, ordinance, regulation, rule, decree or other applicable regulation to its business or operations;

 

		(b)	None of KO NGA and its subsidiaries is subject to any judgment, order or decree entered in any
lawsuit or proceeding applicable to its business and operations that would constitute a Material Adverse Effect;

 

		(c)	KO NGA and its subsidiaries have duly filed all reports and returns required to be filed with governmental
authorities and have obtained all governmental permits and other governmental consents, except as may be required after the execution
of this Agreement. All such permits and consents are in full force and effect, and no proceeding for the suspension or cancellation
of any of them, and no investigation relating to any of them, is pending or threatened, and none of them will be adversely affected
by the consummation of the Transaction; and

 

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		(d)	Each of KO NGA and its subsidiaries has operated in material compliance with all laws, rules, statutes,
ordinances, orders and regulations applicable to its business. None of KO NGA or its subsidiaries has received any notice of any
violation thereof, nor is aware of a valid basis therefore.

 

3.10       Filings, Consents
and Approvals. No filing or registration with, no notice to and no permit, authorization, consent, or approval of any public
or governmental body or authority or other person or entity is necessary for the consummation by KO NGA and its subsidiaries of
the Transaction contemplated by this Agreement or to enable Kandi to continue to conduct the business of KO NGA and its subsidiaries
after the Closing Date in a manner which is consistent with that in which the business is presently conducted.

 

3.11       Financial
Representations. Each of (a) the consolidated unaudited balance sheets for Scrou for the period ended December 31, 2011 (the
“Accounting Date”), together with related statements of income, cash flows, and changes in shareholder’s
equity for such interim period then ended (collectively, the “Scrou Financial Statements”) and (b) the consolidated
audited balance sheets for KO NGA for its last two fiscal years plus any consolidated unaudited balance sheets for KO NGA for the
period ended on the Accounting Date, together with related statements of income, cash flows, and changes in shareholder’s
equity for such fiscal years and interim period then ended (collectively, the “KO NGA Financial Statements”)
to be supplied on or before the Closing Date:

 

		(a)	are in accordance with the books and records of their respective entity; and

 

		(b)	present fairly the financial condition of their respective entity as of the respective dates indicated
and the results of operations for such periods.

 

Neither KO NGA nor Scrou has received any
advice or notification from its independent certified public accountants that KO NGA or Scrou has used any improper accounting
practice that would have the effect of not reflecting or incorrectly reflecting in the KO NGA Financial Statements, the books and
records of KO NGA, the Scrou Financial Statements or the books and records of Scrou, any properties, assets, liabilities, revenues,
or expenses. The books, records, and accounts of Scrou accurately and fairly reflect, in reasonable detail, the assets, and liabilities
of Scrou. Scrou has not engaged in any transaction, maintained any bank account, or used any funds of Scrou, except for transactions,
bank accounts, and funds which have been and are reflected in the normally maintained books and records of Scrou. The books, records,
and accounts of KO NGA accurately and fairly reflect, in reasonable detail, the assets, and liabilities of KO NGA. KO NGA has not
engaged in any transaction, maintained any bank account, or used any funds of KO NGA except for transactions, bank accounts, and
funds which have been and are reflected in the normally maintained books and records of KO NGA.

 

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3.12       Absence of
Undisclosed Liabilities. Neither Scrou nor KO NGA has any material liabilities or obligations either direct or indirect, matured
or unmatured, absolute, contingent or otherwise that exceed $10,000, which:

 

		(a)	are not set forth in the Scrou Financial Statements or the KO NGA Financial Statements, respectively,
and have not heretofore been paid or discharged;

 

		(b)	did not arise in the regular and ordinary course of business under any agreement, contract, commitment,
lease or plan specifically disclosed in writing to Kandi; or

 

		(c)	have not been incurred in amounts and pursuant to practices consistent with past business practice,
in or as a result of the regular and ordinary course of its business since the Accounting Date.

 

3.13       Tax Matters.

 

		(a)	None of KO NGA and its subsidiaries are presently under (nor have any of them received notice of
any contemplated) investigation or audit by any regulatory or governmental agency or body or any foreign or state taxing authority
concerning any fiscal year or period ended prior to the date hereof;

 

		(b)	All taxes required to be withheld by KO NGA and its subsidiaries on or prior to the date hereof
from employees for income taxes, social security taxes, unemployment taxes and other similar withholding taxes have been properly
withheld and, if required on or prior to the date hereof, have been deposited with the appropriate governmental agency; and

 

		(c)	Each of the Scrou Financial Statements and the KO NGA Financial Statements contain full provision
for all taxes including any deferred taxes that may be assessed to Scrou or KO NGA (as the case may be) for the accounting period
ended on the Accounting Date or for any prior period in respect of any transaction, event or omission occurring, or any profit
earned, on or prior to the Accounting Date or for any profit earned by Scrou or KO NGA (as the case may be) on or prior to the
Accounting Date or for which Scrou or KO NGA is accountable up to such date and all contingent liabilities for taxes have been
provided for or disclosed in the Scrou Financial Statements and the KO NGA Financial Statements.

 

3.14        Absence of
Changes.

 

Since the Accounting
Date, none of Scrou, KO NGA or any of KO NGA’s other subsidiaries has:

 

		(a)	incurred any liabilities, other than liabilities incurred in the ordinary course of business consistent
with past practice, or discharged or satisfied any lien or encumbrance, or paid any liabilities, other than in the ordinary course
of business consistent with past practice, or failed to pay or discharge when due any liabilities of which the failure to pay or
discharge has caused or will cause any material damage or risk of material loss to it or to any of its assets or properties;

 

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		(b)	sold, encumbered, assigned or transferred any material fixed assets or properties except for ordinary
course business transactions consistent with past practice;

 

		(c)	created, incurred, assumed or guaranteed any indebtedness for money borrowed, or mortgaged, pledged
or subjected any of the material assets or properties of Scrou, KO NGA or any of KO NGA’s other subsidiaries to any mortgage,
lien, pledge, security interest, conditional sales contract or other encumbrance of any nature whatsoever;

 

		(d)	made or suffered any amendment or termination of any material agreement, contract, commitment,
lease or plan to which it is a party or by which it is bound, or cancelled, modified or waived any substantial debts or claims
held by it or waived any rights of substantial value, other than in the ordinary course of business;

 

		(e)	declared, set aside or paid any dividend or made or agreed to make any other distribution or payment
in respect of its capital shares or redeemed, purchased or otherwise acquired or agreed to redeem, purchase or acquire any of its
capital shares or equity securities;

 

		(f)	suffered any damage, destruction or loss, whether or not covered by insurance, that materially
and adversely effects its business, operations, assets, properties or prospects;

 

		(g)	suffered any material adverse change in its business, operations, assets, properties, prospects
or condition (financial or otherwise);

 

		(h)	received notice or had knowledge of any actual or threatened labor trouble, termination, resignation,
strike or other occurrence, event or condition of any similar character which has had or might have an adverse effect on its business,
operations, assets, properties or prospects;

 

		(i)	made commitments or agreements for capital expenditures or capital additions or betterments exceeding
in the aggregate $5,000;

 

		(j)	other than in the ordinary course of business, increased the salaries or other compensation of,
or made any advance (excluding advances for ordinary and necessary business expenses) or loan to, any of its employees or directors
or made any increase in, or any addition to, other benefits to which any of its employees or directors may be entitled;

 

		(k)	entered into any transaction other than in the ordinary course of business consistent with past
practice; or

 

		(l)	agreed, whether in writing or orally, to do any of the foregoing.

 

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3.15       Absence of
Certain Changes or Events.

 

Since the Accounting
Date, there has not been:

 

		(a)	a Material Adverse Effect; or

 

		(b)	any material change by Scrou or KO NGA in its accounting methods, principles or practices.

 

3.16       Personal Property.
Scrou possesses, and has good and marketable title to all property necessary for the continued operation of the business of Scrou
as presently conducted and as represented to Kandi. All such property is used in the business of Scrou. All such property is in
reasonably good operating condition (normal wear and tear excepted), and is reasonably fit for the purposes for which such property
is presently used. All material equipment, furniture, fixtures and other tangible personal property and assets owned or leased
by Scrou is owned by Scrou free and clear of all liens, security interests, charges, encumbrances, and other adverse claims.

 

3.17       Intellectual
Property.

 

		(a)	Intellectual Property Assets. KO NGA and its subsidiaries own or hold an interest in all
intellectual property assets necessary for the operation of the business of KO NGA and its subsidiaries as they are currently conducted
(collectively, the “Intellectual Property Assets”), including:

 

		(i)	all functional business names, trading names, registered and unregistered trademarks, service marks
and applications (collectively, the “Marks”);

 

		(ii)	all patents, patent applications, and inventions, methods, processes and discoveries that may be
patentable (collectively, the “Patents”);

 

		(iii)	all copyrights in both published works and unpublished works (collectively, the “Copyrights”);
and

 

		(iv)	all know-how, trade secrets, confidential information, customer lists, technical information, data,
process technology, plans, drawings, and blue prints owned, used, or licensed by KO NGA and its subsidiaries as licensees or licensors
(collectively, the “Trade Secrets”).

 

		(b)	Agreements. To the best knowledge of the Sellers, there are no outstanding or threatened
disputes or disagreements with respect to any agreements to which KO NGA or any its subsidiaries is a party.

 

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		(c)	Intellectual Property and Know-How Necessary for the Business. KO NGA and its subsidiaries
are the owners of all rights, titles and interests in and to each of the Intellectual Property Assets, free and clear of all liens,
security interests, charges, encumbrances and other adverse claims, and has the right to use without payment to a third party of
all the Intellectual Property Assets. Each of KO NGA and is subsidiaries and all former and current employees and contractors of
KO NGA and its subsidiaries have executed written contracts, agreements or other undertakings with KO NGA and its subsidiaries
that assign all rights to any Intellectual Property Assets or other inventions, improvements, discoveries, or information relating
to the business of Scrou to Scrou. No employee, director, officer or shareholder of KO NGA or any of its subsidiaries owns directly
or indirectly in whole or in part, any Intellectual Property Asset which Scrou is presently using or which is necessary for the
conduct of its business. No employee or contractor of KO NGA and its subsidiaries has entered into any contract or agreement that
restricts or limits in any way the scope or type of work in which the employee may be engaged or requires the employee to transfer,
assign, or disclose information concerning his work to anyone other than Scrou.

