Document:

THE
      ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAS NOT
      BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR
      APPLICABLE STATE SECURITIES LAWS. THE SECURITIES REPRESENTED BY THIS CERTIFICATE
      ARE BEING OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER [REGULATION
      D
      (“REGULATION D”)] [REGULATION S (“REGULATION S”] PROMULGATED UNDER THE ACT. THE
      SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN
      THE
      ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
      THE
      ACT, OR (B) AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER, IN
      A
      GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT
      OR
      (II) UNLESS SOLD PURSUANT TO, AND IN ACCORDANCE WITH, RULE 144 UNDER THE ACT
      OR
      OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER
      THE
      ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS.
      NOTWITHSTANDING THE FOREGOING, SUBJECT TO COMPLIANCE WITH APPLICABLE SECURITIES
      LAWS, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
      ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
      SECURITIES.

    

    SJ
      ELECTRONICS, INC.

    

    10%
      NOTE DUE 2009

    

    
      	
              Issuance
                Date: September 5, 2008

            	
              Original
                Principal Amount:

              U.S.
                $_______

            

    

    

    

    FOR
      VALUE RECEIVED,
      SJ ELECTRONICS, INC.,
      a Nevada
      corporation (hereinafter called the “Company”), hereby promises to pay to the
      order of ________________________,
      with
      an
      address at ____________________
      or
      registered assigns (the “Holder”), the sum of _______________ Dollars
      ($_________), on the Maturity Date, and to pay interest on the unpaid principal
      balance hereof at the Applicable Rate from the date hereof, until the same
      becomes due and payable, whether at maturity or upon acceleration or by
      prepayment or repurchase in accordance with the terms hereof or otherwise.
      Any
      amount, including, without limitation, principal of or interest on this Note,
      the Optional Prepayment Price and the Repurchase Price, that is payable under
      this Note that is not paid when due shall bear interest at the Default Rate
      from
      the due date thereof until the same is paid (“Default Interest”). Regular
      interest shall accrue monthly and be payable on the Maturity Date. Regular
      interest on this Note shall be computed on the basis of a 360-day year of twelve
      30-day months and actual days elapsed. No regular interest shall be payable
      on
      an interest payment date on any portion of the principal amount of this Note
      which shall have been prepaid prior to such interest payment date so long as
      the
      Company shall have complied in full with its obligations with respect to such
      prepayment.

    

    
      
         

      

      
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    All
      payments of principal, premium, if any, interest, and other amounts on this
      Note
      shall be made in lawful money of the United States of America. All payments
      shall be made by wire transfer of immediately available funds to such account
      as
      the Holder may from time to time designate by written notice in accordance
      with
      the provisions of this Note. Whenever any amount expressed to be due by the
      terms of this Note is due on any day which is not a Business Day, the same
      shall
      instead be due on the next succeeding day which is a Business Day. Certain
      capitalized terms used in this Note are defined in Article I.

    

    The
      obligations of the Company under this Note shall rank in right of payment on
      a
      parity with all other unsubordinated obligations of the Company for indebtedness
      for borrowed money or the purchase price of property. This Note is issued
      pursuant to the Securities Purchase Agreement and the Holder and this Note
      are
      subject to the terms and entitled to the benefits of the Securities Purchase
      Agreement. 

    

    This
      Note
      is one of a duly authorized issue of the Company’s 10% Notes due 2009 limited to
      an aggregate principal amount of $700,000.00 (excluding 10% Notes due 2009
      issued in replacement of lost, stolen, destroyed or mutilated notes or issued
      on
      transfer of such notes). 

    

    The
      following terms shall apply to this Note:

    

    ARTICLE
      I

    

    DEFINITIONS

    

    1.1 Certain
      Defined Terms. (a)
      All
      the agreements or instruments herein defined shall mean such agreements or
      instruments as the same may from time to time be supplemented or amended or
      the
      terms thereof waived or modified to the extent permitted by, and in accordance
      with, the terms thereof and of this Note.

    

    (b) The
      following terms shall have the following meanings (such meanings to be equally
      applicable to both the singular and plural forms of the terms
      defined):

    

    “Accredited
      Investor” means an “accredited investor” as that term is defined in Rule 501 of
      Regulation D under the 1933 Act.

    

    “Affiliate”
      means, with respect to any Person, any other Person that directly, or indirectly
      through one or more intermediaries, controls, is controlled by or is under
      common control with the subject Person. For purposes of this definition,
“control” (including, with correlative meaning, the terms “controlled by” and
“under common control with”), as used with respect to any Person, shall mean the
      possession, directly or indirectly, of the power to direct or cause the
      direction of the management and policies of such Person, whether through the
      ownership of voting securities or by contract or otherwise.

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    “AMEX”
      means the American Stock Exchange, Inc.

    

    “Applicable
      Rate” means ten percent (10%) per annum.

    

    “Board
      of
      Directors” means the Board of Directors of the Company.

    

    “Business
      Day” means any day other than a Saturday, Sunday or a day on which commercial
      banks in The City of New York are authorized or required by law or executive
      order to remain closed.

    

    “Common
      Stock” means the Common Stock, par value $.001 per share, of the Company, or any
      shares of capital stock of the Company into which such shares shall be changed
      or reclassified after the Issuance Date.

    

    “Company”
      shall have the meaning provided in the first paragraph of this
      Note.

    

    “Default
      Interest” shall have the meaning provided in the first paragraph of this
      Note.

    

    “Default
      Rate” means 15 percent per annum (or such lesser rate equal to the highest rate
      permitted by applicable law).

    

    “Event
      of
      Default” shall have the meaning provided in Section 3.1.

    

    “Holder”
      shall have the meaning provided in the first paragraph of this
      Note.

    

    “Issuance
      Date” means September 5, 2008.

    

    “Majority
      Holders” means, at any time, the holders of a majority of
      the
      aggregate principal amount of this Note and the Other Notes outstanding at
      such
      time.

    

    “Maturity
      Date” means the earlier of (a) March 5, 2009 or (b) the closing date of any
      equity or debt financing of the Company or any current or future Subsidiary
      of
      the Company in which the gross proceeds payable to the Company and/or such
      Subsidiary shall exceed $1,000,000. 

    

    “Nasdaq”
      means the Nasdaq Global Market.

    

    “1934
      Act” means the Securities Exchange Act of 1934, as amended.

    

    “1933
      Act” means the Securities Act of 1933, as amended.

    

    “Note”
      means this instrument as originally executed, or if later amended or
      supplemented in accordance with its terms, then as so amended or supplemented.
      

    

    
      
         

      

      
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    “Securities
      Purchase Agreement” means the Securities Purchase Agreement, dated as of the
      date of September 5, 2008, by and between the Company and the original Holder
      of
      this Note or its predecessor instrument.

    

    “NYSE”
      means the New York Stock Exchange, Inc.

    

    “Optional
      Prepayment Date” means the Business Day on which this Note is to be prepaid
      pursuant to Section 2.1.

    

    “Optional
      Prepayment Notice” means an Optional Prepayment Notice in the form attached
      hereto as Exhibit
      A.

    

    “Optional
      Prepayment Period” means the period which commences on the date hereof and ends
      on the Maturity Date, provided
      that
      all
      conditions set forth in Section 2.1 have been met.

    

    “Optional
      Prepayment Price” means an amount in cash equal to the sum of (1) 100% of the
      outstanding principal amount of this Note plus
      (2)
      accrued and unpaid interest on such principal amount to the Optional Prepayment
      Date plus
      (3)
      accrued and unpaid Default Interest, if any, on the amount referred to in the
      immediately preceding clause (2) at the rate provided in this Note.

    

    “Other
      Notes” means the several 10% Notes due 2009, issued by the Company pursuant to
      the Securities Purchase Agreement.

    

    “Person”
      means any natural person, corporation, partnership, limited liability company,
      trust, incorporated organization, unincorporated association or similar entity
      or any government, governmental agency or political subdivision.

