Document:

EMPLOYMENT
      AGREEMENT

     

    THIS
      AGREEMENT
      is made
      on August 30, 2007 and shall be effective as of and contingent upon the
      consummation of the IPO, as defined below.

    

      BETWEEN:

    

     

    
      	
              (1)

            	
              FUQI
                INTERNATIONAL, INC.,
                incorporated under the laws of the State of Delaware, U.S.A., whose
                registered office is at Room 1307, 13/F, Hang Seng TST Building,
                18
                Carnarvon Road, Tsim Sha Tsui, Kowloon, HKSAR (the Company);
                and

            

    

     

    
      	
              (2)

            	
              Lie
                Xi Zhuang (holder
                of PRC identity card no. 440524196810082915)
                of
                Suite 20C, Xing Long Building, No. 3015, Nan Hu Road, Luo Hu District,
                Shenzhen, PRC (the Employee).

            

    

     

    
      WHEREAS:

    

     

    
      	
              (A)

            	
              The
                Company intends to conduct an initial public offering of securities
                in the
                United States (“IPO”).

            

    

     

    
      	
              (B)

            	
              Prior
                to the execution of this agreement, the Employee was employed by
                the
                Company, and the Company and the Employee have agreed to reduce the
                terms
                of the employment in writing as recorded by the provisions of this
                Agreement. 

            

    

     

    
      	
              (C)

            	
              The
                parties desire to enter into this Agreement to establish the terms
                and
                conditions of the Employee’s employment, which shall be contingent on and
                effective as of the consummation of the Company’s
                IPO.

            

    

     

    IT
      IS AGREED
      as
      follows:

    

      DEFINITIONS

    

     

    
      	
              1.

            	
              In
                this Agreement the following expressions shall have the following
                meanings:

            

    

     

    Business
      means
      all
      and any business, trade or other commercial activities of the Company or any
      Group Company;

     

    Board
      means
      the Board of Directors of the Company or a duly authorized committee of the
      Board of Directors;

     

    Confidential
      Information
      means
      all and any information, knowledge or data (whether or not recorded in
      documentary form or on computer disk or tape) not generally known or available
      to the public which Employee may have learned, discovered, developed, conceived,
      originated or prepared during or as a result of the Employment relating to
      the
      operations, business methods, corporate plans, management systems, finances,
      new
      business opportunities, products, services, technology, customers, clients,
      policies, procedures, accounts, personnel, techniques, concepts, or research
      and
      development projects of the Company or any Group Company and any and all trade
      secrets, secret formulae, process, inventions, designs, know-how, discoveries,
      technical specifications and other technical information relating to the
      creation, production or supply of any past, present or future product or service
      of the Company or any Group Company;

     

    
      
        
        

      

      
        Page
          1

        
          

        

      

      
        
        

      

    

     

    Employment
      means
      the Employee’s employment in accordance with the terms and conditions of this
      Agreement;

     

    Group
      Company means
      the
      Company and any company which is a direct or indirect subsidiary of the Company
      from time to time; 

     

    Termination
      Date
      means
      the date on which the Employment is terminated howsoever caused.

    

      TERM AND
        APPOINTMENT

    

     

    
      	
              2.1

            	
              According
                to the terms of this Agreement, the Employee shall be appointed as
                the
                Chief Operating Officer of the
                Company.

            

    

     

    
      	
              2.2

            	
              Subject
                to clause 10, the Employment shall commence upon the closing of the
                Company’s currently proposed IPO and shall continue for a period of three
                (3) years from such date unless or until terminated by either party
                according to clause 9. This Agreement is contingent upon the consummation
                of the Company’s currently proposed IPO, and in the event that the
                currently proposed IPO does not close, for whatever reason, within
                the
                sixty (60) day period following the date of this Agreement, this
                Agreement
                shall be terminated and have no
                effect.

            

    

     

    
      	
              2.3

            	
              Employee
                shall bear his individual income tax by himself according to applicable
                law and shall be responsible to properly report his personal income
                tax to
                his country or place of residency. Notwithstanding the Employee’s
                reporting and payment obligations with respect to income taxes, Employee
                agrees that the Company or Group Company is entitled to withhold
                the tax
                according to applicable law.

            

    

     

    
      DUTIES

       

    

    3.1 During
      the Employment, the Employee will:

     

    
      	 	
              (a)

            	
              devote
                his best efforts, energies, skills and attention to the business
                and
                affairs of the Company and Group
                Company;

            

    

     

    
      	 	
              (b)

            	
              faithfully
                and diligently perform all such duties and exercise all such powers
                that
                are commensurate with Employee’s position and as are lawfully and properly
                assigned to him from time to time by the Chief Executive Officer
                or the
                Board, whether such duties or powers relate to the Company or any
                other
                Group Company;

            

    

     

    
      	 	
              (c)

            	
              comply
                with all directions lawfully and properly given to him by the Chief
                Executive Officer and the Board as they may from time to time deem
                in the
                best interests of the Company;

            

    

     

    
      	 	
              (d)

            	
              devote
                the whole of his time, attention and abilities to the business of
                the
                Company or any other Group Company for which he is required to perform
                duties and shall not, without the Company’s prior written consent, be
                directly or indirectly engaged, concerned or interested in any other
                business activity, trade or
                occupation;

            

    

     

    
      
        
        

      

      
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          2

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (e)

            	
              promptly
                provide the Company with all such information as it may require in
                connection with the business or affairs of the Company and of any
                other
                Group Company for which he is required to perform
                duties.

            

    

     

    
      	 	
              (f)

            	
              comply
                with any and all governmental laws, regulations, and policies in
                connection with his actions as an employee of the Company and conduct
                himself in accordance with the highest business standards as are
                reasonably and customarily expected of such position;
                and

            

    

     

    
      	 	
              (g)

            	
              fully
                cooperate and participate in any investigation conducted by the Company
                relating to its interests or as may be required by applicable
                law.

            

    

     

    
      	
              3.2

            	
              The
                Employee shall be required to work during the Company’s normal business
                hours together with such additional hours as are required in the
                proper
                performance of his duties. The Employee acknowledges that he has
                no
                entitlement to additional remuneration for any hours worked in excess
                of
                the Company’s normal business
                hours.

            

    

     

    
      	
              3.3

            	
              The
                Employee’s normal place of work is Shenzhen, China. However, the Employee
                may be assigned to work in either of the Company’s offices in Hong Kong
                and may be required to make overseas business trips as may be required
                for
                the proper performance of his duties under the
                Employment.

            

    

     

    
      SALARY

       

    

    
      	
              4.1

            	
              The
                Employee’s base salary shall be One Hundred Twenty Thousand US Dollars
                (US$120,000) per annum payable in regular instalments in accordance
                with
                the customary payroll practices of the Company and subject to all
                legally
                required deductions and withholdings. Employee’s base salary will be
                reviewed by the Company’s Compensation Committee annually in a manner that
                is consistent with Company’s compensation policy. The base salary may be
                increased from time to time by the Compensation Committee in its
                absolute
                discretion, the determination of which shall be based upon such standards,
                guidelines and factual circumstances as the Compensation Committee
                deems
                relevant. 