 

		(d)	Trade Secrets. KO NGA and its subsidiaries have taken all reasonable precautions to protect
the secrecy, confidentiality and value of its Trade Secrets. KO NGA and its subsidiaries have good title and an absolute right
to use the Trade Secrets. The Trade Secrets are not part of the public knowledge or literature. KO NGA and its subsidiaries have
not been used, divulged, or appropriated either for the benefit of any person or entity or to the detriment of KO NGA and its subsidiaries.
No Trade Secret is subject to any adverse claim or has been challenged or threatened in any way.

 

3.18       Insurance.
The products sold by and the assets owned by Scrou are insured under various policies of general product liability and other forms
of insurance consistent with prudent business practices. All such policies are in full force and effect in accordance with their
terms, no notice of cancellation has been received, and there is no existing default by Scrou, or any event which, with the giving
of notice, the lapse of time or both, would constitute a default thereunder. All premiums to date have been paid in full.

 

3.19       Employees
and Consultants. All employees and consultants of KO NGA and its subsidiaries have been paid all salaries, wages, income and
any other sum due and owing to them by KO NGA or one of its subsidiaries, as at the end of the most recent completed pay period.
KO NGA and its subsidiaries are not aware of any labor conflict with any employees. No employee of KO NGA or its subsidiaries is
in violation of any term of any employment contract, non-disclosure agreement, non-competition agreement or any other contract
or agreement relating to the relationship of such employee with KO NGA and its subsidiaries or to any other nature of the business
conducted or to be conducted by KO NGA and its subsidiaries.

 

3.20       Real Property.
Each of the leases, subleases, claims or other real property interests (collectively, the “Leases”) to which
KO NGA or its subsidiaries is a party or is bound is legal, valid, binding, enforceable and in full force and effect in all material
respects. All rental and other payments required to be paid by KO NGA or its subsidiaries pursuant to any such Leases have been
duly paid and no event has occurred which, upon the passing of time, the giving of notice, or both, would constitute a breach or
default by any party under any of the Leases. The Leases will continue to be legal, valid, binding, enforceable and in full force
and effect on identical terms following the Closing Date. KO NGA and its subsidiaries have not assigned, transferred, conveyed,
mortgaged, deeded in trust, or encumbered any interest in the Leases or the leasehold property pursuant thereto.

 

    	13

    	 

    

3.21       Material Contracts
and Transactions. Each contract to which KO NGA or one of its subsidiaries is a party is in full force and effect, and there
exists no material breach or violation of or default under any contract, or any event that with notice or the lapse of time, or
both, will create a material breach or violation thereof or default under any contract by KO NGA and its subsidiaries. The continuation,
validity, and effectiveness of each contract will in no way be affected by the consummation of the Transaction contemplated by
this Agreement. There exists no actual or threatened termination, cancellation, or limitation of, or any amendment, modification
or change to any contract.

 

3.22       No Brokers.
None of KO NGA, KO NGA’s subsidiaries or Sellers has incurred any obligation or liability to any party for any brokerage
fees, agent’s commissions or finder’s fees in connection with the Transaction contemplated by this Agreement

 

3.23       Completeness
of Disclosure. No representation or warranty by Sellers or KO NGA in this Agreement nor any certificate, schedule, statement,
document or instrument furnished or to be furnished to Kandi pursuant hereto contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact required to be stated herein or therein or necessary to make any statement
herein or therein not materially misleading.

 

4.          REPRESENTATIONS
AND WARRANTIES OF KANDI

 

As of the Closing, Kandi represents and
warrants to KO NGA and the Sellers and acknowledges that KO NGA and the Sellers are relying upon such representations and warranties
in connection with the execution, delivery and performance of this Agreement, notwithstanding any investigation made by or on behalf
of KO NGA or the Sellers, as follows:

 

4.1       Organization
and Good Standing. Kandi is duly incorporated, organized, validly existing and in good standing under the laws of the State
of Delaware and has all requisite corporate power and authority to own, lease and carry on its business as now being conducted.

 

4.2       Authority.
Kandi has all requisite corporate power and authority to execute and deliver this Agreement and any other document contemplated
by this Agreement (collectively, the “Kandi Documents”) to be signed by Kandi and to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The execution and delivery of each of the Kandi Documents by
Kandi and the consummation by Kandi of the transactions contemplated hereby have been duly authorized by its board of directors
and no other corporate or shareholder proceeding on the part of Kandi is necessary to authorize such documents or to consummate
the transactions contemplated hereby. This Agreement has been, and the other Kandi Documents when executed and delivered by Kandi
as contemplated by this Agreement will be, duly executed and delivered by Kandi and this Agreement is, and the other Kandi Documents
when executed and delivered by Kandi, as contemplated hereby will be, valid and binding obligations of Kandi enforceable in accordance
with their respective terms, except:

 

    	14

    	 

    

		(a)	as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors’ rights generally;

 

		(b)	as limited by laws relating to the availability of specific performance, injunctive relief, or
other equitable remedies; and

 

		(c)	as limited by public policy.

 

4.3       Capitalization
of Kandi. The authorized capital stock of Kandi consists of 100,000,000 shares of Common Stock (the “Kandi Common
Stock”) with 27,445,600 shares of common stock issued and outstanding. Kandi has 10,000,000 shares of preferred stock
authorized, none of which are issued and outstanding. All of such outstanding shares are duly authorized and have been, or upon
issuance will be, validly issued and are fully paid and non-assessable.

 

4.4       Corporate Records
of Kandi. The corporate records of Kandi, as required to be maintained by it pursuant to the laws of the State of Delaware,
are accurate, complete and current in all material respects, and the minute book of Kandi is, in all material respects, correct
and contains all material records required by the law of the State of Delaware in regards to all proceedings, consents, actions
and meetings of the shareholders and the board of directors of Kandi.

 

4.5       Validity of
Kandi Common Stock Issuable upon the Transaction. The Kandi Shares to be issued to the Sellers, or their designees, upon consummation
of the Transaction in accordance with this Agreement will, upon issuance, have been duly and validly authorized and, when so issued
in accordance with the terms of this Agreement, will be duly and validly issued, fully paid and non-assessable.

 

4.6       No Brokers.
Kandi has not incurred any obligation or liability to any party for any brokerage fees, agent’s commissions or finder’s
fees in connection with the Transaction contemplated by this Agreement.

 

5.        CLOSING
CONDITIONS

 

5.1       Conditions
Precedent to Closing by Kandi. The obligation of Kandi to consummate the Transaction is subject to the satisfaction or written
waiver of the conditions set forth below by a date mutually agreed upon by the parties hereto in writing and in accordance with
Section 10.6. The Closing of the Transaction contemplated by this Agreement will be deemed to mean a waiver of all conditions
to Closing. These conditions precedent are for the benefit of Kandi and may be waived by Kandi in its sole discretion.

 

		(a)	Representations and Warranties. The representations and warranties of KO NGA and the Sellers
set forth in this Agreement will be true, correct and complete in all respects as of the Closing Date, as though made on and as
of the Closing Date and Sellers will have delivered to Kandi a certificate dated as of the Closing Date, to the effect that the
representations and warranties made by KO NGA and the Sellers in this Agreement are true and correct.

 

    	15

    	 

    

		(b)	Performance. All of the covenants and obligations that KO NGA and the Sellers are required
to perform or to comply with pursuant to this Agreement at or prior to the Closing must have been performed and complied with in
all material respects.

 

		(c)	Transaction Documents. This Agreement, the Scrou Financial Statements and all other documents
necessary or reasonably required to consummate the Transaction, all in form and substance reasonably satisfactory to Kandi, will
have been executed and delivered to Kandi.

 

		(d)	Third Party Consents. Kandi will have received duly executed copies of all third party consents
and approvals contemplated by this Agreement, in form and substance reasonably satisfactory to Kandi.

 

		(e)	No Material Adverse Change. No Material Adverse Effect will have occurred since the date
of this Agreement.

 

		(f)	No Action. No suit, action, or proceeding will be pending or threatened against Sellers
or KO NGA and its subsidiaries before any governmental or regulatory authority wherein an unfavorable judgment, order, decree,
stipulation, injunction or charge would:

 

		(i)	prevent the consummation of any of the transactions contemplated by this Agreement; or

 

		(ii)	cause the Transaction to be rescinded following consummation.

 

		(g)	Delivery of Financial Statements. Scrou will have delivered to Kandi the Scrou Financial
Statements, which financial statements will include audited financial statements for Scrou’s two most recent fiscal years,
prepared in accordance with GAAP. KO NGA will have delivered to Kandi the KO NGA Financial Statements, which financial statements
will include audited financial statements for KO NGA’s two most recent fiscal years, prepared in accordance with GAAP.

 

		(h)	Due Diligence Review of Financial Statements. Kandi will be reasonably satisfied with its
due diligence investigation and review of the Scrou Financial Statements.

 

		(i)	Due Diligence Generally. Kandi will be reasonably satisfied with its due diligence investigation
of KO NGA and its subsidiaries that is reasonable and customary in a transaction of a similar nature to that contemplated by the
Transaction, including:

 

		(i)	materials, documents and information in the possession and control of KO NGA or its subsidiaries
which are reasonably germane to the Transaction;

 

		(ii)	a physical inspection of the assets of Scrou by Kandi or its representatives;

 

    	16

    	 

    

		(iii)	a review by Kandi of all Material Agreements entered into by KO NGA or its subsidiaries; and

 

		(iv)	title to the material assets of Scrou.

 

		(j)	Surrender of Shares. Sellers shall surrender all of the issued and outstanding shares of
KO NGA to Kandi endorsed in blank for transfer from Sellers to Kandi.

 

		(k)	Former Entities. Yongkang shall have completed the transfer of its ownership and/or shares
in any entities other than Scrou to Sellers or a third party so that the only entities directly or indirectly owned by KO NGA are
K S Asia, Yongkang and Scrou. Yongkang shall deliver to Kandi a new business license issued by the China Administration for Industry
and Commerce providing that Yongkang has only one wholly owned subsidiary (Scrou).

