Public Offering Registration - SJ ELECTRONICS, INC. - 8-4-2008 by SJEL-Agreements

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									As filed with the Securities and Exchange Commission on August 1, 2008 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 SJ ELECTRONICS, INC. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of incorporation or organization) 3679 (Primary Standard Industrial Classification Code Number) 87-0530644 (IRS Employer Identification No.) 5F, No.166, Sinhu 2nd Road Neihu District, Taipei City 114 Taiwan 011-8862-8791-8838 ( Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices ) The Corporation Trust Company of Nevada 6100 Neil Road, Suite 500 Reno, Nevada 89511 (775) 688-3061 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to : Darren L. Ofsink, Esq. Guzov Ofsink, LLC 600 Madison Avenue, 14 th Floor, New York, NY 10022 Approximate date of commencement of proposed sale to the public : From time to time after the Registration Statement has been declared effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box:  If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  Non-accelerated filer  (Do not check if a smaller reporting company)

Accelerated filer  Smaller reporting company 

CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Common stock, par value $.001 per share Common stock, par value $.001 per share, underlying 15% Notes (3) Common stock, par value $.001 per share, underlying Warrants (5) Total Proposed maximum offering price per unit 2.25 (2) 2.25 (4) 2.25 (5) 2.25 $ $ $ $ Proposed maximum aggregate offering price 13,455,495 (2) 10,261,526 (4) 7,236,154 (5) 30,953,175 Amount of regi stration fee $ $ $ $ 517 395 278 1,216.46

Amount to be registered (1) 5,850,215 $ 4,461,533 $ 3,146,154 $ 13,457,902 $

(1) Pursuant to Rule 416 promulgated under the Securities Act of 1933, as amended, there are also registered hereunder such indeterminate number of additional shares as may be issued to the selling stockholders to prevent dilution resulting from stock splits, stock dividends or similar transactions. (2) The registration fee is calculated pursuant to Rule 457(c). Our common stock is quoted under the symbol "SJEL.OB" on the Over-the-Counter Bulletin Board (“OTCBB”) administered by the Financial Industry Regulatory Authority (“FINRA”). As of July 29, 2008, the last reported bid price was $2.00 per share and the last reported asked price was $2.50 per share. The average of the bid and asked price was $2.25 per share. Accordingly, the registration fee is $1,190 based on $2.25 per share. (3) Represents shares of common stock issuable to certain of the selling stockholders upon conversion of the 15% Senior Secured Convertible Notes due 2009 (the “15% Notes”). (4) In accordance with Rule 457(g), the registration fee for these shares was calculated based upon a price which represents the highest of (i) the price at which the 15% Notes may be converted; (ii) the offering price of securities of the same class included in this registration statement; or (iii) the price of securities of the same class, as determined pursuant to Rule 457(c). (5) Represents shares of common stock issuable upon exercise of warrants held by certain of the selling stockholders. In accordance with Rule 457(g), the registration fee for these shares is calculated upon a price which represents the highest of (i) the price at which the warrants may be exercised; (ii) the offering price of securities of the same class included in this registration statement; or (iii) the price of securities of the same class, as determined pursuant to Rule 457(c). The Registrant amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall hereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until the registration statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine.

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION, DATED AUGUST 1, 2008 PRELIMINARY PROSPECTUS SJ ELECTRONICS, INC. 13,457,902 Shares of Common Stock Offered by Selling Stockholders This prospectus relates to the sale by the selling stockholders identified in this prospectus of up to 13,457,902 comprising: shares of our common stock

4,461,533 shares of common stock that the selling stockholders may acquire upon conversion of our 15% Senior Secured Convertible Notes due 2009 (the “15% Notes”); 5,850,215 shares of common stock; 2,250,000 shares of common stock issuable to the selling stockholders upon exercise of our warrants; 896,154 shares of common stock issuable to the selling stockholders upon exercise of the placement agent warrants.

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The selling stockholders may sell all or any portion of their shares of common stock in one or more transactions on the over-the-counter market or in privately negotiated transactions. Each selling stockholder will determine the prices at which it sells its shares. Although we will incur expenses in connection with the registration of the common stock, we will not receive any of the proceeds from the sale of the shares of common stock by the selling stockholders. To the extent the warrants are exercised for cash, if at all, we will receive the exercise price for those warrants. Under the terms of the warrants cashless exercise is permitted if the resale of the warrant shares by the holder is not covered by an effective registration statement at any time following the date of issuance of the warrants. We will receive cash proceeds of $1,125,000 if the warrants are exercised. We will receive cash proceeds of $1,030,000 if the placement agent warrants are exercised. Thus, we will receive total cash proceeds of $2,155,000 ($1,125,000 plus $1,030,000) if all the warrants currently issued and outstanding are exercised. We cannot assure you that the warrants will be exercised for cash or at all. Our common stock is quoted on the Over-the-Counter Bulletin Board overseen by FINRA (the “OTCBB”) under the symbol “SJEL.OB.” On July 29, 2008, the last reported sale price of our common stock quoted on the OTCBB was $2.50 per share. There is no established trading market for our common stock. We cannot give you any assurance that an established trading market in our common stock will develop, or if such a market does develop, that it will continue. Investing in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 19 for a discussion of certain risk factors that you should consider . You should read the entire prospectus before making an investment decision. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is

, 2008

TABLE OF CONTENTS Prospectus Summary Certain Disclosure Regarding Conversion of Notes and Exercise of Warrants Risk Factors About This Prospectus Cautionary Note Regarding Forward-Looking Statements and Other Information Contained in this Prospectus Currency, Exchange Rate, and other References Selling Stockholders Plan of Distribution Use of Proceeds Business Properties Management's Discussion and Analysis of Financial Condition and Results of Operations Market Price of and Dividends on our Common Equity and Related Stockholder Matters Security Ownership of Certain Beneficial Owners and Management Directors and Executive Officers Executive Compensation Certain Relationships and Related Transactions Legal Proceedings Description of Securities to be Registered Legal Matters Experts Interests of Named Experts and Counsel Changes in and Disagreements with Accountants Financial Statements Where You Can Find More Information Disclosure of Commission Position on Indemnification For Securities Act Liabilities 2 3 10 19 33 34 35 35 42 45 46 62 63 77 79 82 85 89 89 90 91 91 91 92 93 93 94

PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read the entire prospectus, including "Risk Factors" and the consolidated financial statements and the related notes before making an investment decision. Except as otherwise specifically stated or unless the context otherwise requires, the “Company,” we," "our" and "us" refers collectively to: (i) (ii) (iii) (iv) (v) (vi) (vii) SJ Electronics, Inc. (“SJEL”) formerly known as Acheron, Inc.; Shing Mei Enterprises Ltd. (“Shing Mei”), a wholly-owned subsidiary of SJEL and a corporation organized under the laws of Samoa; Xujun Electronic (Ganzhou) Co., Ltd, a wholly-owned subsidiary of Shing Mei and a limited liability company organized under the laws of the PRC; Guangxi Hezhou XU JUN Electronics Co., Ltd., a wholly-owned subsidiary of Shing Mei and a limited liability company organized under the laws of the PRC; FuChuan Xujun Science and Technology Electronics Co., Ltd., a wholly-owned subsidiary of Shing Mei and a limited liability company organized under the laws of the PRC; S.J. Electronics Technology (Shenzhen) Co., Ltd., a wholly-owned subsidiary of Shing Mei and a limited liability company organized under the laws of the PRC; S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd., a wholly-owned subsidiary of Shing Mei and a limited liability company organized under the laws of the PRC. 3

The Company Business Overview The Company, through its subsidiaries, is an international designer, developer and manufacturer of computer components including connectors, wire harness and cable assemblies. Initially, the Company was primarily engaged in the production of connector cables, and has subsequently expanded its manufacturing capability to include cable assemblies and connectors and related computer components. The Company specializes in the manufacturing and sales of computer, communication and consumer electronic (3C) power components, including information technology (IT) communications cables, computer & IT appliance power supply cable sets and IT communications signal cable sets. For more information about our business you should read the section entitled “Business”. Our total sales for 2007 were $56,355,689, an increase of $14,093,177, or 33.4%, compared to total sales of $42,262,512 for 2006. For the first quarter of 2008 our total sales were $12,961,563, an increase of $2,123,238, or 19.6%, compared to total sales of $10,838,325 for the first quarter of 2007. History of the Company We are a Nevada corporation organized on June 23, 1994 as Harvest E-xpress. On May 1, 1997, we changed our name to HLS (USA), Inc. On April 13, 2006, we changed our name to Acheron, Inc. Originally, our business was grain cutting and custom machine hire. We did not succeed in this business and began seeking another opportunity. 4

Reverse Acquisition On February 13, 2008 we acquired Shing Mei Enterprises Ltd. (“Shing Mei”) by entering into a reverse merger transaction. In the reverse merger, pursuant to a Securities Exchange Agreement (the “Exchange Agreement”) we acquired all of the equity of Shing Mei, a Samoa corporation engaged in the business of manufacturing computer components, in exchange for issuing 15,000,000 shares of common stock, representing approximately 68% of our outstanding common stock, to the owner of Shing Mei. Under the Exchange Agreement, we also issued to a number of accredited investors who previously had provided bridge financing to Shing Mei, 3,698,937 shares of our common stock in exchange for the 10% Secured Convertible Notes (the “10% Notes”) of Shing Mei, and we issued warrants to purchase 2,250,000 shares of our common stock at $1.00 per share in exchange for warrants of Shing Mei issued to the investors in the 10% Notes. In addition, we issued to Primary Capital, LLC a total of 1,828,222 shares of our common stock in compensation for fees and expenses paid by Primary Capital, LLC on behalf of SJ Electronics, Inc. and for merger, acquisition and investment banking advisory services rendered, and we issued warrants to purchase 450,000 shares of our common stock in exchange for the warrants of Shing Mei issued to Primary Capital, LLC in connection with the sale of the 10% Notes. We agreed to include the shares issued or issuable pursuant to the Exchange Agreement in a registration statement for the resale of any securities to be issued in a subsequent financing. We also agreed to include in such registration statement the shares issued or issuable upon exercise of the warrant to the placement agent. Beginning February 13, 2008, we have been engaged, through our wholly-owned subsidiary Shing Mei, in manufacturing of computer components including connectors, wire harness and cable assemblies in PRC. We serve as a holding company for Shing Mei and have no operations other than the operations of Shing Mei. On March 20, 2008 we changed our name to SJ Electronics, Inc. Recent Developments On May 15, 2008 we entered into a Note Purchase Agreement (the “Note Purchase Agreement”) to sell to certain accredited investors and to certain non-US persons our 15% Senior Secured Convertible Notes Due 2009 (the “15% Notes”) at closings to occur on or before July 31, 2008. On May 15, 2008 the first closing under the Note Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $2,950,000. On May 30, 2008 the second closing under the Note Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $700,000. On June 10, 2008 the third and the final closing under the Note Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $2,150,000. The aggregate principal amount of the 15% Notes sold at all three closings under the Note Purchase Agreement was $5,800,000. 5

Each of the 15% Notes mature one year after the date of issuance thereof. The outstanding principal of the 15% Notes accrue interest at the rate of 15% per annum. All accrued interest on such 15% Notes is payable at maturity. Each 15% Note is convertible into shares of our common stock, par value $0.001 per share (the “Common Stock”) at a conversion price equal to $1.30 per share, subject to adjustments (the “Conversion Price”). Under the Note Purchase Agreement, if the Company’s “pre-tax income” for the year ended December 31, 2008 is less than $10,000,000, then the Conversion Price will be reduced by the percentage shortfall, up to a maximum of $0.65 per share (the “Performance Adjustment”). After any reductions to the Conversion Price made under this provision the Conversion Price will not be less than $0.65 per share. In the event of a conversion, accrued interest shall be automatically converted into Common Stock. In addition, we have the right to prepay the entire outstanding principal due under the 15% Notes upon certain conditions, including, but not limited to, that no event of default has occurred or is continuing at the time we elect to prepay. We also issued warrants to purchase 446,154 shares of Common Stock to Primary Capital, LLC in connection with the sale of the 15% Notes. Such warrants have an exercise price of $1.30 per share subject to adjustments. The 446,154 warrants contain the same Performance Adjustment provisions as the 15% Notes. Upon the Performance Adjustment of the exercise price, the number of shares issuable upon exercise of the 446,154 warrants will also be adjusted to become the product determined by dividing the combined exercise price of the warrants ($580,000, which is 446,154 times $1.30) by the adjusted exercise price, which equals 892,307 shares at the exercise price of $0.65 per share. We agreed to file with the SEC a registration statement within 45 days of the last closing date (i.e., June 10, 2008) to register for resale the shares of Common Stock issuable upon conversion of the 15% Notes and to cause that registration statement to be declared effective by the earlier to occur of (i) 180 days after the last closing date, or (ii) the fifth trading day following the day we receive notice from the SEC that the initial registration statement will not be reviewed or is no longer subject to further review and comments. We also agreed to include in such registration statement the shares issuable upon exercise of the warrant issued to Primary Capital, LLC in connection with the sale of the 15% Notes. 6

Employees As of July 29, 2008, we had 4,500 employees, all of whom are full-time employees. 3,950 of our employees work in manufacturing. Executive Offices Our executive offices are located at 5F, No.166, Sinhu 2nd Road, Neihu District, Taipei City 114, Taiwan and our telephone number is 011-8862-8791-8838. The Offering Offering by Selling Stockholders This prospectus relates to the resale by the selling stockholders identified in this prospectus of up to 13,457,902 shares of our common stock including: 4,461,533 shares of common stock that the selling stockholders may acquire upon conversion of the 15% Notes; 5,850,215 shares of common stock; 7

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2,250,000 shares of common stock issuable to the selling stockholders upon exercise of our warrants; 896,154 shares of common stock issuable to the selling stockholders upon exercise of the warrants issued to Primary Capital, LLC (the “Placement Agent Warrants”).

The shares being registered may be offered for sale by the selling stockholders from time to time. No shares are being offered for sale by the Company. Common stock outstanding prior to Offering Common stock offered by the Company Total shares of common stock offered by selling stockholders Common stock to be outstanding after the offering (assuming conversion of the 15% Notes, and exercise of all of the warrants).

21,984,215 0

13,457,902 (representing approximately 61% of the shares of common stock currently outstanding).

29,591,902 shares. 8

Total dollar value of common stock being registered

The closing market price for the common stock on June 10, 2008, the date of the last closing of the sale of the 15% Notes in the private placement was $2.25. Using this value, the dollar value of the 13,457,902 shares of common stock (including the shares underlying the 15% Notes and all the warrants) being registered was $30,280,280. The closing market price for the common stock on July 29, 2008 was $2.50. Using this value, the total dollar value of the 13,457,902 shares of common stock (including shares underlying the 15% Notes and all the warrants) being registered is $33,644,755. We will not receive any of the proceeds from the sales of the shares by the selling stockholders. To the extent the warrants and the placement agent warrants are exercised for cash, if at all, we will receive the exercise price for those warrants. Under the terms of the warrants, cashless exercise is permitted if the underlying shares have not been registered at any time following the date of issuance of the warrants. We will receive cash proceeds of $1,125,000 if the warrants are exercised. We will receive cash proceeds of $1,030,000 if the Placement Agent Warrants are exercised. Thus, we will receive total cash proceeds of $2,155,000 ($1,125,000 plus $1,030,000) if all the warrants currently issued and outstanding are exercised. We intend to use any cash proceeds received from the exercise of the warrants for working capital and other general corporate purposes. We cannot assure you that any of those warrants will ever be exercised for cash or at all.