            

    

     

    
      	
              4.2

            	
              Other
                than as explicitly set forth in this Agreement, the Employee’s salary is
                inclusive of all fees and other remuneration to which he may be or
                become
                entitled as an officer of the Company or of any other Group
                Company.

            

    

     

    
      	
              4.3

            	
              The
                Employee shall receive, on an annual basis, stock options with a
                ten-year
                term to acquire shares of the Company’s common stock having a market value
                of 1% of our annual profit before tax, not exceeding $120,000 in
                value, as
                set forth in our annual report on Form 10-K for the relevant period
                as
                filed with the Securities and Exchange Commission. The per share
                exercise
                price of these options shall be 100% of the fair market value of
                the
                Company’s common stock on the date of grant.

            

    

     

    
      	
              4.4

            	
              During
                Employment, Employee is entitled to reimbursement for reasonable
                and
                necessary business expenses incurred by Employee in connection with
                the
                performance of Employee’s duties. Payments to Employee will be made in
                accordance with the Company’s policy and procedures upon presentation of
                itemized statements of such business expenses in such detail as the
                Company may reasonably require and pursuant to applicable Company
                policy.

            

    

     

    
      
        
        

      

      
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          3

        
          

        

      

      
        
        

      

    

     

    
      BONUS

    

     

    
      	
              5.1

            	
              The
                Employee shall be eligible to receive a management bonus in respect
                of
                each fiscal year of the Company completed in an amount to be determined
                by
                the Compensation Committee in its absolute discretion. Payment of
                such
                bonus, if any, shall be at the absolute discretion of the Company’s
                Compensation Committee, the determination of which shall be based
                upon
                such standards, guidelines and factual circumstances as the Compensation
                Committee deems relevant. 

            

    

     

    
      	
              5.2

            	
              After
                the Termination Date the Employee will not be eligible to receive
                the
                bonus referenced in clause 5.1 and the payment of any bonus to which
                the Employee may be eligible for after the Termination Date will
                be at the
                sole discretion of the Board and Compensation
                Committee.

            

    

     

    
      VACATION

       

    

    
      	
              6.1

            	
              The
                Employee is entitled to accrue up to twenty (20) working days’ paid
                vacation per calendar year during his Employment (plus public holidays
                in
                Hong Kong), to be taken at a time or times convenient to the Company.
                The
                right to paid vacation will accrue pro rata during each calendar
                year of
                the Employment. Any vacation time not taken within 12 months of accruing
                will be forfeited, and no more than twenty (20) working days’ of vacation
                may be accrued at any time. Vacation time may not be carried over
                from one
                year to the next and] payment will not be made in lieu of vacations
                not
                taken. 

            

    

     

    
      	
              6.2

            	
              On
                termination of the Employment, the Employee shall be entitled to
                payment
                in lieu of accrued but untaken vacation (other than vacations forfeited
                in
                accordance with clause 6.1) on a pro rata
                basis.

            

    

     

    
      SICKNESS AND
        OTHER
        INCAPACITY

    

     

    
      	
              7.1

            	
              Subject
                to the Employee’s compliance with the Company’s policy on notification and
                certification of periods of absence from work, the Employee will
                continue
                to be paid his full salary during any period of absence from work
                due to
                sickness, injury or other incapacity, up to a maximum of two (2)
                days for
                each completed month of service in the first year of service and
                four (4)
                days for each completed month of service thereafter.
                

            

    

     

    
      	
              7.2

            	
              The
                Employee will not be paid during any period of absence from work
                (other
                than due to vacation, holiday, sickness, injury or other incapacity)
                without the prior written permission of the
                Company.

            

    

     

    
      
        
        

      

      
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          4

        
          

        

      

      
        
        

      

    

     

    
      INTELLECTUAL
        PROPERTY

    

     

    
      	
              8.1

            	
              The
                Employee shall forthwith disclose full details of any inventions,
                designs,
                know-how or discoveries, whether registerable or not, or whether
                patentable or a copyright work (Inventions)
                in confidence to the Company and shall regard himself in relation
                thereto
                as a trustee for the Company.

            

    

     

    
      	
              8.2

            	
              All
                intellectual property rights in such Inventions shall vest absolutely
                in
                the Company which shall be entitled, so far as the law permits, to
                the
                exclusive use thereof.

            

    

     

    
      	
              8.3

            	
              Notwithstanding
                clause 8.2 above, the Employee shall assign to the Company the copyright
                (by way of assignment of copyright) and other intellectual property
                rights, if any, in respect of all works written, originated, conceived
                or
                made by the Employee (except only those works written, originated,
                conceived or made by the Employee wholly outside his normal working
                hours
                hereunder and wholly unconnected with the Employment) during the
                continuance of the Employment.

            

    

     

    
      	
              8.4

            	
              The
                Employee agrees and undertakes that at any time during or after the
                termination of his Employment he will execute such deeds or documents
                and
                do all such acts and things as the Company may deem necessary or
                desirable
                to substantiate the Company’s rights in respect of the Inventions and
                other intellectual property rights referred to in this clause 8,
                including
                for the purpose of obtaining letters patent or other privileges in
                all
                such countries as the Company may
                require.

            

    

     

    
      TERMINATION

       

    

    
      	
              9.1

            	
              Either
                party may terminate the Employment by providing the other party with
                sixty
                (60) days’ written notice. The Company may, in its sole discretion, also
                terminate the Employment immediately without prior written notice
                by
                making a payment of the base salary to Employee in lieu of prior
                written
                notice.

            

    

     

    
      	
              9.2

            	
              At
                any time during the Employment the Company may also terminate the
                Employment immediately and with no liability to make any further
                payment
                to the Employee (other than in respect of amounts accrued) for serious
                misconduct, including, without limitation, if the
                Employee:

            

    

     

    
      	 	
              (a)

            	
              commits
                any serious or repeated breach of any of his obligations under this
                Agreement or his Employment;

            

    

     

    
      	 	
              (b)

            	
              is
                guilty of serious misconduct which, in the Board’s reasonable opinion, has
                damaged or may damage the business or affairs of the Company or any
                other
                Group Company;

            

    

     

    
      	 	
              (c)

            	
              is
                guilty of conduct which, in the Board’s reasonable opinion, brings or is
                likely to bring himself, the Company or any other Group Company into
                disrepute;

            

    

     

    
      	 	
              (d)

            	
              is
                charged with a criminal offense (other than a road traffic offense
                not
                subject to a custodial sentence);

            

    

     

    
      
        
        

      

      
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          5

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (e)

            	
              is
                or becomes incapacitated or ill to the extent that he is unable to
                perform
                the inherent duties and obligations of the Employment and the Employee
                has
                exhausted all of his entitlement to paid sickness leave set out in
                clause
                7, or 

            

    

     

    
      	 	
              (f)

            	
              is
                declared bankrupt or makes any arrangement with or for the benefit
                of his
                creditors.