 

5.2       Conditions
Precedent to Closing by Sellers. The obligation of the Sellers to consummate the Transaction is subject to the satisfaction
or written waiver of the conditions set forth below by a date mutually agreed upon by the parties hereto in writing and in accordance
with Section 10.6. The Closing of the Transaction will be deemed to mean a waiver of all conditions to Closing. These conditions
precedent are for the benefit of the Sellers and may be waived by Sellers in their discretion.

 

		(a)	Representations and Warranties. The representations and warranties of Kandi set forth in
this Agreement will be true, correct and complete in all respects as of the Closing Date, as though made on and as of the Closing
Date and Kandi will have delivered to Sellers a certificate dated the Closing Date, to the effect that the representations and
warranties made by Kandi in this Agreement are true and correct.

 

		(b)	Public Market. On the Closing Date, Kandi’s Common Stock will be traded on the NASDAQ
Global Market.

 

6.        ADDITIONAL
COVENANTS OF THE PARTIES

 

6.1       Confidentiality.
All information regarding the business of Kandi including, without limitation, financial information that Kandi provides to Sellers
during its due diligence investigation of Kandi will be kept in strict confidence by Sellers and will not be used (except in connection
with due diligence), dealt with, exploited or commercialized by Sellers or disclosed to any third party (other than Sellers’s
professional accounting and legal advisors) without Kandi’s prior written consent. All information regarding the business
of KO NGA and its subsidiaries including, without limitation, financial information that Sellers provides to Kandi during its due
diligence investigation of KO NGA and its subsidiaries will be kept in strict confidence by Kandi and will not be used (except
in connection with due diligence), dealt with, exploited or commercialized by Kandi or disclosed to any third party (other than
Sellers’s professional accounting and legal advisors) without Sellers’ prior written consent unless it is required
by the law or regulations. The Non-Disclosure Agreement, dated September 16, 2011, between the parties shall remain in full force
and effect for the period described therein or until September 16, 2014, whichever is later.

 

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6.2        Conduct of
KO NGA and its subsidiaries. From the date of this Agreement to the Closing Date, and except to the extent that Kandi otherwise
consents in writing, KO NGA and its subsidiaries will operate its business substantially as presently operated and only in the
ordinary course and in compliance with all applicable laws, and use its best efforts to preserve intact its good reputation and
present business organization and to preserve its relationships with persons having business dealings with it.

 

6.3        Certain Acts
Prohibited. Except as expressly contemplated by this Agreement or for purposes in furtherance of this Agreement, between the
date of this Agreement and the Closing Date, none of KO NGA nor any of its subsidiaries will, without the prior written consent
of Kandi:

 

		(a)	amend its Articles of Incorporation, Bylaws or other constating documents;

 

		(b)	incur any liability or obligation other than in the ordinary course of business or encumber or
permit the encumbrance of any of its properties or assets except in the ordinary course of business;

 

		(c)	dispose of or contract to dispose of any of its property or assets, including the Intellectual
Property Assets, except in the ordinary course of business consistent with past practice;

 

		(d)	issue, deliver, sell, pledge or otherwise encumber or subject to any lien any shares of KO NGA
Common Stock, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities;

 

		(i)	declare, set aside or pay any dividends on, or make any other distributions in respect of the KO
NGA Common Stock, or

 

		(ii)	split, combine or reclassify any KO NGA Common Stock or issue or authorize the issuance of any
other securities in respect of, in lieu of or in substitution for shares of KO NGA Common Stock; or

 

		(e)	not materially increase the benefits or compensation expenses of KO NGA and its subsidiaries, other
than as contemplated by the terms of any employment agreement in existence on the date of this Agreement, increase the cash compensation
of any director, executive officer or other key employee or pay any benefit or amount not required by a plan or arrangement as
in effect on the date of this Agreement to any such person.

 

6.4       Notification.
Between the date of this Agreement and the Closing Date, each of the parties to this Agreement will promptly notify the other parties
in writing if it becomes aware of any fact or condition that causes or constitutes a material breach of any of its representations
and warranties as of the date of this Agreement, if it becomes aware of the occurrence after the date of this Agreement of any
fact or condition that would cause or constitute a material breach of any such representation or warranty had such representation
or warranty been made as of the time of occurrence or discovery of such fact or condition. Should any such fact or condition require
any change in the Schedules relating to such party, such party will promptly deliver to the other parties a supplement to the Schedules
specifying such change. During the same period, each party will promptly notify the other parties of the occurrence of any material
breach of any of its covenants in this Agreement or of the occurrence of any event that may make the satisfaction of such conditions
impossible or unlikely.

 

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6.5        Access and
Investigation. Between the date of this Agreement and the Closing Date, KO NGA, will and will cause its representatives to:

 

		(a)	afford Kandi and its representatives full and free access to its personnel, properties, assets,
contracts, books and records, and other documents and data;

 

		(b)	furnish Kandi and its representatives with copies of all such contracts, books and records, and
other existing documents and data as required by this Agreement and as Kandi may otherwise reasonably request; and

 

		(c)	furnish Kandi and its representatives with such additional financial, operating, and other data
and information as Kandi may reasonably request.

 

All of such access,
investigation and communication by Kandi and its representatives will be conducted during normal business hours and in a manner
designed not to interfere unduly with the normal business operations of KO NGA and its subsidiaries. KO NGA will instruct its auditors
to co-operate with Kandi and its representatives in connection with such investigations.

 

6.6       Public Announcements.
Kandi and KO NGA each agree that they will not release or issue any reports or statements or make any public announcements relating
to this Agreement or the Transaction contemplated herein without the prior written consent of the other party, except as may be
required upon written advice of counsel to comply with applicable laws or regulatory requirements after consulting with the other
party hereto and seeking their reasonable consent to such announcement.

 

7.        CLOSING

 

7.1       Closing.
The Closing shall take place on the Closing Date at the office of Kandi or at such other location as agreed to by the parties.

 

7.2       Closing Deliveries
of Scrou and the Selling Shareholder. At Closing, Sellers will deliver or cause to be delivered the following, fully executed
and in form and substance reasonably satisfactory to Kandi:

 

		(a)	A fully executed and completed copy of this Agreement;

 

		(b)	share certificates representing the KO NGA Shares as required by Section 2.3 of this Agreement;

 

		(c)	all certificates and other documents required by Section 2.3 of this Agreement; and

 

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		(d)	the Scrou Financial Statements, the KO NGA Financial Statements and any other necessary documents,
each duly executed by Sellers, as required to give effect to the Transaction.

 

7.3       Closing Deliveries
of Kandi. At Closing, Kandi will deliver or cause to be delivered the following, fully executed and in form and substance reasonably
satisfactory to Sellers:

 

		(a)	copies of the resolutions or consent action adopted by or on behalf of the Board of Directors of
Kandi evidencing approval of this Agreement and the Transaction;

 

		(b)	any other necessary documents, each duly executed by Kandi, as required to give effect to the Transaction;
and

 

		(c)	certificates representing the Kandi Shares.

 

8.         INDEMNIFICATION

 

8.1        Certain Definitions.
For the purposes of this Article 8 the terms “Loss” and “Losses” mean any and all demands,
claims, actions or causes of action, assessments, losses, damages, Liabilities, costs, and expenses, including without limitation,
interest, penalties, fines and reasonable attorneys, accountants and other professional fees and expenses, but excluding any indirect,
consequential or punitive damages suffered by Kandi or KO NGA including damages for lost profits or lost business opportunities.

 

8.2       Agreement
of the Sellers to Indemnify. The Sellers will indemnify, defend, and hold harmless, to the full extent of the law, Kandi and
its shareholders from, against, and in respect of any and all Losses asserted against, relating to, imposed upon, or incurred by
Kandi and its shareholders by reason of, resulting from, based upon or arising out of:

 

		(a)	the breach by the Sellers or KO NGA of any representation or warranty of the Sellers or KO NGA
contained in or made pursuant to this Agreement or any certificate or other instrument delivered pursuant to this Agreement;

 

		(b)	the breach or partial breach by the Sellers or KO NGA of any covenant or agreement of the Sellers
or KO NGA made in or pursuant to this Agreement or any certificate or other instrument delivered pursuant to this Agreement;

 

		(c)	any misstatement, misrepresentation or breach of the representations and warranties made by the
Sellers contained in or made pursuant to the Certificate of Non-U.S. Shareholder executed by the Selling Shareholder as part of
the share exchange procedure detailed in Section 2.3 of this Agreement; or

 

		(d)	a claim against Kandi or any of its subsidiaries arising out of KO NGA’s prior direct or
indirect ownership of a Former Entity.

 

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8.3        Agreement
of Kandi to Indemnify. Kandi will indemnify, defend, and hold harmless, to the full extent of the law, the Sellers from, against,
for, and in respect of any and all Losses asserted against, relating to, imposed upon, or incurred by the Sellers by reason of,
resulting from, based upon or arising out of:

 

		(a)	the breach by Kandi of any representation or warranty of Kandi contained in or made pursuant to
this Agreement or any certificate or other instrument delivered pursuant to this Agreement; or

 

		(b)	the breach or partial breach by Kandi of any covenant or agreement of Kandi made in or pursuant
to this Agreement or any certificate or other instrument delivered pursuant to this Agreement.

 

9.         TERMINATION

 

9.1        Termination.
This Agreement may be terminated at any time prior to the Closing Date contemplated hereby by:

 

		(a)	mutual agreement of Kandi, KO NGA and Sellers representing 51% of the outstanding shares of KO
NGA;

 

		(b)	Kandi, if (i) there has been a material breach by KO NGA or the Sellers of any material representation,
warranty, covenant or agreement set forth in this Agreement on the part of KO NGA or the Sellers that is not cured, to the reasonable
satisfaction of Kandi, within ten business days after notice of such breach is given by Kandi (except that no cure period will
be provided for a breach by KO NGA or the Sellers that by its nature cannot be cured); or (ii) the due diligence inquiry into the
Scrou Financial Statements reveals material discrepancies from what has previously been represented to Kandi;

 

		(c)	KO NGA, if there has been a material breach by Kandi of any material representation, warranty,
covenant or agreement set forth in this Agreement on the part of Kandi that is not cured by the breaching party, to the reasonable
satisfaction of KO NGA, within ten business days after notice of such breach is given by Kandi (except that no cure period will
be provided for a breach by Kandi that by its nature cannot be cured);

 

		(d)	KO NGA or Kandi, upon payment of RMB 10 million to the other party; or

 

		(e)	KO NGA or Kandi if any permanent injunction or other order of a governmental entity of competent
authority preventing the consummation of the Transaction contemplated by this Agreement has become final and non-appealable.