Use of Proceeds

Our OTC Bulletin Board Trading Symbol Risk Factors

SJEL.OB See "Risk Factors" beginning on page 19 and other information included in this prospectus for a discussion of factors you should consider before deciding to invest in shares of our common stock. 9

CERTAIN DISCLOSURE REGARDING CONVERSION OF NOTES AND EXERCISE OF WARRANTS The closing market price for our common stock on July 29, 2008 was $2.50 per share. Using this market price per share, the maximum aggregate dollar value of the 4,461,533 shares of common stock underlying the 15% Notes that we are registering for resale is $11,153,833 (4,461,533 times $2.50) The maximum aggregate dollar possible profit on the 4,461,533 shares of common stock to be issued by us on payment of the principal due on the 15% Notes that we have registered for resale is $1.30 per share or $5,800,000 in the aggregate. This number represents the 48% discount ($1.20) to the market price per share ($2.50) on July 29, 2008. Under the terms of the 15% Notes if our “pre-tax income” for the year ended December 31, 2008 is less than $10,000,000, then the Conversion Price will be reduced by the percentage shortfall, up to a maximum of $0.65 per share (the “Performance Adjustment”). After any reductions to the Conversion Price made under this provision the Conversion Price will not be less than $0.65 per share. $0.65 represents a 74% discount ($1.85) to the market price per share ($2.50) on July 29, 2008. The following is a table disclosing the dollar amount of each payment required to be made by us to selling stockholders (or any affiliate of a selling stockholder) in connection with the private placement of the 15% Notes excluding related interest payments disclosed in a separate table below. There are no other persons with whom any selling stockholder has a contractual relationship regarding the transactions. Gross proceeds from issuance of the convertible notes: Payments in connection with the transaction that we made: Placement Agent’s fee (1) Placement Agent’s warrants (1) Liquidated Damages payable under Note Purchase Agreement (2) Interest Payments (3) Professional fees Filing, printing and shipping fees Total Payments made by us: Net proceeds to us: 10 $ $ $ $ $ $ $ $ $ 5,800,000 580,000 423,846 580,000 870,000 90,000 2,000 2,545,846 3,254,154

(1) Under the engagement agreement between Shing Mei and Primary Capital, LLC (“PC”), the Company paid PC a transaction fee of $580,000 at the closing of the transaction and issued PC five year warrants to purchase 446,154 shares of common stock with an exercise price of $1.30 per share. We have valued the 446,154 warrants for purposes of this table using their “intrinsic value” i.e. the difference between the aggregate strike price of $580,000 and the aggregate fair market value of $1,003,846 based on the closing price of $2.25 on June 10, 2007 (the date of issue), which amounts to $423,846. (2) Under the terms of that certain Note Purchase Agreement pursuant to which the 15% Notes were sold and issued (the “Note Purchase Agreement”), we are required, among other things, to use our commercially reasonable best efforts to file this Registration Statement not later than 45 days after the last closing date (which was June 10, 2008) and to have this registration statement declared effective on the earlier occur of   180 days after the filing date (which was August 1, 2008); or the fifth business day following the day we receive notice from the SEC that the SEC has determined that the registration statement is eligible to be declared effective without further comments by the SEC.

Under the terms of the Note Purchase Agreement, we also agreed, as soon as reasonably practicable following the date on which we are permitted by then current SEC guidance to file a subsequent registration statement, to use our commercially reasonable best efforts to file a subsequent registration statement covering 100% of the remaining registrable securities (or such lesser number as the SEC deems appropriate). We have agreed to continue this process until such time as all of the registrable securities have been registered. 11

Our failure to meet this schedule and other timetables provided in the Note Purchase Agreement could result in the imposition of liquidated damages, which are payable through cash payments at the rate of 1.0% per month of the principal amount of the 15% Notes at the time outstanding, capped at 10% of the principal amount of the 15% Notes at the time outstanding or $580,000 as of the date of issuance of the 15% Notes. As of the date of this prospectus we were delinquent by 6 days in meeting our obligations to file this registration statement within the time limit set forth in the Note Purchase Agreement and are required to pay liquidated damages in the amount of $11,598. We have no way of knowing whether we will be required to pay some or any of the remaining portion of the total amount of $580,000. (3) The following is a table disclosing the interest payments required to be made to the selling stockholders during the life of the convertible notes. Date 05/15/2009 05/30/2009 06/10/2009 Total Interest Payments: Interest Payment Amount 442,500.00 105,000.00 322,500.00 870,000.00

$ $ $ $

The net proceeds to us from the sale of the 15% Notes were $3,254,154. This amount includes the payment of fees, including professional fees, placement agent’s fees, interest payments and filing, printing and shipping fees, associated with the sale and issuance of the 15% Notes. The following is a table disclosing the aggregate amount of possible profit which could have been realized by the selling stockholders if they had converted the 15% Notes at the conversion discount on the date of issuance and sold the underlying common stock on such date. The conversion price of the 15% Notes of $1.30 per share at the time of issuance represented a discount of: $1.20 to the price of $2.50 which was the market price for our common stock at the first closing on May 15, 2008; $1.20 to the price of $2.50 which was the market price for our common stock at the second closing on May 30, 2008; and $0.95 to the price of $2.25 which was the market price for our common stock at the third closing on June 10, 2008. 12

Under the Note Purchase Agreement, if our “pre-tax income” for the year ended December 31, 2008 is less than $10,000,000, then the Conversion Price will be reduced by the percentage shortfall, up to a maximum of $0.65 per share (the “Performance Adjustment”) After any reductions to the conversion price made under this provision the conversion price will not be less than $0.65 per share. The conversion price of the 15% Notes of $0.65 per share at the time of issuance represented a discount of: $1.85 to the price of $2.50 which was the market price for our common stock at the first closing on May 15, 2008; $1.85 to the price of $2.50 which was the market price for our common stock at the second closing on May 30, 2008; and $1.60 to the price of $2.25 which was the market price for our common stock at the third closing on June 10, 2008. Closings 05/30/2008 $ 2.50 $ 1.30 $ 0.65 538,461 1,346,151 699,999 349,999 646,153 996,152 4,940,379 7,840,376

Market price per share of common stock underlying the 15% Notes Conversion price per share of common stock underlying the 15% Notes Conversion price per share of common stock underlying the 15% Notes (after Performance Adjustment) Total shares of common stock underlying the 15% Notes Combined market price of the total number of shares at each closing underlying the 15% Notes using market price Combined conversion price of shares underlying the 15% Notes (at $1.30) Combined conversion price of shares underlying the 15% Notes (after Performance Adjustment) Total possible discount to market price at time of issuance (at $1.30) Total possible discount to market price at time of issuance (after Performance Adjustment) Total possible discount to market price at time of issuance (at $1.30) for all three closings Total possible discount to market price at time of issuance (after Performance Adjustment) for all three closings 13

05/15/2008 $ 2.50 $ 1.30 $ 0.65 2,269,229 5,673,072 2,949,997 1,474,999 2,723,075 4,198,073

$ $ $

06/10/2008 2.25 1.30 0.65 1,653,844 3,721,149 2,149,997 1,074,999 1,571,152 2,646,151

$ $ $ $ $ $ $

$ $ $ $ $

$ $ $ $ $

The following is a table disclosing the aggregate amount of possible profit which could have been realized by the selling stockholders if they had converted the 15% Notes at the conversion discount on July 29, 2008 and sold the underlying common stock. On July 29, 2008 the closing market price for our common stock was $2.50 per share. Market price per share of common stock underlying the 15% Notes: Conversion price per share of common stock underlying the 15% Notes Conversion price per share of common stock underlying the 15% Notes (after Performance Adjustment) Total shares of common stock underlying the 15% Notes Combined market price of the total number of shares underlying the 15% Notes using market price Combined conversion price of shares underlying the 15% Notes (at $1.30) Combined conversion price of shares underlying the 15% Notes (after Performance Adjustment) Total premium if all 15% Notes were converted at $1.30 and sold at market on July 29, 2008 Total premium if all 15% Notes were converted at $0.65 and sold at market on July 29, 2008 Warrants Warrants : 2,250,000 shares of common stock are issuable upon exercise of the warrants. The warrants have a five year term and have an exercise price of $1.00 per share (subject to adjustment). The initial exercise price represented a discount of $1.25 per share to the $2.25 market price of our common stock on February 13, 2008, the date of issuance. As of July 29, 2008, the closing price for the common stock was $2.50. Primary Capital, LLC Warrants (the “Placement Agent’s Warrants”) : 896,154 shares of common stock are issuable upon the exercise of the Placement Agent’s Warrants to purchase our common stock. Of those warrants, the warrants to purchase 450,000 shares of our common stock have an exercise price of $1.00 per share (subject to adjustment) and represent a discount of $1.25 to the $2.25 market price for our common stock on February 13, 2008, the date of issuance. The warrants to purchase 446,154 shares of our common stock have an exercise price of $1.30 per share (subject to adjustment) and represent a discount of $0.95 to the $2.25 market price for our common stock on June 10, 2008, the date of issuance. Under the terms of the 446,154 warrants if the “pre-tax income” for the year ended December 31, 2008 is less than $10,000,000 then the exercise price will be reduced by the percentage shortfall, up to a maximum of $0.65 per share (the “Performance Adjustment”). After any reductions to the exercise price made under this provision the exercise price will not be less than $0.65 per share. Upon the Performance Adjustment of the exercise price, the number of shares issuable upon exercise of the 446,154 warrants will also be adjusted to become the product determined by dividing the combined exercise price of the warrants ($580,000, which is 446,154 times $1.30) by the adjusted exercise price of $0.65 per share, which equals 892,307 shares. As of July 29, 2008, the closing price for the common stock was $2.50. 14 $ $ $ $ $ $ $ $ 2.50 1.30 0.65 4,461,533 11,153,833 5,800,000 2,900,000 5,353,840 8,253,836

The following is a table disclosing the aggregate amount of possible profit which could be realized by the selling stockholders (or its affiliates) as a result of any exercise price discounts for the common stock underlying the warrants. The only warrants, options, notes or other securities of the issuer that are held by the selling stockholders or any of their affiliates are the 15% Notes, the warrants issued to the selling stockholders in exchange for warrants issued by Shing Mei and the placement agent’s warrants that were issued in connection with the issuance and sales of the 15% Notes and in exchange for the placement agent’s warrants issued by Shing Mei. 02/13/2008 2.25 1.00 1.00 2,250,000 450,000 5,062,500 1,012,500 2,250,000 450,000 2,812,500 562,500 3,375,000 $ $ $ 3,375,000 06/10/2008 2.25 1.30 1.30 0.65 446,154 892,308 1,003,847 2,007,692 580,000 580,000 423,847 423,847 1,427,692 1,427,692

Market price of common stock underlying warrants on the date of issuance of warrants, per share Exercise price per share: Warrant Exercise price per share: Placement Agent’s Warrant Exercise price per share: Placement Agent’s Warrant (after Performance Adjustment) No. of shares issuable under Warrants No. of shares issuable under Placement Agent’s Warrants No. of shares issuable under Placement Agent’s Warrants (after Performance Adjustment) Market price on date of issuance of total number of shares underlying Warrants Market price on date of issuance of total number of shares underlying Placement Agent’s Warrant Market price on date of issuance of total number of shares underlying Placement Agent’s Warrant (after Performance Adjustment) Combined exercise price of Warrants Combined exercise price of Placement Agent’s Warrant Combined exercise price of Placement Agent’s Warrant (after Performance Adjustment) Total discount to market price on date of issuance: Warrant Total discount to market price on date of issuance: Placement Agent’s Warrant Total discount to market price on date of issuance: All Warrants Total discount to market price on date of issuance: Placement Agent’s Warrant (after Performance Adjustment) Total discount to market price on date of issuance: All Warrants including Placement Agent’s Warrant after Performance Adjustment Total discount to market price on date of issuance: All Warrants including Placement Agent’s Warrants combined for February 13, 2008 and June 10, 2008 Total discount to market price on date of issuance: All Warrants including Placement Agent’s Warrants (after Performance Adjustment) combined for February 13, 2008 and June 10, 2008 15

$ $ $

$ $ $ $

$ $

$ $ $ $ $ $ $ $ $ $ $

$ $ $ $ $

3,236,347 4,802,692

The following table shows the possible premium to market price based on the market price on August 1, 2008 which was $2.50 per share. Market price per share of underlying shares of common stock Exercise price per share: Warrants Exercise price per share: Placement Agent’s Warrant (issued on February 13, 2008) Exercise price per share: Placement Agent’s Warrant (issued on June 10, 2008) Exercise price per share: Placement Agent’s Warrant (issued on June 10, 2008) (after Performance Adjustment) No. of shares issuable under Warrants No. of shares issuable under Placement Agent’s Warrant (issued on February 13, 2008) No. of shares issuable under Placement Agent’s Warrant (issued on June 10, 2008) (after Performance Adjustment) Market price of total number of shares underlying Warrants Market price of total number of shares underlying Placement Agent’s Warrant (issued on February 13, 2008) Market price of total number of shares underlying Placement Agent’s Warrant (issued on June 10, 2008) Market price of total number of shares underlying Placement Agent’s Warrant (issued on June 10, 2008) (after Performance Adjustment) Combined exercise price under Warrants Combined exercise price under Placement Agent’s Warrant (issued on February 13, 2008) Combined exercise price under Placement Agent’s Warrant (issued on June 10, 2008) Combined exercise price under Placement Agent’s Warrant (issued on June 10, 2008) (after Performance Adjustment) Total premium if Warrants exercised and sold at market price on July 29, 2008 Total premium if Placement Agent’s Warrant (issued on February 13, 2008) exercised and sold at market on July 29, 2008 Total premium if Placement Agent’s Warrant (issued on June 10, 2008) exercised and sold at market on July 29, 2008 Total premium if all warrants exercised and sold at market on July 29, 2008 Total premium if Placement Agent’s Warrant (issued on June 10, 2008) exercised at $0.65 and sold at market on July 29, 2008 Total premium if all warrants exercised (including June 10, 2008 Placement Agent’s Warrant exercised at $0.65) and sold at market on July 29, 2008 16 $ $ $ $ $ 2.50 1.00 1.00 1.30 0.65 2,250,000 450,000 892,308 5,625,000 1,125,000 1,115,385 2,230,770 2,250,000 450,000 580,000 580,000 3,375,000 675,000 535,385 4,585,385 1,650,770 5,700,770

$ $ $ $ $ $ $ $ $ $ $ $ $ $

The following is a table disclosing (i) the gross proceeds paid to us in connection with the financing transaction, (ii) the payments required to be made by us, (iii) the resulting net proceeds and (iv) the aggregate potential profit realizable by the selling stockholders as a result of discounts to the market price on the date of issuance relating to the conversion price of the 15% Notes and the exercise price of the warrants: % of Net Proceeds 100 % 152 % 241 % 99 % 148 %

Gross proceeds paid to us: All payments required to be made by us: Net proceeds to us: Combined total possible profit assuming conversion of the 15% Notes at $1.30 and resale of the 4,461,533 shares underlying the 15% Notes at the market price at time of issuance Combined total possible profit assuming conversion of the 15% Notes at $0.65 and resale of the 4,461,533 shares underlying the 15% Notes at the market price at time of issuance Combined total possible profit as a result of discounted exercise price of the warrants (including exercise of June 10, 2008 Placement Agent’s warrants at $1.30) on the date of issuance Combined total possible profit as a result of discounted exercise price of the warrants (including exercise of June 10, 2008 Placement Agent’s warrants at $0.65) on the date of issuance 17

Amount $ 5,800,000 $ 2,545,846 $ 3,254,154 $ $ $ $ 4,940,379 7,840,376 3,236,347 4,802,692

The following table shows the total possible profit as a result of the conversion of the 15% Notes at the conversion price and the exercise of the warrants at the exercise price as compared to the market price of the Common Stock on July 29, 2008 which was $2.50 per share . % of Net Proceeds % 100 % 165 % 254 % 141 % 175 %