            

    

     

    Any
      delay
      or forbearance by the Company in exercising any right of termination shall
      not
      constitute a waiver of it.

     

    
      	
              9.3

            	
              On
                termination of the Employment for whatever reason (and whether in
                breach
                of contract or otherwise) the Employee
                will:

            

    

     

    
      	 	
              (a)

            	
              immediately
                deliver to the Company all books, documents, papers, computer records,
                computer data, and any other property relating to the business of
                or
                belonging to the Company or any other Group Company which is in his
                possession or under his control. The Employee is not entitled to
                retain
                copies or reproductions of any documents, papers or computer records
                relating to the business of or belonging to the Company or any other
                Group
                Company;

            

    

     

    
      	 	
              (b)

            	
              immediately
                resign from any office he holds with the Company or any other Group
                Company (and from any related trusteeships) without any compensation
                for
                loss of office. Should the Employee fail to do so he hereby irrevocably
                authorizes the Company to appoint some person in his name and on
                his
                behalf to sign any documents and do any thing to give effect to his
                resignation from office; and

            

    

     

    
      	 	
              (c)

            	
              immediately
                pay to the Company or, as the case may be, any other Group Company
                all
                outstanding amounts due or owed to the Company or any other Group
                Company.
                The Employee confirms that, should he fail to do so, the Company
                is to be
                treated as authorised to deduct from any amounts due or owed to the
                Employee by the Company (or any other Group Company) a sum equal
                to such
                amounts. 

            

    

     

    
      	
              9.4

            	
              The
                Employee will not at any time after termination of the Employment
                represent himself as being in any way concerned with or interested
                in the
                business of, or employed by, the Company or any other Group
                Company.

            

    

     

    
      	
              9.5

            	
              The
                Employee agrees that any payments pursuant to this clause 9 will
                be in
                full and final settlement of any and all claims the Employee may
                have
                against the Company or any other Group Company arising out of or
                in
                connection with his Employment or its termination, and Employee and
                the
                Company agree to execute a general mutual release in favor of the
                other
                and their successors, affiliates and estates to the fullest extent
                permitted by law, drafted by and in a form reasonably satisfactory
                to the
                Company and Employee. 

            

    

     

    
      SUSPENSION

    

     

    
      	
              10.1

            	
              Where
                notice of termination has been served by either party whether in
                accordance with clause 9.1 or otherwise, the Company shall be under
                no obligation to provide work for or assign any duties to the Employee
                for
                the whole or any part of the relevant notice period and may require
                him:

            

    

     

    
      	 	
              (a)

            	
              not
                to attend any premises of the Company or any other Group Company;
                and/or

            

    

     

    
      
        
        

      

      
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          6

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              to
                resign with immediate effect from any offices he holds with the Company
                or
                any other Group Company (and any related trusteeships);
                and/or

            

    

     

    
      	 	
              (c)

            	
              to
                refrain from business contact with any customers, clients or employees
                of
                the Company or any Group Company;
                and/or

            

    

     

    
      	 	
              (d)

            	
              to
                take any vacation which has accrued under clause 6.1 during any
                period of suspension under this
                clause 10.1.

            

    

     

    
      	
              10.2

            	
              The
                provisions of clauses 11 and 12 shall remain in full force and effect
                during any period of suspension under
                clause 10.1.

            

    

     

    
      	
              10.3

            	
              Any
                suspension under this clause 10.1 shall be on full salary and
                benefits during any period of
                suspension.

            

    

     

    
      CONFIDENTIAL
        INFORMATION 

    

     

    
      	
              11.1

            	
              The
                Employee acknowledges:

            

    

     

    
      	 	
              (a)

            	
              that
                the Confidential Information is valuable to the Company and other
                Group
                Companies;

            

    

     

    
      	 	
              (b)

            	
              that
                the Company will provide the Employee with access to Confidential
                Information so that the Employee is properly able to carry out the
                duties
                pursuant to this Agreement;

            

    

     

    
      	 	
              (c)

            	
              that
                the Employee owes, without limitation, a duty of trust and confidence
                to
                the Company and a duty to act at all times in the best interests
                of the
                Company;

            

    

     

    
      	 	
              (d)

            	
              that
                the disclosure of any Confidential Information to any customer or
                actual
                or potential competitor of the Company or any Group Company would
                place
                the Company at a serious competitive disadvantage and would cause
                immeasurable damage to the Business and therefore the restrictions
                contained in clauses 11 and 12 are reasonable to protect the
                Company;

            

    

     

    and
      the
      Employee undertakes that he will not at any time (whether during the Employment
      or for a period of 12 months from the Termination Date) use for his own or
      another’s advantage, or reveal to any third-party person, firm, company or
      organization and shall use his best efforts to prevent the publication or
      disclosure of any Confidential Information to any third party.

     

    
      	
              11.2

            	
              The
                limitations imposed on Employee pursuant to clause 11.1 shall not
                apply to
                Employee’s (i) compliance with legal process or subpoena, or (ii)
                statements in response to inquiry from a court or regulatory body,
                provided that Employee gives the Company reasonable prior written
                notice
                of such process, subpoena or request. In addition, the restrictions
                in
                this clause shall not apply so as to prevent the Employee from using
                his
                own personal skill in any business in which he may be lawfully engaged
                after the Employment is ended.

            

    

     

    
      
        
        

      

      
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          7

        
          

        

      

      
        
        

      

    

     

    
      RESTRICTIVE
        COVENANTS

    

     

    
      	
              12.1

            	
              The
                Employee covenants with the Company (for itself and as trustee and
                agent
                for each other Group Company) that, for the period during the Employment
                and the twelve (12) months following the Termination Date, he shall
                not,
                whether directly or indirectly, on his own behalf or on behalf of
                or in
                conjunction with any other person, firm, company or other entity
                (except
                on behalf of the Company):

            

    

     

    
      	 	
              (a)

            	
              solicit
                or entice away or attempt to solicit or entice away from the Company
                or
                any Group Company any person, firm, company or other entity who is,
                or
                was, a client of the Company or any Group Company with whom the Employee
                had business dealings during the course of his Employment or in the
                twelve
                (12) month period prior to the Termination
                Date;

            

    

     

    
      	 	
              (b)

            	
              solicit
                or entice away or attempt to solicit or entice away any individual
                person
                who is employed or engaged by the Company or any Group Company either
                as a
                director or in a managerial or technical capacity; or who is in possession
                of Confidential Information and with whom the Employee had business
                dealings during the course of his Employment or the twelve (12) month
                period immediately prior to the Termination Date;
                

            

    

     

    
      	 	
              (c)

