Document:

COOPERATION
AGREEMENT

      

      COOPERATION
AGREEMENT (the “Agreement”) is made and entered in as of 30th day of
April, 2008, by and between Changxing Chisen Electric Co., Ltd. a company
incorporated under the laws of People’s Republic of China (“PRC” or “China”),
with its principle address of business at Jingyi Road, Changxing Economic
Development Zone, Changxing, Zhejiang, China (hereinafter referred to as “Party
A”), and Xiamen University, a first class comprehensive university under the
laws of PRC , with its
location in the city of Xiamen, Fujian Province, China (hereinafter referred to
as “Party B”)

      

      WITNESSETH:

      

      WHEREAS, Party A desire to
established the Zhejiang Changxing Chisen Physical-Chemical Power Supply
Research and Development Center (the “R&D CENTER” or the “Center”) at the
College of Chemistry and Chemical Engineering at Xiamen University in order to
research and develop new products.

       

      NOW, THEREFORE, in
consideration of the premises, and the mutual covenants and agreements
hereinafter contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties do hereby
mutually covenant and agree as follows:

      

      
        
          
            	
                    I.

                  	
                    Organizational
      Structure and Responsibility of R&D
Center

                  

          

        

      

       

      1. Organizational Structure of
R&D Center

       

      The
R&D CENTER is established by Changxing Chisen Electric Co., Ltd. and College
of Chemistry and Chemical Engineering at Xiamen University
together.  The R&D CENTER is running by one Chief Officer and two
Associate Officers.  Chief Officer is recommended and appointed by
Party A, and the Associate Officers are recommended and appointed by Party A and
Party B, respectively.  They represent and on behalf of both Party A
and Party B to supervise, urge and manage the operation of the research and
development (“R&D”) projects, the daily management and coordination with
each Party. The Center should make appropriate management policies and follow,
after the confirmation from both Party A B.

       

      
        
          
            
              	 	
                      2.

                    	
                      The R&D
      projects will be proposed by the Center and commenced after the approval
      from both Parties A and
B.

                    

            

          

        

      

       

      
        	 	
                
                  3.

                

              	
                
                  Responsibilities
      of R&D CENTER

                

              

      

       

      
        	
              	
                
                  a.

                

              	
                
                  Monitor
      the industrial demand of Party A from time to time, and set up the project
      accordingly for both Parties A and B to discuss and
      approve.

                

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        
          
            	
                  	
                    b.

                  	
                    Coordinate
      with Party A to apply for science & technology plan projects at all
      levels (including, but not limited to, national, provincial and local
      levels), and complete the subject
projects.

                  

          

        

      

      
        	
              	
                
                  
                    c.

                  

                

              	
                
                  
                    Provide
      training to R&D staff of Party A with regards to Party A’s
      requirements..

                  

                

              

      

      
        	
              	
                
                  d.

                

              	
                
                  Efficient
      and effectiveness all other issues of
  cooperation.

                

              

      

      

      II.
Responsibilities of Party A and Party B

       

      
        
          
            
              	
                      
                      

                    	
                      1.

                    	
                      Responsibilities
      of Party A

                    

            

          

           

        

      

      
        
          
            	
                  	
                    a.

                  	
                    Throughout
      the cooperation period, Party A shall sponsor RMB300, 000 (Three Hundred
      Thousand) annually as operating cost of the R&D CENTER located in
      Party B. The payment will be remitted to Party B’s account during May to
      July each year. (Account Name: Xiamen University; Bank: Industry and
      Commercial Bank of China, Xiamen University Branch; Account Number:
      4100021709024904620)

                  

          

        

      

      
        	
              	
                
                  
                    b.

                  

                

              	
                
                  
                    Provide
      additional R&D funds, which will be allocated by the Center in
      accordance with the proposal and the specific R&D
      projects.

                  

                

              

      

      
        	
              	
                
                  
                    c.

                  

                

              	
                
                  
                    Throughout
      the cooperation period, Party A shall provide accommodation, office,
      R&D labs and testing workshops to all the Center staff to perform
      their work successfully and
  effectively.

                  

                

              

      

      
        	
              	
                
                  
                    d.

                  

                

              	
                
                  
                    During
      the R&D period, Party A shall provide all necessary technology
      supports and ensure all other necessary supports to the staff of Party B
      on field work.