Gross proceeds paid to issuer: All payments required to be made by us: Net proceeds to us: Combined total possible profit assuming conversion of the 15% Notes at $1.30 and resale of the 4,461,533 shares underlying the 15% Notes at the market price on July 29, 2008 Combined total possible profit assuming conversion of the 15% Notes at $0.65 and resale of the 4,461,533 shares underlying the 15% Notes at the market price on July 29, 2008 Combined total possible profit as a result of discounted exercise price of the warrants (including exercise of June 10, 2008 Placement Agent’s warrants at $1.30) on July 29, 2008 Combined total possible profit as a result of discounted exercise price of the warrants (including exercise of June 10, 2008 Placement Agent’s warrants at $0.65) on July 29, 2008

Amount $ 5,800,000 $ 2,545,846 $ 3,254,154 $ $ $ $ 5,353,840 8,253,836 4,585,385 5,700,770

The following is a table comparing the shares outstanding prior to the financing transaction, the number of shares registered by the selling shareholders, or their affiliates, in prior registration statements (along with that number still held and number sold pursuant to such prior registration statement) and the number of shares registered for resale in this registration statement relating to the financing transaction. Number of shares outstanding on May 15, 2008 held by persons other than the selling shareholders, affiliates of the Company and affiliates of the selling shareholders Number of shares registered for resale by selling shareholders or affiliates in prior registration statements Number of shares registered for resale by selling shareholders or affiliates of selling shareholders that continue to be held by selling shareholders or affiliates of selling shareholders Number of shares that have been sold in registered resales by selling shareholders or affiliates of selling shareholders Number of shares being registered for resale on behalf of selling shareholders or affiliates of selling shareholders in this registration statement 18

80,000 0

0 0

13,457,902

RISK FACTORS An investment in our securities involves a high degree of risk. In determining whether to purchase our securities, you should carefully consider all of the material risks described below, together with the other information contained in this prospectus before making a decision to purchase our securities. You should only purchase our securities if you can afford to suffer the loss of your entire investment. Risks Related to our Business We have a limited operating history for you to evaluate our business. We may never attain profitability. We have been engaged in our line of business since 2002 only. Our proposed operations are therefore subject to all of the risks inherent in light of the expenses, difficulties, complications and delays frequently encountered in connection with the formation of any new business, as well as those risks that are specific to the manufacture of connectors, wire harness and cable assemblies. Investors should evaluate us in light of the delays, expenses, problems and uncertainties frequently encountered by companies developing markets for new products, services and technologies. We may never overcome these obstacles. Our business is speculative and dependent upon the implementation of our business plan and our ability to market our products to third parties on terms that will be commercially viable for us. Disruptions in the supply of copper and other raw materials used in our products could cause us to be unable to meet customer demand, which could result in the loss of customers and net sales. Copper is the primary raw material that we use to manufacture our products. Other significant raw materials that we use are plastics, such as polyethylene and polyvinyl chloride, aluminum, linerboard and wood reels. There are a limited number of domestic and foreign suppliers of copper and these other raw materials. We typically do not have any long term supply agreements for our raw material needs. If we are unable to maintain good relations with our suppliers or if there are any business interruptions at our suppliers, we may not have access to a sufficient supply of raw materials. If we lose one or more key suppliers and are unable to locate an alternative supply, we may not be able to meet customer demand, which could result in the loss of customers and net sales. 19

The markets for our products are highly competitive, and our inability to compete with other manufacturers in the wire and cable industry could harm our net sales and profitability. The markets for wire and cable products are highly competitive. We compete with at least one major competitor in each of our business lines. Many of our products are made to industry specifications and may be considered fungible with our competitors’ products. Accordingly, we are subject to competition in many of our markets primarily on the basis of price. We must also be competitive in terms of quality, availability, payment terms and customer service. We are facing increased competition from products manufactured in many countries that in many cases are comparable in terms of quality but are offered at lower prices. Unless we can produce our products at competitive prices or purchase comparable products from sources on favorable terms, we may experience a decrease in our net sales and profitability. Some of our competitors have greater resources, financial and otherwise, than we do and may be better positioned to invest in manufacturing and supply chain efficiencies and product development. We may not be able to compete successfully with our existing competitors or with new competitors. Our net sales, net income and growth depend largely on the economic strength of the markets that we serve, and if these markets become weaker, we could suffer decreased sales and net income. Many of our customers use our products as components in their own products or in projects undertaken for their customers. Our ability to sell our products is largely dependent on general economic conditions, including how much our customers and end-users spend on information technology, new construction and building, maintaining or reconfiguring their communications network, industrial manufacturing assets and power transmission and distribution infrastructures. A general weakening in any or all of these economic conditions could adversely affect both: (i) the aggregate results of our reportable business segments – electrical/wire and cable distributors, specialty distributors and original equipment manufacturers ( “ OEMs”) and consumer outlets; and (ii) our sales into the multiple channels within these business segments, including electrical distribution, wire and cable distribution, OEM/government, heating, ventilation, air RVs, copper fabrication, retail and automotive. In the early 2000s, many companies significantly reduced their capital equipment and information technology budgets, and construction activity that necessitates the building or modification of communication networks and power transmission and distribution infrastructures slowed considerably as a result of a weakening of the United States and foreign economies. A similar slowdown could result in a decline of our net sales and financial results. 20

We are dependent upon a number of key customers. If they were to cease purchasing our products, our net sales and profitability would likely decline. We are dependent upon a number of key customers. Approximately 57% of our sales in the first quarter of 2008 generated from one customer, Taiwan based Lite-On Group, an electronics group company. Our customers can cease buying our products at any time and can also sell products that compete with our products. The loss of one or more key customers, or a significant decrease in the volume of products they purchase from us, could result in a drop in our net sales and a decline in our profitability. In addition, a disruption or a downturn in the business of one or more key customers could reduce our sales and could reduce our liquidity if we were unable to collect amounts they owe us. We face pricing pressure in each of our markets, and our inability to continue to achieve operating efficiency and productivity improvements in response to pricing pressure may result in lower margins. We face pricing pressure in each of our markets as a result of significant competition and industry over-capacity, and price levels for many of our products (after excluding price adjustments related to the increased cost of copper) have declined over the past few years. We expect pricing pressure to continue for the foreseeable future. A component of our business strategy is to continue to achieve operating efficiencies and productivity improvements with a focus on lowering purchasing, manufacturing and distribution costs. We may not be successful in lowering our costs. In the event we are unable to lower these costs in response to pricing pressure, we may experience lower margins and decreased profitability. 21

Growth through acquisitions is a significant part of our strategy and we may not be able to successfully identify, finance or integrate acquisitions in order to grow our business. Growth through acquisitions has been, and we expect it to continue to be, a significant part of our strategy. We continually evaluate possible acquisition candidates. We may not be successful in identifying, financing and closing acquisitions on favorable terms. Potential acquisitions may require us to obtain additional financing or issue additional equity securities or securities convertible into equity securities, and any such financing and issuance of equity may not be available on terms acceptable to us or at all. If we finance acquisitions by issuing equity securities or securities convertible into equity securities, our existing shareholders could be diluted, which, in turn, could adversely affect the market price of our stock. If we finance an acquisition with debt, it could result in higher leverage and interest costs. Further, we may not be successful in integrating any such acquisitions that are completed. Integration of any such acquisitions may require substantial management, financial and other resources and may pose risks with respect to production, customer service and market share of existing operations. In addition, we may acquire businesses that are subject to technological or competitive risks, and we may not be able to realize the benefits expected from such acquisitions. We may be unable to obtain additional capital that we will require to implement our business plan, which could restrict our ability to grow. We expect that our current capital and our other existing resources will be sufficient only to provide a limited amount of working capital, and the revenues generated from sale of our products alone may not be sufficient to fund our operations or planned growth. We will likely require additional capital to continue to operate our business beyond the initial phase of our current operations, and to further expand our business. We may be unable to obtain additional capital required. Furthermore, inability to maintain capital may damage our reputation and credibility with industry participants. Our inability to raise additional funds when required may have a negative impact on our operations and financial results. 22

Future acquisitions and future development, production and marketing activities, as well as our administrative requirements (such as salaries and general overhead expenses, as well as legal compliance costs and accounting expenses) will require a substantial amount of additional capital and cash flow. We plan to pursue sources of additional capital through various financing transactions or arrangements, including joint venturing of projects, debt financing, equity financing or other means. We may not be successful in locating suitable financing transactions in the time period required or at all, and we may not obtain the capital we require by other means. If we do not succeed in raising additional capital, the capital received through this offering may not be sufficient to fund our operations going forward without obtaining additional capital financing. Any additional capital raised through the sale of equity may dilute your ownership percentage. This could also result in a decrease in the fair market value of our equity securities because our assets would be owned by a larger pool of outstanding equity. The terms of securities we issue in future capital transactions may be more favorable to our new investors, and may include preferences, superior voting rights and the issuance of warrants or other derivative securities, and issuances of incentive awards under equity employee incentive plans, which may have a further dilutive effect. Our ability to obtain needed financing may be impaired by such factors as the capital markets (both generally and in the cable and connector industry in particular), our status as a relatively new enterprise with a limited demonstrated operating history, and/or the loss of key management. If the amount of capital we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs (even to the extent that we reduce our operations), we may be required to cease our operations. 23

We may incur substantial costs in pursuing future capital financing, including investment banking fees, legal fees, accounting fees, securities law compliance fees, printing and distribution expenses and other costs. We may also be required to recognize non-cash expenses in connection with certain securities we may issue, such as convertible notes and warrants, which may adversely impact our financial condition. We may not be able to effectively manage our growth, which may harm our profitability . Our strategy envisions expanding our business. If we fail to effectively manage our growth, our financial results could be adversely affected. Growth may place a strain on our management systems and resources. We must continue to refine and expand our business development capabilities, our systems and processes and our access to financing sources. As we grow, we must continue to hire, train, supervise and manage new employees. We cannot assure you that we will be able to:  meet our capital needs;  expand our systems effectively or efficiently or in a timely manner;  allocate our human resources optimally;  identify and hire qualified employees or retain valued employees; or  incorporate effectively the components of any business that we may acquire in our effort to achieve growth. If we are unable to manage our growth, our operations and our financial results could be adversely affected by inefficiency, which could diminish our profitability. 24

Loss of Agatha Shen, our Chairman and CFO, and Peter Chang, our President, could impair our ability to operate. If we lose our key employees, Agatha Shen, our Chairman and CFO, and Peter Chang, our President, our business could suffer. Our success is highly dependent on our ability to attract and retain qualified scientific and management personnel. We are highly dependent on our management. Each of these individuals has an employment agreement with the Company. However, the loss of each of these person’s services could have a material adverse effect on our operations. If we were to lose these individuals, we may experience difficulties in competing effectively, developing our technology and implementing our business strategies. We do not have key-man life insurance in place for any person working for us. Our management team does not have extensive experience in public company matters, which could impair our ability to comply with legal and regulatory requirements. Our management team has had limited public company management experience or responsibilities. This could impair our ability to comply with legal and regulatory requirements such as the Sarbanes-Oxley Act of 2002 and applicable federal securities laws including filing required reports and other information required on a timely basis. There can be no assurance that our management will be able to implement and affect programs and policies in an effective and timely manner that adequately respond to increased legal, regulatory compliance and reporting requirements imposed by such laws and regulations. Our failure to comply with such laws and regulations could lead to the imposition of fines and penalties and further result in the deterioration of our business. 25

Risks Related to Conducting Business in the People’s Republic of China (PRC) Changes in the political and economic policies of the PRC government could have a material adverse effect on our operations. Most of our operations are conducted in the PRC. As such, our business operations may be adversely affected by the political and economic environment in the PRC. The PRC has operated as a socialist state since 1949 and is controlled by the Communist Party of China. As a result, the economy of the PRC differs from the economies of most developed countries in many respects, including, but not limited to:         structure capital re-investment government involvement allocation of resources level of development control of foreign exchange growth rate rate of inflation

In recent years, the government has introduced measures aimed at creating a “socialist market economy” and policies have been implemented to allow business enterprises greater autonomy in their operations. Nonetheless, a substantial portion of productive assets in the PRC is still owned by the PRC government. Changes in the political leadership of the PRC may have a significant affect on laws and policies related to the current economic reforms program, other policies affecting business and the general political, economic and social environment in the PRC, including the introduction of measures to control inflation, changes in the rate or method of taxation, the imposition of additional restrictions on currency conversion and remittances abroad, and foreign investment. Moreover, economic reforms and growth in the PRC have been more successful in certain provinces in the PRC than in others, and the continuation or increases of such disparities could affect the political or social stability in the PRC. The future direction of these economic reforms is uncertain and the uncertainty may decrease the attractiveness of our company as an investment, which may in turn materially adversely affect the price at which our stock trades. 26

Social conditions in the PRC could have a material adverse effect on our operations as the PRC government continues to exert substantial influence over the manner in which we must conduct our business activities. The PRC only recently has permitted provincial and local economic autonomy and private economic activities. The government of the PRC has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in the PRC may be adversely affected by changes in Chinese laws and regulations, including those relating to taxation, import and export tariffs, environmental regulations, land use rights, property and other matters. We believe our operations in China are in compliance with all applicable legal and regulatory requirements. However, the central or local governments may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations. Were the PRC government, or local municipalities, to limit our ability to develop, produce, import or sell our products in the PRC, or to finance and operate our business in the PRC, our business could be adversely affected. The Chinese government exerts substantial influence over the manner in which we must conduct our business activities. China only recently has permitted provincial and local economic autonomy and private economic activities. Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, import and export tariffs, environmental regulations, land use rights, property and other matters. 27

Government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties or joint ventures. Future inflation in China may inhibit our activity to conduct business in China. In recent years, the Chinese economy has experienced periods of rapid expansion and high rates of inflation. During the past ten years, the rate of inflation in China has been as high as 20.7% and as low as -2.2%. These factors have led to the adoption by Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. While inflation has been more moderate since 1995, high inflation may in the future cause Chinese government to impose controls on credit and/or prices, or to take other action, which could inhibit economic activity in China, and thereby harm the market for our products. Restrictions on currency exchange may limit our ability to receive and use our revenues effectively. Although the functional currency of the Company is the Hong Kong Dollar, the majority of our operating revenues at the subsidiary level will be settled in Renminbi, and any future restrictions on currency exchanges may limit our ability to use revenue generated in Renminbi to fund any future business activities outside China or to make dividend or other payments in U.S. dollars. Although the Chinese government introduced regulations in 1996 to allow greater convertibility of the Renminbi for current account transactions, significant restrictions still remain, including primarily the restriction that foreign-invested enterprises may only buy, sell or remit foreign currencies after providing valid commercial documents, at those banks in China authorized to conduct foreign exchange business. In addition, conversion of Renminbi for capital account items, including direct investment and loans, is subject to governmental approval in China, and companies are required to open and maintain separate foreign exchange accounts for capital account items. We cannot be certain that the Chinese regulatory authorities will not impose more stringent restrictions on the convertibility of the Renminbi. 28

Currently, since our primary operations are in the PRC, most of our revenues will be settled in RMB. Due to certain restrictions on currency exchanges that exist in the PRC, our ability to use revenue generated in RMB to pay any dividend payments to its shareholders may be limited. The value of our securities will be affected by the foreign exchange rate between U.S. dollars and Renminbi. The value of our common stock will be affected by the foreign exchange rate between the Hong Kong Dollar and Renminbi, and between those currencies and other currencies in which our sales may be denominated. For example, to the extent that we need to convert U.S. dollars into Renminbi for our operational needs and should the Renminbi appreciate against the U.S. dollar at that time, our financial position, the business of the Company, and the price of our common stock may be harmed. Conversely, if we decide to convert our Renminbi into U.S. dollars for the purpose of declaring dividends on our common stock or for other business purposes and the U.S. dollar appreciates against the Renminbi, the U.S. dollar equivalent of our earnings from our subsidiaries in China would be reduced. Risks Related to our Common Stock There has been a limited trading market for our common stock and no market. It is anticipated that there will be a limited trading market for the Company’s common stock on the FINRA administered Over-the-Counter Bulletin Board (“OTCBB”). The lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable. The lack of an active market may also reduce the fair market value of your shares. An inactive market may also impair our ability to raise capital by selling shares of capital stock and may impair our ability to acquire other companies or technologies by using common stock as consideration. 29