            	
              carry
                on, set up, be employed, engaged or interested in a business in Hong
                Kong,
                the People’s Republic of China, and any other geographic locations where
                the Company’s Business is conducted, that is in competition with, whether
                directly or indirectly, the Business as at the Termination Date.
                It is
                agreed that if any such company ceases to be in competition with
                the
                Company and/or any Group Company this clause 12.1(c) shall, with
                effect from that date, cease to apply in respect of such company.
                The
                provisions of this clause 12.1(c) shall not, at any time following
                the Termination Date, prevent the Employee from (i) owning an equity
                interest in the Company, and (ii) owning up to one percent (1%) of
                the
                securities in a corporation engaged in a business that competes with
                the
                Company, provided that such securities are listed on a national securities
                exchange. Nothing in this clause 12.1(c) shall prohibit Employee
                from
                seeking or doing of business not in direct or indirect competition
                with
                the Business;

            

    

     

    
      	
              12.2

            	
              While
                the parties agree that the restrictions contained in Clause 11 and
                12 are
                reasonable in all the circumstances, it is agreed that if any court
                of
                competent jurisdiction holds that the length of the post-termination
                covenants contained in clauses 11 and 12 are not reasonable, the
                parties
                agree that:

            

    

     

    
      	 	
              (a)

            	
              the
                covenants are to apply for a period of nine (9) months from the
                Termination Date; or, if this period is held to be
                unreasonable,

            

    

     

    
      	 	
              (b)

            	
              for
                a period of six (6) months from the Termination Date; or if this
                period is
                held to be unreasonable,

            

    

     

    
      
        
        

      

      
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          8

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (c)

            	
              for
                such other period as any court of competent jurisdiction decides
                is
                reasonable.

            

    

     

    
      	
              12.3

            	
              The
                period during which the restrictions referred to in clauses 12.1(a)
                to (c) inclusive which apply following the Termination Date shall
                be
                reduced by the amount of time during which, if at all, the Company
                suspends the Employee under the provisions of clause 10.1.
                

            

    

     

    
      MISCELLANEOUS

    

     

    
      	
              13.1

            	
              This
                Agreement, together with any other documents referred to in this
                Agreement, supersedes all other agreements both oral and in writing
                between the Company and the Employee. The Employee acknowledges that
                he
                has not entered into this Agreement in reliance upon any representation,
                warranty or undertaking which is not set out in this Agreement or
                expressly referred to in it as forming part of the Employee’s contract of
                employment.

            

    

     

    
      	
              13.2

            	
              The
                Employee represents and warrants to the Company that he will not
                by reason
                of entering into the Employment, or by performing any duties under
                this
                Agreement, be in breach of any terms of employment with a third party
                whether express or implied or of any other obligation binding on
                him.

            

    

     

    
      	
              13.3

            	
              Any
                notice to be given under this Agreement to the Employee may be served
                by
                being handed to him personally or by being sent by registered post
                to him
                at his usual or last known address; and any notice to be given to
                the
                Company may be served by being left at or by being sent by registered
                post
                to its registered office for the time being. Any notice served by
                registered post shall be deemed to have been served two days (excluding
                Sundays and statutory holidays) after the date of the registered
                post
                receipt. 

            

    

     

    
      	
              13.4

            	
              The
                provisions of clauses 11, 12 and 13 shall remain in full force and
                effect after the Termination Date. 

            

    

     

    
      	
              13.5

            	
              This
                Agreement and the relationship between the parties shall be governed
                by,
                and interpreted in accordance with, the laws of the State of Delaware,
                U.S.A. Each of the parties agrees that the courts of the State of
                Delaware
                are to have non-exclusive jurisdiction to settle any disputes (including
                claims for set-off and counterclaims) which may arise in connection
                with
                the creation, validity, effect, interpretation or performance of,
                or the
                legal relationships established by, this Agreement or otherwise arising
                in
                connection with this Agreement, and for such purposes irrevocably
                submit
                to the non-exclusive jurisdiction of the courts of the State of
                Delaware.

            

    

     

    
      	
              13.6

            	
              The
                Agreement is written in both Chinese and English languages. If any
                inconsistency arises between the two versions, the English version
                shall
                prevail.

            

    

     

    
      	
              13.7

            	
              If
                any one or more of the provisions contained in this Agreement shall
                for
                any reason be held to be invalid, illegal, or unenforceable in any
                respect, such invalidity, illegality, or unenforceability shall not
                affect
                any other provision hereof, and this Agreement shall be construed
                as if
                such invalid, illegal, or unenforceable provision had never been
                contained
                herein. In addition, if any court of competent jurisdiction determines
                that any of the provisions set forth herein are unenforceable because
                of
                the duration or geographic scope of such provision, such court shall
                have
                the power to reduce the duration or scope of such provision as the
                case
                may be, to the extent necessary to render such provision
                enforceable.

            

    

     

    
      
        
        

      

      
        Page
          9

        
          

        

      

      
        
        

      

    

     

    
      	
              13.8

            	
              The
                waiver by any party to a breach of any provision of this Agreement
                must be
                in writing and signed by such party to be effective, and shall not
                operate
                or be construed as a waiver of any subsequent breach of this
                Agreement.

            

    

     

    
      	
              13.9

            	
              This
                Agreement is personal in nature, and neither this Agreement nor any
                part
                of any obligation herein shall be assignable by Employee. The Company
                shall be entitled to assign this Agreement to any affiliate or successor
                of the Company that assumes the ownership or control of the business
                of
                the Company, and the Agreement shall inure to the benefit of any
                such
                successor or assign.

            

    

     

    
      	
              13.10

            	
              This
                Agreement may be executed in one or more facsimile counterparts,
                and by
                the parties hereto in separate facsimile counterparts, each of which
                when
                executed shall be deemed to be an original while all of which taken
                together shall constitute one and the same
                instrument.

            

    

     

    [SIGNATURE
      PAGE TO FOLLOW]

     

    
      
        
        

      

      
        Page
          10

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF
      this
AGREEMENT
      has
      been
      signed on the date the day and year first above written.

     

    
      	SIGNED by
              LIE
              XI ZHUANG	 	)     /s/ LIE
              XI ZHUANG
	in the presence of: 	 	)

    

     

    
      	SIGNED for
              and on behalf of	 	)     /s/
              YU KWAI CHONG
	FUQI INTERNATIONAL,
              INC.
              in
              the presence of:	 	)

    

     

    
      
        
        

      

      
        Page
          11

        
          

        

      

      
        
        

      

    

    DATED
      THE
      30 DAY OF AUGUST, 2007

     

    FUQI
      INTERNATIONAL, INC.

     

    and

     

    LIE
      XI ZHUANG

     

    
      
        

      

       

    

    EMPLOYMENT
      AGREEMENTEMPLOYMENT
      AGREEMENT

     

    THIS
      AGREEMENT
      is made
      on August 30, 2007 and shall be effective as of and contingent upon the
      consummation of the IPO, as defined below.