    

    “Principal
      Market” means, at any time, whichever of the OTCBB, Nasdaq, Nasdaq Capital
      Market, AMEX, NYSE or such other U.S. market or exchange is at the time the
      principal market on which the Common Stock is then listed for
      trading.

     

    “SEC”
      means the US Securities and Exchange Commission.

     

    “Subsidiary”
      means any corporation or other entity of which a majority of the capital stock
      or other ownership interests having ordinary voting power to elect a majority
      of
      the board of directors or other Persons performing similar functions are at
      the
      time directly or indirectly owned by the Company.

    

    “Superior
      Indebtedness” has the meaning provided in Article 4.

    

    “Trading
      Day” means at any time a day on which the Principal Market is open for general
      trading of securities.

    

    
      
         

      

      
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    “Transaction
      Documents” means this Note, the Securities Purchase Agreement and the other
      agreements, instruments and documents contemplated hereby and
      thereby.

    

    

    ARTICLE
      II

    

    OPTIONAL
      PREPAYMENT 

    

    

    2.1 Optional
      Prepayment.  (a)
      At any
      time during the Optional Prepayment Period, the Company shall have the right
      to
      prepay at any one time all of the outstanding principal amount of this Note
      at
      the Optional Prepayment Price pursuant to this Section 2.1 on any Optional
      Prepayment Date, so long as the following conditions are met:

    

    (1) on
      the
      date the Company gives the Optional Prepayment Notice and at all times to and
      including the Optional Prepayment Date, no Event of Default and no event which,
      with notice or passage of time, or both, would become an Event of Default has
      occurred and is continuing: and

    

    (2)
       on
      the
      date the Company gives the Optional Prepayment Notice, the Company has funds
      available to pay the Optional Prepayment Price of this Note.

    

    In
      order
      to exercise its right of prepayment under this Section 2.1, the Company
      shall give the Optional Prepayment Notice to the Holder not less than ten (10)
      Trading Days or more than twenty (20) Trading Days prior to the Optional
      Prepayment Date stating: (1) that the Company is exercising its right to prepay
      this Note in accordance with this Section 2.1, (2) the principal amount of
      this Note to be prepaid, (3) the Optional Prepayment Price, (4) the Optional
      Prepayment Date and (5) that all of the conditions of this Section 2.1 entitling
      the Company to call this Note for prepayment have been met. On the Optional
      Prepayment Date (or such later date as the Holder surrenders this Note to the
      Company) the Company shall pay to or upon the order of the Holder, by wire
      transfer of immediately available funds to such account as shall be specified
      for such purpose by the Holder at least one Business Day prior to the Optional
      Prepayment Date, an amount equal to the Optional Prepayment Price of the portion
      (which may be all) of this Note to be prepaid. 

    

    (b) In
      order
      that the Company shall not discriminate among the Holder and the holders of
      the
      Other Notes, the Company agrees that it shall not prepay any of the Other Notes
      pursuant to the provisions thereof similar to this Section 2.1 or
      repurchase or otherwise acquire any of the Other Notes unless the Company offers
      simultaneously to prepay, repurchase or otherwise acquire this Note for cash
      at
      the same unit price as the Other Note or Other Notes.

    

    
      
         

      

      
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    2.2 No
      Other Prepayment.
      Except
      as specifically provided in Section 2.1, this Note may not be prepaid, redeemed
      or repurchased at the option of the Company prior to the applicable Maturity
      Date, as the case may be. 

    

    

    ARTICLE
      III

    

    EVENTS
      OF DEFAULT

    

    3.1 If
      any of
      the
      following events of default (each, an “Event of Default”) shall
      occur:

    

    (a) Failure
      to Pay Principal, Interest, Etc.
      The
      Company fails to pay the principal or the Optional Prepayment Price hereof
      when
      due, whether at maturity, upon acceleration or otherwise, as applicable;
      or

    

    (b)  Breach
      of Covenant. The
      Company fails to comply in any material respect with any material provision
      of
      the Securities Purchase Agreement; or

    

    (c) Breach
      of Representations and Warranties.
      Any
      representation or warranty of the Company made herein or in any agreement,
      statement or certificate given in writing pursuant hereto or in connection
      herewith (including, without limitation, the Securities Purchase Agreement)
      shall be false or misleading in any material respect when made; or

    

    (d) Certain
      Voluntary Proceedings.
      The
      Company or any Subsidiary shall commence a voluntary case or other proceeding
      seeking liquidation, reorganization or other relief with respect to itself
      or
      its debts under any bankruptcy, insolvency or other similar law now or hereafter
      in effect or seeking the appointment of a trustee, receiver, liquidator,
      custodian or other similar official of it or any substantial part of its
      property, or shall consent to any such relief or to the appointment of or taking
      possession by any such official in an involuntary case or other proceeding
      commenced against it, or shall make a general assignment for the benefit of
      creditors, or shall fail generally to pay its debts as they become due or shall
      admit in writing its inability generally to pay its debts as they become due;
      or

    

    (e) Certain
      Involuntary Proceedings. An
      involuntary case or other proceeding shall be commenced against the Company
      or
      any Subsidiary seeking liquidation, reorganization or other relief with respect
      to it or its debts under any bankruptcy, insolvency or other similar law now
      or
      hereafter in effect or seeking the appointment of a trustee, receiver,
      liquidator, custodian or other similar official of it or any substantial part
      of
      its property, and such involuntary case or other proceeding shall remain
      undismissed and unstayed for a period of 60 consecutive days; or

    

    (f) Judgments. Any
      court
      of competent jurisdiction shall enter one or more final judgments against the
      Company or any Subsidiary or any of their respective properties or other assets
      in an aggregate amount in excess of $100,000, which is not vacated, bonded,
      stayed, discharged, satisfied or waived for a period of 30 consecutive days;
      or

    

    
      
         

      

      
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    (g) Delisting
      of Common Stock.
      The
      Common Stock shall cease to be listed or quoted on the Principal Market;

    

    then,
      (x)
      upon the occurrence and during the continuation of any such Event of Default,
      the Company shall within ten Business Days after the occurrence of the Event
      of
      Default pay to the Holder an amount equal to the sum of (1) 150% of the
      outstanding principal amount of this Note plus
      (2)
      accrued and unpaid interest on such principal amount to the date of payment
      plus
      (3)
      accrued and unpaid Default Interest, if any, thereon at the rate provided in
      this Note to the date of payment, (y) all other amounts payable hereunder or
      under any of the other Transaction Documents shall immediately become due and
      payable, all without demand, presentment or notice, all of which hereby are
      expressly waived, together with all costs, including, without limitation,
      reasonable legal fees and expenses of collection and (z) the Holder shall be
      entitled to exercise all other rights and remedies available at law or in
      equity.

    

     

    ARTICLE
      IV

     

    SUBORDINATION

     

    4.1
       This
      Subordinated Note shall be subordinate and junior in right of payment to all
      indebtedness, obligations, and liabilities, matured, unmatured, or contingent
      of
      the Company to the holders of the Company’s 15% Senior Secured Convertible Notes
      due 2009 issued pursuant to the Securities Purchase Agreement dated as of May
      15, 2008 (the May 2008 Purchase Agreement”) between the Company and such note
      holders (the “15% Notes”) and any other indebtedness, obligation, and liability
      of the Company to the holders of such 15% Notes, whether now existing or
      hereafter created and whether arising out of or in connection with the May
      2008
      Purchase Agreement or otherwise, and interest (including any interest accruing
      subsequent to the commencement of bankruptcy, insolvency, or similar proceedings
      with respect to the Company) payable on such indebtedness and commitment,
      facility, balance deficiency, reduction fees and other obligations and
      liabilities payable in connection therewith (said indebtedness, fees,
      obligations, and liabilities being hereinafter called the “Superior
      Indebtedness”). As used in this Note the phrase “subordinate and junior in right
      of payment” shall mean that:

     

    (a) No
      part
      of this Note shall have any claim to the assets of the Company on a parity
      with
      or prior to the claim of the Superior Indebtedness. Unless and until the
      Superior Indebtedness shall have been irrevocably paid in full, the holder
      of
      this Note will not (except as otherwise provided herein) take, demand, or
      receive, nor will the Company make, give, or permit, directly or indirectly,
      by
      set-off, redemption, purchase, or in any other manner, any payment or security
      for the whole or any part of the principal of this Note; provided, however,
      that
      the Company may pay all or any part of the indebtedness evidenced hereby when
      and as, and only when and as, the same becomes due and payable in accordance
      with the terms and conditions hereof in effect on the date hereof including
      as
      provided in Article II hereof if, and only if, after giving effect to such
      interest payment, no Default or Event of Default described in the May 2008
      Purchase Agreement will be in existence and no default is or will be in
      existence in respect of any other Superior Indebtedness.