You may have difficulty trading and obtaining quotations for our common stock. The common stock may not be actively traded, and the bid and asked prices for our common stock on the OTCBB may fluctuate widely. As a result, investors may find it difficult to dispose of, or to obtain accurate quotations of the price of, our securities. This severely limits the liquidity of the common stock, and would likely reduce the market price of our common stock and hamper our ability to raise additional capital. The market price of our common stock may, and is likely to continue to be, highly volatile and subject to wide fluctuations. The market price of our common stock is likely to be highly volatile and could be subject to wide fluctuations in response to a number of factors that are beyond our control, including:  dilution caused by our issuance of additional shares of common stock and other forms of equity securities, which we expect to make in this offering and in connection with future capital financings to fund our operations and growth, to attract and retain valuable personnel and in connection with future strategic partnerships with other companies;  announcements of new acquisitions or other business initiatives by our competitors;  our ability to take advantage of new acquisitions or other business initiatives;  quarterly variations in our revenues and operating expenses;  changes in the valuation of similarly situated companies, both in our industry and in other industries;  changes in analysts’ estimates affecting our Company, our competitors and/or our industry; 30

 changes in the accounting methods used in or otherwise affecting our industry;  additions and departures of key personnel;  fluctuations in interest rates and the availability of capital in the capital markets; and  significant sales of our common stock, including sales by the investors following registration of the shares of common stock issued in this Offering and/or future investors in future offerings we expect to make to raise additional capital. These and other factors are largely beyond our control, and the impact of these risks, singly or in the aggregate, may result in material adverse changes to the market price of our common stock and/or our results of operations and financial condition. Our operating results may fluctuate significantly, and these fluctuations may cause our stock price to decline. Our operating results will likely vary in the future primarily as the result of fluctuations in our revenues and operating expenses, expenses that we incur, the prices of raw materials we use in the commodities markets and other factors. If our results of operations do not meet the expectations of current or potential investors, the price of our common stock may decline. We do not expect to pay dividends in the foreseeable future. We do not intend to declare dividends for the foreseeable future, as we anticipate that we will reinvest any future earnings in the development and growth of our business. Therefore, investors will not receive any funds unless they sell their common stock, and stockholders may be unable to sell their shares on favorable terms or at all. Investors cannot be assured of a positive return on investment or that they will not lose the entire amount of their investment in the common stock. 31

Investors in this offering will experience dilution upon the exercise of warrants or options. As a result of the share exchange pursuant to the Exchange Agreement, there are warrants to purchase 2,250,000 shares of Common Stock outstanding, which if exercised, could decrease the net tangible book value of your Common Stock. There are also warrants to purchase 896,154 shares of our Common Stock outstanding, which were issued to Primary Capital, LLC for investment banking services. Further, the sale or availability for sale of the underlying shares in the marketplace could depress our stock price. We agreed to register for resale all of the underlying shares described above. Holders of registered underlying shares could resell the shares immediately upon registration, resulting in significant downward pressure on our stock price. Directors and officers of the Company will have a high concentration of Common Stock ownership . Based on the 21,984,215 shares of Common Stock that are estimated to be outstanding as of the date hereof, our officers and directors will beneficially own 15,250,000 shares, or approximately 69% of our outstanding Common Stock. Such a high level of ownership by such persons may have a significant effect in delaying, deferring or preventing any potential change in control of the Company. Additionally, as a result of their high level of ownership, our officers and directors might be able to strongly influence the actions of the Company’s board of directors and the outcome of actions brought to our shareholders for approval. Such a high level of ownership may adversely affect the voting and other rights of our shareholders. 32

Applicable SEC rules governing the trading of “penny stocks” limit the trading and liquidity of our common stock, which may affect the trading price of our common stock. Shares of Common Stock may be considered a “penny stock” and be subject to SEC rules and regulations which impose limitations upon the manner in which such shares may be publicly traded and regulate broker-dealer practices in connection with transactions in “penny stocks.” Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the Financial Industry Regulatory Authority (“FINRA”) automated quotation system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. In addition, the penny stock rules generally require that prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules which may increase the difficulty investors may experience in attempting to liquidate such securities. ABOUT THIS PROSPECTUS You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information other than that contained in this prospectus. The selling stockholders are offering to sell and seeking offers to buy shares of our common stock, including shares they acquire on exercise of their warrants, only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common stock. The prospectus will be updated and updated prospectuses made available for delivery to the extent required by the federal securities laws. 33

No person is authorized in connection with this prospectus to give any information or to make any representations about us, the selling stockholders, the securities or any matter discussed in this prospectus, other than the information and representations contained in this prospectus. If any other information or representation is given or made, such information or representation may not be relied upon as having been authorized by us or any selling stockholder. This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy the securities in any circumstances under which the offer or solicitation is unlawful. Neither the delivery of this prospectus nor any distribution of securities in accordance with this prospectus shall, under any circumstances, imply that there has been no change in our affairs since the date of this prospectus. The prospectus will be updated and updated prospectuses made available for delivery to the extent required by the federal securities laws. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND OTHER INFORMATION CONTAINED IN THIS PROSPECTUS This prospectus contains some forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. Forward-looking statements involve risks and uncertainties. Forward-looking statements include statements regarding, among other things, (a) our projected sales, profitability and cash flows, (b) our growth strategies, (c) anticipated trends in our industries, (d) our future financing plans and (e) our anticipated needs for working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plan,” “potential,” “projects,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend” or the negative of these words or other variations on these words or comparable terminology. These statements may be found under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” as well as in this prospectus generally. In particular, these include statements relating to future actions, future performance, sales efforts, expenses, the outcome of contingencies such as legal proceedings, and financial results. Any or all of our forward-looking statements in this prospectus may turn out to be inaccurate. They can be affected by inaccurate assumptions we might make or by known or unknown risks or uncertainties. Consequently, no forward-looking statement can be guaranteed. Actual future results may vary materially as a result of various factors, including, without limitation, the risks outlined under “Risk Factors” and matters described in this prospectus generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact occur and you should not place undue reliance on these forward-looking statements. 34

CURRENCY, EXCHANGE RATE AND OTHER REFERENCES Unless otherwise noted, all currency figures in this filing are in U.S. dollars. References to “yuan” or “RMB” are to the Chinese yuan, which is also known as the renminbi. According to the currency exchange website www.xe.com, on July 29, 2008, $1.00 was equivalent to 6.83 yuan. SELLING STOCKHOLDERS This prospectus relates to the offer and sale of our common stock by the selling stockholders identified in the table below. Except as described below, none of the selling stockholders has held a position as an officer or director of the Company, nor has any selling stockholder had a material relationship of any kind with the Company. The table set forth below lists the names of the selling stockholders as well as (1) the number of shares underlying the 15% Notes acquired by each of the selling stockholders in a private placement that are being registered, (2) the number of shares underlying the placement agent warrants issued to Primary Capital, LLC in a private placement (in connection with the sale of the 15% Notes) that are being registered, (3) the number of shares issued in a private placement in exchange for the 10% Secured Convertible Notes (the “10% Notes”) of Shing Mei to the selling stockholders, who had been investors in the 10% Notes, which are being registered, (4) the number of shares underlying the warrants issued by the Company in exchange for the warrants to purchase shares of Shing Mei to each of the selling stockholders that are being registered, (5) the number of shares underlying the placement agent warrants issued to Primary Capital, LLC in a private placement in exchange for the placement agent warrants to purchase shares of Shing Mei issued in a private placement to Primary Capital, LLC that are being registered, and (6) the number of shares issued to Primary Capital, LLC in a private placement in exchange for fees and expenses paid by Primary Capital, LLC on behalf of the Company and for merger, acquisition and investment banking advisory services provided to the Company that are being registered. 35

Each selling stockholder may offer for sale all or part of the shares from time to time. The table below assumes that the selling stockholders will sell all of the shares offered for sale. A selling stockholder is under no obligation, however, to sell any shares pursuant to this prospectus. After due inquiry and investigation and based on information provided by the selling stockholders, none of the selling stockholders has an existing short position in our stock. Other than as described in this prospectus, we have not in the past engaged in any securities transaction with any of the selling stockholders, any affiliates of the selling stockholders, or, after due inquiry and investigation, to the knowledge of the management of the Company, any person with whom any selling stockholder has a contractual relationship regarding the transaction (or any predecessors of those persons). In addition, other than in connection with the contractual obligations set forth in (i) securities exchange agreement (the “Exchange Agreement”) entered into between Shing Mei and the Company, (ii) the note purchase agreement entered into between the Company and each of the selling stockholders who invested in the private placement, (iii) the agreement entered into by Shing Mei and the placement agent, and (iv) the securities purchase agreement entered into by Shing Mei and the purchasers listed as parties thereto, we do not have any agreement or arrangement with any selling stockholder with respect to the performance of any current or future obligations. Except as described below, none of the selling stockholders is a broker-dealer, or an affiliate of a broker-dealer. 36

Name of Selling Stockholder Peter Treadway (4) Janet Wang (5) Chesnut Ridge Partners, LP (6) Ancora Greater China Fund, LP (7) Li Jun Zheng (8) Wu Qin Chuan (9) Chen Li Ren (10) Zhe Jing (11) Ai Zhen Lu (12) Feng Chao Liang (13) Hui Qi Wu (14) Wang Ling Ming (15) Yan Chen (16) Jin Cheng Yue (17) Cao Xue Lei & Du Yan (18) Zi Cheng Wang (19) Lin Yan (20) Bi Jun Chang (21) Xinguo Qiang (22) James Wiyaka Adiprana (23) eFuture International Limited (24) Manilal Patel (25) Brent Andrus (26) Stuart E. Feick (27) CK Strategic Income Ventures Limited (28) Hwan Koo Kim (29) Barry James Buckley (30) Professional Offshore Opportunity Fund Ltd. (31) Xuguang Sun (32) Strategic Alliance Fund II, L.P. (33) Growth Ventures, Inc. Pension Plan & Trust (34) Strategic Alliance Fund, L.P. (35) Jeffrey A. Grossman (36) MGG III Properties LLC (37) John Tammaro (38) Primary Capital LLC (39) Tai-Hwa Ho (40) Tobias Lenza (41) Jimmy Sung (42) Steven L. White (43) 1 st Orion Corp. (44) David Lockton (45) Peter Poland (46) George Raney (47) Daniel Carlson (48) Huifeng Chang (49) Ming Liu (50) Oubo Jin (51) Pan Jun (52)

Number of shares of Common Stock beneficially owned before the offering (1) 57,692 38,461 230,769 815,192 230,769 76,923 76,923 76,923 76,923 153,846 76,923 153,846 38,461 76,923 461,538 76,923 76,923 76,923 153,846 76,923 384,615 152,673 153,846 38,461 692,308 384,615 384,615 3,676,437 409,050 303,000 303,000 227,250 151,500 30,300 20,150 2,109,903 191,963 32,908 49,363 202,295 270,000 6,000 2,000 18,000 100,000 2,500 25,000 100,000 2,500

Percent of shares of Common Stock beneficially owned before the offering (2) * * 1.0 % 3.7 % 1% * * * * * * * * * 2.0 % * * * * * 1.7 % * * * 3.0 % 1.7 % 1.7 % 15.7 %(31) 1.8 % 1.4 % 1.4 % 1.0 % * * * 9.2 % * * * * 1.2 % * * * * * * * *

Number of shares of Common Stock being offered 57,692 38,461 230,769 815,192 230,769 76,923 76,923 76,923 76,923 153,846 76,923 153,846 38,461 76,923 461,538 76,923 76,923 76,923 153,846 76,923 384,615 152,673 153,846 38,461 692,308 384,615 384,615 3,676,437 409,050 303,000 303,000 227,250 151,500 30,300 20,150 2,109,903 191,963 32,908 49,363 202,295 200,000 6,000 2,000 18,000 100,000 2,500 25,000 100,000 2,500

Number of shares of Common Stock beneficially owned after the offering (3) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 70,000 0 0 0 0 0 0 0 0

Percent of shares of Common Stock Beneficially owned after the offering (2) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 * 0 0 0 0 0 0 0 0

37

* (1)

Less than 1%. Under applicable SEC rules, a person is deemed to beneficially own securities which the person has the right to acquire within 60 days through the exercise of any option or warrant or through the conversion of another security. Also under applicable SEC rules, a person is deemed to be the “beneficial owner” of a security with regard to which the person directly or indirectly, has or shares (a) the voting power, which includes the power to vote or direct the voting of the security, or (b) the investment power, which includes the power to dispose, or direct the disposition, of the security, in each case, irrespective of the person’s economic interest in the security. Each listed selling stockholder has the sole investment and voting power with respect to all shares of common stock shown as beneficially owned by such selling stockholder, except as otherwise indicated in the table. 38

(2)

(3) (4) (5) (6) (7)

(8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19)

As of July 29, 2008 there were 21,984,215 shares of our common stock issued and outstanding. In determining the percent of common stock beneficially owned by a selling stockholder on July 29, 2008, (a) the numerator is the number of shares of common stock beneficially owned held by such selling stockholder (including shares that he has the right to acquire within 60 days of July 29, 2008 ), and (b) the denominator is the sum of (i) the 21,984,215 shares outstanding on July 29, 2008 and (ii) the number of shares of common stock which such selling stockholders has the right to acquire within 60 days of July 29, 2008. All of the shares held by each selling stockholder are being registered. Accordingly, assuming all the shares in the offering are sold, the number of shares beneficially owned after the offering will be zero and the percentage will be zero. Includes 57,692 shares issuable upon conversion of the 15% Notes. Includes 38,461 shares issuable upon conversion of the 15% Notes. Includes 230,769 shares issuable upon conversion of the 15% Notes. Kenneth Pasternak has sole voting and dispositive power over the shares held by Chestnut Ridge Partners, LP. Includes 57,692 shares issuable upon conversion of the 15% Notes, 507,500 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 250,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Ancora Greater China Fund, LP is an affiliate of a broker-dealer. Ancora Greater China Fund, LP certified to us that it bought the above mentioned securities in the ordinary course of business, and at the time of the purchase of these securities, it had no agreements or understandings, directly or indirectly, with any person to distribute these securities. John P. Micklitish has sole voting and dispositive power over the shares held by Ancora Greater China Fund, LP. Includes 230,769 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 153,846 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 153,846 shares issuable upon conversion of the 15% Notes. Includes 38,461 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 461,538 shares issuable upon conversion of the 15% Notes. Cao Xue Lei and Du Yan have shared voting and dispositive power over these shares. Includes 76,923 shares issuable upon conversion of the 15% Notes. 39

(20) (21) (22) (23) (24) (25)

(26) (27) (28) (29) (30) (31)

(32)

(33)

(34)

Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 153,846 shares issuable upon conversion of the 15% Notes. Includes 76,923 shares issuable upon conversion of the 15% Notes. Includes 384,615 shares issuable upon conversion of the 15% Notes. Xuguang Sun has sole voting and dispositive power over the shares held by eFuture International Limited. Includes 76,923 shares issuable upon conversion of the 15% Notes, 50,750 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 25,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing . Includes 153,846 shares issuable upon conversion of the 15% Notes. Includes 38,461 shares issuable upon conversion of the 15% Notes. Includes 692,308 shares issuable upon conversion of the 15% Notes. Eric Ng and Benson Beh have shared voting and dispositive power over the shares held by CK Strategic Income Ventures Limited. Includes 384,615 shares issuable upon conversion of the 15% Notes. Includes 384,615 shares issuable upon conversion of the 15% Notes. Includes 2,176,437 shares issued under the Exchange Agreement in exchange for a promissory note evidencing debt obligations by Shing Mei, and 1,500,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. A portion of the promissory note representing 868,563 shares of common stock remains unconverted because of the limitation on its conversion which makes the promissory note unconvertible to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock. The warrants contain limitation on their exercise, which makes the warrants unexercisable to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock. Howard Berger has sole voting and dispositive power over the shares held by Professional Offshore Opportunity Fund Ltd. Includes 274,050 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 135,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Includes 203,000 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 100,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Strategic Alliance Fund II, L.P is an affiliate of a broker-dealer and certified to us that it bought the above mentioned securities in the ordinary course of business, and at the time of the purchase of these securities, it had no agreements or understandings, directly or indirectly, with any person to distribute these securities. Daniel Carlson and John C. Leo have shared voting and dispositive power over the shares held by Strategic Alliance Fund II, L.P. Includes 203,000 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 100,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Gary McAdam has sole voting and dispositive power over the shares held by Growth Venture Inc., Pension Plan and Trust. 40

(35)

(36)

(37)

(38)

(39)

(40) (41) (42)

Includes 152,250 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 75,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Strategic Alliance Fund, L.P is an affiliate of a broker-dealer and certified to us that it bought the above mentioned securities in the ordinary course of business, and at the time of the purchase of these securities, it had no agreements or understandings, directly or indirectly, with any person to distribute these securities. Daniel Carlson and John C. Leo have shared voting and dispositive power over the shares held by Strategic Alliance Fund, L.P. Includes 101,500 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 50,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. Includes 20,300 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, and 10,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing. MGG III Properties LLC is an affiliate of a broker-dealer and certified to us that it bought the above mentioned securities in the ordinary course of business, and at the time of the purchase of these securities, it had no agreements or understandings, directly or indirectly, with any person to distribute these securities. Marcello Gualda has sole voting and dispositive power over the shares held by MGG III Properties LLC. Includes 10,150 shares issued under the Exchange Agreement in exchange for promissory note evidencing debt obligations by Shing Mei, 5,000 shares issuable upon exercise of the warrants issued under the Exchange Agreement in exchange for warrants of Shing Mei issued previously in the bridge financing, and 5,000 shares received from Primary Capital, LLC in consideration for consulting services rendered. John Tammaro is an associated person of Primary Capital, LLC. Includes 1,213,749 shares and 450,000 shares upon exercise of the placement agent warrants issued to Primary Capital, LLC for the bridge financing and other investment banking services, and 446,154 shares issuable upon exercise of the placement agent warrants issued in connection with the sale of the 15% Notes. Primary Capital, LLC is a FINRA member broker-dealer. We do not have any arrangement with Primary Capital, LLC for it to act as a broker-dealer for the sale of the shares included herein for the selling stockholders. Primary Capital, LLC may be deemed to be an underwriter with respect to its respective sales of shares to be offered by them in this prospectus. Primary Capital, LLC served as placement agent and consultant in connection with our private financing in May 2008, Reverse Merger in February 2008 and bridge financing of Shing Mei in December 2007. John C. Leo has sole voting and dispositive power over the shares held by Primary Capital, LLC. Includes 191,963 shares received from Primary Capital, LLC in consideration for consulting services rendered. Tai-Hwa Ho is an associated person of Primary Capital, LLC Includes 32,908 shares received from Primary Capital, LLC in consideration for consulting services rendered. Tobias Lenza is an associated person of Primary Capital, LLC. Includes 49,363 shares received from Primary Capital, LLC in consideration for consulting services rendered. Jimmy Sung is an associated person of Primary Capital, LLC. 41

(43)

(44) (45) (46) (47) (48)

(49) (50) (51) (52)

Prior to February 13, 2008, Steven L. White owned 8,000,000 post-split shares of our common stock or approximately 93% of our outstanding common stock, and served as our sole officer and director. Therefore, Steven L. White could be deemed to have been our affiliate at that time. Includes 254,000 shares owned prior to February 13, 2008 and 16,000 shares acquired in ordinary brokerage transactions . Laura Lee Madsen has sole voting and dispositive power over the shares held by 1 st Orion Corp. Includes 6,000 shares owned prior to February 13, 2008. Includes 2,000 shares owned prior to February 13, 2008. Includes 18,000 shares owned prior to February 13, 2008. Includes 100,000 shares received from Primary Capital, LLC in consideration for consulting services rendered. Daniel Carlson is an associated person of Primary Capital, LLC and have shared voting and dispositive power over shares held by Strategic Alliance Fund, L.P. and by Strategic Alliance Fund II, L.P. Includes 2,500 shares received from Primary Capital, LLC in consideration for consulting services rendered. Huifeng Chang is an associated person of Primary Capital, LLC. Includes 25,000 shares received from Primary Capital, LLC in consideration for consulting services rendered. Ming Liu is an associated person of Primary Capital, LLC. Includes 100,000 shares received from Primary Capital, LLC in consideration for consulting services rendered. Oubo Jin is an associated person of Primary Capital, LLC. Includes 2,500 shares received from Primary Capital, LLC in consideration for consulting services rendered. Pan Jun is an associated person of Primary Capital, LLC. Plan of Distribution

The selling security holders and any of their pledgees, donees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of Common Stock being offered under this prospectus on any stock exchange, market or trading facility on which shares of our Common Stock are traded or in private transactions. These sales may be at fixed or negotiated prices. The selling security holders may use any one or more of the following methods when disposing of shares:  ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

42



block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; purchases by a broker-dealer as principal and resales by the broker-dealer for its account; an exchange distribution in accordance with the rules of the applicable exchange; privately negotiated transactions; to cover short sales made after the date that the registration statement of which this prospectus is a part is declared effective by the Commission; broker-dealers may agree with the selling security holders to sell a specified number of such shares at a stipulated price per share; a combination of any of these methods of sale.

   

 

The shares may also be sold under Rule 144 under the Securities Act of 1933, as amended (“Securities Act”), or any exemption from registration under the Securities Act if available, rather than under this prospectus. The selling security holders have the sole and absolute discretion not to accept any purchase offer or make any sale of shares if they deem the purchase price to be unsatisfactory at any particular time. The selling security holders may pledge their shares to their brokers under the margin provisions of customer agreements. If a selling security holder defaults on a margin loan, the broker may, from time to time, offer and sell the pledged shares. Broker-dealers engaged by the selling security holders may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling security holders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated, which commissions as to a particular broker or dealer may be in excess of customary commissions to the extent permitted by applicable law. 43

If sales of shares offered under this prospectus are made to broker-dealers as principals, we would be required to file a post-effective amendment to the registration statement of which this prospectus is a part. In the post-effective amendment, we would be required to disclose the names of any participating broker-dealers and the compensation arrangements relating to such sales. The selling security holders and any broker-dealers or agents that are involved in selling the shares offered under this prospectus may be deemed to be “underwriters” within the meaning of the Securities Act in connection with these sales. Commissions received by these broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Any broker-dealers or agents that are deemed to be underwriters may not sell shares offered under this prospectus unless and until we set forth the names of the underwriters and the material details of their underwriting arrangements in a supplement to this prospectus or, if required, in a replacement prospectus included in a post-effective amendment to the registration statement of which this prospectus is a part. The selling security holders and any other persons participating in the sale or distribution of the shares offered under this prospectus will be subject to applicable provisions of the Exchange Act, and the rules and regulations under that act, including Regulation M. These provisions may restrict activities of, and limit the timing of purchases and sales of any of the shares by, the selling security holders or any other person. Furthermore, under Regulation M, persons engaged in a distribution of securities are prohibited from simultaneously engaging in market making and other activities with respect to those securities for a specified period of time prior to the commencement of such distributions, subject to specified exceptions or exemptions. All of these limitations may affect the marketability of the shares. 44

If any of the shares of Common Stock offered for sale pursuant to this prospectus are transferred other than pursuant to a sale under this prospectus, then subsequent holders could not use this prospectus until a post-effective amendment or prospectus supplement is filed, naming such holders. We offer no assurance as to whether any of the selling security holders will sell all or any portion of the shares offered under this prospectus. We have agreed to pay all fees and expenses we incur incident to the registration of the shares being offered under this prospectus. However, each selling security holder and purchaser is responsible for paying any discounts, commissions and similar selling expenses they incur. We and the selling security holders have agreed to indemnify one another against certain losses, damages and liabilities arising in connection with this prospectus, including liabilities under the Securities Act. USE OF PROCEEDS We will not receive any of the proceeds from the sales of the shares of the Common Stock by the selling stockholders. To the extent the warrants are exercised for cash, if at all, we will receive the exercise price for those warrants. Under the terms of the warrants cashless exercise is permitted, but only if the underlying shares have not been registered at any time following the date of issuance of the warrants. We will receive cash proceeds of $1,125,000 if the warrants are exercised. We will receive cash proceeds of $1,030,000 if the Placement Agent Warrants are exercised. Thus, we will receive total cash proceeds of $2,155,000 ($1,125,000 plus $1,030,000) if all the warrants currently issued and outstanding are exercised. We intend to use any cash proceeds received from the exercise of the warrants for working capital and other general corporate purposes. We cannot assure you that any of the warrants will ever be exercised for cash or at all. 45

BUSINESS Corporate History SJ Electronics, Inc. (the “Company” or “SJ Electronics”) was originally formed in the State of Nevada on June 23, 1994 as Harvest E-xpress. On May 1, 1997, we changed our name to HLS (USA), Inc. On April 13, 2006, we changed our name to Acheron, Inc. On March 20, 2008, we changed our name to SJ Electronics, Inc. Originally, SJ Electronics’s business was grain cutting and custom machine hire. It did not succeed in its business and it began seeking another opportunity. In 1997, SJ Electronics purchased HLS Corporation Unlimited to pursue the business of HLS whose assets consisted of securities representing approximately a 46% indirect interest in Henan Xinfei Co. Ltd., a Sino-foreign equity joint venture engaged in the manufacture and sale of refrigerators and freezers in China. The terms of the acquisition were never met and in August 1999, it completed the unwinding of the transaction with HLS and SJ Electronics has been inactive since that time. Reverse Merger On February 13, 2008, the Company entered into and completed the transactions contemplated under a Securities Exchange Agreement (the “Exchange Agreement”) with Yu-ping “Agatha” Shen, the sole shareholder (the “Shareholder”) of Shing Mei Enterprises Ltd., a corporation organized under the laws of Samoa (“Shing Mei”), pursuant to which the Company purchased from the Shareholder all issued and outstanding shares of Shing Mei’s common stock in consideration for the issuance of 15,000,000 shares of Common Stock of the Company, (the “Share Exchange”). The Share Exchange resulted in a change in control of the Company with the Shareholder owning 15,000,000 shares of Common Stock of the Company out of a total of 21,984,215 issued and outstanding shares after giving effect to the Share Exchange, or approximately 68%. Also, the Shareholder was elected a director of the Company (as well as certain of Shareholder’s nominees) and appointed as its executive officer. As a result of the Exchange Agreement, (i) Shing Mei became a wholly-owned subsidiary of the Company and (ii) the Company succeeded to the business of Shing Mei as its sole business. Following this transaction, the Company changed its name to SJ Electronics, Inc. 46

Also, under the Exchange Agreement, the Company issued to a number of accredited investors who previously had provided bridge financing to Shing Mei, 3,698,937 shares of its Common Stock in exchange for the 10% Secured Convertible Notes (the “10% Notes”) of Shing Mei and five year warrants to purchase 2,250,000 shares at $1.00 per share in exchange for warrants to purchase Shing Mei shares issued in connection with the sale of the 10% Notes. The number of shares issued to the investors in the 10% Notes of Shing Mei did not include 868,563 shares issuable to one of the investors in payment of the unconverted portion of that investor’s 10% Note. These shares were not issued because of the limitation on conversion of the 10% Notes which makes the notes unconvertible to the extent the holder would upon exercise, beneficially own more than 9.9% of common stock of SJ Electronics, Inc. In addition, the Company issued a total of 1,828,222 shares of Common Stock to Primary Capital, LLC in compensation for fees and expenses paid by Primary Capital, LLC on behalf of SJ Electronics, Inc., and for merger, acquisition and investment banking advisory services rendered, and warrants to purchase 450,000 shares of common stock to Primary Capital, LLC in exchange for warrants of Shing Mei issued previously to Primary Capital, LLC in connection with the sale of the 10% Notes of Shing Mei. The Company agreed to file with the SEC a registration statement for the resale of all the shares issued or issuable under the Exchange Agreement upon conversion of the 10% Notes and exercise of the warrants issued in exchange for the bridge warrants. Recent Developments May 2008 Private Placement On May 15, 2008 the Company entered into and consummated a Note Purchase Agreement (the “Note Purchase Agreement”) to sell to certain accredited investors and to non-US persons the 15% Notes at closings to occur on or before July 31, 2008. On May 15, 2008 the first closing under the Note Purchase Agreement took place at which the Company sold to certain investors and to non-US persons the 15% Notes in the aggregate principal amount of $2,950,000. On May 30, 2008 the second closing under the Note Purchase Agreement took place at which the Company sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $700,000. On June 10, 2008 the third and the final closing under the Note Purchase Agreement took place at which the Company sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $2,150,000. The aggregate principal amount of the 15% Notes sold at all three closings under the Note Purchase Agreement was $5,800,000. 47

The 15% Notes mature one year after the date of issuance. The 15% Notes pay interest at the rate of 15% per annum. All principal and accrued interest is payable at maturity. The 15% Notes are convertible into shares of Common Stock at a Conversion Price equal to $1.30 per share subject to adjustments. Under the Note Purchase Agreement if our “pre-tax income” for the year ended December 31, 2008 is less than $10,000,000 ,then the Conversion Price will be reduced by the percentage shortfall, up to a maximum of $0.65 per share (the “Performance Adjustment”). After any reductions to the Conversion Price made under this provision the conversion price will not be less than $0.65 per share. In the event of a conversion, accrued interest shall be automatically converted into Common Stock. In addition, the Company has the right to prepay the entire outstanding principal due under the 15% Notes upon certain conditions, including, but not limited to, that no event of default has occurred or is continuing. In addition, the Company issued warrants to purchase 446,154 shares of Common Stock to Primary Capital, LLC in connection with the sale of the 15% Notes. The warrants have an exercise price of $1.30 per share subject to adjustments. The 446,154 warrants contain the same Performance Adjustment provisions as the 15% Notes. Upon the Performance Adjustment of the exercise price, the number of shares issuable upon exercise of the 446,154 warrants will also be adjusted to become the product determined by dividing the combined exercise price of the warrants ($580,000, which is 446,154 times $1.30) by the adjusted exercise price, which equals 892,307 shares at the exercise price of $0.65 per share. The Company agreed to file with the SEC a registration statement within 45 days of the last closing date (which was, June 10, 2008) to register for resale of the shares of Common Stock issuable upon conversion of the 15% Notes and to cause that registration statement to be declared effective by the earlier to occur of (i) 180 days after the closing date, or (ii) the fifth trading day following the day we receive notice from the SEC that the initial registration statement will not be reviewed or is no longer subject to further review and comments. The Company also agreed to include in such registration statement the shares issuable upon exercise of the warrants issued to Primary Capital, LLC in connection with the sale of the 15% Notes. 48