                  

                

              

      

      
        	
              	
                
                  e.

                

              	
                
                  Efficient
      and effectiveness all other issues of
  cooperation.

                

              

      

      

      
        
          
            	
                  	
                    2.

                  	
                    Responsibilities
      of Party B

                  

          

        

         

      

      
        
          	
                	
                  a.

                	
                  In
      view of the development trend of new power technology, Party B shall
      accordingly coordinate with Party A to make technical development plans
      and initiates plans and solutions to master cutting-edge
      technologies.

                

        

      

      
        
          	
                	
                  b.

                	
                  In
      accordance with the technical
      requirements and industry development plan, Party B shall build a team to
      research the projects approved by both parties and other science &
      technology schemes which has been set
up.

                

        

      

      
        
          	
                	
                  c.

                	
                  Researches
      and develops the new model Lithium-ion battery, the ultra capacitor
      combined power battery, and so
on.

                

        

      

      
        
          	
                	
                  d.

                	
                  Provide
      the research staff with R&D labs and relevant
    equipment.

                

        

      

      
        
          	
                	
                  e.

                	
                  Efficient
      and effectiveness all other issues of
  cooperation.

                

        

      

      

      
        
          
            
              	
                    	
                      III.

                    	
                      Entitlement
      of Achievements

                    
	 	 	 

            

          

        

      

      
        
          	
                	
                  1.

                	
                  All
      science & technology and R&D projects which were set up by the
      Center and has obtained achievements shall be entitled to both Parties.
      Neither Parties can transfer the achievements without the permission of
      the other Party. (Changes are subject to the amended version, if
      any).

                

        

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        
          
            	
                  	
                    2.

                  	
                    All
      patent and non-patent technology achievements can be accessed by both
      Parties. The authors and owners ranking will be subject to the relevant
      agreements related to the specific projects.  The ranking of
      participants will be ranked in the order of their
      contributions.

                  

          

        

      

      
        	
              	
                
                  3.

                

              	
                
                  Once
      the achievements are transferred to the third Party with the permission of
      both Parties, and are for commercial use, the profits gained by these
      transactions will be distributed on the proportional basis.  The
      specific distribution proportion will be subject to the clauses set forth
      in the agreements related to the specific
  projects.

                

              

      

      
        	
              	
                
                  4.

                

              	
                
                  Once
      the project was initiated by the Center, Party B shall not carry out any
      research on that same project. Otherwise, the achievement obtained by
      Party B will be deemed as the achievements of the
      Center.

                

              

      

       

      
        
          
            	
                  	
                    IV.

                  	
                    Operating Fund
      Management

                  

          

        

      

      
         

        
          	
                	
                  1.

                	
                   Both
      Parties should actively apply for project fund sponsorships and subsidies
      from all functional departments of the government. The received funds will
      be allocated among the projects in accordance with the agreement and
      remitted to both Parties’ bank accounts for delegated R&D project
      purpose.

                

        

      

      
        	
              	
                
                  2.

                

              	
                
                  The
      R&D expenditures should be reviewed and approved by the Chief Officer
      of the Center; the expenditures incurred in Party B should be reviewed and
      approved by the Associate Officer who is recommended and appointed by
      Party B.

                

              

      

      
        	
              	
                
                  3.

                

              	
                
                  All
      other matters not mentioned herein and above will be resolved through
      amicable negotiation by both
Parties.

                

              

      

      

      
        
          
            
              	
                      V.

                    	
                      The
      terms of this Agreement is valid for three full years from the date of
      April 30,
2008.  

                    

            

          

        

         

        Supplemental
agreement will be concluded in accordance with the cooperation needs in the
future. This Agreement shall be in quadruplicate copies, with two copies for
each of the parties.

      

      

      IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.

      

      
        
          
            	
                    Party A

                    Changxing Chisen Electric Co., Ltd.

                    Jingyi Road

                    Changxing Economic Development

                    Zone, Changxing, China

                    For and on Behalf of Changxing Chisen

                    Electric Co., Ltd.