     

    
      
         

      

      
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    (b) In
      the
      event of any distribution, division, or application, partial or complete,
      voluntary or involuntary, by operation of law or otherwise, of all or any part
      of the property, assets, or business of the Company or the proceeds thereof
      to
      any creditor or creditors of the Company, or upon any indebtedness of the
      Company by reason of any liquidation, dissolution, or other winding up of the
      Company or the business either by reason of any assignment for the benefit
      of
      creditors or any proceeding by or against the Company for any relief under
      any
      bankruptcy, reorganization, or insolvency law or laws, federal or state, or
      any
      law, federal or state, relating to the relief of debtors, readjustment of
      indebtedness, reorganization, composition, or extension or in the event of
      the
      occurrence and during the continuation of any Default or Event of Default
      described in the May 2008 Purchase Agreement, then and in any such event any
      payment or distribution of any kind or character, whether in cash, property,
      or
      securities which, but for the subordination provisions of this Note, would
      otherwise be payable or deliverable upon or in respect of this Note shall
      instead be paid over or delivered to the holders of the 15% Notes for
      application on account of the Superior Indebtedness, and the holder of this
      Note
      shall not receive any such payment or distribution or any benefit
      therefrom.

     

    (c) The
      holder of this Note hereby irrevocably authorizes and empowers (without imposing
      any obligation on) the holders of the 15% Notes, under the circumstances set
      forth in Section 4.1 (b) hereof, to demand, sue for, collect, and receive every
      such payment or distribution described therein and give acquittance therefore,
      to file claims and proofs of claims in any statutory or nonstatutory proceeding,
      to vote the full amount of this Note in its sole discretion in connection with
      any resolution, arrangement, plan, reorganization, compromise, settlement,
      or
      extension and to take all such other action (including, without limitation,
      the
      right to participate in any composition of creditors and the right to vote
      this
      Note at creditors' meetings for the election of trustees, acceptances of plans,
      and otherwise), in the names of the holders of the 15% Notes, in the name of
      the
      holder of this Note, or otherwise as the holders of the 15% Notes may deem
      necessary or advisable for the enforcement of the subordination provisions
      of
      this Note. The holder of this Note hereby agrees, under the circumstances set
      forth in Section 4.1(b) hereof, duly and promptly to take such action as may
      be
      requested at any time and from time to time by the holders of 15% Notes to
      collect this Note for the account of the holders of the 15% Notes and to file
      appropriate proofs of claim in respect thereof, to deliver this Note to the
      holders of 15% Notes on demand therefore, to execute and deliver such powers
      of
      attorney, assignments, or other instruments as may be requested by the holders
      of 15% Notes in order to enable the holders of 15% Notes to enforce any and
      all
      claims upon or in respect of this Note, and to collect and receive any and
      all
      payments or distributions which may be payable or deliverable at any time upon
      or in respect of this Note.

     

    
      
         

      

      
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    (d)  Subject
      to the provisions of Section 4.1(a) above, should any payment, distribution,
      or
      security, or the proceeds of any thereof be collected or received by the holder
      of this Note in respect of this Note and such collection or receipt is not
      expressly permitted hereunder prior to the payment in full of the Superior
      Indebtedness, the holder hereof will forthwith deliver the same to the holders
      of 15% Notes in precisely the form received (except for the endorsement or
      the
      assignment of the Holder hereof where necessary), and until so delivered the
      same shall be held in trust by the holder hereof as the property of the holders
      of 15% Notes.

     

    (e) Subject
      to the payment in full of the Superior Indebtedness, the holder of this Note
      shall be subrogated to the rights of the holders of Superior Indebtedness to
      receive payments or distributions of assets of the Company made on the Superior
      Indebtedness until the principal of this Note shall be paid in full, and for
      the
      purposes of such subrogation no payments or distributions to the holders of
      15%
      Notes of any cash, property, or securities to which the holder of this Note
      would be entitled, except for these provisions shall, as between the Company,
      its creditors other than the holders of 15% Notes, and the holder of this Note,
      be deemed to be a payment by the Company to or on account of Superior
      Indebtedness, it being understood that these provisions are and are intended
      solely for the purpose of defining the relative rights of the holder of this
      Note, on the one hand, and the holders of 15% Notes and the other holders of
      Superior Indebtedness, on the other hand.

     

    (f)  The
      Holder hereby waives any and all notice of renewal, extension, or accrual of
      any
      of the Superior Indebtedness, present or future, and agrees and consents that
      without notice to or assent by the Holder hereof:

     

    (i) The
      obligations and liabilities of the Company or any other party or parties for
      or
      upon the Superior Indebtedness (and/or any promissory note(s), security
      document, or guaranty evidencing or securing the same) may from time to time
      in
      whole or in part be renewed, extended, modified, amended, accelerated,
      compromised, supplemented, terminated, sold, exchanged, waived, or
      released;

     

    (ii) The
      holders of 15% Notes may exercise or refrain from exercising any right, remedy,
      or power granted by the May 2008 Purchase Agreement or any other document
      creating, evidencing, or otherwise relating to the Superior Indebtedness or
      at
      law, in equity, or otherwise with respect to the Superior Indebtedness or any
      collateral security or lien (legal or equitable) held, given, or intended to
      be
      given therefore (including, without limitation, the right to perfect or refrain
      from perfecting any lien or security interest created in connection
      therewith);

     

    (iii) Any
      and
      all guarantees, collateral security, and/or liens (legal or equitable) at any
      time present or future held, given, or intended to be given for the Superior
      Indebtedness and any rights or remedies of the holders of 15% Notes in respect
      thereof may, from time to time in whole or in part be exchanged, sold,
      surrendered, released, modified, waived, or extended by the holders of 15%
      Notes; and

     

    
      
         

      

      
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    (iv) Any
      balance or balances of funds with the holders of 15% Notes at any time standing
      to the credit of the Company or any guarantor of any of the Superior
      Indebtedness may from time to time in whole or in part be surrendered or
      released;

     

    all
      as
      the holders of 15% Notes may deem advisable and all without impairing,
      abridging, diminishing, releasing, or affecting the subordination to the
      Superior Indebtedness provided herein.

     

    (g) The
      Holder hereby waives notice of or proof of reliance hereon and protest, demand
      for payment, and notice of default.

     

    (h)  The
      holders of 15% Notes shall not be prejudiced in its right to enforce the
      subordination contained herein in accordance with the terms hereof by any act
      or
      failure to act on the part of the Company.

     

    (i)
       The
      subordination provisions contained herein are for the benefit of the holders
      of
      Superior Indebtedness and may not be rescinded, canceled, amended, or modified
      in any way without the prior written consent of the holders of Superior
      Indebtedness, except upon irrevocable payment in full of the Superior
      Indebtedness.

     

    

    ARTICLE
      V

    

    MISCELLANEOUS

    

    5.1 Failure
      or Indulgency Not Waiver.
      No
      failure or delay on the part of the Holder in the exercise of any power, right
      or privilege hereunder shall operate as a waiver thereof, nor shall any single
      or partial exercise of any such power, right or privilege preclude other or
      further exercise thereof or of any other right, power or privileges. All rights
      and remedies existing hereunder are cumulative to, and not exclusive of, any
      rights or remedies otherwise available. The Company stipulates that the remedies
      at law of the Holder in the event of any default or threatened default by the
      Company in the performance of or compliance with any of the terms of this Note
      are not and will not be adequate, and that such terms may be specifically
      enforced (x) by a decree for the specific performance of any agreement contained
      herein or (y) by an injunction against a violation of any of the terms hereof
      or
      (z) otherwise.