December 2007 Shing Mei Bridge Financing In December of 2007, Shing Mei raised $2,250,000 in gross proceeds in a private placement of the 10% Notes to a number of accredited investors and to non-US persons. The investors in the 10% Notes were also issued warrants to purchase 2,250,000 shares of common stock of Shing Mei at $1.00 per share. Under the terms of the transaction, the 10% Notes were convertible into common stock of a publicly traded US shell company at a conversion price of $0.50 per share and the warrants were exchangeable for warrants of such publicly traded company with similar terms if a reverse merger of Shing Mei with such company would occur. On February 13, 2008, such reverse merger was consummated with SJ Electronics, Inc. and all the 10% Notes were converted into common stock of SJ Electronics, Inc., except for certain notes representing 868,563 shares of common stock, which remain unconverted because of the limitation on its conversion which makes the promissory note unconvertible to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock of SJ Electronics, Inc. At the closing of the reverse merger, the warrants issued in connection with the sale of the 10% Notes were exchanged for warrants of SJ Electronics, Inc. with similar terms. Shing Mei Organization Shing Mei Enterprises Ltd. (“Shing Mei”) was incorporated in Samoa in August of 2003. In October 2004, Shing Mei acquired 100% ownership of S.J. Electronics (Gongming loutsun Shenzhen) Co., Ltd., located in the City of Shenzhen in the Peoples Republic of China (“PRC”). 49

In November 2005, Shing Mei established its own 100% subsidiary, Xujun Electronic (Ganzhou) Co., Ltd, located in the city of Quannan of Jiangxi Province in PRC. In January 2006, Shing Mei established its own 100% subsidiary, Guangxi Hezhou XU JUN Electronics Co., Ltd. located in the city of Hezhou of Guangxi Province in PRC. In August 2006, Shing Mei established its own 100% subsidiary, S.J. Electronics Technology (Shenzhen) Co., Ltd. located in the city of Shenzhen of Guangdong Province in PRC. In August 2007, Shing Mei established its own 100% subsidiary, FuChuan Xu Jun Science and Technology Electronics Co., Ltd. located in the city of FuChuan of Guangxi Province in PRC. As of the date of this prospectus, Shing Mei owns 100% equity interest in its five subsidiaries (collectively referred to as the “Company”), located in Shenzhen of Guangdong Province, Jiangxi Province and Guangxi Province in the PRC. Shing Mei’s primary business activities are the manufacture and sale of electronic cable products and the assembling of wire harnesses by its five subsidiaries in the PRC. Corporate Structure The following diagram sets forth our current corporate structure: 50

51

Description of Shing Mei Business Overview of Business Shing Mei, through its subsidiaries, manufactures and distributes computer components including connectors, wire harness and cable assemblies for over five years. Its products include power components for computer, communication and consumer electronic (3C), such as information technology (IT) communications cables, computer & IT appliance power supply cable sets and IT communications signal cable sets. Shing Mei was formed in August 2003 under the laws of Samoa. Its executive offices are based in Taiwan and its production facilities are located at five factories in three provinces in the PRC: Shenzhen (Economic Special Zone, Guangdong province, there are two factories located in Shenzhen city), Quannan (Jiangxi Province), Hezhou (Guangxi Province), and Fuchuan (Guangxi Province). Products We, through our five subsidiaries in China, have the following product lines: Product line IT Communications Signal Cable Set Application For the transmission of digital signals in home appliances, IT and communication devices. Power transmission for Personal Computers and peripherals (such as printer, scanner and keyboard, etc) and other consumer electronics (such as digital camera, camcorder and DVD player, etc) and Internet equipment. For linking connectors, used in digital signal transmission in Personal Computers systems and peripherals, communication devices, industrial automation control and home appliances. 52

Computer & IT Home Appliance Power Supply Cable Set

IT Communications Cable

IT Communications Cables The IT communications cables manufactured by the Company are used by manufacturers of IT and communication devices for power supply or digital data transmission. This product line complies with the safety regulations and environmental protection rules effective at our customer locations where our products are subject to UL, CSA and ROHS directive, as we described under Government Regulations section of this “Business” section of the prospectus. This item is linked with the production process and marketing channels of other premium products manufactured by the Company such as the computer & IT appliance power supply cable set and IT communications signal cable set, which makes this item a vital part in the overall marketing strategy of the Company. Computer & IT Appliance Power Supply Cable Sets Power supply cable sets manufactured by the Company are an indispensable component for personal computers, consumer electronics, Internet equipment, and digital appliances for data and power transmission. Since these products connect to power supplies, a higher level of safety is demanded. As such, confirmation and compliance pertaining to the safety requirements and other standards in the importing countries is the preliminary step for selling this item for distribution within those countries. This creates a high entrance barrier to the production and distribution of this item, which allows the Company to sell this item at a fairly stable price. The Company has several years of experience in the production of this item and the quality has been highly recognized by multi-national companies like Hewlett-Packard (HP) and Samsung. The Company has obtained the required safety certifications from them. 53

IT Communications Signal Cable Sets These product lines cover most applications for 3C products. Most customers buy both power supply cable sets and signal cable sets from our Company at the same time, which offers the customer a one-stop shopping solution, and allows the Company to cross sell its products to key customers as well as develop new customer relationships. The cable assembly component is assembled in a variety of sizes and combinations of connectors and cabling. Cabling is purchased from a variety of major unaffiliated suppliers and is assembled with the Company’s connectors as complete cable assemblies. Cable assemblies have thousands of applications including local area networks, wide area networks, Internet systems, personal communication services (PCS) /cellular systems, TV/dish network systems, test equipment and entertainment systems. Most cable assemblies are manufactured to the purchaser’s specifications. New Products Recently, we have started to manufacture a series of new products as follows:  Notebook Personal Computers Antennas (also known as laptop WiFi antenna): it is a high performance, versatile antenna. It is designed for the Notebook computers in order to extend the range of its wireless card application. RF Cable (Radio Frequency Cable): it is used to connect electronic products with external high frequency signals. It can be applied at wireless industries, communication, and measurement equipment and other similar areas. LCD Power Converters: it is a highly integrated AC/DC device, which can be powered directly from a 12-V source. It is the ideal power manager to safely control high current capabilities of large screen and LCD (Liquid Crystal Display) monitor panels. 54





The following is an explanatory flow chart for the major steps involved in the manufacturing process of our products:

(1) PVC is the abbreviation for Polyvinyl chloride, which is thermoplastic polymer commonly used as the insulation on electric wires. PE refers to Polyethylene or polythene, which is a thermoplastic polymer widely used in products such as wire and cable. We purchase PVC and PE from suppliers. (2) 2C/3C Cord is communication and consumer electronics products cord which we manufacture. (3) Housing is the hole that connector can plug in and terminal is connected with Housing. The combined device is used to attach to the end of a wire or cable or to an electrical apparatus for convenience in making connections. We manufacture this product. (4) H, S Tube is heat shrinkable tube, which is used to protect wire from oxidization. EMI (Electro Magnetic Interferences) Core is to prevent magnetic effect for digital transmission, which usually appear on keyboards. We purchase H, S Tube and EMI Core from suppliers. 55

We purchase copper plates from London Metal Exchange and then have our contracted companies process the copper plates to copper tubes with a diameter of eight millimeters for our further extraction into thinner copper tubes. We manufacture connectors, wire, 2C/3C Cord, Housing and Terminal. We purchase PVC, PE, H, S Tube and EMI Core from our suppliers. Then we process the cable assemblies and wire harness series. Customers The Company serves a number of large electronics companies in Taiwan. Approximately 10% of our products are sold to Japan and Korea as well as chain stores in the United States and Europe. Customers include internationally renowned firms such as Lite-On Group, Sony, JVC, Samsung, Cannon, Hewlett-Packard, NEC Delta, FPS Group, and Hipro. Shing Mei has proven to be consistently successful in servicing large multinational customers since inception, evidencing the recognition of its product quality and production capacity. There is a lengthy qualifying process for substantiation required by any multinational or major overseas companies that would be our customers, in which such potential customers will check the quality and design of our products to see whether it matches those of their products. Once substantiation has been granted, the Company is deemed certified as a supplier for an individual customer. In general, once a product supplier has been certified by a customer and deliveries have started, the customer will rarely shift to other suppliers. Approximately 57% of our sales in the first quarter of 2008 generated from one customer, Taiwan based Lite-On Group, an electronics group company. The other 43% of our business was mainly with other Taiwan based electronics manufacturing services (“EMS”) companies. In the first quarter of 2008 and the last quarter of 2007, over 90% of our sales were to companies that are publicly traded in Taiwan. Our top 10 customers, ranked from largest to smallest, are: Lite-On Group, Silitek Corp., Li Shin International, Yet Foundate Limited, Hamagawa Corp., Rapid Conn, Mentor Media, Northstar Systems Holdings, Real Young Electronics, Beststop Technology. 56

Competition We have numerous small competitors and some large competitors. Unlike most of our small competitors, which only produce one particular harness or cable, we offer the entire spectrum of our product lines such as our IT Communications Signal Cable Sets and Computer & IT Appliance Power Supply Cable Sets. Many of our products are made to comply with industry specifications and therefore may be interchangeable with some of our competitors’ products. Some of our competitors are large and well-established companies, such as Belden, General Cable and American Insulated Wire, and have financial resources that may be superior to ours. The primary competitive factors for our products include breadth of product offering, inventory availability, delivery time, price, quality, customer service, relationships, brand recognition and logistics capabilities. We believe we can compete effectively on the basis of each of these factors. We believe our key competitive strengths are the following:     strong market presence across multiple end markets: we have established cable and wire harness markets. We are now developing a portable computers (“Notebook”) market to extend our presence at multiple end markets; flexible operating model: our techniques and operations of know-how combined with the assembly lines that are easy to adjust enable us to operate in a flexible model; successful focus on reducing operating costs: we carry out an all-in-one manufacturing process to reduce our cost: we purchase copper directly from London Metal Exchange and have our own copper processing plant; and experienced and dedicated management team: our management members have a minimum of 20 years’ experience in this industry. 57

We intend to expand our business, enhance our market position and increase our net sales and cash flow by focusing on the following key strategic initiatives: Pursue Growth Opportunities in Existing and Complementary Markets. We believe we have significant opportunities to grow our business by increasing our penetration within our existing customer base, adding new customers, expanding our already broad product offering, and pursuing additional marketing channels. Selectively Pursue Strategic Acquisitions. As a leading manufacturer in our core markets, we believe we are well-positioned to benefit from the consolidation of manufacturers in these markets. We believe our management has the ability to identify and integrate strategic acquisitions. We will continue to selectively consider acquisitions that improve our market position within our existing target markets, expand our product offerings or end markets, or increase our manufacturing efficiency. Manage Cost Structure Through Operating Efficiency and Productivity Improvements. We continue to evaluate our operating efficiency and productivity, and are focused on lowering our manufacturing and distribution costs. We plan to more fully integrate our copper production, realign plant production, and add and continue to improve warehouse efficiencies. We also intend to add internal capacity for new products and new product development while continuing to implement new software to enhance our order execution capabilities throughout our supply chain. We believe that these initiatives will provide significant savings and improve operating profits. Expand Product Lines. We are actively seeking to identify, develop and commercialize new products that use our core technology and manufacturing competencies, and will continue to focus on products with attractive margins for this business sector. Value Added Services. We will continue to provide our customers with value added services such as engineering and design consultation in order to improve the manufacturing process, reduce costs, increase profitability and provide a more efficient product to the end user. 58

Research and Development Although the Company offers design and engineering services we do not focus on research and development and has made only nominal expenditures in this area. Sales and Marketing Our sales and marketing group consists of two teams: internal sales team and external sales team. Our external sales team has three representatives and our internal sales team has thirteen representatives who direct sales to distributors, retailers and Original Equipment Manufacturers (OEMs) through print brochures, industry trade advertising, trade exhibitions, website applications and direct outside sales presentations. Raw Materials Connector materials are typically made of commodity metals such as copper and zinc and include small applications of precious materials, including silver and gold. We purchase cooper from London Metal Exchange and other materials from suppliers in mainland China. We believe that the raw materials used in our products are readily available and that the Company is not currently dependent on any one supplier for its raw materials. We do not currently have any long-term purchase or supply agreements with our product suppliers. We pay cash immediately for copper and we pay for other materials within a ninety-day term. Nevertheless, should we experience a material delay in obtaining raw materials and component parts from our existing suppliers, until alternate arrangements are made, our ability to meet the customers’ needs may be adversely affected. We generally do not engage in speculative raw material commodity contracts. We reflect raw material price changes in the sale price of our products. 59

Backlog and Shipping Our product lines have no significant order backlog because we follow the industry practice of stocking finished goods to meet customer demand on a just-in-time basis. We believe that the ability to fill orders in a timely fashion is a competitive factor in the markets in which we operate. As a result of high demand for our products we typically build up our inventory levels during the third and early fourth quarters of the year. In addition, receivables related to increased shipments during the third and early fourth quarter are collected during the late fourth quarter, and early first quarter of the following year. Intellectual Property While we have performed no intellectual property protection to date, we intend to assert our rights under trade secret and unfair competition laws, if applicable in the countries where we conduct business to protect our intellectual property, including product designs, property manufacturing processes and technologies, product research and concepts. Government Regulations Any company that conducts business in the PRC must have a business license that covers a particular type of work. The business license of each of our subsidiaries in the PRC covers our present manufacturing business. We are not subject to any environmental controls or restrictions that require the outlay of capital or the obtaining of a permit in order to engage in business operations. Most of our products are certified by UL (Underwriters Laboratories, an independent product safety certification organization headquartered in U.S. with international presence that has been testing products and writing Standards for Safety since 1894), CSA (Canadian Standards Association established in 1919) and ROHS directive (Restriction of Hazardous Substances Directive or RoHS which took effect on July 1, 2006 in the European Union). 60

Our following subsidiaries in China hold the Certifications from QA International Certification Limited, an UKAS (United Kingdom Accreditation Service) accredited certification body: Holder S.J. Electronics (Gongming loutsun Shenzhen) Co., Ltd. Xujun Electronic (Ganzhou) Co., Ltd S.J. Electronics Technology (Shenzhen) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd Employees As of the date of this prospectus, the Company had over 4,500 employees in total. All of them are full time employees. The following table illustrates the allocation of these employees among the various job functions conducted at the Company: Manufacturing Production Management Quality Control Engineering Administration Production Technology 61 3,950 154 210 100 230 110 Name ISO 140001:2004 Duration Nov 14, 2006 – Nov 30, 2007 (pending to be renewed) Nov 9, 2007 – Aug 31, 2008 Nov 20, 2007 – Nov 30, 2008

ISO 9001:2000 ISO 140001:2004

ISO 9001:2000

Nov 10, 2007 – Nov 30, 2008

DESCRIPTION OF PROPERTY The Company does not own any real estate. The Company and its subsidiaries are leasing the following properties: Lessor Shenzhen Gong Ming Village Cooperative Co. Location Bao An District, No. 3 Industrial Zone, Building 4 Gong Ming Avenue, Lou Chun District, No. 2 Industrial Zone, Qu Tong Fu Yu Industrial Park, Building 4 Bao An District, Gong Ming Avenue, No. 5 and 6 Tong Fu Industrial Park He Jie Township Factory 2 nd Floor Purpose Factory Area 2,500 m 2 Rent 20,000 RMB/month or approximately $2,928/month 10,000 RMB/month or approximately $1,464/month Term March 8 2007 – March 8, 2010

Shenzhen Gong Ming Village Cooperative Co.

Factory

5,115 m 2

November 17, 2006 – November 17, 2009

Shenzhen Gong Ming Village Cooperative Co.