     

    
      BETWEEN:

    

     

    
      	
              (1)

            	
              FUQI
                INTERNATIONAL, INC.,
                incorporated under the laws of the State of Delaware, U.S.A., whose
                registered office is at Room 1307, 13/F, Hang Seng TST Building,
                18
                Carnarvon Road, Tsim Sha Tsui, Kowloon, HKSAR (the Company);
                and

            

    

     

    
      	
              (2)

            	
              Heung
                Sang Fong (holder
                of Hong Kong identity card no. G574932(7))
                of
                12897 Regan Lane, Saratoga, CA 95070, USA (the Employee).

            

    

     

    
      WHEREAS:

    

     

    
      	
              (A)

            	
              The
                Company intends to conduct an initial public offering of securities
                in the
                United States (“IPO”).

            

    

     

    
      	
              (B)

            	
              Prior
                to the execution of this agreement, the Employee was employed by
                the
                Company, and the Company and the Employee have agreed to reduce the
                terms
                of the employment in writing as recorded by the provisions of this
                Agreement. 

            

    

     

    
      	
              (C)

            	
              The
                parties desire to enter into this Agreement to establish the terms
                and
                conditions of the Employee’s employment, which shall be contingent on and
                effective as of the consummation of the Company’s
                IPO.

            

    

     

    IT
      IS AGREED
      as
      follows:

     

    
      DEFINITIONS

    

     

    
      	
              1.

            	
              In
                this Agreement the following expressions shall have the following
                meanings:

            

    

     

    Business
      means
      all
      and any business, trade or other commercial activities of the Company or any
      Group Company;

     

    Board
      means
      the Board of Directors of the Company or a duly authorized committee of the
      Board of Directors;

     

    Confidential
      Information
      means
      all and any information, knowledge or data (whether or not recorded in
      documentary form or on computer disk or tape) not generally known or available
      to the public which Employee may have learned, discovered, developed, conceived,
      originated or prepared during or as a result of the Employment relating to
      the
      operations, business methods, corporate plans, management systems, finances,
      new
      business opportunities, products, services, technology, customers, clients,
      policies, procedures, accounts, personnel, techniques, concepts, or research
      and
      development projects of the Company or any Group Company and any and all trade
      secrets, secret formulae, process, inventions, designs, know-how, discoveries,
      technical specifications and other technical information relating to the
      creation, production or supply of any past, present or future product or service
      of the Company or any Group Company;

     

    
      
        
        

      

      
        Page
          1

        
          

        

      

      
        
        

      

    

     

    Employment
      means
      the Employee’s employment in accordance with the terms and conditions of this
      Agreement;

     

    Group
      Company means
      the
      Company and any company which is a direct or indirect subsidiary of the Company
      from time to time; 

     

    Termination
      Date
      means
      the date on which the Employment is terminated howsoever caused.

     

    
      TERM
        AND APPOINTMENT

    

     

    
      	
              2.1

            	
              According
                to the terms of this Agreement, the Employee shall be appointed as
                the
                Executive Vice President, Corporate Development of the
                Company.

            

    

     

    
      	
              2.2

            	
              Subject
                to clause 10, the Employment shall commence upon the closing of the
                Company’s currently proposed IPO and shall continue for a period of three
                (3) years from such date unless or until terminated by either party
                according to clause 9. This Agreement is contingent upon the consummation
                of the Company’s currently proposed IPO, and in the event that the
                currently proposed IPO does not close, for whatever reason, within
                the
                sixty (60) day period following the date of this Agreement, this
                Agreement
                shall be terminated and have no
                effect.

            

    

     

    
      	
              2.3

            	
              Employee
                shall bear his individual income tax by himself according to applicable
                law and shall be responsible to properly report his personal income
                tax to
                his country or place of residency. Notwithstanding the Employee’s
                reporting and payment obligations with respect to income taxes, Employee
                agrees that the Company or Group Company is entitled to withhold
                the tax
                according to applicable law.

            

    

     

    
      DUTIES

    

     

    3.1 During
      the Employment, the Employee will:

     

    
      	 	
              (a)

            	
              devote
                his best efforts, energies, skills and attention to the business
                and
                affairs of the Company and Group
                Company;

            

    

     

    
      	 	
              (b)

            	
              faithfully
                and diligently perform all such duties and exercise all such powers
                that
                are commensurate with Employee’s position and as are lawfully and properly
                assigned to him from time to time by the Chief Executive Officer
                or the
                Board, whether such duties or powers relate to the Company or any
                other
                Group Company;

            

    

     

    
      	 	
              (c)

            	
              comply
                with all directions lawfully and properly given to him by the Chief
                Executive Officer and the Board as they may from time to time deem
                in the
                best interests of the Company;

            

    

     

    
      	 	
              (d)

            	
              devote
                the whole of his time, attention and abilities to the business of
                the
                Company or any other Group Company for which he is required to perform
                duties and shall not, without the Company’s prior written consent, be
                directly or indirectly engaged, concerned or interested in any other
                business activity, trade or
                occupation;

            

    

     

    
      
        
        

      

      
        Page
          2

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (e)

            	
              promptly
                provide the Company with all such information as it may require in
                connection with the business or affairs of the Company and of any
                other
                Group Company for which he is required to perform
                duties.

            

    

     

    
      	 	
              (f)

            	
              comply
                with any and all governmental laws, regulations, and policies in
                connection with his actions as an employee of the Company and conduct
                himself in accordance with the highest business standards as are
                reasonably and customarily expected of such position;
                and

            

    

     

    
      	 	
              (g)

            	
              fully
                cooperate and participate in any investigation conducted by the Company
                relating to its interests or as may be required by applicable
                law.

            

    

     

    
      	
              3.2

            	
              The
                Employee shall be required to work during the Company’s normal business
                hours together with such additional hours as are required in the
                proper
                performance of his duties. The Employee acknowledges that he has
                no
                entitlement to additional remuneration for any hours worked in excess
                of
                the Company’s normal business
                hours.

            

    

     

    
      	
              3.3

            	
              The
                Employee’s normal place of work is in the United States. However, the
                Employee may be assigned to work in either of the Company’s offices in
                Hong Kong or Shenzhen and may be required to make overseas business
                trips
                as may be required for the proper performance of his duties under
                the
                Employment.

            

    

     

    
      SALARY

    

     

    
      	
              4.1

            	
              The
                Employee’s base salary shall be One Hundred Twenty Thousand US Dollars
                (US$120,000) per annum payable in regular instalments in accordance
                with
                the customary payroll practices of the Company and subject to all
                legally
                required deductions and withholdings. Employee’s base salary will be
                reviewed by the Company’s Compensation Committee annually in a manner that
                is consistent with Company’s compensation policy. The base salary may be
                increased from time to time by the Compensation Committee in its
                absolute
                discretion, the determination of which shall be based upon such standards,
                guidelines and factual circumstances as the Compensation Committee
                deems
                relevant. 