    

    5.2 Notices.
      Except
      as otherwise specifically provided herein, any notice herein required or
      permitted to be given shall be in writing and may be personally served, sent
      by
      telephone line facsimile transmission or delivered by courier or sent by United
      States mail and shall be deemed to have been given upon receipt if personally
      served, sent by telephone line facsimile transmission or sent by courier or
      three days after being deposited in the facilities of the United States Postal
      Service, certified, with postage pre-paid and properly addressed, if sent by
      mail. For the purposes hereof, the address and facsimile line transmission
      number of the Holder shall be as furnished by the Holder for such purpose and
      shown on the records of the Company; and the address of the Company shall be
      SJ
      Electronics, Inc., 5F, No. 166, Sinhu 2nd
      Road,
      Neihu District, Taipei City, Taiwan, Attention: Agatha Shen (telephone line
      facsimile number 886-2-8791-1368). The Holder or the Company may change its
      address for notice by service of written notice to the other as herein
      provided.

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    5.3 Amendment,
      Waiver. (a)
      Neither
      this Note or any Other Note nor any terms hereof or thereof may be changed,
      amended, discharged or terminated unless such change, amendment, discharge
      or
      termination is in writing signed by the Company and the Majority Holders,
      provided that no such change, amendment, discharge or termination shall, without
      the consent of the Holder and the holders of the Other Notes affected thereby
      (i) extend the scheduled Maturity Date of this Note or any Other Note, or reduce
      the rate or extend the time of payment of interest (other than as a result
      of
      waiving the applicability of any post-default increase in interest rates) hereon
      or thereon or reduce the principal amount hereof or thereof or the Optional
      Prepayment Price hereof or thereof, (ii) amend, modify or waive any provision
      of
      this Section 5.3 or (iii) reduce any percentage specified in, or otherwise
      modify, the definition of Majority Holders.  

     

    (b) Any
      term
      or condition of this Note may be waived by the Holder or the Company at any
      time
      if the waiving party is entitled to the benefit thereof, but no such waiver
      shall be effective unless set forth in a written instrument duly executed by
      or
      on behalf of the party waiving such term or condition. No waiver by any party
      of
      any term or condition of this Note, in any one or more instances, will be deemed
      to be or construed as a waiver of the same or any other term or condition of
      this Note on any future occasion.

    

    5.4 Assignability.
      This
      Note shall be binding upon the Company and its successors, and shall inure
      to
      the benefit of and be binding upon the Holder and its successors and permitted
      assigns. The Company may not assign its rights or obligations under this
      Note.

    

    5.5 Governing
      Law.
      This
      Note shall be governed by the internal laws of the State of New York, without
      regard to the principles of conflict of laws.

     

    5.6 Transfer
      of Note.
      This
      Note has not been and is not being registered under the provisions of the 1933
      Act or any state securities laws and this Note may not be transferred prior
      to
      the end of the holding period applicable to sales without restrictions under
      Rule 144 unless (1) the transferee is an Accredited Investor and (2) the Holder
      shall have delivered to the Company an opinion of counsel, reasonably
      satisfactory in form, scope and substance to the Company, to the effect that
      this Note may be sold or transferred without registration under the 1933 Act.
      Prior to any such transfer, such transferee shall have represented in writing
      to
      the Company that such transferee has requested and received from the Company
      all
      information relating to the business, properties, operations, condition
      (financial or other), results of operations or prospects of the Company and
      the
      Subsidiaries deemed relevant by such transferee; that such transferee has been
      afforded the opportunity to ask questions of the Company concerning the
      foregoing and has had the opportunity to obtain and review the reports and
      other
      information concerning the Company which at the time of such transfer have
      been
      filed by the Company with the SEC pursuant to the 1934 Act. 

    

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    5.7 Enforceable
      Obligation. The
      Company represents and warrants that at the time of the original issuance of
      this Note it received the full purchase price payable pursuant to the Securities
      Purchase Agreement in an amount at least equal to the original principal amount
      of this Note, and that this Note is an enforceable obligation of the Company
      which is not subject to any offset, reduction, counterclaim or disallowance
      of
      any sort.

    

    5.8 Replacement
      of Notes.
      Upon
      receipt by the Company of evidence reasonably satisfactory to it of the
      ownership of and the loss, theft, destruction or mutilation of this Note and
      (a)
      in the case of loss, theft or destruction, of indemnity from the Holder
      reasonably satisfactory in form to the Company (and without the requirement
      to
      post any bond or other security) or (b) in the case of mutilation, upon
      surrender and cancellation of this Note, the Company will execute and deliver
      to
      the Holder a new Note of like tenor without charge to the Holder.

    

    5.9 Payment
      of Note on Prepayment; Deposit of Optional Prepayment Price.

    

    (a)  If
      this
      Note or any portion of this Note is to be prepaid as provided in Section 2.1
      and
      any notice required in connection therewith shall have been given as provided
      therein and the Company shall have otherwise complied with the requirements
      of
      this Note with respect thereto, then this Note or the portion of this Note
      to be
      so prepaid or repurchased and with respect to which any such notice has been
      given shall become due and payable on the date stated in such notice at the
      Optional Prepayment Price. On and after the Optional Prepayment Date so stated
      in such notice, interest on this Note or the portion of this Note to be so
      prepaid or repurchased shall cease to accrue, and this Note or such portion
      hereof shall be deemed not to be outstanding and shall not be entitled to any
      benefit with respect to principal of or interest on the portion to be so
      prepaid, except to receive payment of the Optional Prepayment Price. On
      presentation and surrender of this Note or such portion hereof, this Note or
      the
      specified portion hereof shall be paid and repurchased at the Optional
      Prepayment Price. If a portion of this Note is to be prepaid or repurchased,
      upon surrender of this Note to the Company in accordance with the terms hereof,
      the Company shall execute and deliver to the Holder without service charge,
      a
      new Note or Notes, having the same date hereof and containing identical terms
      and conditions, in such denomination or denominations as requested by the Holder
      in aggregate principal amount equal to, and in exchange for, the unprepaid
      portion of the principal amount of this Note so surrendered.

    

    (b) Upon
      the
      payment in full of all amounts payable by the Company under this Note, any
      Event
      of Default which occurred prior to such payment by reason of one or more
      provisions of this Note with which the Company thereafter is no longer obligated
      to comply, then shall no longer exist.

    

    
      
         

      

      
        12

        
          

        

      

      
         

      

       

    

    5.10 Construction.
      The
      language used in this Note will be deemed to be the language chosen by the
      Company and the original Holder of this Note (or its predecessor instrument)
      to
      express their mutual intent, and no rules of strict construction will be applied
      against the Company or the Holder.

    

    

    [Remainder
      of Page Intentionally Left Blank]

    

     

    
 

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    

     

    IN
      WITNESS WHEREOF,
      the
      Company has caused this Note to be signed in its name by its duly authorized
      officer on of the day and in the year first above written.

    

    Date:
      September 5, 2008

     

    
      	
              SJ
                ELECTRONICS, INC.

            
	 
	 
	 
	
              By:____________________________

            
	
              Name:

            
	
              Title:

            

    

     

    

     

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    

    ASSIGNMENT

    

    FOR
      VALUE RECEIVED,
      _________________________ hereby sell(s), assign(s) and transfer(s) unto
      _________________________ (Please insert social security or other Taxpayer
      Identification Number of assignee: ______________________________) the within
      Note, and hereby irrevocably constitutes and appoints _________________________
      attorney to transfer the said Note on the books of SJ Electronics, Inc., a
      Nevada corporation (the “Company”), with full power of substitution in the
      premises.