Factory

10,230 m 2

81,840 RMB/month or approximately $11,982/month

May 15, 2006 – May 14, 2009

Guangxi Province He Zhou City Fang Yuan Plastics Manufacturing Co., Ltd. Guangxi Province He Zhou City Fang Yuan Plastics Manufacturing Co., Ltd. Guangxi Province He Zhou City Fang Yuan Plastics Manufacturing Co., Ltd. All South County Grain Agency

Factory

2,400 m 2

10,800 RMB/month or approximately $1,581/month

February 1, 2007 – October 30, 2008

He Jie Township Factory 3 nd Floor 3 rd floor and 4 th Floor He Jie Township Factory 4 th and 5 th Floors

Factory

2,400 m 2

17,820 RMB/month or approximately $2,609/month

July 1, 2006 – October 30, 2008

Dormitories Factory

1,560 m 2 4,800 m 2 21,600 RMB/month or approximately $3,163/month November 1, 2005 – October 30, 2008

All South County Industrial Park Zone 2, Buildings A, B and C

Factory

14,984.64 m 2

52,400 RMB/month or approximately $7,672/month 12,538 RMB/month or approximately $1,836/month

November 3, 2005 – November 2, 2010

Fuzhou County Printing Factory

Fuzhou County Phoenix Manufacturing and Road No. 79 printing operations factory 62

2,743 m 2

March 1, 2007 – February 28, 2010

FINANCIAL INFORMATION MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION Forward Looking Statements Some of the statements contained in this Management’s Discussion and Analysis (“MD&A”) that are not historical facts are “forward-looking statements” which can be identified by the use of terminology such as “estimates,” “projects,” “plans,” “believes,” “expects,” “anticipates,” “intends,” or the negative or other variations, or by discussions of strategy that involve risks and uncertainties. We urge you to be cautious of the forward-looking statements that such statements, which are contained in this MD&A, reflect our current beliefs with respect to future events and involve known and unknown risks, uncertainties, and other factors affecting our operations, market growth, services, products, and licenses. No assurances can be given regarding the achievement of future results, as actual results may differ materially as a result of the risks we face, and actual events may differ from the assumptions underlying the statements that have been made regarding anticipated events. Factors that may cause actual results, our performance or achievements, or industry results, to differ materially from those contemplated by such forward-looking statements include without limitation: 1. Our ability to attract and retain management, and to integrate and maintain technical information and management information systems; 2. Our ability to generate customer demand for our services; 3. The intensity of competition; and 4. General economic conditions. 63

All written and oral forward-looking statements made in connection with this MD&A that are attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Given the uncertainties that surround such statements, you are cautioned not to place undue reliance on such forward-looking statements. Company Overview SJ Electronics, Inc. (formerly Acheron, Inc.) (“Company”, “we” or “us”) was formed as a Nevada corporation on June 23, 1994 as Harvest E-xpress and later changed its name to HLS (USA), Inc. (from May 1, 1997 through April 12, 2006), and Acheron, Inc. (from April 13, 2006 through March 19, 2008). On March 20, 2008, it changed its name to SJ Electronics, Inc. On February 13, 2008, the Company entered into and completed the transactions contemplated under a Securities Exchange Agreement (the “Exchange Agreement”) with Yu-Ping “Agatha” Shen, the sole shareholder (the “Shareholder”) of Shing Mei Enterprises Ltd., a corporation organized under the laws of Samoa (“Shing Mei”), pursuant to which the Company purchased from the Shareholder all issued and outstanding shares of Shing Mei’s common stock in consideration for the issuance of 15,000,000 shares of Common Stock of the Company (the “Share Exchange”). The Share Exchange resulted in a change in control of the Company, with the Shareholder owning 15,000,000 shares of common stock of the Company out of a total of 21,984,215 issued and outstanding shares after giving effect to the Share Exchange, or approximately 68%. As a result of the Share Exchange, (i) Shing Mei became a wholly-owned subsidiary of the Company and (ii) the Company succeeded to the business of Shing Mei as its sole business. The transaction was accounted for as a reverse merger (the “Reverse Merger”). As a result, the historical financial results are those of Shing Mei and its subsidiaries. SJ Electronics, Inc., through Shing Mei and its five subsidiaries, is an international designer, developer and manufacturer of computer components including connectors, wire harness and cable assemblies. SJ Electronics, Inc. specializes in the manufacturing and sales of computer, communication and consumer electronic (3C) power components, including information technology (IT) communications cables, computer & IT appliance power supply cable sets and IT communications signal cable sets. 64

Approximately 57% of our sales in the first quarter of 2008 were generated from one customer, Taiwan based Lite-On Group, an electronics group company. The other 43% of our business is mainly with other Taiwan based electronics manufacturing services (“EMS”) companies. Over 90% of our sales are to companies that are publicly traded in Taiwan. Our top 10 customers, ranked from largest to smallest, are: Lite-On Group, Silitek Corp., Li Shin International, Yet Foundate Limited, Hamagawa Corp., Rapid Conn, Mentor Media, Northstar Systems Holdings, Real Young Electronics, Beststop Technology. Our business is impacted by seasonal factors. Usually, 60% of our business occurs in the second half of each year because our products are mainly used in consumer electronics. Thus, there is a major holiday increase in end demand of our products and our business ramps up accordingly in anticipation of this. Results of Operations Comparison of Fiscal Years Ended December 31, 2007 and December 31, 2006. Sales Our sales for the fiscal year ended December 31, 2007 were $56,355,689, an increase of $14,093,177, or 33.4%, from $42,262,512 for the fiscal year ended December 31, 2006. The increase in sales is attributable to two factors: 1) our sales of existing products to current customers have increased as we have demonstrated our ability to deliver high quality products in a timely and cost effective manner, and 2) we have expanded our product line and are seeing substantial business from customers in these new products, such as Notebook Personal Computers Antennas, RF Cables and LCD Power Converters. 65

Cost of Goods Sold Cost of goods sold for the fiscal year ended December 31, 2007 (“fiscal 2007”) was $48,634,296, an increase of $9,562,463, or 24.5%, from 39,071,833 for the fiscal year ended December 31, 2006 (“fiscal 2006”). The increase in cost of goods sold was due to the 33% increase in our sales for fiscal 2007 compared to that of fiscal 2006. We controlled the cost of goods sold in the following ways. We obtained a competitive purchase price for the raw materials by paying in cash instead of by credit. By paying immediately in cash for raw materials, in particular for copper, we are given a discount to market prices by our suppliers. We also began to manufacture our own connectors by integrating our own technology, instead of purchasing the connectors from other manufacturers. Gross Profit Gross profit for fiscal 2007 was $7,721,393, an increase of $4,530,714, or 142% from $3,190,679 for fiscal 2006. The gross profit margins were 13.7% for fiscal 2007 and 7.6% for fiscal 2006. The increase in the gross profit margin was a result of the increase in sales while the cost of goods sold was effectively controlled. Selling Expenses Selling expenses were $504,937 for fiscal 2007, as compared to $458,075 for fiscal 2006, an increase of $46,862, or 10.2%. The increase was due to the overall increase in sales we experienced. General and Administrative Expenses General and administrative expenses were $2,264,487 for fiscal 2007, an increase of $374,234, or 19.8%, as compared to $1,890,253 for fiscal 2006. The increase was a result of additional expenses incurred in preparing Shing Mei for the Reverse Merger. 66

(Gain) Loss on Disposal of Assets We incurred a gain of $13,358 on selling our machinery and equipment for fiscal 2007, while we had a loss of $600,115 on disposal of assets due to fixed assets write-off for the fiscal 2006. Interest Income (Expenses) and Other Income (Expenses) We incurred interest expenses of $585,382 for fiscal 2007 for the payment of the interests of our accounts receivable financing lines while the interest payment for fiscal 2006 was $86,031 for our accounts receivable financing lines. We intend to increase our borrowings against our accounts receivable as they grow. Other expenses were comprised of other assets write-off at the amount of $113,352 for fiscal 2007 while we had some miscellaneous revenue of $52,515 under other income for fiscal 2006. Such interest expenses and other expenses or income were netted of our interest income and other income or expenses. Income Taxes Shing Mei is not subject to any tax in Samoa. Our five subsidiaries in China had the income tax holiday for the fiscal 2007 and 2006. S.J. Electronics (Gongming Loutsun Shenzhen) Co., Ltd. was registered as an assembling factory which has no income tax obligation according to the income tax regulation of the PRC. Our other four subsidiaries in China were qualified for a tax holiday pursuant to the PRC laws and regulations governing foreign invested enterprises for the first two profitable years, followed by a 50% reduction on their income tax for the following three consecutive years. Net Income Net income for fiscal 2007 was $4,266,593, an increase of $4,057,873, or 1,944.2%, from $208,720 in fiscal 2006. The increase in net income was due to the economies of scale achieved by the Company in fiscal 2007; while sales increased dramatically, we did not have a correspondingly large increase in operating costs. In addition, our gross margins were higher as a result of our efforts to decrease costs on raw materials as detailed previously. 67

Comparison of Three Months Ended March 31, 2008 and March 31, 2007. Sales During the three months ended March 31, 2008, we had sales of $12,961,563 as compared to sales of $10,838,325 for the three months ended March 31, 2007, an increase of approximately 19.6%. This increase is attributable to the increased sales of wire harnesses and cables. We have been broadening our product offering and improving the quality of our products. Our customers are increasingly satisfied with our ability to deliver quality products in a timely fashion. Cost of Goods Sold Cost of goods sold for the three months ended March 31, 2008 increased $1,350,642 or 13.6%, from $9,955,843 for the three months ended March 31, 2007 to $11,306,485 for the three months ended March 31, 2008. The increase was relatively proportional to the corresponding 19.6% increase in our sales for the three months ended March 31, 2008 as compared to that of the same period in 2007. Gross Profit Gross profit was $1,655,078 for the three months ended March 31, 2008 as compared to $882,482 for the three months ended March 31, 2007, representing gross margins of approximately 12.8% and 8.1%, respectively. The increase in our gross margins was a result of our efforts to obtain a competitive purchase price of raw materials by paying in cash instead of by credit as detailed previously. 68

Selling Expenses Selling expenses totaled $256,935 for the three months ended March 31, 2008, as compared to $290,551 for the three months ended March 31, 2007, a decrease of approximately 11.6%. This decrease is primarily attributable to less shipping expenses incurred in the same period of 2008 than those of 2007. General and Administrative Expenses General and administrative expenses totaled $1,968,875 for the three months ended March 31, 2008, as compared to $237,955 for the three months ended March 31, 2007, an increase of $1,730,920, or approximately 727% . This increase was primarily attributable to the increase in loss in foreign currency exchange fluctuation between Chinese Renminbi (“RMB”) and Hong Kong Dollar (“HKD”) as we use RMB and HKD for purchase of raw materials and receive payment for the sale of our products in HKD. As RMB appreciated against HKD in the first quarter of 2008 as compared to the same period in 2007, we incurred losses from the currency exchange. There was also $457,185 consulting expense amortized in connection with our reverse merger in this quarter. (Gain) Loss on Disposal of Assets We had a loss of $25,856 on disposal of assets during the three months ended March 31, 2008. We received a gain of $177,706 on selling our machinery and equipment during the three months ended March 31, 2007. Interest Income (Expenses) and Other Income (Expenses) We incurred interest expenses of $367,234 for the three months ended March 31, 2008 for the payment of the interests of our standard one year lines of credit and accounts receivable loans while the interest payment for the same period in 2007 was $99,986 for our loans. We currently have total loans outstanding of $18,190,808. Other income was comprised of certain miscellaneous revenue at the amount of $124,158 for the three months ended March 31, 2008 and $231,231 for the same period in 2007. 69

Income Taxes Shing Mei is not subject to any tax in Samoa. Our five subsidiaries in China had the income tax holiday for 2007. S.J. Electronics (Gongming Loutsun Shenzhen) Co., Ltd. was registered as an assembling factory which has no income tax obligation according to the income tax regulation of the PRC. Our other four subsidiaries in China were qualified for a tax holiday pursuant to the PRC laws and regulations governing foreign invested enterprises for the first two profitable years, followed by a 50% reduction on their income tax for the following three consecutive years. Net Income Our net loss for the three months ended March 31, 2008 was $839,664 as compared to our net income of $662,927 for the three months ended March 31, 2007. The loss was primarily attributable the foreign exchange rate loss and consulting expense amortized. Liquidity and Capital Resources As of March 31, 2008, we had cash and cash equivalents of $697,907. Our current assets were $33,990,916, including $20,801,201 accounts receivable. Our current liabilities were $33,225,398, including $18,190,808 short-term loans and $13,148,406 accounts payable. Our total stockholders’ equity as of March 31, 2008 was $5,839,255. In May and June of 2008, we raised an aggregate of $5,800,000 in gross proceeds from a private placement of the 15% Senior Secured Convertible Notes due 2009. This capital is being used to help fund working capital. 70

In December of 2007, Shing Mei raised $2,250,000 in gross proceeds in a private placement of the 10% Notes to a number of accredited investors and to non-US persons. The investors in the 10% Notes were also issued warrants to purchase 2,250,000 shares of common stock of Shing Mei at $1.00 per share. Under the terms of the transaction, the 10% Notes were convertible into common stock of a publicly traded US shell company at a conversion price of $0.50 per share and the warrants were exchangeable for warrants of such publicly traded company with similar terms if a reverse merger of Shing Mei with such company would occur. On February 13, 2008, such reverse merger was consummated with SJ Electronics, Inc. and all the 10% Notes were converted into common stock of SJ Electronics, Inc., except for certain notes representing 868,563 shares of common stock, which remain unconverted because of the limitation on its conversion which makes the notes unconvertible to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock. At the closing of the reverse merger, the warrants issued in connection with the sale of the 10% Notes were exchanged for warrants of SJ Electronics, Inc. with similar terms. The capital raised from the sale of the 10% Notes was used as working capital to finance our operations. We also utilize bank loans to finance our operations and capital expenditures. Due to the significant growth rate we are experiencing, and the standard 120 day terms we offer to our customers, we anticipate needing additional working capital financing going forward. Cash Flows The fiscal year ended December 31, 2007 compared to the fiscal year ended December 31, 2006 Net cash provided by operating activities was $193,991 for fiscal 2007. Net cash used by operating activities was $2,178,848 for fiscal 2006. The negative cash flow from operations for fiscal 2006 was due to the negative cash flow caused by the increase in account receivables of $7,707,919. Accounts receivable only increased by $4,519,582 for fiscal 2007, which allowed us to achieve positive cash flow from operations in 2007. 71

Net cash used in investing activities was $1,857,128 for fiscal 2007 and $3,445,093 for fiscal 2006. During 2006 and 2007 we invested significantly in both new plants and equipment as we needed to boost production capacity to keep up with the growth in our business. Net cash provided by financing activities was $1,941,379 for the fiscal 2007 and $7,447,954 for the fiscal 2006. We had a short term loan proceeds of $9,618,150 for the fiscal 2007 as opposed to $1,994,699 for the fiscal 2006, we paid $8,309,267 to All Safe Cable Co., Ltd., a company wholly owned by Yuping “Agatha” Shen, our Chairman and controlling shareholder, at the time of the payment. The payment was a repayment of forgiven money owed by Shing Mei to All Safe Cable Co., Ltd. as a dividend. Three months ended March 31, 2008 compared to three months ended March 31, 2007 Net cash used in operating activities was $3,237,182 during the three months ended March 31, 2008 and $1,206,480 during the three months ended March 31, 2007. The cash used during the three months ended March 31, 2008 was mainly for the increased levels of prepaid expenses and other receivables and higher inventory of raw materials. The negative cash flow from operations during the three months ended March 31, 2007 was due to increased inventories. Net cash used in investing activities was $23,644 during the three months ended March 31, 2008 and $981,867 during the three months ended March 31, 2007. We spent $981,867 for the construction of additional manufacturing facilities during the first quarter in 2007. We made minimal improvements to our facilities during the first quarter of 2008. Net cash provided by financing activities was $2,872,249 during the three months ended March 31, 2008 and $2,913,209 during the three months ended March 31, 2007, a decrease of $40,960. For the three months ended March 31, 2008, although we received $7,538,270 loan proceeds from banks, as opposed to only $1,757,562 for the same period of 2007, we also made a payment of $3,955,722 in 2008 on related party dues we owed, as opposed to related party proceeds of $446,705 for the same period of 2007. 72