 

9.2       Effect of Termination.
In the event of the termination of this Agreement as provided in Section 9.1, this Agreement will be of no further force or effect,
provided, however, that no termination of this Agreement will relieve any party of liability for any breaches of this Agreement
that are based on a wrongful refusal or failure to perform any obligations.

 

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10.        MISCELLANEOUS
PROVISIONS

 

10.1      Effectiveness
of Representations; Survival. Each party is entitled to rely on the representations, warranties and agreements of each of the
other parties and all such representations, warranties and agreements will be effective regardless of any investigation that any
party has undertaken or failed to undertake. Unless otherwise stated in this Agreement, and except for instances of fraud, the
representations, warranties and agreements will survive the Closing Date and continue in full force and effect until three (3)
years after the Closing Date.

 

10.2      Further Assurances.
Each of the parties hereto will co-operate with the others and execute and deliver to the other parties hereto such other instruments
and documents and take such other actions as may be reasonably requested from time to time by any other party hereto as necessary
to carry out, evidence, and confirm the intended purposes of this Agreement.

 

10.3      Amendment.
This Agreement may not be amended except by an instrument in writing signed by each of the parties.

 

10.4      Expenses.
Each party will bear its own costs incurred in connection with the preparation, execution and performance of this Agreement and
the Transaction contemplated hereby, including all fees and expenses of its own agents, representatives and accountants.

 

10.5      Entire Agreement.
This Agreement, the schedules attached hereto and the other documents in connection with this transaction contain the entire agreement
between the parties with respect to the subject matter hereof and supersede all prior arrangements and understandings, both written
and oral, expressed or implied, with respect thereto. Any preceding correspondence or offers are expressly superseded and terminated
by this Agreement.

 

10.6      Notices.
All notices and other communications required or permitted under this Agreement must be in writing and will be deemed given if
sent by email, personal delivery, faxed with electronic confirmation of delivery, internationally-recognized express courier or
registered or certified mail (return receipt requested), postage prepaid, to the parties at the addresses provided in this Agreement.

 

All such notices and
other communications will be deemed to have been received:

 

		(a)	In the case of email, on the day after the email has been sent;

 

		(b)	in the case of personal delivery, on the date of such delivery;

 

		(c)	in the case of a fax, when the party sending such fax has received electronic confirmation of its
delivery;

 

		(d)	in the case of delivery by internationally-recognized express courier, on the third business day
following dispatch; and

 

		(e)	in the case of mailing, on the seventh business day following mailing.

 

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10.7       Headings.
The headings contained in this Agreement are for convenience purposes only and will not affect in any way the meaning or interpretation
of this Agreement.

 

10.8       Benefits.
This Agreement is and will only be construed as for the benefit of or enforceable by those persons party to this Agreement.

 

10.9       Assignment.
This Agreement may not be assigned (except by operation of law) by any party without the consent of the other parties.

 

10.10      Governing
Law. This Agreement will be governed by and construed in accordance with the laws of the state of Delaware applicable to contracts
made and to be performed therein.

 

10.11      Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and
no rule of strict construction will be applied against any party.

 

10.12      Gender.
All references to any party will be read with such changes in number and gender as the context or reference requires.

 

10.13      Counterparts.
This Agreement may be executed in one or more counterparts, all of which will be considered one and the same agreement and will
become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.

 

10.14      Schedules.
The schedules are attached to this Agreement and are incorporated herein.

 

10.15      Effective.
This Agreement becomes effective upon the parties’ execution.

 

IN WITNESS WHEREOF the parties hereto
have executed this Agreement as of the day and year first above written.

 

	Kandi Technologies, Corp.	 
	 	 
	Per:	 	 
	 	Name:  Hu Xiaoming	 
	 	Title:  Chief Executive Officer	 
	 	 
	KO NGA Investment Limited	 
	 	 
	Per:	 	 
	 	Name:	 
	 	Title:	 

 

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	Sellers:	 
	 	 
	 	 
	GAO SHUPING	 
	 	 
	 	 
	ZHENG XIUJIN	 
	 	 
	 	 
	HU QIKUN	 
	 	 
	 	 
	XU WENGE	 
	 	 
	 	 
	LUO XIANSONG	 
	 	 
	 	 
	LI QIAOHONG	 
	 	 
	 	 
	WANG YINGXIONG	 

 

    	24

    	 

    

 

SCHEDULE
1

 

TO THE SHARE EXCHANGE AGREEMENT

Shareholders of KO NGA

 

	Name	 	Address	 	Number of
 KO NGA
 Shares held
 prior to
 Closing	 	
        Percentage

        Interest
	 	
        Sample

        Distribution

        of Kandi

        Shares

        (Sec 2.2(e))

	
        Gao SHUPING

        高淑萍

        (ID330722196606095922)
	 	
        NO 33 SHANGFANGJIAN XITIAN VILLAGE LONGSHAN
        TOWN, YONGKANG CITY, ZHEJIANG

        浙江永康市龙山镇溪田村上房尖33号
	 	42	 	16.6008	%	385,936
	
        ZHENG XIUJIN

        郑秀金

        (ID330722195909285921)
	 	
        NO 33 XIADIANKOU VILLAGE LONGSHAN TOWN,
        YONGKANG, ZHEJIANG

        浙江永康市龙山镇下奠口村33号
	 	30	 	11.8577	%	275,669
	
        HU QIKUN

        胡启昆

        (ID330722195811010014)
	 	
        NO 3218 JIULING EAST RAOD, DONGCHENG STREET,
        YONGKANG, ZHEJIANG

        浙江永康市东城街道九铃东路3218号
	 	24	 	9.4862.	%	220,535
	
        XU WENGE

        徐文革

        (ID330722196612120426)
	 	
        ROOM 503 NO 1166 JIULING WEST RAOD, XICHENG
        STREET, YONGKANG, ZHEJIANG

        浙江永康市西城街道九铃西路1166号503室
	 	41	 	16..2005	%	376,747
	
        LUO XIANSONG

        罗献松

        (ID330702197312252012)
	 	
        NO 24 YANGHUAN ROAD, WUCHENG AREA, JINHUA,
        ZHEJIANG

        浙江金华市婺城区杨环路24号
	 	30	 	11.8577	%	275,669
	
        Li QIAOHONG

        李巧红

        (ID330722196001310028)
	 	
        NO 3 BUILD 5 XIJIN ROAD, JIANGNAN STREET,
        YONGKANG, ZHEJIANG

        浙江永康市江南街道西津路5幢3号
	 	43	 	16.9960	%	395,125
	
        WANG YINGXIONG

        王英雄

        (ID330722197811044010)
	 	
        NO 8 LANE 40 NANSHAN ROAD, NANSHAN VILLAGE
        GUSHAN TOWN, YONGKANG, ZHEJIANG

        浙江永康市古山镇南山村南山路40弄
        8号
	 	43	 	16.9960	%	395,125

 

Schedule 1-1

 

    	 

    	 

    

  

SCHEDULE
2

 

FORM REGULATION
S. CERTIFICATE

 

Schedule 2-1EMPLOYMENT AGREEMENT

 

Amended March 31, 2012

 

THIS EMPLOYMENT AGREEMENT
is made and entered into this 16th day of May, 2011, (amended March 31, 2012) by and between Net Talk.com , Inc., a Florida corporation
(the "Company"), and ANASTASIOS N.KYRIAKIDES, residing at 1030 Street, Hollywood, Florida 33019 (the "Executive").

 

WITNESSETH:

 

		1.	EMPLOYMENT

 

The Company hereby
employs the Executive, and the Executive hereby accepts such employment, upon the terms and subject to the conditions set forth
in this Agreement. (The “Amendment Employment Agreement”)

 

		2.	TERM

 

Subject to the provisions
for termination as hereinafter provided, the term of employment under this Agreement shall begin as of May 16, 2011, and shall
continue through May 16, 2014, provided, however, (each such May 1st being referred to as a "Renewal Date"), the term
of this Agreement shall automatically be extended for an additional two years so that on each Renewal Date the then remaining unexpired
term of this Agreement shall be five years.

 

		3.	COMPENSATION

 

(a) Base Salary.       
The Company shall pay to the Executive as basic compensation for all services rendered by the Executive during the term of this
Agreement a basic annualized salary of $199,000 per year (starting January 1, 2012) the base salary will increase to $250,000),
or such other sum in excess of that amount as the parties may agree on from time to time or as provided in the next sentence (as
in effect from time to time, the "Base Salary"), payable monthly or in other more frequent installments, as determined
by the Company. The Board of Directors shall have the authority to increase the Executive's Base Salary in effect from time to
time. In addition, the Board of Directors, in its discretion, may award a bonus or bonuses to the Executive in addition to the
bonuses provided for in Section 3(b).

 

(b) Bonuses.       In
addition to the Base Salary to be paid pursuant to Section 3(a), for each of the Company's five fiscal years ending May 16, 2016,
to the extent earned, specified on Exhibit A to this agreement. For each fiscal year ending after May 16, 2011, the Company shall
pay to the Executive as incentive compensation annual bonuses in accordance with comparable incentive bonus plan(s) adopted by
the Board of Directors of the Company.

 

(c) Certain Plans and
Initial Award.      (i) It is anticipated that the Company will adopt certain incentive compensation
plans, including a long term incentive plan (the "LTIP"), providing for annual or other periodic awards to key employees,
among other things, of restricted stock, and a stock option plan (the "ISO/NSO Plan"), providing for the annual or other
periodic issuance of options to purchase the Company's common stock. The LTIP and ISO/NSO Plan are referred to collectively in
this Agreement as the "Plans." The Executive will be given an opportunity to participate in the Plans, in accordance
with and subject to the terms of the Plans as they may be adopted, amended and administered from time to time.

 

(1) In addition to the incentive compensation
referred to in Section 3(c)(i), the Company hereby agrees to issue to the Executive under the LTIP, effective immediately following
the completion of the Distribution, that number of shares of the Company's common stock (the "Initial Restricted Stock"),
twenty four percent (24%) of any new secondary IPO of the shares of the Company's common stock.