    

    In
      connection with any transfer of the Note within the period prior to the
      expiration of the holding period applicable to sales thereof under Rule 144
      under the 1933 Act (or any successor provision) (other than any transfer
      pursuant to a registration statement that has been declared effective under
      the
      1933 Act), the undersigned confirms that such Note is being
      transferred:

    

    
      	
               

            	
              [

            	
              ]

            	
              To
                the Company or a subsidiary thereof;
                or

            

    

    

    

    
      	
               

            	
              [

            	
              ]

            	
              To
                a non-US Person and in compliance with Regulation S under the 1933
                Act;
                or

            

    

    

    
      	
               

            	
              [

            	
              ]

            	
              Pursuant
                to and in compliance with Rule 144 under the 1933
                Act;

            

    

    

    and
      unless the box below is checked, the undersigned confirms that, to the knowledge
      of the undersigned, such Note is not being transferred to an Affiliate of the
      Company.

     

    
      	
               

            	
              [

            	
              ]

            	
              The
                transferee is an Affiliate of the
                Company.

            

    

    

    Capitalized
      terms used in this Assignment and not defined in this Assignment shall have
      the
      respective meanings provided in the Note.

    

     Dated:_____________________

    

    

    
      	
              NAME:_____________________

            
	 
	 
	
              ___________________________

            
	
              Signature(s)

            
	 

    

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

     

    EXHIBIT
      A

    

    

    OPTIONAL
      PREPAYMENT NOTICE

    (Section 2.1
      of 10% Note due 2009)

    

    To:_________________________________     

    (Name
      of
      Holder)

    

    (1) Pursuant
      to the terms of the 10% Note due 2009 (the “Note”), SJ Electronics, Inc., a
      Nevada corporation (the “Company”), hereby notifies the above-named Holder that
      the Company is exercising its right to prepay the Note in accordance with
      Section 2.1 of the Note as set forth below:

    

    (i) The
      principal amount of the Note to be prepaid is $             .

    

    (ii) The
      Optional Prepayment Price is $               .

    

    (iii) The
      Optional Prepayment Date is               .

    

    (2) All
      of
      the conditions specified in Section 2.1 of the Note entitling the Company to
      call the Note for prepayment have been satisfied.

    

    (3) Capitalized
      terms used herein and not otherwise defined herein have the respective meanings
      provided in the Note.

    

     

     

     Date:__________________

    

    
      	
              SJ
                ELECTRONICS, INC.

            
	 
	 
	 
	
              By:________________________

            
	
              Name:

            
	
              Title:

            

    

    

     

    
      
         

      

      
        16EMPLOYMENT
      AGREEMENT

     

    This
      Employment Agreement (the "Employment Agreement") is entered into effective
      as
      of the 10th day
      of
      September, 2008 (the “Effective Date”), by and among Apollo Medical Holdings,
      Inc., a Delaware corporation (the "Company") and Noel DeWinter, an individual
      who is a resident of the State of California (“DeWinter”). 

     

    WITNESSETH:

    

    WHEREAS,
      the
      Company is a medical management company focused on managing the provision of
      hospital-based medicine through its affiliated medical groups (the “Business”),
      which currently consist of ApolloMed Hospitalists and Apollo Medical Associates;
      and

    

    WHEREAS,
      the Board of Directors of the Company (the “Board”) desires to employ DeWinter
      as Chief Financial Officer of the Company (“CFO”) and to compensate him
      therefor; and

     

    WHEREAS,
      DeWinter is willing to make his services available to the Company on the terms
      and consitions hereinafter set forth.

     

    NOW,
      THEREFORE, in consideration of the mutual covenants hereinafter stated, it
      is
      agreed as follows:

     

    1.
      SCOPE
      OF WORK. The Company hereby arees to employ DeWinter and DeWinter hereby agrees
      to serve the Company as its CFO. At such time as the Company shall obtain
      directors and officers liability insurance, DeWinter shall be covered by such
      insurance policy, which shall contain appropriate and customary limits. During
      the Term of this Employment Agreement, as defined below, DeWinter shall
      diligently perform all services as may from time to time be delegated to him
      by
      the Board. DeWinter
      shall devote substantially all his working time and attention to the business
      and affairs of the Company, render such services to the best of his ability,
      and
      use his reasonable best efforts to promote the interests of the
      Company. In
      connection with the performance of his responsibilities as CFO, DeWinter shall,
      performs those functions generally associated with the position of Chief
      Financial Officer of a public reporting company during the term of this
      Employment Agreement, including without limitation:

     

    
      	
            	a.	
              Review
                and establish the Company’s monthly accounting closing process for the
                timely production of financial
                statements.

            

    

    
      	 	
              b.

            	
              Review
                and implement production of the Company’s monthly financial statements and
                quarterly and annual reporting on Forms 10Q and 10K, respectively,
                when
                and if the Company becomes a reporting company under the Rules and
                Regulations (the “Rules”) of the Securities and Exchange Commission (the
                “SEC”).

            

    

    
    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
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        Page
        2

    

     

    
      	 	
              c.

            	
              Review
                and implement production of other financial and accounting processes,
                if
                requested, such as budgeting, forecasting and the development of
                operating
                metrics.

            

    

    
      	 	
              d.

            	
              Act
                as the liaison with the Company’s external accountants and auditors, and
                the Audit Committee of the Board of
                Directors.

            

    

    
      	 	
              e.

            	
              Certify
                the Company’s public financial statements as the Company’s Chief Financial
                Officer, as required by the Rules of the
                SEC.

            

    

    
      	 	
              f.

            	
              Assist
                with the design and implementation of internal controls in accordance
                with
                the requirements of the Sarbanes-Oxley Act of 2002, as amended, and
                the
                Rules of the SEC and the various stock exchanges applicable to the
                Company.

            

    

     

    2.
      TERM.
      The term of this Employment Agreement shall be for no specific period of time.
      As a result, either DeWinter or the Company can terminate this Employment
      Agreement at any time for any reason or for no reason, with or without cause,
      by
      giving written notice to the other party. The
      provisions of Sections 3(d), 3(g), 4(c), 5(e), 5(f), 5(g), 6, 8, 9, 10, 11,
      12,
      13, 14, 16, 17, 18, 19 and 21 shall survive the termination of this
      Agreement.

     

    
      
        3.
          COMPENSATION.

         

      

    

    a. Cash
      Compensation.
      The
      Company shall pay DeWinter Seven Thousand Dollars ($7,000.00) per month; $3,500
      to be paid on the 15th
      of each
      month and $3,500 to be paid on the last day of each month during the term of
      this Employment Agreement. The parties agree to negotiate in good faith an
      increase in the monthly cash compensation from time to time but the Company
      shall be under no obligation to increase the compensation provided for herein.
      

     

    b. Equity
      Compensation.
      Upon
      the execution and delivery of this Agreement, the Company shall issue to
      DeWinter a restricted stock award equal to Two Hundred Fifty Thousand (250,000)
      shares of the Company’s common stock (the “Shares”). All certificates
      representing the Shares shall bear a legend substantially in the form provided
      in Section 5(b) hereinbelow regarding the fact that the Shares are not
      registered under the Securities Act of 1933, as amended (the “Securities Act”),
      and none of the Shares may be sold, pledged, hypothecated or otherwise
      transferred without compliance with Federal and applicable state securities
      laws. 

     

    c. Reserved.
      

     

    d. Reserved.
      

     

    e. Business
      Expense Reimbursement.
      The
      Company shall reimburse DeWinter for reasonable travel and other expenses
      actually and properly incurred by DeWinter in carrying out the obligations
      hereunder, provided that such expenses are approved by the Chief Executive
      Officer or President of the Company and are supported by proper receipts,
      invoices or vouchers supplied to Company within 30 days of the day any such
      expenses were incurred. Expenses to be incurred in an amount to exceed $250.00
      shall require prior written approval of the Chief Executive Officer or President
      of the Company. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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      Page
      3

     

    g. Reserved.
      

     

    4. REPRESENTATIONS
      AND WARRANTIES. DeWinter represents, warrants and covenants to the Company
      that:

             

    a.  He
      will
      devote sufficient business time, energy, interest, ability, and skill to the
      provision of the services to the Company provided for hereunder.