            

    

     

    
      	
              4.2

            	
              Other
                than as explicitly set forth in this Agreement, the Employee’s salary is
                inclusive of all fees and other remuneration to which he may be or
                become
                entitled as an officer of the Company or of any other Group
                Company.

            

    

     

    
      	
              4.3

            	
              Upon
                the closing of the IPO, the Employee shall receive stock options
                with a
                term of three (3) years to purchase Six Hundred Thousand (600,000)
                shares
                of the Company’s common stock. One-third of the stock options shall vest
                upon the effective date of the IPO, an additional one-third of the
                stock
                options shall vest after completion of twelve (12) months of service
                rendered from the effective date of the IPO, and the remaining one-third
                of stock options shall vest after completion of twenty-four (24)
                months of
                service rendered from the effective date of this IPO. The per share
                exercise price of such options shall be equal to 100% of the fair
                market
                value of the Company’s common stock on the date of the grant. The details
                of the option grant shall be as set forth in the stock option agreement
                as
                executed by the Company and the Employee upon the date of
                grant.

            

    

     

    
      
        
        

      

      
        Page
          3

        
          

        

      

      
        
        

      

    

     

    
      	
              4.4

            	
              During
                Employment, Employee is entitled to reimbursement for reasonable
                and
                necessary business expenses incurred by Employee in connection with
                the
                performance of Employee’s duties. Payments to Employee will be made in
                accordance with the Company’s policy and procedures upon presentation of
                itemized statements of such business expenses in such detail as the
                Company may reasonably require and pursuant to applicable Company
                policy.

            

    

     

    
      BONUS

    

     

    
      	
              5.1

            	
              The
                Employee shall be eligible to receive a management bonus in respect
                of
                each fiscal year of the Company completed in an amount to be determined
                by
                the Compensation Committee in its absolute discretion. Payment of
                such
                bonus, if any, shall be at the absolute discretion of the Company’s
                Compensation Committee, the determination of which shall be based
                upon
                such standards, guidelines and factual circumstances as the Compensation
                Committee deems relevant. 

            

    

     

    
      	
              5.2

            	
              After
                the Termination Date the Employee will not be eligible to receive
                the
                bonus referenced in clause 5.1 and the payment of any bonus to which
                the Employee may be eligible for after the Termination Date will
                be at the
                sole discretion of the Board and Compensation
                Committee.

            

    

     

    
      VACATION

    

     

    
      	
              6.1

            	
              The
                Employee is entitled to accrue up to twenty (20) working days’ paid
                vacation per calendar year during his Employment (plus public holidays
                in
                Hong Kong), to be taken at a time or times convenient to the Company.
                The
                right to paid vacation will accrue pro rata during each calendar
                year of
                the Employment. Any vacation time not taken within 12 months of accruing
                will be forfeited, and no more than twenty (20) working days’ of vacation
                may be accrued at any time. Vacation time may not be carried over
                from one
                year to the next and payment will not be made in lieu of vacations
                not
                taken. 

            

    

     

    
      	
              6.2

            	
              On
                termination of the Employment, the Employee shall be entitled to
                payment
                in lieu of accrued but untaken vacation (other than vacations forfeited
                in
                accordance with clause 6.1) on a pro rata
                basis.

            

    

     

    
      SICKNESS
        AND OTHER INCAPACITY

    

     

    
      	
              7.1

            	
              Subject
                to the Employee’s compliance with the Company’s policy on notification and
                certification of periods of absence from work, the Employee will
                continue
                to be paid his full salary during any period of absence from work
                due to
                sickness, injury or other incapacity, up to a maximum of two (2)
                days for
                each completed month of service in the first year of service and
                four (4)
                days for each completed month of service thereafter.
                

            

    

     

    
      	
              7.2

            	
              The
                Employee will not be paid during any period of absence from work
                (other
                than due to vacation, holiday, sickness, injury or other incapacity)
                without the prior written permission of the
                Company.

            

    

     

    
      
        
        

      

      
        Page
          4

        
          

        

      

      
        
        

      

    

     

    
      INTELLECTUAL
        PROPERTY

    

     

    
      	
              8.1

            	
              The
                Employee shall forthwith disclose full details of any inventions,
                designs,
                know-how or discoveries, whether registerable or not, or whether
                patentable or a copyright work (Inventions)
                in confidence to the Company and shall regard himself in relation
                thereto
                as a trustee for the Company.

            

    

     

    
      	
              8.2

            	
              All
                intellectual property rights in such Inventions shall vest absolutely
                in
                the Company which shall be entitled, so far as the law permits, to
                the
                exclusive use thereof.

            

    

     

    
      	
              8.3

            	
              Notwithstanding
                clause 8.2 above, the Employee shall assign to the Company the copyright
                (by way of assignment of copyright) and other intellectual property
                rights, if any, in respect of all works written, originated, conceived
                or
                made by the Employee (except only those works written, originated,
                conceived or made by the Employee wholly outside his normal working
                hours
                hereunder and wholly unconnected with the Employment) during the
                continuance of the Employment.

            

    

     

    
      	
              8.4

            	
              The
                Employee agrees and undertakes that at any time during or after the
                termination of his Employment he will execute such deeds or documents
                and
                do all such acts and things as the Company may deem necessary or
                desirable
                to substantiate the Company’s rights in respect of the Inventions and
                other intellectual property rights referred to in this clause 8,
                including
                for the purpose of obtaining letters patent or other privileges in
                all
                such countries as the Company may
                require.

            

    

     

    
      TERMINATION

    

     

    
      	
              9.1

            	
              Either
                party may terminate the Employment by providing the other party with
                sixty
                (60) days’ written notice. The Company may, in its sole discretion, also
                terminate the Employment immediately without prior written notice
                by
                making a payment of the base salary to Employee in lieu of prior
                written
                notice.

            

    

     

    
      	
              9.2

            	
              At
                any time during the Employment the Company may also terminate the
                Employment immediately and with no liability to make any further
                payment
                to the Employee (other than in respect of amounts accrued) for serious
                misconduct, including, without limitation, if the
                Employee:

            

    

     

    
      	 	
              (a)

            	
              commits
                any serious or repeated breach of any of his obligations under this
                Agreement or his Employment;

            

    

     

    
      	 	
              (b)

            	
              is
                guilty of serious misconduct which, in the Board’s reasonable opinion, has
                damaged or may damage the business or affairs of the Company or any
                other
                Group Company;

            

    

     

    
      	 	
              (c)

            	
              is
                guilty of conduct which, in the Board’s reasonable opinion, brings or is
                likely to bring himself, the Company or any other Group Company into
                disrepute;

            

    

     

    
      	 	
              (d)

            	
              is
                charged with a criminal offense (other than a road traffic offense
                not
                subject to a custodial sentence);

            

    

     

    
      
        
        

      

      
        Page
          5

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (e)

            	
              is
                or becomes incapacitated or ill to the extent that he is unable to
                perform
                the inherent duties and obligations of the Employment and the Employee
                has
                exhausted all of his entitlement to paid sickness leave set out in
                clause
                7, or 

            

    

     

    
      	 	
              (f)

            	
              is
                declared bankrupt or makes any arrangement with or for the benefit
                of his
                creditors.