                  
	 
      	 
      
	
                    By:

                  	
                    
                      /s/ Xu
      Kecheng

                    

                  
	
                    Name:

                  	
                    Xu
      Kecheng

                  

          

        

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      
        
          
            	
                    Party
      B

                    Xiamen
      University

                    Xiamen,
      Fujian Province, China

                    For
      and on Behalf of Xiamen University

                  
	 
      	 
      
	
                    By:

                  	
                    
                      /s/ Liu
    Xu

                    

                  
	
                    Name:

                  	
                    Liu
      XuUnassociated Document

     

    EXHIBIT
10.1

    

    DIRECTOR
AGREEMENT

    

    This DIRECTOR AGREEMENT is made as of
this ___day of June___, 2010 (the "Agreement"), by and
between China Electric Motor, Inc., a Delaware corporation (the "Company") and Tony
Shen (the “Director”).

    

    WHEREAS, the Company is engaged in the
design, manufacture, sale and marketing of micro-motors and micro-motor
components with a range of applications in automobiles, power tools, home
appliances and consumer electronics (the “Business”);

    

    WHEREAS, the Company wishes to appoint
the Director as a non-executive member of the Board of Directors of the Company
(the “Board”) and enter into an agreement with the Director with respect to such
appointment; and

    

    WHEREAS, the Director wishes to accept
such appointment and to serve the Company on the terms set forth herein, and in
accordance with, the provisions of this Agreement.

    

    NOW, THEREFORE, in consideration of the
mutual covenants contained herein, the parties hereto agree as
follows:

    

    1.           Directorship.  Subject
to the terms and provisions of this Agreement, the Company shall cause the
Director to be appointed as non-executive member of the Board and the Director
hereby agrees to serve the Company in that directorship upon the terms and
conditions hereinafter set forth, provided however, that the Director's
continued service on the Board after the initial term on the Board shall be
subject to any necessary approval by the Company's stockholders.

    

    2.           Duties.  During
the Directorship Term (as defined in Section 5 hereof), the Director shall serve
as a member of the Board, and the Director shall make reasonable business
efforts to attend all Board meetings, serve on appropriate subcommittees as
reasonably requested by the Board, make himself available to the Company at
mutually convenient times and places, attend external meetings and
presentations, as appropriate and convenient, and perform such duties, services
and responsibilities and have the authority commensurate to such
directorship.

    

    The Director will use his best efforts
to promote the interests of the Company. The Company recognizes that the
Director (i) is a full-time executive employee of another entity and that his
responsibilities to such entity must have priority and (ii) may sit on the Board
of Directors of other entities; although Director will use reasonable business
efforts to coordinate his respective commitments so as to fulfill his
obligations to the Company and, in any event, will fulfill his legal obligations
as a director. Other than as set forth above, the Director will not, without the
prior written approval of the Board, engage in any other business activity which
could materially interfere with the performance of his duties, services and
responsibilities hereunder or which is in violation of the reasonable policies
established from time to time by the Company, provided that the foregoing shall
in no way limit his activities on behalf of (i) his current employer and its
affiliates or (ii) the boards of directors of those entities on which he
sits.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    3.           Monetary
Remuneration.

    

    (a)  Fees and Compensation.
During the Directorship Term the Director shall receive a monthly fee of
US$1,500.00, and when serving as Chair of Audit Committee, an additional
monthly fee of US$700.00. Such fees shall be payable on the first day of each
month.  The Director's status during the Directorship Term shall be
that of an independent contractor and not, for any purpose, that of an employee
or agent with authority to bind the Company in any respect. All payments and
other consideration made or provided to the Director under Sections 3 and 4
shall be made or provided without withholding or deduction of any kind, and the
Director shall assume sole responsibility for discharging, all tax or other
obligations associated therewith.

    

    (b) Expense
Reimbursements.  During the Directorship Term, the Company shall
reimburse the Director for all reasonable out-of-pocket expenses incurred by the
Director in attending any in-person meetings and in performing other tasks (as
defined in Section 2 hereof) for the Company, provided that the Director
complies with the generally applicable policies, practices and procedures of the
Company for submission of expense reports, receipts or similar documentation of
such expenses. Any reimbursements for allocated expenses (as compared to
out-of-pocket expenses of the Director) must be approved in advance by the
Company.