     

    b.  He
      will
      not, for as long as such person is providing services to the Company hereunder,
      directly or indirectly, promote, participate, or engage in any business activity
      that is competitive with the Company’s Business, including, without limitation,
      any involvement as a shareholder, director, officer, employee, partner, party
      to
      a joint venture, Employee, advisor, individual proprietor, lender, or agent
      of
      any business, without the prior written consent of the
      Company. 

     

    c.  During
      the term of this Agreement and for a period of two years after the termination
      of this Agreement, he will not solicit, attempt to solicit, or cause to be
      solicited any customers of the Company for purposes of promoting or selling
      products or services which are competitive with those of the Company, nor will
      such person solicit, attempt to solicit, or cause to be solicited any employees,
      agents, or other independent contractors of the Company to cease their
      relationship with the Company. 

     

    5. SPECIAL
      SECURITIES REPRESENTATIONS. As a material inducement to the Company to issue
      to
      DeWinter the Shares, DeWinter represents and warrants to the Company as
      follows:

     

    a.
       He
      is
      acquiring the Shares for investment for his own account, and not with a view
      toward distribution thereof, and with no present intention of dividing his
      interest with others or reselling or otherwise disposing of all or any portion
      of the Shares. He has not offered or sold a participation in the Shares and
      will
      not offer or sell any interest therein. He further acknowledges that he does
      not
      have in mind any sale of the Shares currently or after the passage of a fixed
      or
      determinable period of time or upon the occurrence or non-occurrence of any
      predetermined events or consequence; and that he has no present or contemplated
      agreement, undertaking, arrangement, obligation, indebtedness or commitment
      providing for or which is likely to compel a disposition of the Shares and
      is
      not aware of any circumstances presently in existence that are likely in the
      future to prompt a disposition thereof.

     

    b.
       He
      is
      aware of the restrictions of transferability of the Shares and further
      understands and acknowledges that any certificates evidencing the Shares will
      bear a legend substantially in the following form: 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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      Page
      4

     

    THE
      SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED FOR SALE UNDER ANY STATE
      SECURITIES LAWS (COLLECTIVELY, “SECURITIES LAWS”) AND MAY NOT BE OFFERED, SOLD,
      PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS REGISTERED OR QUALIFIED
      FOR SALE UNDER ALL APPLICABLE SECURITIES LAWS OR UNLESS, IN THE OPINION OF
      COUNSEL SATISFACTORY TO THE ISSUER, IN FORM AND SUBSTANCE SATISFACTORY TO THE
      ISSUER, ANY SUCH OFFER, SALE OR OTHER TRANSFER IS EXEMPT FROM THE REGISTRATION
      OR QUALIFICATION REQUIREMENTS OF SUCH SECURITIES LAWS.

    

    g.
       He
      understands that the Shares may only be disposed of pursuant to either (i)
      an
      effective registration statement under the Securities Act, or (ii) an exemption
      from the registration requirements of the Securities Act. The Company has
      neither filed such a registration statement with the SEC or any state
      authorities nor agreed to do so.

     

    6. RESERVED.

    

    7. RESERVED.
      

    

    8. NONDISCLOSURE
      OF CONFIDENTIAL INFORMATION. Concurrently with the parties’ execution of this
      Agreement, DeWinter will execute and deliver to the Company the Non-Disclosure
      and Confidentiality Agreement attached hereto as Appendix
      A (the
      “Confidentiality Agreement”), the
      provisions of which are incorporated herein by this reference. 

    

    10. REMEDIES.
      Remedies at law shall be deemed to be inadequate for any breach of any of the
      covenants of this Agreement, and the Company shall be entitled to injunctive
      relief in addition to any other remedies it may have in the event of such
      breach. 

    

    11.
       RESERVED. 

    

    12.
       NOTICES.
      Any notices required or permitted to be given in writing will be deemed received
      when personally delivered, delivered by email or delivered by facsimile
      transmission or, if earlier, three (3) days after mailing by United States
      mail, postage prepaid. Notice to the Company is valid if sent to the Company’s
      principal place of business and notice to DeWinter is valid if sent to such
      person at the address in the Company’s records. Each party may change its
      respective address only by notice given to the other parties in the manner
      set
      forth herein. 

    

    13. WAVIER
      OF
      BREACH. The waiver by a party hereto of a breach of any provision of this
      Agreement shall not operate or be construed as a waiver of any subsequent breach
      of this Agreement.

    

    14. ASSIGNMENT.
      Neither party may sell, assign, transfer or otherwise convey any of its rights
      or delegate any of its duties under this Agreement without the prior written
      consent of the other, except to a corporation which has substantially all the
      business and assets of the assignor and assumed in writing its obligations
      under
      this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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      5

     

    15. COMPLIANCE
      WITH LAW. During the term of this Agreement, DeWinter shall comply with all
      laws
      and regulations applicable to him. During the term of this Agreement, the
      Company shall comply with all laws and regulations applicable to the Company
      in
      the conduct of its business.

    

    16. EQUITABLE
      RELIEF. It is agreed and understood that monetary damages would not adequately
      compensate an injured party for the breach of this Agreement by any other party,
      that this Agreement shall be specifically enforceable, and that any breach
      or
      threatened breach of this Agreement shall be the proper subject of a temporary
      or permanent injunction or restraining order. Further, each party hereto waives
      any claim or defense that there is an adequate remedy at law for such breach
      or
      threatened breach.

    

    17. ATTORNEYS’
      FEES. In the event that an action at law or in equity is brought to enforce
      the
      provisions of this Agreement or to prevent a breach thereof, the successful
      party in such action or arbitration proceedings shall be entitled to any award
      of attorneys’ fees and other costs as shall be established by the court or
      pursuant to a binding arbitration.

    

    18. APPLICABLE
      LAW. This Agreement shall be construed as a whole and in accordance with its
      fair meaning. This Agreement shall be interpreted in accordance with the laws
      of
      the State of California without regard to conflict of laws
      principles.

    

    19. ENTIRE
      AGREEMENT; AMENDMENTS. This Agreement embodies the entire understanding among
      the parties and merges all prior discussions or communications among them,
      and
      no party shall be bound by any definitions, conditions, warranties, or
      representations other than as expressly stated in this Agreement or as
      subsequently set forth in writing, and signed by the duly authorized
      representative of all the parties hereto. This Agreement, when executed shall
      supersede and render null and void any and all preceding or written
      understandings and agreements. This Agreement may only be changed, modified,
      or
      amended in writing by mutual consent of the parties hereto. 

    

    20. CONFLICTS
      OF INTEREST The parties acknowledge that, in the course of DeWinter’s services,
      DeWinter may now or in the future have certain potential or actual conflicts
      of
      interest. Without the Company’s written consent, DeWinter shall not engage in
      any transaction with any medical management company focused on managing the
      provision of hospital-based medicine.

    

    21. SEVERABILITY.
      In the event that any part of this Agreement shall be found to be unenforceable,
      all other parts of this Agreement shall remain in full force and
      effect.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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      Page
      6

     

    22. COUNTERPARTS.
      This agreement may be executed in two or more counterparts, each of which shall
      be deemed an original, and may be validly executed by facsimile
      signature.

     

    IN
      WITNESS WHEREOF, this Employment Agreement has been executed as of the date
      first above written.

    

      
        	
                APOLLO
                  MEDICAL HOLDINGS, INC.

              	 	
                NOEL
                  DEWINTER (“DeWinter”)

              
	 	 	 	 	 	 
	
                By: 

              	
                /s/
                  Warren Hosseinion

              	 	 	
                /s/
                  Noel DeWinter

              	 
	 	
                     Warren
                  Hosseinion

              	 	 	
                Noel
                  DeWinter

              	 
	 	
                     Chief
                  Executive Officer

              	 	 	 	 

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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      7

     

    Appendix
      A

     

    NON-DISCLOSURE
      AGREEMENT

     

    This
      Non-Disclosure Agreement (“Agreement”) dated as of September 10, 2008 is entered
      in by and between Apollo Medical Holdings, Inc. (the “Company”) and Noel
      DeWinter (the “Employee”), and sets forth the terms and conditions on which
      Company is willing to disclose certain material non-public information about
      the
      Company. 