  

(2) Any and all risks of forfeiture shall
lapse as to all of the Initial Restricted Stock and the Initial Options shall be fully vested and shall be exercisable as to all
of the shares of common stock covered by the Initial Options upon (i) the death of the Executive or termination of employment upon
the "Permanent Disability" (as that term is defined in Section 7(b) (ii) of this Agreement) of the Executive, (ii) the
termination of employment of the Executive by the Company "Without Good Cause" (as that term is defined in Section 8(b)
(iii) of this Agreement) or (iii) the exercise by the Executive of his rights to terminate his employment under Section 8(d) (ii)
following a "Change of Control" (as that term is defined in Section 8(d) (i) of this Agreement).

 

    	 

    	 

    

 

(d) Reimbursement.
The Company shall reimburse the Executive, in accordance with the Company's policies and practices for senior management, for all
reasonable expenses incurred by the Executive in the performance of the Executive's duties under this Agreement, provided, however,
that the Executive must furnish to the Company an itemized account, satisfactory to the Company, in substantiation of such expenditures.

 

(e) Certain Benefits.
The Executive shall be entitled to such fringe benefits including, but not limited to, medical and other insurance benefits as
may be provided from time to time by the Company to other senior officers of the Company. In addition, without restricting the
foregoing, the Company shall provide the Executive at the Company's sole cost and expense with (i) a policy or policies of term
life insurance (the "Basic Life Insurance") providing, among other things, basic death benefits of not less than two
times the Base Salary in effect from time to time, (ii) directors and officers liability insurance with coverage, terms and limits
suitable for the chief executive officer of a OTCBB comparable in financial size and wherewithal to that of the Company and (iii)
a monthly allowance of $500 cash to reimburse the Executive for the use and maintenance of his automobile in furtherance of the
business and affairs of the Company, provided that the Executive shall at all times insure the Executive and the Company in such
amounts as may be reasonably requested by the Company against claims for bodily injury, death and property damages occurring as
a result of its use. The Company shall use its reasonable best efforts to make available to the Executive in providing and paying
for the Basic Life Insurance the opportunity to purchase at the Executive's sole cost and expense additional life insurance with
a basic death benefit (the "Optional Life Insurance") equal to two times the Executive's Base Salary in effect from time
to time (affording the Executive the opportunity to have basic death benefit life insurance coverage equal to four times such Base
Salary). The Company will use its reasonable best efforts to affect the transfer of the ownership to the Executive of the policy
or policies for the Basic Life Insurance and the Optional Life Insurance, if any, upon the termination of the Executive's employment
by the Company premiums would be the obligation of the Executive.

 

(f) Other Incentive
and Benefit Plans. The Executive shall be eligible to participate, in accordance with the terms of such plans as they may be adopted,
amended and administered from time to time, in incentive bonus, benefit or similar plans, including without limitation, any stock
option, bonus or other equity ownership plan, any short, mid or long term incentive plan and any other bonus, pension or profit
sharing plans established by the company from time to time.

 

		4.	DUTIES

 

(a)       General.       The Executive
is engaged as the Chief Executive Officer and President of the Company and initially shall be elected as a director of the Company.
In addition, at the request of the Board of Directors, the Executive shall serve in the same positions in any wholly owned subsidiary
of the Company, without any additional compensation. The Executive's duties shall be commensurate with those customarily associated
with the chief executive of a corporation comparable to the Company.

 

(b)      Specific.     In
addition to the general duties, responsibilities and authority as Chief Executive Officer and President, and without in any way
intending to diminish the Executive duties, responsibilities and authority, the Executive's duties, responsibilities and authority
shall include but not be limited to (i) suggesting to the Board of Directors persons who should serve as executive officers for
the Company and suggesting the duties, salaries, annual raises and (except as may be limited by the specific provisions of bonus
and incentive plans adopted by the Company), the bonuses for such persons and the Board shall give due and proper consideration
to such suggestions, (ii) determining who shall serve in all positions below, the level of executive officer, and determining the
duties, salaries, annual raises and (except as may be limited by the specific provisions of bonus and incentive plans adopted by
the Company) the bonus for such persons, with authority to delegate authority regarding such junior personnel to other members
of senior management, (iii) participating in consultation with the Board of Directors in the development and implementation of
the Company's strategic business plans and (iv) retaining consultants, professionals and other independent contractors of the Company's
business; provided, however, that the selection of the Company's independent certified public accountants and general counsel shall
be made with the concurrence of the Board of Directors.

 

(c)      Indemnification.    
To the fullest extent permitted by law, the Company shall indemnify and hold harmless the Executive for all liabilities, costs,
expenses and damages arising out of or in connection with the Executive's service to the Company under this Agreement. In furtherance
of this indemnity, the Company shall enter into an indemnification agreement, in form and substance reasonably satisfactory to
the Executive and the Company. In addition, the indemnity providing officer or director, or service in a similar capacity, for
any civic, community or charitable organization, provided such service is undertaken at the request of or with the knowledge and
acquiescence of the Company. The foregoing indemnification shall be in addition to any rights or benefits the Executive may have
under statute, the Bylaws or Articles of Incorporation of the Company, under a policy of insurance, or otherwise.

 

    	 

    	 

    

 

		5.	EXTENT OF SERVICES; VACATIONS AND DAYS OFF

 

(a) Extent of Services.        During
the term of the Executive's employment under this Agreement, except during customary vacation periods and periods of illness, the
Executive shall devote full-time energy and attention during regular business hours to the benefit and business of the Company
as may be reasonably necessary in performing the Executive's duties pursuant to this Agreement. Notwithstanding the foregoing,
the Executive may (i) serve on corporate, trade association, civic, religious or charitable boards or committees, (ii) deliver
lectures, fulfill speaking engagements or teach at educational institutions and (iii) manage personal investments, so long as such
activities do not materially interfere with the performance of the Executive's duties and responsibilities and do not create a
conflict of interest.

 

(b) Vacations.         The
Executive shall be entitled to vacations with pay and to such personal and sick leave with pay in accordance with the policy of
the Company as may be established from time to time by the Company and applied to other senior officers of the Company. In no event
shall the Executive be entitled to not fewer than four weeks' annual vacation. Unused vacation days may be carried over from one
year to the next for a period of up to three years. Any vacation days which remain unused on the third anniversary of the end of
the fiscal year to which they originally related shall expire and shall thereafter no longer be useable by the Executive.

 

		6.	FACILITIES

 

The Company shall provide
the Executive with a fully furnished office, and the facilities of the Company shall be generally available to the Executive in
the performance of the Executive's duties pursuant to this Agreement, it being understood and contemplated by the parties that
all equipment, supplies and office personnel required in the performance of the Executive's duties under this Agreement shall be
supplied by and at the sole expense of the Company.

 

		7.	ILLNESS OR INCAPACITY, TERMINATION ON DEATH, ETC.

 

(a) Death.       If
the Executive dies during the term of the Executive's employment, the Company shall pay to the estate of the Executive within 30
days after the date of death such Base Salary and any cash bonus compensation earned and un — earned during the full duration
of this contract, and pursuant to the provisions of any incentive compensation plan then in effect but not yet paid, as would otherwise
have been payable to the Executive up to the end of the month in which the Executive's death occurs. After receiving the full payments
provided in this Section 7(a), the Executive and the Executive's estate shall have no further rights under this Agreement (other
than those rights already accrued).

 

(b) Disability.        
(i) During any period of disability, illness or incapacity during the term of this Agreement which renders the Executive at least
temporarily unable to perform the services required under this Agreement, the Executive shall receive the Base Salary payable under
Section 3(a) of this Agreement plus any cash bonus compensation earned pursuant to the provisions of any incentive compensation
plan then in effect but not yet paid, less any cash benefits received by him under any disability insurance carried by or provided
by the Company. Upon the Executive's "Permanent Disability" (as defined below), which Permanent Disability continues
during the payment periods specified herein, the Company shall pay to the Executive for the period of time specified below an amount
(the "Disability Payment") equal to the (i) sum of (A) the Base Salary paid in the same monthly or other period installments
as in effect at the time of the Executive's Permanent Disability plus (B) an amount equal to the target level of the annual cash
bonus payable to the Executive under the Company's Management Incentive Compensation Plan as described on Exhibit A or any similar
bonus or incentive plans or programs then in effect (the "MICP Target Amount") in respect of the fiscal year during which
the Executive's Permanent Disability occurred, which MICP Target Amount shall be paid in pro rata equal monthly installments over
the period of time specified below (ii) reduced by the amount of any monthly payments under any policy of disability income insurance
paid for by the Company which payments are received during the time when any Disability Payment is being made to the Executive
following the Executive's Permanent Disability. For so long as the Executive's Permanent Disability continues, the Disability Payment
shall be paid by the Company to the Executive in equivalent installments at the same time or times as would have been the case
for payment of Base Salary over the unexpired term of this Agreement if the Executive had not become permanently disabled and had
remained employed by the Company hereunder, but in no case shall such period exceed 72 months. The Executive may be entitled to
receive payments under any disability income insurance which may be carried by or provided by the Company from time to time. Upon
"Permanent Disability" (as that term is defined in Section 7(b) (ii) below) of the Executive, except as provided in this
Section 7(b) all rights of the Executive under this Agreement (other than rights already accrued) shall terminate.

 

    	 

    	 

    

 

(ii) The
term "Permanent Disability" as used in this Agreement shall mean, in the event a disability insurance policy is maintained
by the Company covering the Executive at such time and is in full force and effect, the definition of permanent disability set
forth in such policy. In the event no disability insurance policy is maintained at such time and in full force and effect, "Permanent
Disability" shall mean the inability of the Executive, as determined by the Board of Directors of the Company, by reason of
physical or mental disability to perform the duties required of him under this Agreement for a period of one hundred and eighty
(180) days in any one-year period. Successive periods of disability, illness or incapacity will be considered separate periods
unless the later period of disability, illness or incapacity is due to the same or related cause and commences less than six months
from the ending of the previous period of disability. Upon such determination, the Board of Directors may terminate the Executive's
employment under this Agreement upon ten (10) days' prior written notice. If any determination of the Board of Directors with respect
to permanent disability is disputed by the Executive, the parties hereto agree to abide by the decision of a panel of three physicians.
The Executive and Company shall each appoint one member, and the third member of the panel shall be appointed by the other two
members. The Executive agrees to make him available for and submit to examinations by such physicians as may be directed by the
Company. Failure to submit to any such examination shall constitute a breach of a material part of this Agreement.