    

    4.           Equity
Arrangement.  Within five (5) business days after the approval
of an equity incentive plan (the “Plan”) by the
Company’s stockholders, the Company agrees to grant the  Director
Twenty Thousand
(20,000) shares of restricted common stock of the Company (the “Shares”) pursuant to
the Plan. These Shares will vest in Two (2) years with Twenty Five Hundred
(2,500) Shares being vested every quarter, starting from the effective date of
this Agreement. Other terms and conditions of the Shares, shall be determined by
the Company’s Board of Directors in accordance with the Plan at the time of the
grant and set forth in a stock grant agreement to be executed by the Company and
the Director. If the Plan is not yet approved by the end of any quarter during
the Term of this Agreement, the Director will be paid an additional fee equal to
the market value of Shares that would have been vested by then, in lieu of the
Shares that would have been vested by then.

    

    5.           Directorship
Term.  The "Directorship Term", as used in this Agreement,
shall mean the period commencing on the date hereof and terminating on the
earliest of the following to occur:

    

    (a) the death of the
Director;

    

    (b) the termination of the Director
from the position of member of the Board by votes of the Company’s
stockholders;

    

    (c) the resignation by the Director
from the Board for any reason.

    

    6.           Director's Representation
and Acknowledgment.  Based on the understanding that the
Company is currently only engaged in the Business, the Director represents to
the Company that his execution and performance of this Agreement shall not be in
violation of any agreement or obligation (whether or not written) that he may
have with or to any person or entity, including without limitation, any prior
employer. The Director hereby acknowledges and agrees that this Agreement (and
any other agreement or obligation referred to herein) shall be an obligation
solely of the Company, and the Director shall have no recourse whatsoever
against any stockholder of the Company or any of their respective affiliates
with regard to this Agreement.

     

    
      
         

      

      
        - 2
-

        
          

        

      

      
         

      

    

    

    7.           Director
Covenants.

    

    (a)  Unauthorized Disclosure.
The Director agrees and understands that in the Director's position with the
Company, the Director has been and will be exposed to and receive information
relating to the confidential affairs of the Company, including but not limited
to technical information, business and marketing plans, strategies, customer
information, other information concerning the Company's products, promotions,
development, financing, expansion plans, business policies and practices, and
other forms of information considered by the Company to be confidential and in
the nature of trade secrets. The Director agrees that during the Directorship
Term and thereafter, the Director will keep such information confidential and
will not disclose such information, either directly or indirectly, to any third
person or entity without the prior written consent of the Company; provided,
however, that (i) the Director shall have no such obligation to the extent such
information is or becomes publicly known or generally known in the Company's
industry other than as a result of the Director's breach of his obligations
hereunder and (ii) the Director may, after giving prior notice to the Company to
the extent practicable under the circumstances, disclose such information to the
extent required by applicable laws or governmental regulations or judicial or
regulatory process. This confidentiality covenant has no temporal, geographical
or territorial restriction. Upon termination of the Directorship Term, the
Director will promptly return to the Company all property, keys, notes,
memoranda, writings, lists, files, reports, customer lists, correspondence,
tapes, disks, cards, surveys, maps, logs, machines, technical data or any other
tangible product or document which has been produced by, received by or
otherwise submitted to the Director in the course or otherwise as a result of
the Director's position with the Company during or prior to the Directorship
Term, provided that, the Company shall retain such materials and make them
available to the Director if requested by him in connection with any litigation
against the Director under circumstances in which (i) the Director demonstrates
to the reasonable satisfaction of the Company that the materials are necessary
to his defense in the litigation, and (ii) the confidentiality of the materials
is preserved to the reasonable satisfaction of the Company.

    

    (b)  Non-Solicitation.  During
the Directorship Term and for a period of [one (1) ] year after the termination
of the Directorship Term, the Director shall not interfere with the Company's
relationship with, or endeavor to entice away from the Company, any person who,
on the date of the termination of the Directorship Term, was an employee or
customer of the Company or otherwise had a material business relationship with
the Company.

    

    The provisions of this Section 7 shall
survive any termination of the Directorship Term, and the existence of any claim
or cause of action by the Director against the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to the enforcement
by the Company of the covenants and agreements of this Section 7.

     

     

    
      
         

      

      
        - 3
-

        
          

        

      

      
         

      

    

    

    8.           Indemnification.  The
Company agrees to indemnify the Director for his activities as a director of the
Company to the fullest extent permitted by law, and to cover the Director under
any directors and officers liability insurance obtained by the Company. Such
liability insurance coverage shall be US$10,000,000.00 or higher per occurrence
and in aggregate, and shall start on or before July 1, 2010. Further, the
Company and the Director agree to enter into an indemnification agreement on or
before July 1, 2010, substantially in the form of agreement entered into by the
Company and its other Board members.