     

    1. Purpose.
      In
      connection with his retention as a Employee to the Company pursuant to an
      agreement dated as of even date (the “Employee Agreement”), the Company may
      disclose to the Employee certain confidential technical and business information
      which the Company requires the Employee to treat as confidential. 

     

    2. Definition. 
      “Confidential
      Information”
means
      any information disclosed to the Employee by the Company, either directly or
      indirectly in writing, orally or by inspection of tangible objects, including
      without limitation documents, prototypes and forecasted financial information.
      Confidential Information may also include information disclosed to the Company
      by third parties. Confidential Information shall not, however, include any
      information which the Employee can establish by written documentation (i) was
      publicly known and made generally available in the public domain prior to the
      time of disclosure to the Employee by the Company; (ii) becomes publicly
      known and made generally available after disclosure to the Employee by the
      Company through no action or inaction of the Employee; (iii) is in the
      possession of the Employee, without confidentiality restrictions, at the time
      of
      disclosure by the Company as shown by the Employee's files and records
      immediately prior to the time of disclosure; (iv) is developed
      independently of the Confidential Information, as shown by written records
      prepared contemporaneously with such independent development; or (v) is
      disclosed pursuant to the requirement of a United States government agency
      or
      judicial body, provided that the Employee shall provide reasonable advice notice
      thereof to enable the Company to seek a protective order or otherwise prevent
      such disclosure.

     

    3. Non-use
      and Non-disclosure.
      The
      Employee agrees not to use any Confidential Information for any purpose except
      within the proper scope of his duties pursuant to the Employment Agreement.
      The
      Employee agrees not to disclose any Confidential Information to third parties,
      except to those individuals who, with the prior written consent of the Company,
      are designated as authorized to receive such Confidential Information in order
      for the Employee to perform his duties and obligation sunder the Employment
      Agreement. The Employee agrees that each third party receiving any Confidential
      Information will enter into a separate Non-Disclosure Agreement with the
      Company. 

     

    4. Maintenance
      of Confidentiality.
      The
      Employee agrees that it shall take all commercially reasonable measures to
      protect the secrecy of and avoid disclosure and unauthorized use of the
      Confidential Information. Without limiting the foregoing, the Employee shall
      take at least those measures that the Employee takes to protect its own
      confidential information of a similar nature and shall have its employees or
      advisors who have access to Confidential Information sign a non-use and
      non-disclosure agreement in content substantially similar to the provisions
      hereof, prior to any disclosure of Confidential Information to such employees.
      The Employee shall immediately notify the Company in the event of any
      unauthorized use or disclosure of any Confidential Information.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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    5. No
      Warranty.
      ALL
      CONFIDENTIAL INFORMATION IS PROVIDED “AS IS”. COMPANY MAKES NO WARRANTIES,
      EXPRESS, IMPLIED OR OTHERWISE, REGARDING ITS ACCURACY, COMPLETENESS OR
      PERFORMANCE. 

     

    6. Return
      of Materials.
      All
      documents and other tangible objects containing or representing Confidential
      Information which are in the possession of the Employee shall be and remain
      the
      property of the Company and shall be promptly returned to the Company upon
      request for any reason or for no reason. 

    

    7. Work
      Made for Hire. 

     

    (a) Employee
      and/or designates of the Employee shall promptly and fully inform the Company
      of, and disclose to the Company , any and all ideas, processes, trademarks,
      trade names, service marks, service mark applications, copyrights, mask work
      rights, fictitious business names, technology, patents, know-how, trade secrets,
      computer programs, original works of authorship, formulae, concepts, themes,
      inventions, designs, creations, new works, derivative works and discoveries,
      and
      all applications, improvements, rights and claims related to any the foregoing,
      and all other intellectual property, proprietary rights and work product,
      whether or not patentable or copyrightable, registered or unregistered or
      domestic or foreign, and whether or not relating to a published work, that
      Employee develops, makes, creates, conceives or reduces to practice during
      the
      term of the Employment Agreement, whether alone or in collaboration with others
      (collectively, “Invention
      Ideas”).
      Employee hereby assigns to the Company exclusively in perpetuity throughout
      the
      world all right, title and interest (choate or inchoate) in (i) the Invention
      Ideas, (ii) all precursors, portions and work in progress with respect thereto
      and all inventions, works of authorship, mask works, technology, information,
      know-how, materials and tools relating thereto or to the development, support
      or
      maintenance thereof and (iii) all copyrights, patent rights, trade secret
      rights, trademark rights, mask works rights, sui
      generis
      database
      rights and all other intellectual and industrial property rights of any sort
      and
      all business, contract rights, causes of action, and goodwill in, incorporated
      or embodied in, used to develop, or related to any of the foregoing
      (collectively "Intellectual Property").. All copyrightable Invention Ideas
      are
      intended by Employee to be a “work-made-for-hire” by Employee for Company and
      owned by Company pursuant to Section 201 (b) of Title 17 of the United States
      Code.

    

    (b)
      Employee shall do and perform, or cause to be done and performed, all such
      further acts and things, and shall execute and deliver all such other
      agreements, certificates, instruments and documents, as the Company may
      reasonably request in order to obtain patent or copyright registration on all
      Invention Ideas and Intellectual Property , and shall execute and deliver all
      documents, instruments and agreements, including the formal execution of an
      assignment of copyright and/or patent application or issued patent, and do
      all
      things necessary or requested by the Company, in order to enable Company to
      ultimately and finally obtain and enforce full and exclusive title to all
      Invention Ideas and Intellectual Property and all rights assigned pursuant
      to
      this Section 7. Employee hereby appoints the Company as Employee’s
      irrevocable attorney-in-fact for the purpose of executing and delivering all
      such documents, instruments and agreements, and performing all such acts, with
      the same legal force and effect as if executed and delivered and taken by
      Employee. 

    

    (c) If
      for
      any reason the foregoing assignment is determined to be unenforceable Employee
      grants to Company a perpetual, irrevocable, worldwide, royalty-free, exclusive,
      sub-licensable right and license to exploit and exercise all such Invention
      Ideas and Intellectual Property. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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    (d) Because
      of the difficulty of establishing when Employee first conceives of or develops
      Intellectual Property, proprietary rights or work product or whether such
      Intellectual Property, proprietary rights or work product results from access
      to
      Company’s confidential and proprietary information or equipment, facilities or
      data, Employee agrees that any Intellectual Property, proprietary rights and
      work product shall be presumed to be an Invention Idea if it is conceived,
      developed, used, sold, exploited or reduced to practice by Employee or with
      the
      aid of Employee within one year after the normal termination of Employee’s
      employment with Company. Employee can rebut that presumption if Employee proves
      that the intellectual property, proprietary rights and work product (i) was
      first conceived or developed after termination of Employee’s employment with and
      by Company; (ii) was conceived or developed entirely on Employee’s own time
      without using Company’s equipment, supplies, facilities or confidential and
      proprietary information; and (iii) did not result from any work performed
      by Employee for or on behalf of Company. 

    

    (e) Employee
      acknowledges that there is no intellectual property, proprietary right or work
      product that Employee desires not to be deemed Invention Ideas or Intellectual
      Property and thus to exclude from the above provisions of this Agreement. To
      the
      best of Employee’s knowledge, there is no other existing contract in conflict
      with this Agreement or any other contract to assign ideas, processes,
      trademarks, service marks, inventions, technology, computer programs, original
      works of authorship, designs, formulas, discoveries, patents or copyrights
      that
      is now in existence between Employee and any other person or
      entity.

    

    (f) This
      Section 7 shall not operate to require Employee to assign to Company any of
      Employee’s rights to inventions, intellectual properties or work products that
      would not be assignable under the provisions of California Labor Code Section
      2870. Employee represents and warrants to Company that this paragraph
      constitutes Company’s written notification to Employee of the provisions of
      Section 2870 of the California Labor Code, and Employee represents and warrants
      to Company that Employee has reviewed Section 2870 of the California Labor
      Code.