 

		8.	OTHER TERMINATIONS

 

(a)      By the Executive.
(i) The Executive may terminate the Executive's employment hereunder upon giving at least ninety (90) days' prior written notice.
In addition, the Executive shall have the right to terminate the Executive's employment hereunder on the conditions and at the
times provided for in Section 8(d) of this Agreement.

 

(ii)      If the Executive gives notice pursuant
to Section 8(a) (i) above, the Company shall have the right (but not the obligation) to relieve the Executive, in whole or in part,
of the Executive's duties under this Agreement, or direct the Executive to no longer perform such duties, or direct that the Executive
should no longer report to work, or any combination of the foregoing. In any such event, the Executive shall be entitled to receive
only the Base Salary not yet paid, as would otherwise have been payable to the Executive up to the end of the month specified as
the month of termination in the termination notice. In the event the Executive gives notice pursuant to Section 8(a)(i) above but
specifies a termination date in excess of ninety (90) days from the date of such notice, the Company shall have the right (but
not the obligation) to accelerate the termination date to any date prior to the date specified in the notice that is in excess
of ninety (90) days from the date of the notice, and the Company shall have the right (but not the obligation) to relieve the Executive,
in whole or in part, of the Executive's duties under this Agreement, or direct the Executive to no longer perform such duties,
or direct that the Executive should no longer report to work, or any combination of the foregoing; provided, however, that in any
such event the Executive shall be entitled to receive the Base Salary, as would otherwise have been payable to the Executive up
to the end of the month of the termination date properly selected by the Company. Upon receiving the payments provided for under
this Section 8(a), all rights of the Executive under this Agreement (other than rights already accrued) shall terminate.

 

(b)     Termination for
"Good Cause". (i) Except as otherwise provided in this Agreement, the Company may terminate the employment of the Executive
hereunder only for "good cause," which shall mean (a) the willful, substantial, continued and unjustified refusal of
the Executive substantially to perform his duties with the (other than any failure due to physical or mental incapacity) or (b)
willful misconduct materially and demonstrably injurious to the Company, financially or otherwise, in each case, as determined
in the reasonable discretion of the Board of Directors, but with respect to each of the foregoing bases for termination specified
in the preceding clause, only if (1) the Executive has been provided with written notice of any assertion that there is a basis
for termination for good cause which notice shall specify in reasonable detail specific facts regarding any such assertion and
the Executive has been given a reasonable period of time within which to remedy or cure the problem or complaint, (2) such notice
is provided to the Executive a reasonable time before the Board of Directors meets to consider any possible termination for cause,
(3) at or prior to the meeting of the Board of Directors to consider the matters described in the written notice, an opportunity
is provided to the Executive and his counsel to be heard by the Board of Directors with respect to the matters described in the
written notice, before it acts with respect to such matter, (4) any resolution or other action by the Board of Directors with respect
to any deliberation regarding or decision to terminate the Executive for good cause is duly adopted by a vote of a majority of
the entire Board of Directors of the Company at a meeting of the Board duly called and held and (5) the Executive is promptly provided
with a copy of the resolution or other corporate action taken with respect to such termination. No act or failure to act by the
Executive shall be considered willful unless done or omitted to be done by him not in good faith and without reasonable belief
that his action or omission was in the best interests of the Company.

 

    	 

    	 

    

 

(ii)     If the employment of the Executive
is terminated for good cause under Section 8(b) (i) of this Agreement, the Company shall pay to the Executive any Base Salary earned
prior to the effect yet paid and any cash bonus compensation earned pursuant to the provisions of any incentive compensation plan
then in effect but not paid to the Executive prior to the effective date of such termination. Under such circumstances, such payments
shall be in full and complete discharge of any and all liabilities or obligations of the Company to the Executive hereunder, and
the Executive shall be entitled to no further benefits under this Agreement (other than rights already accrued).

 

(iii) Termination of the employment of the Executive other than
as expressly specified above in Section 8(b) (i) for good cause shall be deemed to be a termination of employment "Without
Good Cause."

 

(c) Termination without
Good Cause. (i) Notwithstanding any other provision of this Agreement, the Company shall have the right to terminate the Executive's
employment Without Good Cause pursuant to the provisions of this Section 8(c). If the Company shall terminate the employment of
the Executive Without Good Cause effective on a date earlier than the termination date provided for in Section 2 (with the effective
date of termination as so identified by the Company being referred to herein as the "Accelerated Termination Date"),
the Executive, until the end of the term of this Agreement then in effect as provided for in Section 2, but in no case shall such
period exceed 60 months, or until the date which is 24 months after the Accelerated Termination Date, whichever is greater, shall
continue to receive (1) the Base Salary, paid in the same monthly or other periodic installments as in effect prior to the Accelerated
Termination Date (2) an equal monthly pro rata portion of an amount of cash equal to the MICP Target Amount (as that term is defined
in Section 7(b)(i)) in respect of the year during which the Executive's employment terminates, multiplied times the number of years
(or fractions thereof) remaining in the then unexpired term of this Agreement or multiplied rata portion of an amount of cash equal
to the cash value of any bonus paid or to be paid to the Executive in the form of performance shares or restricted stock under
the LTIP as described on Exhibit A or any similar bonus or incentive plans or programs then in effect (valued, if applicable under
the terms of such plans or programs, at the greater of the closing price on the OTCBB Stock Exchange, or other such market on which
the Company's stock trades if it is not listed on the New York Stock Exchange/ or other exchanges, on the first trading day of
the plan or program cycle or the Accelerated Termination Date, or if the Accelerated Termination Date is not a trading day, on
the first trading day thereafter) in respect of the then-current three year cycle of such plans or programs or such other cycle
as is then in effect, calculated as if the then-current cycle were completed and the target levels attained (the "LTIP Target
Amount"), which cash payment shall be in lieu and in full satisfaction any rights under the LTIP in respect of such stock
or shares as described in Exhibit A or any similar bonus or incentive plans or programs in effect at the time of such payment (all
of which stock or shares shall be cancelled upon such payment and receipt); provided however, if the Accelerated Termination Date
is prior to September 30, 2013, the amount of cash payable to the Executive under the LTIP shall be $630,000, and (4) any other
cash or other bonus compensation earned prior to the date of such termination pursuant to the terms of all incentive compensation
plans then in effect other than the Company's Management Incentive Compensation Plan as described on Exhibit A or any similar bonus
or incentive plans or programs then in effect; provided that, notwithstanding such termination of employment, the Executive's covenants
set forth in Section 10 and Section 11 are intended to and shall remain in full force and effect and provided further that in the
event of such termination, the Company shall have the right (but not the obligation) to relieve the Executive, in whole or in part,
of the Executive's duties under this Agreement, or direct the Executive to no longer perform such duties, or direct that the Executive
no longer be required to report to work, or any combination of the foregoing.

 

(ii) The parties agree that, because there
can be no exact measure of the damage that would occur to the Executive as a result of a termination by the Company of the Executive's
employment Without Good Cause, the payments and benefits paid and provided pursuant to this Section 8(c) shall be deemed to constitute
liquidated damages and not a penalty for the Company's termination of the Executive's employment Without Good Cause.

 

(d) Change of Control.
(i) For purposes of this Agreement, a "Change in Control”:

 

		(1)	a change in control of the Company of a nature that is required, pursuant to the Securities Exchange Act of 1934 (the "1934
Act"), to be reported in response to Item 1(a) of a Current Report on Form 8-K or Item 6(e) of Schedule 14A under the 1934
Act (in each case under this Agreement, references to provisions of the 1934 Act and the rules and regulations promulgated there
under being understood to refer to such law, rules and regulations as the same are in effect on November 1, 1996); or

 

		(2)	the acquisition of "Beneficial Ownership" (as defined in Rule 13d-3 under the 1934 Act) of the Company's securities
comprising 35% or more of the combined voting power of the Company's outstanding securities by any "person" (as that
term is used in Sections 13(d) and 14(d) (2) of the 1934 Act and the rules and regulations promulgated there under, but not including
any trustee or fiduciary acting in that capacity for an employee benefit plan sponsored by the Company) and such person's "affiliates"
and "associates" (as those terms are defined under the 1934 Act), but excluding any ownership by the Executive and his
affiliates and associates; or

 

    	 

    	 

    

 

		(3)	the failure of the "Incumbent Directors" (as defined below) to constitute at least a majority of all directors of
the Company (for these purposes, "Incumbent Directors" means individuals who were the directors of the Company on May
16, 2011 and, after his or her election, any individual becoming a director subsequent to May 16, 2011, whose election, or nomination
for election by the Company's stockholders, is approved by a vote of at least two-thirds of the directors then comprising the Incumbent
Directors, except that no individual shall be considered an Incumbent Director who is not recommended by management and whose initial
assumption of office as a director is in connection with an actual or threatened "election contest" relating to the "election
of directors" of the Company, as such terms are used in Rule 14a-11 of Regulation 14A under the 1934 Act); or

 

		(4)	the closing of a sale of all or substantially all of the assets of the Company;

 

		(5)	the Company's adoption of a plan of dissolution or liquidation; or

 

		(6)	the closing of a merger or consolidation involving the Company in which the Company is not the surviving corporation or if,
immediately following such merger or consolidation, less than seventy-five percent (75%) of the surviving corporation's outstanding
voting stock is held or is anticipated to be held by persons who are stockholders of the Company immediately prior to such merger
or consolidation.

