EMPLOYMENT AGREEMENT

4.1

The Employee is entitled to a gross monthly salary amounting to 150 000 SEK per month. The salary is paid in accordance with Neonode's prevalent payment routines. The gross monthly salary will be reviewed on an annual basis in February month. Neonode is under no obligation to award an increased salary following a salary review. There shall be no review of the salary after notice has been given by either party to terminate the employment.

4.2

The parties acknowledge that the CEO may require overtime work in relation to which no additional compensation will be paid. Overtime work has been taken into consideration, inter alia, when determining the salary level and other benefits according to this Employment Agreement.

4.3

In addition to the salary set out in Clause 4.1 above, the Employee is entitled to receive a yearly bonus of up to 1 000 000 SEK based on the development of the company and the share price development. In addition the Employee may be entitled to participate in Neonode's from time to time applicable bonus policy and stock option programs. The terms and conditions for the yearly bonus, stock options and any -other payments are subject to the sole discretion of the compensation committee of Neonode.

4.4

The Employee is entitled to preventive health care allowance (Sw. friskvardsbidrag) in accordance with Neonode's from time to time applicable health care allowance policy. Such allowance may, however, not exceed SEK 2,000 per annum.

4.5

The Employee is not, in addition to what is stipulated in this Employment Agreement, entitled to any additional remuneration for the Employee's duties.

5.1

The Employee is entitled to pension and insurance benefits in accordance with Neonode's policy as applicable from time to time.

5.2

In addition to Clause 5.1 above, Neonode undertakes to supply occupational group life insurance (Sw. TjanstegrupplivfOrsakring), industrial (occupational) injury insurance (Sw. Trygghetsforsakring vid arbetsskada) and work travel insurance.

In the event of sickness, the Employee shall be entitled to sick pay in accordance with Swedish statutory requirements.

The Employee shall, upon submission of appropriate receipts, receive reimbursement for reasonable out-of-pocket business expenses properly incurred by the Employee in connection with the Employee's duties. Neonode will also reimburse the Employee for any reasonable business travel expenses which the Employee incurs in connection with the Employee's duties, subject to and in accordance with the from time to time applicable business travel policy (or equivalent), or, where applicable, in accordance with a specific agreement to be agreed upon by Neonode and the Employee. Reimbursement is subject to the Employee providing Neonode with appropriate receipts and/or invoices.

9.1

The Employee confirms that Neonode has informed the Employee of the principles governing Neonode's processing employees' personal data in accordance with the Personal Data Act (1998:204) and that the Employee has given consent thereto.

9.2

The Employee undertakes to comply with Neonode's, and its affiliated companies', from time to time applicable policies regarding the use of Neonode's (and its affiliated companies') computers, e-mail system, Internet services and software programs. The Employee is aware that Neonode has full access to all files, e-mail correspondence and document handling systems as well as full access to all Internet usage which is stored in the Neonode's IT system.

10.1

Without any additional compensation, Neonode is the sole owner of all rights (and has the exclusive right of disposition to all rights), including but not limited to all intellectual property rights, to any results and material made, designed or produced by the Employee within the frame of the Employee's employment. Accordingly, Neonode is entitled to modify and/or further develop any results, material or intellectual property rights as well as to transfer or license the rights to such results, material or intellectual property rights to third parties.

10.2

The Employee is obliged to and agrees to support and procure that Neonode, at any time during the employment or after its expiration, can fully profit from the rights relating to Clause 10.1 above. Accordingly, the Employee is, inter alia, obliged to prepare any documentation which Neonode, at its sole discretion, deems necessary or desirable in order to protect, register and/or maintain Neonode's rights according to Clause 10.1 above, including but not limited, where necessary, to transfer (without the right to any additional compensation) any such rights to Neonode.