    

    8. Unfair
      Competition and Protection of Proprietary Information.

    

    (a) Employee
      shall not at any time (including after Employee’s employment with Company
      terminates) divulge, furnish or make accessible to anyone any of Company’s
      Proprietary Information, or use in any way any of Company’s Proprietary
      Information other than as reasonably required to perform Employee’s duties under
      this Agreement. Employee shall not undertake any other acts or omissions that
      would reduce the value to Company of Company’s Proprietary Information. The
      restrictions on Employee’s use of Company’s Proprietary Information shall not
      apply to knowledge or information that Employee can prove is part of the public
      domain through no fault of Employee. Employee agrees that such restrictions
      are
      fair and reasonable. 

    

    (b) Employee
      agrees that Company’s Proprietary Information constitutes a unique and valuable
      asset of Company that Company acquired at great time and expense, and which
      is
      secret and confidential and will only be available to or communicated to
      Employee in confidence in the course of Employee’s provision of services to
      Company. Employee also agrees that any disclosure or other use of Company’s
      Proprietary Information other than for Company’s sole benefit would be wrongful,
      would constitute unfair competition and will cause irreparable and incalculable
      harm to Company and to its subsidiaries, affiliates and divisions. In addition
      to all other remedies Company may have, it shall have the right to seek and
      obtain appropriate injunctive and other equitable relief, including emergency
      relief, to prevent any violations of this Section 8.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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    (c)
       Employee
      agrees that Company’s employees constitute a valuable asset of Company. Employee
      agrees that Employee shall not, during the Term and for a period of two years
      thereafter, directly or indirectly, for Employee or on behalf of any other
      person or entity, solicit any person who was an employee of or Employee to
      Company (at any time while Employee is performing any services for Company,
      or
      at any time within twelve months prior to or after such solicitation) for a
      competing business or otherwise induce or attempt to induce any such persons
      to
      terminate their employment or relationship with Company or otherwise to disrupt
      or interfere, or attempt to disrupt or interfere, with Company’s employment or
      relationships with such persons. Employee agrees that any such solicitation,
      inducement or interference would be wrongful and would constitute unfair
      competition, and will cause irreparable and incalculable harm to Company.
      Further, Employee shall not engage in any other unfair competition with Company.
      Employee agrees that such restrictions are fair and reasonable.

    

    (d) Employee
      recognizes and agrees that Employee has no expectation of privacy with respect
      to Company’s telecommunications, networking or information processing systems
      (including stored computer files, e-mail messages and voice messages), and
      that
      Employee’s activity, and any files or messages, on or using any of those systems
      may be monitored at any time without notice.

    

    (e) As
      used
      in this Agreement, “Company’s Proprietary Information” means any knowledge,
      trade secrets (including “trade secrets” as defined in Section 3426.1 of
      the California Civil Code), Invention Ideas, proprietary rights or proprietary
      information, intangible assets or property, and other intellectual property
      (whether or not copyrighted or copyrightable or patented or patentable),
      information and materials (including processes, trademarks, trade names, service
      marks, service mark applications, copyrights, mask work rights, technology,
      patents, patent applications and works of authorship), in whatever form,
      including electronic form, and all goodwill relating or appurtenant thereto,
      owned or licensed by Company or any of its subsidiaries, affiliates or
      divisions, or directly or indirectly useful in any aspect of the business of
      Company or its subsidiaries, affiliates or divisions, whether or not marked
      as
      confidential or proprietary and whether developed by Employee, by Company or
      its
      subsidiaries, affiliates or divisions or by others. Without limiting the
      foregoing, Company’s Proprietary Information includes (a) the names, locations,
      practices and requirements of any of Company’s customers, prospective customers,
      vendors, suppliers and personnel and any other persons having a business
      relationship with Company; (b) confidential or secret development or research
      work of Company or its subsidiaries, affiliates or divisions, including
      information concerning any future or proposed services or products; (c)
      Company’s accounting, cost, revenue and other financial records and documents
      and the contents thereof; (d) Company’s documents, contracts, agreements,
      correspondence and other similar business records; (e) confidential or secret
      designs, software code, know how, processes, formulae, plans and devices; and
      (f) any other confidential or secret aspect of the business of Company or its
      subsidiaries, affiliates or divisions.

    

    9. Employee’s
      Activities.
      During
      the term of the Employment Agreement, neither Employee nor any person or entity
      acting with or on Employee’s behalf, nor any person or entity under the control
      of or affiliated with Employee, shall, directly or indirectly, in any way
      Compete with the Company. Employee agrees that, if Employee has any business
      to
      transact on Employee’s own account that is similar to the business entrusted to
      Employee by Company, Employee shall notify Company and always give preference
      to
      Company’s business. Employee agrees that such restrictions are fair and
      reasonable. For purposes of this Agreement, “Compete” means doing any of the
      following: (i) selling products or services to any person or entity that was
      or
      is (at any time, including during the Term and the period when the provisions
      of
      this paragraph are in effect) a client or customer of Company (or its
      subsidiaries, affiliates or divisions) or on a list of prospective clients
      or
      customers of Company, or calling on, soliciting, taking away or accepting any
      such person or entity as a client or customer, or any attempt or offer to do
      any
      of the foregoing; (ii) entering into, or any attempt or offer to enter into,
      any
      business, enterprise or activity that is in any way similar to or otherwise
      competitive with the business that the Company (or its subsidiaries, affiliates
      or divisions) conducted at any time during the Term or any time the provisions
      of this paragraph are in effect, or (iii) directly or indirectly assisting
      any
      person or entity to take or attempt or offer to take any of the actions
      described in the foregoing clauses (i) or (ii).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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    10. Remedies.

    

    (a) The
      Employee agrees that any violation or threatened violation of this Agreement
      will cause irreparable injury to the Company, entitling the Company to obtain
      injunctive relief in addition to all legal remedies at its
      disposal.

     

    (b) In
      addition to all remedies available hereunder, at law or in equity, if Employee
      breaches any provision of Section 8 of this Agreement, Company shall have
      the right to invoke any and all remedies provided under the California Uniform
      Trade Secrets Act (California Civil Code §§3426, et
      seq.)
      or
      other statutes or common law remedies of similar effect.

    

    (c) The
      remedies provided to Company in this Section 10 are cumulative, and not
      exclusive, of any other remedies that may be available to Company at law or
      in
      equity. 

    

    11. No
      License.
      Nothing
      in this Agreement is intended to grant any rights to the Employee under any
      patent, copyright or other proprietary rights of the Company, nor shall this
      Agreement grant the Employee any rights in or to Confidential Information except
      as expressly set forth herein.

     

    12. Term.
      This
      Agreement shall survive the term of the Employment Agreement and shall continue
      until such time as all Confidential Information disclosed hereunder becomes
      publicly known and made generally available through no action or inaction of
      the
      Employee.

     

    13. Miscellaneous.
      This
      Agreement shall bind and inure to the benefit of the parties hereto and their
      successors and assigns. This Agreement shall be governed by the laws of the
      State of California, without reference to conflict of laws principles. This
      document contains the entire agreement between the parties with respect to
      the
      subject matter hereof. Any failure to enforce any provision of this Agreement
      shall not constitute a waiver thereof or of any other provision hereof. This
      Agreement may not be amended, nor any obligation waived, except by a writing
      signed by both parties hereto.

     

    IN
      WITNESS WHEREOF, the parties hereto have executed or caused their duly
      authorized officers to execute this Agreement as of the date first above
      written.

    

    
      	
              APOLLO
                MEDICAL HOLDINGS, INC. 

              (“COMPANY”)

            
	 
	
              By
                

            	
              /s/
                Warren Hosseinion

            
	
                        
                Warren Hosseinion

            
	
              Title: 
                President and Chief Executive Officer

            
	 
	
              “EMPLOYEE”

            
	 
	
              /s/
                Noel DeWinter

            
	
                            Noel
                DeWinter

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