 

(ii) If a Change in
Control of the Company occurs, the Executive shall have the right, exercisable for a period of one year thereafter by delivering
a written statement to that effect to the Company, to immediately terminate this Agreement and upon such a determination the Executive
shall have the right to receive and the Company shall be obligated to pay to Executive in cash a lump sum payment in an amount
equal to the sum of (1) the "Control Cash Payment" as that term is defined in Section 8(d)(iii) of this Agreement; (2)
three times the annual Base Salary then in effect, (3) three times the MICP Target Amount (as that term is defined in Section 7(b)(i))
in the year in which employment terminates, (4) the cash value of the LTIP Target Amount (as that term is defined in Section 8(c)),
which cash payment shall be in lieu and in full satisfaction of any rights under the LTIP in respect of such stock or shares as
described in Exhibit A or any similar bonus or incentive plans or programs in effect at the time of such payment (all of which
stock or shares shall be cancelled upon such payment and receipt), and (5) the additional payments necessary to discharge certain
tax liabilities (the "Gross Up") as that term is defined in Section 13 of this Agreement (the sum of the foregoing amounts
other than the Gross Up being referred to as the "Change in Control Payment"). If the Executive fails to exercise his
rights under this Section 8(d) within one year following a Change in Control, such rights shall expire and be of no further force
or effect.

 

(iii) The “Control
Cash Payment” shall be (A) $1,500,000 if the Event to occur that constitutes a Change of Control occurs.

 

(e) Intentions Regarding
Certain Stock and Benefit Plans. Except as otherwise provided herein, upon any termination of the Executive's employment Without
Good Cause or upon the exercise by the Executive of his rights to terminate his employment following a Change of Control, it is
the intention of the parties that any and all vesting or performance requirements or conditions affecting any outstanding restricted
stock, performance stock, stock option, stock appreciation right, bonus, award, right, grant or any other incentive compensation
under any of the Plans, under this Agreement, or otherwise received, shall be deemed to be fully satisfied and any risk of forfeiture
with respect thereto shall be deemed to have lapsed.

 

(f) Certain Rights
Mutually Exclusive. The provisions of Section 8(c) and Section 8(d) are mutually exclusive, provided, however, that if within one
year following commencement of an 8(c) payout there shall be a Change in Control as defined in Section 8(d) (i), then the Executive
shall be entitled to the amount payable to the Executive under Section 8(d) (ii) and Section 8(d) (iii) reduced by the amount that
the Executive has received under Section 8(c) up to the date of the change in control. The triggering of the lump sum payment requirement
of Section 8(d) shall cause the provisions of Section 8(c) to become inoperative.

 

    	 

    	 

    

 

		9.	DISCLOSURE

 

The Executive agrees
that during the term of the Executive's employment by the Company, the Executive will disclose and disclose only to the Company
all ideas, methods, plans, developments or improvements known by him which relate directly or indirectly to the business of the
Company, whether acquired by the Executive before or during the Executive's employment by the Company. Nothing in this Section
9 shall be construed as requiring any such communication where the idea, plan, method or development is lawfully protected from
disclosure as a trade secret of a third party and of this Section 9 shall not be violated by ordinary and customary communications
with reporters, bankers and securities analysts and other members of the investment community.

 

		10.	CONFIDENTIALITY

 

The Executive agrees
to keep in strict secrecy and confidence any and all information the Executive assimilates or to which the Executive has access
during the Executive's employment by the Company and which has not been publicly disclosed and is not a matter of common knowledge
in the fields of work of the Company. The Executive agrees that both during and after the term of the Executive's employment by
the Company, the Executive will not, without the prior written consent of the Company, disclose any such confidential information
to any third person, partnership, joint venture, company, corporation or other organization. The foregoing covenants shall not
be breached to the extent that any such confidential information becomes a matter of general knowledge other than through a breach
by the Executive of the Executive's obligations under this Section 10.

 

		11.	NONCOMPETITION AND NONSOLICITATION

 

(a) General. The Executive
hereby acknowledges that, during and solely as a result of the Executive's employment by the Company, the Executive has received
and shall continue to receive: (1) special training and education with respect to the operations of the Company's real estate development
and management businesses and its leasing, lending and financing activities, and other related matters, and (2) access to confidential
information and business and professional contacts. In consideration of the special and unique opportunities afforded to the Executive
by the Company as a result of the Executive's employment, as outlined in the previous sentence, the Executive hereby agrees to
the restrictive covenants in this Section 11.

 

(b) Noncompetition.
During the term of the Executive's employment, whether pursuant to this Agreement, any automatic or other renewal hereof or otherwise,
and, except as may be otherwise herein provided, for a period of two (2) years after the termination of the Executive's employment
with the Company ,regardless of the reason for such termination, the Executive shall not, directly or indirectly, enter into, engage
in, be employed by or consult with any business which competes with the Company's real estate lending, leasing, development or
management businesses in Florida. The Executive shall not engage in such prohibited activities, either as an individual, partner,
officer, director, stockholder, employee, advisor, independent contractor, joint venture, consultant, agent, or representative
or salesman for any person, firm, partnership, corporation or other entity so competing with the Company. The restrictions of this
Section 11 shall not be violated by (i) the ownership of no more than 2% of the outstanding securities of any company whose stock
is traded on a national securities exchange or is quoted in the Automated Quotation System of the National Association of Securities
Dealers (NASDAQ), or (ii) other outside business investments that do not in any manner conflict with the services to be rendered
by the Executive for the Company and that do not diminish or detract from the Executive's ability to render the Executive's required
attention to the business of the Company.

 

(c) No solicitation.
During the Executive's employment with the Company and, except as may be otherwise herein provided, for a period of two (2) years
following the termination of the Executive's employment with the Company, regardless of the reason for such termination, the Executive
agrees the Executive will refrain from and will not, directly or indirectly, as an individual, partner, officer, director, stockholder,
employee, advisor, independent contractor, joint venture, consultant, agent, representative, salesman or otherwise solicit any
of the employees of the Company to terminate their employment.

 

    	 

    	 

    

 

(d)     Term Extended or
Suspended. The period of time during which the Executive is prohibited from engaging in certain business practices pursuant to
Sections 11(b) or (c) shall be extended by any length of time during which the

Executive is in breach of such covenants.

  

(e)
    Essential Element. It is understood by and between the parties hereto that the foregoing restrictive
covenants set forth in Sections 11(a) through (c) are essential elements of this Agreement, and that, but for the agreement
of the Executive to comply with such covenants, the Company would not have agreed to enter into this Agreement. Such
covenants by the Executive shall be construed as agreements independent of any other provision in this Agreement. The
existence of any claim or cause of action of the Executive against the Company, whether predicated on this Agreement, or
otherwise, shall not constitute a defense to the enforcement by the Company of such covenants.

 

(f)     Severability.
It is agreed by the Company and Executive that if any portion of the covenants set forth in this Section 11 are held to be invalid,
unreasonable, arbitrary or against public policy, then such portion of such covenants shall be considered divisible both as to
time and geographical area. The Company and Executive agree that, if any court of competent jurisdiction determines the specified
time period or the specified geographical area applicable to this Section 11 to be invalid, unreasonable, arbitrary or against
public policy, a lesser time period or geographical area which is determined to be reasonable, non-arbitrary and not against public
policy may be enforced against the Executive. The Company and the Executive agree that the foregoing covenants are appropriate
and reasonable when considered in light of the nature and extent of the business conducted by the Company.

 

		12.	SPECIFIC PERFORMANCE

 

The Executive agrees
that damages at law will be an insufficient remedy to the Company if the Executive violates the terms of Sections 9, 10 or 11 of
this Agreement and that the Company would suffer irreparable damage as a result of such violation. Accordingly, it is agreed that
the Company shall be entitled, upon application to a court of competent jurisdiction, to obtain injunctive relief to enforce the
provisions of such Sections, which injunctive relief shall be in addition to any other rights or remedies available to the Company.
The Executive agrees to pay to the Company all reasonable costs and expenses incurred by the Company relating to the enforcement
of the terms of Sections 9, 10 or 11 of this Agreement, including reasonable fees and reasonable disbursements of counsel selected
by the Company (during investigation and before and at trial and in appellate proceedings).

 

		13.	PAYMENT OF EXCISE TAXES

 

(a)         Payment
of Excise Taxes. If the Executive is to receive any (1) Change of Control Payment under Section 8(d), (2) any benefit or payment
under Section 7 as a result of or following the death or Permanent Disability of the Executive, (3) any benefit or payment under
Section 8(c) as a result of or following any termination of employment hereunder Without Good Cause, (4) any benefit or payment
under the Plans as a result of a Change of Control, following the death or Permanent Disability of the Executive or following the
termination of employment hereunder Without Good Cause (such sections being referred to as the "Covered Sections" and
the benefits and payments to be received there under being referred to as the "Covered Payments"), the Executive shall
be entitled to receive the amount described below to the extent applicable: If any Covered Payment(s) under any of the Covered
Sections or by the Company under another plan or agreement (collectively, the "Payments") are subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986 (as amended from time to time, the "Code"), or any successor
or similar provision of the Code (the "Excise Tax"), the Company shall pay the Executive an additional amount (the "Gross
Up") such that the net amount retained by the Executive after deduction of any Excise Tax on the Payments and the federal
income tax on any amounts paid under this Section 13 shall be equal to the Payments.

 

(b)        Certain Adjustment
Payments. For purposes of determining the Gross Up, the Executive shall be deemed to pay the federal income tax at the highest
marginal rate of taxation (currently 39.5%) in the calendar year in which the payment to which the Gross Up applies is to be made.
The determination of whether such Excise Tax is payable and the amount thereof shall be made upon the opinion of tax counsel selected
by the Company and reasonably acceptable to the Executive. The Gross Up, if any, that is due as a result of such determination
shall be paid to the Executive in cash in a lump sum within thirty (30) days of such computation. If such opinion is not finally
accepted by the Internal Revenue Service upon audit or otherwise, then appropriate adjustments shall be computed (without interest
but with Gross Up, if applicable) by such tax counsel based upon the final amount of the Excise Tax so determined; any additional
amount due the Executive as a result of such adjustment shall be paid to the Executive by his or her Company in cash in a lump
sum within thirty (30)days of such computation, or any amount due the Executive's Company as a result of such adjustment shall
be paid to the Company by the Executive in cash in a lump sum within thirty (30) days of such computation.

 

    	 

    	 

    

  

		14.	MISCELLANEOUS

 

(a)         Waiver
of Breach. The waiver by either party to this Agreement of a breach of any of the provisions of this Agreement by the other party
shall not be construed as a waiver of any subsequent breach by such other party.