            

    

     

    Any
      delay
      or forbearance by the Company in exercising any right of termination shall
      not
      constitute a waiver of it.

     

    
      	
              9.3

            	
              On
                termination of the Employment for whatever reason (and whether in
                breach
                of contract or otherwise) the Employee
                will:

            

    

     

    
      	 	
              (a)

            	
              immediately
                deliver to the Company all books, documents, papers, computer records,
                computer data, and any other property relating to the business of
                or
                belonging to the Company or any other Group Company which is in his
                possession or under his control. The Employee is not entitled to
                retain
                copies or reproductions of any documents, papers or computer records
                relating to the business of or belonging to the Company or any other
                Group
                Company;

            

    

     

    
      	 	
              (b)

            	
              immediately
                resign from any office he holds with the Company or any other Group
                Company (and from any related trusteeships) without any compensation
                for
                loss of office. Should the Employee fail to do so he hereby irrevocably
                authorizes the Company to appoint some person in his name and on
                his
                behalf to sign any documents and do any thing to give effect to his
                resignation from office; and

            

    

     

    
      	 	
              (c)

            	
              immediately
                pay to the Company or, as the case may be, any other Group Company
                all
                outstanding amounts due or owed to the Company or any other Group
                Company.
                The Employee confirms that, should he fail to do so, the Company
                is to be
                treated as authorised to deduct from any amounts due or owed to the
                Employee by the Company (or any other Group Company) a sum equal
                to such
                amounts. 

            

    

     

    
      	
              9.4

            	
              The
                Employee will not at any time after termination of the Employment
                represent himself as being in any way concerned with or interested
                in the
                business of, or employed by, the Company or any other Group
                Company.

            

    

     

    
      	
              9.5

            	
              The
                Employee agrees that any payments pursuant to this clause 9 will
                be in
                full and final settlement of any and all claims the Employee may
                have
                against the Company or any other Group Company arising out of or
                in
                connection with his Employment or its termination, and Employee and
                the
                Company agree to execute a general mutual release in favor of the
                other
                and their successors, affiliates and estates to the fullest extent
                permitted by law, drafted by and in a form reasonably satisfactory
                to the
                Company and Employee. 

            

    

     

    
      SUSPENSION

    

     

    
      	
              10.1

            	
              Where
                notice of termination has been served by either party whether in
                accordance with clause 9.1 or otherwise, the Company shall be under
                no obligation to provide work for or assign any duties to the Employee
                for
                the whole or any part of the relevant notice period and may require
                him:

            

    

     

    
      
        
        

      

      
        Page
          6

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (a)

            	
              not
                to attend any premises of the Company or any other Group Company;
                and/or

            

    

     

    
      	 	
              (b)

            	
              to
                resign with immediate effect from any offices he holds with the Company
                or
                any other Group Company (and any related trusteeships);
                and/or

            

    

     

    
      	 	
              (c)

            	
              to
                refrain from business contact with any customers, clients or employees
                of
                the Company or any Group Company;
                and/or

            

    

     

    
      	 	
              (d)

            	
              to
                take any vacation which has accrued under clause 6.1 during any
                period of suspension under this
                clause 10.1.

            

    

     

    
      	
              10.2

            	
              The
                provisions of clauses 11 and 12 shall remain in full force and effect
                during any period of suspension under
                clause 10.1.

            

    

     

    
      	
              10.3

            	
              Any
                suspension under this clause 10.1 shall be on full salary and
                benefits during any period of
                suspension.

            

    

     

    
      CONFIDENTIAL
        INFORMATION 

    

     

    
      	
              11.1

            	
              The
                Employee acknowledges:

            

    

     

    
      	 	
              (a)

            	
              that
                the Confidential Information is valuable to the Company and other
                Group
                Companies;

            

    

     

    
      	 	
              (b)

            	
              that
                the Company will provide the Employee with access to Confidential
                Information so that the Employee is properly able to carry out the
                duties
                pursuant to this Agreement;

            

    

     

    
      	 	
              (c)

            	
              that
                the Employee owes, without limitation, a duty of trust and confidence
                to
                the Company and a duty to act at all times in the best interests
                of the
                Company;

            

    

     

    
      	 	
              (d)

            	
              that
                the disclosure of any Confidential Information to any customer or
                actual
                or potential competitor of the Company or any Group Company would
                place
                the Company at a serious competitive disadvantage and would cause
                immeasurable damage to the Business and therefore the restrictions
                contained in clauses 11 and 12 are reasonable to protect the
                Company;

            

    

     

    and
      the
      Employee undertakes that he will not at any time (whether during the Employment
      or for a period of 12 months from the Termination Date) use for his own or
      another’s advantage, or reveal to any third-party person, firm, company or
      organization and shall use his best efforts to prevent the publication or
      disclosure of any Confidential Information to any third party.

     

    
      	
              11.2

            	
              The
                limitations imposed on Employee pursuant to clause 11.1 shall not
                apply to
                Employee’s (i) compliance with legal process or subpoena, or (ii)
                statements in response to inquiry from a court or regulatory body,
                provided that Employee gives the Company reasonable prior written
                notice
                of such process, subpoena or request. In addition, the restrictions
                in
                this clause shall not apply so as to prevent the Employee from using
                his
                own personal skill in any business in which he may be lawfully engaged
                after the Employment is ended.

            

    

     

    
      
        
        

      

      
        Page
          7

        
          

        

      

      
        
        

      

    

     

    
      RESTRICTIVE
        COVENANTS

    

     

    
      	
              12.1

            	
              The
                Employee covenants with the Company (for itself and as trustee and
                agent
                for each other Group Company) that, for the period during the Employment
                and the twelve (12) months following the Termination Date, he shall
                not,
                whether directly or indirectly, on his own behalf or on behalf of
                or in
                conjunction with any other person, firm, company or other entity
                (except
                on behalf of the Company):

            

    

     

    
      	 	
              (a)

            	
              solicit
                or entice away or attempt to solicit or entice away from the Company
                or
                any Group Company any person, firm, company or other entity who is,
                or
                was, a client of the Company or any Group Company with whom the Employee
                had business dealings during the course of his Employment or in the
                twelve
                (12) month period prior to the Termination
                Date;

            

    

     

    
      	 	
              (b)

            	
              solicit
                or entice away or attempt to solicit or entice away any individual
                person
                who is employed or engaged by the Company or any Group Company either
                as a
                director or in a managerial or technical capacity; or who is in possession
                of Confidential Information and with whom the Employee had business
                dealings during the course of his Employment or the twelve (12) month
                period immediately prior to the Termination Date;
                

