AMENDED AND RESTATED SETTLEMENT AGREEMENT

 

1.

On or before July 20, 2012, the Company will deliver $50,000 by wire transfer to Sichenzia Ross Friedman Ference LLP’s Escrow Account pursuant to the attached wire instructions for disbursement to the Subscribers upon receipt of a fully executed copy of this Agreement;

 

2.

On or before July 31, 2012, the Company shall pay an additional $50,000 by wire transfer to Sichenzia Ross Friedman Ference LLP’s Escrow Account pursuant to the attached wire instructions for disbursement to the Subscribers upon receipt of a fully executed copy of this Agreement; and

 

3.

On or before August 31, 2012, the Company shall pay an additional $31,250 by wire transfer to Sichenzia Ross Friedman Ference LLP’s Escrow Account pursuant to the attached wire instructions for disbursement to the Subscribers upon receipt of a fully executed copy of this Agreement;

 

4.

Subject to the full and timely payment no later than August 31, 2012, of the $131,250 provided for above:

 

a.

ACP, on behalf of itself, and each of the Subscribers, forever releases and discharges the Company, China Electronic Holdings, Inc. (Delaware), Lu’an Guoying Electronic Sales Co., Ltd. and its shareholders, subsidiaries, affiliates, successors, and assigns (collectively, the “Releasees”) from any and all claims, demands, causes of action, and liabilities of any kind whatsoever (upon any legal or equitable theory, whether contractual, common-law, statutory, federal, state, local, or otherwise), whether known or unknown, arising out of or in connection with any further liquidated damages without limitation as identified in Section 7, Section 9, and Section 13(f)of the Subscription Agreement;

 

b.

ACP, on behalf of itself, and each of the Subscribers, waives any right it or they may have to require the Company to register any securities of the Company under the Securities Act of 1933, as amended, together with any right it or they may have to seek damages or otherwise declare an Event of Default under the Subscription Agreements including, without limitation under Sections 7(o) “Further Registration Statements,” 7(r) “Uplisting”,9(d) “Non-Registration Events”, and 13(f) “Damages”.  This agreement supersedes in its entirety Section 7(o), 7(r), 9(d) and 13(f) of the Subscription Agreements in connection with the Offering.