 

(b)         Compliance
with Other Agreements. The Executive represents and warrants that the execution of this Agreement by him and the Executive's performance
of the Executive's obligations hereunder will not conflict with, result in the breach of any provision of or the termination of
or constitute a default under any Agreement to which the Executive is a party or by which the Executive is or may be bound.

 

(c)
         Binding Effect; Assignment.    The rights and obligations
of the Company under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Company.
This Agreement is a personal employment contract and the rights, obligations and interests of the Executive hereunder may not be
sold, assigned, transferred, pledged or hypothecated.

 

(d)          Entire
Agreement. This Agreement contains the entire agreement and supersedes all prior agreements and understandings, oral or written,
with respect to the subject matter hereof. This Agreement may be changed only by an agreement in writing signed by the party against
whom any waiver, change, amendment, modification or discharge is sought.

 

(e)           Headings.
The headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of
this Agreement.

 

(f)           No
Duty to Mitigate. The Executive shall be under no duty to mitigate any loss of income as result of the termination of his employment
hereunder and any payments due the Executive upon termination of employment shall not be reduced in respect of any other employment
compensation received by the Executive following such termination.

 

(g)         
Florida Law. This Agreement shall be construed pursuant to and governed by the substantive laws of the State of Florida (except
that any provision of Florida law shall not apply if the law of a state or jurisdiction other than Florida would otherwise apply).

 

(h)          Venue;
Process. The parties to this Agreement agree that jurisdiction and venue in any action brought pursuant to this Agreement to enforce
its terms or otherwise with respect to the relationships between the parties shall properly lie in and only in the Circuit Court
of the State of Florida in and for Dade County (the "Circuit Court") and the parties agree that jurisdiction shall not
properly lie in any other jurisdiction provided, however, if jurisdiction does not properly lie with the Circuit Court, the parties
agree that jurisdiction and venue shall properly lie in and only in the United States District Court for the District of Florida,
Dade Division. The parties hereby waive any objections which they may now or hereafter have based on venue and/or forum non conveniens
and irrevocably submit to the jurisdiction of any such court in any legal suit, action or proceeding arising out of or relating
to this Agreement. The parties further agree that the mailing by certified or registered mail, return receipt requested, of any
process required by any such court shall constitute valid and lawful service of process against them, without the necessity for
service by any other means provided by statute or rule of court.

 

(i)           Severability.
Any provision of this Agreement which is determined by a court of competent jurisdiction to be prohibited, unenforceable or not
authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability
or non-authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality
of such provision in any other jurisdiction. In any such case, such determination shall not affect any other provision of this
Agreement, and the remaining provisions of this Agreement shall remain in full force and effect. If any provision or term of this
Agreement is susceptible to two or more constructions or interpretations, one or more of which would render the provision or term
void or unenforceable, the parties agree that a construction or interpretation which renders the term or provision valid shall
be favored.

 

(j)           Deduction
for Tax Purposes. The Company's obligations to make payments under this Agreement are independent of whether any or all of such
payments are deductible expenses of the Company for federal income tax purposes.

 

    	 

    	 

    

 

(k)          Enforcement.
If, within 10 days after demand to comply with the obligations of one of the parties to this Agreement served in writing on the
other, compliance or reasonable assurance of compliance is not forthcoming, and the party demanding compliance engages the services
of an attorney to enforce rights under this Agreement, the prevailing party in any action shall be entitled to recover all reasonable
costs and expenses of enforcement (including reasonable attorneys' fees and reasonable expenses during investigation, before and
at trial and in appellate proceedings). In addition, each of the parties agrees to indemnify the other in respect of any and all
claims, losses, costs, liabilities and expenses, including reasonable fees and reasonable disbursements of counsel (during investigation
prior to initiation of litigation and at trial and in appellate proceedings if litigation ensues), directly or indirectly resulting
from or arising out of a breach by the other party of their respective obligations hereunder. The parties' costs of enforcing this
Agreement shall include prejudgment interest. -of- pocket expenses in connection with the enforcement of this Agreement, all such
amounts shall accrue interest at 10% per annum (or such lower rate as may be required to avoid any limit imposed by applicable
law) commencing 30 days after any such expenses are incurred.

 

(I)          Notices.
      All notices which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given
when received if personally delivered; when transmitted if transmitted by telecopy or similar electronic transmission method; one
working day after it is sent, if sent by recognized expedited delivery service; and three days after it is sent, if mailed, first
class mail, certified mail, return receipt requested, with postage prepaid. In each case notice shall be sent to:

 

	To the Company:	NetTALK.com, Inc.
	 	1100 NW 163rd Drive Suite B -4
	 	North Miami, FI.33169
	 	Attn: Chairman of the Board
	 	Facsimile: (305) 621 - 1201

 

To the Executive at
the Executive's address herein first above written, or to such other address as either party may specify by written notice to the
other.

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement, the day and year first above written.

 

	ATTEST:	 	 	NETTALK.COM, INC.
	 	 	 	 
	(Corporate Seal)	 	 	 
	 	 	 	By: /s/Anastasios Kyriakides
	Secretary	 	 	 
	 	 	Title: CEO and President
	Witness:	 	EXECUTIVE
	 	 	 	 
	 	 	 	ANASTASIOS N. KYRIAKIDES

 

    	 

    	 

    

 

EXHIBIT A

TO

EMPLOYMENT AGREEMENT WITH ANASTASIOS N.KYRIAKIDES

DATED May 16, 2011 (amended March 31, 2012)

 

The Company will establish
a Management Incentive Compensation Plan ("MICP") and Long Term Incentive Plan ("LTIP") for its senior management
in which the Executive will participate. During the first three full fiscal years of the Company's operation, the MICP will provide
for annual cash bonuses based upon the Company's net income for each of the Covered Years. The LTIP will provide the opportunity
to earn restricted shares based upon the Company's cumulative results of operation for three year cycles, beginning with the three
year cycle comprising the Covered Years. The Executive's participation in the MICP and the LTIP during the Covered Years shall
be based upon the criteria and shall include awards with the values indicated in the tables set forth below and as more fully described
in this Exhibit A.

 

MICP

During each of the
Covered Years, (i) all MICP bonuses shall be paid in cash; (ii) if Threshold Net Income is not achieved, no MICP cash bonus will
be paid; (iii) if actual net income exceeds Threshold Net Income, but is less than Target Net Income, or exceeds Target Net Income
but is less than Maximum Net Income, the percentage of the MICP bonus shall be proportionately increased above the Threshold bonus
amount or the Target Bonus amount, as the case may be, and (iv) if actual net income equals or exceeds Maximum Net Income, the
Maximum MICP cash bonus will be paid, but no additional cash bonus will be payable under the MICP regardless of the amount by which
actual net income in that Covered Year exceeds Maximum Net Income. The following table sets forth information regarding the MICP
Net Income Threshold, Target and Maximum and cash bonuses.

 

	MICP	 	2012	 	 	2013	 	 	2014	 
	THRESHOLD	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	1,500,000	 	 	$	1,700,000	 	 	$	2,100,000	 
	MICP Cash Bonus	 	$	70,000	 	 	$	70,000	 	 	$	70,000	 
	(% of Target Bonus)	 	 	(50	)%	 	 	(50	)%	 	 	(50	)%
	 	 	 	 	 	 	 	 	 	 	 	 	 
	TARGET	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	2,100,000	 	 	$	2,300,000	 	 	$	2,800,000	 
	MICP Cash Bonus	 	$	140,000	 	 	$	140,000	 	 	$	140,000	 
	(% of Base Salary)	 	 	(50	)%	 	 	(50	)%	 	 	(50	)%
	 	 	 	 	 	 	 	 	 	 	 	 	 
	MAXIMUM	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	2,600,000	 	 	$	2,900,000	 	 	$	3,500,000	 
	MICP Cash Bonus	 	$	210,000	 	 	$	210,000	 	 	$	210,000	 
	(% of Target Bonus)	 	 	(150	)%	 	 	(150	)%	 	 	(150	)%

 

Notwithstanding the foregoing and the information
contained in any of the tables contained in this Exhibit, and regardless of the actual net income achieved by the Company in the
first Covered Year, the MICP cash bonus shall not be less than the amount of the MICP cash bonus that would be payable if the Target
Net Income was achieved in the first Covered Year (50% of Base Salary).

 

    	 

    	 

    

 

LTIP

 

The sum of each year's
Threshold Net Income for the three Covered Years shall be referred to as the "Threshold LTIP Net Income"; the sum of
each year's Target Net Income for the three Covered Years shall be referred to as "Target LTIP Net Income"; and the
sum of each year's Maximum Net Income for the three Covered Years shall be referred to as "Maximum LTIP Net Income,"
in each case, as set forth in the following tables:

 

LTIP

 

	 	 	2012	 	 	2013	 	 	2014	 	 	LTIP NET INCOME	 
	THRESHOLD	 	 	 	 	 	 	 	 	 	 	 	 	 	 	THRESHOLD	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	1,500,000	 	 	$	1,700,000	 	 	$	2,100,000	 	 	$	5,300,000	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	TARGET	 	 		 	 	 	 	 	 	 	 	 	 	 	TARGET 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	2,100,000	 	 	$	2,300,000	 	 	$	2,800,000	 	 	$	7,200,000	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	MAXIMUM	 	 	 	 	 	 	 	 	 	 	 	 	 	 	MAXIMUM	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income	 	$	2,600,000	 	 	$	2,900,000	 	 	$	3,500,000	 	 	$	9,000,000	 

 

The following table sets for information
regarding the Threshold, Target and Maximum LTIP Net income and values associated with achieving such levels of cumulative net
income:

 

LTIP Five Years

Ending May 16, 2016

 

	THRESHOLD 	 	 	 	 
	 	 	 	 	 
	Cumulative Net Income	 	$	5,300,000	 
	LTIP Value	 	$	210,000	 
	(% of Target Bonus)	 	 	(50	)%
	 	 	 	 	 
	TARGET	 	 	 	 
	 	 	 	 	 
	Cumulative Net Income	 	$	7,200,000	 
	LTIP Value	 	$	420,000	 
	(% of Base Salary)	 	 	(75	)%
	 	 	 	 	 
	MAXIMUM	 	 	 	 
	 	 	 	 	 
	Cumulative Net Income	 	$	9,000,000	 
	LTIP Value	 	$	630,000	 
	(% of Target Bonus)	 	 	(150	)%

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