            

    

     

    
      	 	
              (c)

            	
              carry
                on, set up, be employed, engaged or interested in a business in Hong
                Kong,
                the People’s Republic of China, and any other geographic locations where
                the Company’s Business is conducted, that is in competition with, whether
                directly or indirectly, the Business as at the Termination Date.
                It is
                agreed that if any such company ceases to be in competition with
                the
                Company and/or any Group Company this clause 12.1(c) shall, with
                effect from that date, cease to apply in respect of such company.
                The
                provisions of this clause 12.1(c) shall not, at any time following
                the Termination Date, prevent the Employee from (i) owning an equity
                interest in the Company, and (ii) owning up to one percent (1%) of
                the
                securities in a corporation engaged in a business that competes with
                the
                Company, provided that such securities are listed on a national securities
                exchange. Nothing in this clause 12.1(c) shall prohibit Employee
                from
                seeking or doing of business not in direct or indirect competition
                with
                the Business;

            

    

     

    
      	
              12.2

            	
              While
                the parties agree that the restrictions contained in Clause 11 and
                12 are
                reasonable in all the circumstances, it is agreed that if any court
                of
                competent jurisdiction holds that the length of the post-termination
                covenants contained in clauses 11 and 12 are not reasonable, the
                parties
                agree that:

            

    

     

    
      	 	
              (a)

            	
              the
                covenants are to apply for a period of nine (9) months from the
                Termination Date; or, if this period is held to be
                unreasonable,

            

    

     

    
      	 	
              (b)

            	
              for
                a period of six (6) months from the Termination Date; or if this
                period is
                held to be unreasonable,

            

    

     

    
      
        
        

      

      
        Page
          8

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (c)

            	
              for
                such other period as any court of competent jurisdiction decides
                is
                reasonable.

            

    

     

    
      	
              12.3

            	
              The
                period during which the restrictions referred to in clauses 12.1(a)
                to (c) inclusive which apply following the Termination Date shall
                be
                reduced by the amount of time during which, if at all, the Company
                suspends the Employee under the provisions of clause 10.1.
                

            

    

     

    
      MISCELLANEOUS

    

     

    
      	
              13.1

            	
              This
                Agreement, together with any other documents referred to in this
                Agreement, supersedes all other agreements both oral and in writing
                between the Company and the Employee. The Employee acknowledges that
                he
                has not entered into this Agreement in reliance upon any representation,
                warranty or undertaking which is not set out in this Agreement or
                expressly referred to in it as forming part of the Employee’s contract of
                employment.

            

    

     

    
      	
              13.2

            	
              The
                Employee represents and warrants to the Company that he will not
                by reason
                of entering into the Employment, or by performing any duties under
                this
                Agreement, be in breach of any terms of employment with a third party
                whether express or implied or of any other obligation binding on
                him.

            

    

     

    
      	
              13.3

            	
              Any
                notice to be given under this Agreement to the Employee may be served
                by
                being handed to him personally or by being sent by registered post
                to him
                at his usual or last known address; and any notice to be given to
                the
                Company may be served by being left at or by being sent by registered
                post
                to its registered office for the time being. Any notice served by
                registered post shall be deemed to have been served two days (excluding
                Sundays and statutory holidays) after the date of the registered
                post
                receipt. 

            

    

     

    
      	
              13.4

            	
              The
                provisions of clauses 11, 12 and 13 shall remain in full force and
                effect after the Termination Date. 

            

    

     

    
      	
              13.5

            	
              This
                Agreement and the relationship between the parties shall be governed
                by,
                and interpreted in accordance with, the laws of the State of Delaware,
                U.S.A. Each of the parties agrees that the courts of the State of
                Delaware
                are to have non-exclusive jurisdiction to settle any disputes (including
                claims for set-off and counterclaims) which may arise in connection
                with
                the creation, validity, effect, interpretation or performance of,
                or the
                legal relationships established by, this Agreement or otherwise arising
                in
                connection with this Agreement, and for such purposes irrevocably
                submit
                to the non-exclusive jurisdiction of the courts of the State of
                Delaware.

            

    

     

    
      	
              13.6

            	
              The
                Agreement is written in both Chinese and English languages. If any
                inconsistency arises between the two versions, the English version
                shall
                prevail.

            

    

     

    
      	
              13.7

            	
              If
                any one or more of the provisions contained in this Agreement shall
                for
                any reason be held to be invalid, illegal, or unenforceable in any
                respect, such invalidity, illegality, or unenforceability shall not
                affect
                any other provision hereof, and this Agreement shall be construed
                as if
                such invalid, illegal, or unenforceable provision had never been
                contained
                herein. In addition, if any court of competent jurisdiction determines
                that any of the provisions set forth herein are unenforceable because
                of
                the duration or geographic scope of such provision, such court shall
                have
                the power to reduce the duration or scope of such provision as the
                case
                may be, to the extent necessary to render such provision
                enforceable.

            

    

     

    
      
        
        

      

      
        Page
          9

        
          

        

      

      
        
        

      

    

     

    
      	
              13.8

            	
              The
                waiver by any party to a breach of any provision of this Agreement
                must be
                in writing and signed by such party to be effective, and shall not
                operate
                or be construed as a waiver of any subsequent breach of this
                Agreement.

            

    

     

    
      	
              13.9

            	
              This
                Agreement is personal in nature, and neither this Agreement nor any
                part
                of any obligation herein shall be assignable by Employee. The Company
                shall be entitled to assign this Agreement to any affiliate or successor
                of the Company that assumes the ownership or control of the business
                of
                the Company, and the Agreement shall inure to the benefit of any
                such
                successor or assign.

            

    

     

    
      	
              13.10

            	
              This
                Agreement may be executed in one or more facsimile counterparts,
                and by
                the parties hereto in separate facsimile counterparts, each of which
                when
                executed shall be deemed to be an original while all of which taken
                together shall constitute one and the same
                instrument.

            

    

     

    [SIGNATURE
      PAGE TO FOLLOW]

     

    
      
        
        

      

      
        Page
          10

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF
      this
AGREEMENT
      has
      been
      signed on the date the day and year first above written.

     

    
      	
              SIGNED by
                HEUNG
                SANG FONG 

            	 )	/s/ HEUNG
              SANG FONG
	
              in
                the presence of: 

            	 )	 

    

     

    
      	SIGNED for
              and on behalf of   	 )	/s/ YU KWAI CHONG
	FUQI INTERNATIONAL,
              INC.
              in
              the presence of:	 )	 

    

     

    
      
        
        

      

      
        Page
          11

        
          

        

      

      
        
        

      

    

     

    DATED
      THE
      30 DAY OF AUGUST, 2007

    

    FUQI
      INTERNATIONAL, INC.

     

    and

    

    HEUNG
      SANG FONG

    

    
      
        

      

    

    

    EMPLOYMENT
      AGREEMENT

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