    

    9.           Non-Waiver of
Rights.  The failure to enforce at any time the provisions of
this Agreement or to require at any time performance by the other party of any
of the provisions hereof shall in no way be construed to be a waiver of such
provisions or to affect either the validity of this Agreement or any part
hereof, or the right of either party to enforce each and every provision in
accordance with its terms. No waiver by either party hereto of any breach by the
other party hereto of any provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions at that
time or at any prior or subsequent time.

    

    10.           Notices.  Every
notice relating to this Agreement shall be in writing and shall be given by
personal delivery or by registered or certified mail, postage prepaid, return
receipt requested; to:

    

    If to the Company:

    
      

    

    
      Sunna
Motor Industry Park

      Jian’an,
Fuyong Hi-Tech Park

      Baoan
District, Shenzhen, Guangdong, China

       

       

      If to the
Director:

       

      Room
502,

      6 Fangcun
Avenue West,

      Guangzhou,
Guangdong, China

    

     

     

    Either of the parties hereto may change
their address for purposes of notice hereunder by giving notice in writing to
such other party pursuant to this Section 10.

    

    11.           Binding
Effect/Assignment.  This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, executors,
personal representatives, estates, successors (including, without limitation, by
way of merger) and assigns. Notwithstanding the provisions of the immediately
preceding sentence, neither the Director nor the Company shall assign all or any
portion of this Agreement without the prior written consent of the other
party.

     

    
      
         

      

      
        - 4
-

        
          

        

      

      
         

      

    

    

    12.           Entire
Agreement.  This Agreement (together with the other agreements
referred to herein) sets forth the entire understanding of the parties hereto
with respect to the subject matter hereof and supersedes all prior agreements,
written or oral, between them as to such subject matter.

    

    13.           Severability.  If
any provision of this Agreement, or any application thereof to any
circumstances, is invalid, in whole or in part, such provision or application
shall to that extent be severable and shall not affect other provisions or
applications of this Agreement.

    

    14.           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware, without reference to
the principles of conflict of laws. All actions and proceedings arising out of
or relating to this Agreement shall be heard and determined in any Delaware
state or federal court and the parties hereto hereby consent to the jurisdiction
of such courts in any such action or proceeding; provided, however, that neither
party shall commence any such action or proceeding unless prior thereto the
parties have in good faith attempted to resolve the claim, dispute or cause of
action which is the subject of such action or proceeding through mediation by an
independent third party.

    

    15.           Legal
Fees.  The parties hereto agree that the non-prevailing party
in any dispute, claim, action or proceeding between the parties hereto arising
out of or relating to the terms and conditions of this Agreement or any
provision thereof (a "Dispute"), shall reimburse the prevailing party for
reasonable attorney's fees and expenses incurred by the prevailing party in
connection with such Dispute; provided, however, that the Director shall only be
required to reimburse the Company for its fees and expenses incurred in
connection with a Dispute, if the Director's position in such Dispute was found
by the court, arbitrator or other person or entity presiding over such Dispute
to be frivolous or advanced not in good faith.

    

    16.           Modifications.  Neither
this Agreement nor any provision hereof may be modified, altered, amended or
waived except by an instrument in writing duly signed by the party to be
charged.

    

    17.           Tense and
Headings.  Whenever any words used herein are in the singular
form, they shall be construed as though they were also used in the plural form
in all cases where they would so apply. The headings contained herein are solely
for the purposes of reference, are not part of this Agreement and shall not in
any way affect the meaning or interpretation of this Agreement.

    

    18.           Counterparts.  This
Agreement may be executed in two or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument.

    

    (remainder
of this page intentionally left blank)

    

    
      
         

      

      
        - 5
-

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the Company has caused this Director Agreement to be executed
by authority of its Board of Directors, and the Director has hereunto set his
hand, on the day and year first above written.

    

    CHINA
ELECTRIC MOTOR, INC.

    

    

    /s/ Yue
Wang

      
        

      

    

    By: 
Name:  Yue Wang

           
Title:    Chief Executive Officer

    

    

    

    

    DIRECTOR

    

    

    /s/ Tony
Shen

      
        

      

    

    Name: 
Tony Shen

     

     

     

    - 6 -

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