Accounts Receivable As of March 31, 2008, the Company had accounts receivable of $20,801,201, among which, $9,407,683 were factored as collateral for its short-term bank loans. As of December 31, 2007, the Company had accounts receivable of $21,990,170, among which, $5,169,571 were factored to banks as collateral for bank loans. The Company had no allowance for bad debt provision because since the inception, it has adopted the direct write-off method for bad debts. Loans As of March 31, 2008, the Company had several outstanding bank loans which were used primarily for general working capital purposes. These are recurring loans which carry annual interest rates of 5.5% ~7.5% with a term of six months. All bank credit facilities are created under accounts receivable factoring with collectable authority from the customers of the Company. Those bank credit lines are rollover within one-year terms. The outstanding bank loans are showed in the following table: March 31, 2008 Short term loans A/R Factoring Taipei Fubon Bank Hong Kong Branch The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch En Tie Commercial Bank A/R Factoring Total: Export loans The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch L/C loans Taipei Fubon Bank Hong Kong Branch The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch L/C loans Total: Short term loans TOTAL: 73

$

2,613,670 5,634,013 1,160,000 9,407,683 542,950 168,795 8,071,380 8,240,175 18,190,808

$ $ $ $ $

Off Balance Sheet Arrangements The Company has no off balance sheet arrangements. Critical Accounting Policies and Estimates Management’s discussion and analysis of its financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. Our financial statements reflect the selection and application of accounting policies which require management to make significant estimates and judgments. See Note 2 to our consolidated financial statements, “Summary of Significant Accounting Policies.” Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as well as the reported amounts of revenues and expenses. Management makes these estimates using the best information available at the time the estimates are made. However, actual results could differ from estimates. Accounts Receivable Accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts based on a review of all outstanding amounts on a monthly basis. The Company analyzes the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in our customer payment terms. Significant changes in customer concentration or payment terms, deterioration of customer credit-worthiness or weakening in economic trends could have a significant impact on the collectibility of receivables and our operating results. The Company had no allowance for bad debt provision because since its inception, it has adopted the direct write-off method for bad debts. 74

Inventories Inventories, which are primarily comprised of raw materials, work-in-process goods, packaging materials, and finished goods, are stated at the lower of cost or net realizable value, using the first-in, first-out (“FIFO”) method. Cost is determined on the basis of a moving average. The Company evaluates the need for reserves associated with obsolete, slow-moving and non-salable inventory by reviewing net realizable values on a periodic basis. Revenue Recognition The Company recognizes revenue when the significant risks and rewards of ownership have been transferred pursuant to PRC law, including such factors as when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, sales and value-added tax laws have been complied with, and collectibility is reasonably assured. The Company generally recognizes revenue when its products are shipped. Foreign Currency Translation The functional currency of Shing Mei is Hong Kong Dollar (“HKD”). The Company maintains its financial statements using the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. 75

However, the functional currency of all five subsidiaries of the Company is the Renminbi (“RMB”), the PRC’s currency. Those subsidiaries maintain their financial statements using their own functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. For financial reporting purposes, the financial statements of Shing Mei, which are prepared in HKD, are translated into the Company’s reporting currency, United States Dollars (“USD”). All the financial statements of its subsidiaries, which are prepared in RMB, are translated into the Company’s reporting currency, USD. Balance sheet accounts are translated using the closing exchange rate in effect at the balance sheet date and income and expense accounts are translated using the average exchange rate prevailing during the reporting period. Adjustments resulting from the translation, if any, are included in accumulated other comprehensive income (loss) as a component of stockholders’ equity. The exchange rates used for foreign currency translation were as follows (USD$1 = RMB): Period Covered Three months ended March 31, 2007 Three months ended March 31, 2008 Balance Sheet Date Rates 7.72950 7.01200 Average Rates 7.75180 7.1622

The exchange rates used for foreign currency translation were as follows (USD$1 = HKD): Period Covered Three months ended March 31, 2007 Three months ended March 31, 2008 76 Balance Sheet Date Rates 7.81270 7.78190 Average Rates 7.81350 7.79433

MARKET PRICE OF AND DIVIDENDS ON COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Market for Our Common Stock Bid and ask quotations for our common stock appear on the OTC Bulletin Board under the symbol “SJEL”. The high and low bid prices for our common stock as reported by Yahoo Finance on July 29, 2008 were: $2.00 and $2.30, and the quarterly high and low bid prices for our common stock over the time since the data first became available, are given below. These over-the-counter market high ask and low bid quotations reflect inter-dealer prices as adjusted as a result of a 2-for-5 reverse stock split effective February 4, 2008, without retail mark-up, mark-down or commissions and may not necessarily represent actual transactions. As of July 29, 2008, our common stock was held by approximately 384 holders of record. Bid Prices High Fiscal 2008 Quarter Ended June 30, 2008 Quarter Ended March 31, 2008 Fiscal 2007 Quarter Ended December 31, 2007 Quarter Ended September 30, 2007* _____________ *Earlier data unavailable. $ $ 2.75 2.25 $ $ Low 1.75 0.51

$ $

0.20 0.15

$ $

0.20 0.15

No cash dividends on outstanding common stock have been paid within the last two fiscal years and interim periods. The Company does not anticipate or intend upon paying cash dividends for the foreseeable future. 77

Dividends Our board of directors has not declared a dividend on our common stock during the last two fiscal years or the subsequent interim period and we do not anticipate the payments of dividends in the near future as we intend to reinvest our profits to grow operations. We rely on dividends from Shing Mei for our funds and PRC regulations may limit the amount of funds distributed to us from Shing Mei, which will affect our ability to declare any dividends. See "Description of Securities - Common Stock." Securities Authorized for Issuance under Equity Compensation Plans As of the date of this prospectus, we do not have any securities authorized for issuance under any equity compensation plans and we do not have any equity compensation plans. Shares Eligible for Future Sale There is no established trading market for our Common Stock. Future sales of substantial amounts of our Common Stock in the trading market could adversely affect market prices. This is an offering of 13,457,902 shares of our Common Stock by the selling stockholders. As of July 29, 2008, there were issued and outstanding (i) 21,984,215 shares of Common Stock, (ii) 15% Notes in the aggregate amount of $5,800,000 convertible into 4,461,533 shares of Common Stock, (iii) placement agent warrants to purchase 896,154 shares of Common Stock and (iv) warrants to purchase 2,250,000 shares of Common Stock. Assuming conversion of all of the 15% Notes and exercise of all of the warrants, there will be 29,591,902 shares of Common Stock outstanding. 13,457,902 of these shares are being registered for resale in this prospectus. On November 15, 2007, Shing Mei entered into an engagement agreement with Primary Capital, LLC (“PC”) for the provision of investment banking and other services as in contemplation of a reverse merger of Shing Mei or a company affiliated with Shing Mei with a publicly traded shell company and subsequent financing transaction. Under the terms of these agreements Shing Mei must pay the following: 78

  

annual retainer of $175,000; a cash fee to PC equal to 10% of the gross proceeds invested in a financing to the investors introduced by PC; warrants to purchase 10% of shares of common stock sold in a financing or underlying securities sold in a financing.

Under the terms of this agreement, for services provided by PC, including payment of fees and expenses associated with the reverse merger, PC and its affiliates shall collectively control ten percent of the shares of common stock of the post-reverse merger entity as of the date of the closing of the 15% Notes financing. On February 13, 2008, we issued to PC 1,828,222 shares of common stock and warrants to purchase 450,000 shares of common stock. On June 10, 2008, we issued to PC warrants to purchase 446,154 shares of common stock. None of these shares are currently eligible for resale under Rule 144. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information with respect to the beneficial ownership of our voting securities by (i) any person or group owning more than 5% of each class of voting securities, (ii) each director, (iii) our chief executive officer and each other executive officer whose cash compensation for the most recent fiscal year exceeded $100,000 and (iv) all executive officers and directors as a group as of July 29, 2008. 79

Amount and Nature of Beneficial Ownership (1) Name and Address of Beneficial Owner Owner of More than 5% of Class Professional Offshore Opportunity Fund Ltd. 1400 Old Country Road Suite 206 Westbury, New York 11590 (2) Primary Capital, LLC 14 Wall Street, 20th Fl. New York, NY 10005 (3) Directors and Executive Officers Yu Ping “Agatha” Shen (Chairman and CFO) (4) (6) Chia Hsiang “Peter” Chang (President) (5) (6) Ming-Kong “Michael” Ho (Director) (6) Zheng James Chen (Director) 25 East Cheryl Road Pine Brook, NJ 07058 All Directors and Executive Officers (4 persons) (1) 15,000,000 250,000 0 0 0 0 Common Stock Warrants

Percentage of Class (1) Common Stock Warrants

2,176,437

1,500,000

9.9 %

6.4 %

1,213,749

896,154

5.5 %

3.9 %

68 % 1.1 % 0

0 0 0

0

0

0

0

15,250,000

0

69.1 %

0

In determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common stock which may be acquired on exercise of warrants or options or conversion of convertible securities within 60 days of that date. In determining the percent of common stock owned by a person or entity on July 29, 2008, (a) the numerator is the number of shares of common stock beneficially owned by such selling stockholder (including shares that he has the right to acquire within 60 days of July 29, 2008 ), and (b) the denominator is the sum of (i) the 21,984,215 shares outstanding on July 29, 2008 and (ii) the number of shares of common stock which such selling stockholders has the right to acquire within 60 days of July 29, 2008 upon conversion of the notes and exercise of warrants. Unless otherwise stated, each beneficial owner has sole power to vote and dispose of its shares. 80

(2)

Under the Exchange Agreement, on February 13, 2008 we issued to Professional Offshore Opportunity Fund Ltd. who had been an investor in the 10% Secured Convertible Notes (the “10% Notes”) of Shing Mei, 2,176,437 shares of our common stock in exchange for a portion of the 10% Note of Shing Mei, and warrants to purchase 1,500,000 shares of our common stock at $1.00 per share in exchange for warrants of Shing Mei issued to Professional Offshore Opportunity Fund Ltd. in connection with the sale and issuance of the 10% Notes. A portion of the 10% Note representing 868,563 shares of common stock remains unconverted because of the limitation on its conversion which makes the note unconvertible to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock. The warrants contain limitation on their exercise, which makes the warrants unexercisable to the extent the holder would upon exercise, beneficially own more than 9.9% of the common stock. On February 13, 2008 we issued a total of 1,828,222 shares of our common stock to Primary Capital, LLC in compensation for fees and expenses, paid by Primary Capital, LLC on behalf of SJ Electronics, Inc., and for merger, acquisition and investment banking advisory services rendered, and warrants to purchase 450,000 shares of our common stock in exchange for warrants of Shing Mei issued to Primary Capital, LLC in connection with the sale of the 10% Notes. On June 10, 2008 we also issued the warrant to purchase 446,154 shares of our common stock to Primary Capital in connection with the sale of the 15% Notes. Primary Capital, LLC transferred 614,473 shares of common stock in consideration for consulting services to certain persons, each of whom is listed in the “Selling Stockholders” section of this prospectus. On February 13, 2008, pursuant to the Exchange Agreement we issued 15,000,000 shares of our common stock to Ms. Shen in exchange for all of the equity of Shing Mei. Includes 250,000 shares of our common stock issued to Mr. Chang pursuant to his employment agreement with Shing Mei, dated January 31, 2008 upon achievement of certain milestones by the Company. 750,000 shares of our common stock have been placed in escrow and will be released to Mr. Chang if the remaining milestones have been achieved by the Company. The address of each of the officers and directors (except for Zheng James Chen) named in the table is 5F, No. 166, Sinhu 2nd Road, Weihu District, Taipei City 114, Taiwan. 81

(3)

(4)

(5)

(6)

DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS Our Directors and Executive Officers Our executive officers and directors as of the date of this prospectus are as follows: Directors and Executive Officers Yu Ping “Agatha” Shen

Position/Title Director, Chairman of the Board, Chief Financial Officer Director, President Director Director

Age 49

Chia Hsiang “Peter” Chang Ming-Kong “Michael” Ho Zheng James Chen

44 50 42

The following is a summary of the biographical information of our directors and officers: Yu Ping “Agatha” Shen has been Director of the Company since February 2008. She has been Chairman of the Board and Chief Financial Officer of the Company since May 2008. Ms. Shen has also been the President of Shing Mei since March 2002. She has also been Chairman of S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd., Guangxi Hezhou XU JUN Electronics Co., Ltd., Xujun Electronic (Ganzhou) Co., Ltd., S.J. Electronics Technology (Shenzhen) Co., Ltd., TechPower-Semi Enterprise Co., Ltd., S.J. International Pte., Ltd., each a subsidiary of Shing Mei. Ms. Shen holds a degree from Shih Hsing University in Taiwan. 82

Chia-Hsiang “Peter” Chang has been Director and President of the Company since May 2008. He has been General Manager of Shing Mei since March 2002. Mr. Chang earned a degree in mechanical engineering from National Taipei University of Technology, Taiwan in 1983. Mr. Chang overseas all manufacturing and manages all the day to day operations of the Company. Ming-Kong “Michael” Ho has been Director and Vice President of Sales and Marketing of the Company since March 2008. He has been Vice President of Sales and Marketing of Shing Mei since March 2006. From January 2002 through December 2004, he was CEO of Lee Sheng Footware. From January 2005 through February 2006, he was a specialist at Phino Electronics Ltd. Mr. Ho holds degrees in electrical engineering from Taipei Industrial Technology and in computer science from UCLA. Zheng James Chen has been Director of the Company since May 2008. Mr. Chen has more than twenty years of business management experience. From 2003 until 2005 he was research associate at Fulcrum Global Partners. From 2005 until present Mr. Chen has been vice-president and senior research analyst at BB&T Capital Markets. Mr. Chen holds degrees in business administration, finance and accounting from New York University, in chemical engineering from University of Connecticut and in polymer material engineering from East China University of Science and Technology. Mr. Chen has not had any relationship with us (either as a partner, stockholder or employee) in the past three years and he is qualified as an independent director as defined by rules of the Nasdaq Stock Market. All of our directors hold offices until our next annual meeting of the shareholders and until their successors have been qualified after being elected or appointed. Officers serve at the discretion of the board of directors. 83

There are no family relationships among our directors and executive officers. There is no arrangement or understanding between or among our executive officers and directors pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current board of directors. Our directors and executive officers have not, during the past five years:    had any bankruptcy petition filed by or against any business of which he was a general partner or executive officer, either at the time of the bankruptcy or within two years prior to that time, been convicted in a criminal proceeding and is not subject to a pending criminal proceeding, been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities, futures, commodities or banking activities; or been found by a court of competent jurisdiction (in a civil action), the Securities Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacate



Audit Committee Financial Expert Our board of directors currently acts as our audit committee. Our board of directors has not yet determined whether we have a member who qualifies as an "audit committee financial expert" as defined in Item 407(d) of Regulation S-K, and is "independent" as the term is used in Rule 10A-3(b) under the Exchange Act. Our board of directors is in the process of searching for a suitable candidate for this position. 84

Audit Committee We have not yet appointed an audit committee, and our board of directors currently acts as our audit committee. At the present time, we believe that the members of board of directors are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. Our company, however, recognizes the importance of good corporate governance and intends to appoint an audit committee comprised entirely of independent directors, including at least one financial expert. Compensation Committee We do not presently have a Compensation Committee. Our board of directors presently performs that function. Nominating Committee We do not presently have a Nominating Committee. Our board of directors presently performs that function. EXECUTIVE COMPENSATION The following is a summary of the compensation paid by us to the individuals who have served as our CEO or CFO for the two years ended December 31, 2007 and 2006. Other than Mr. Chang, no executive officer received compensation in excess of $100,000 in 2006 or 2007. 85

. Salary (cash or non-cash) ($) 94,697 94,697 113,636 113,636

Name and Principal Position Yu Ping “Agatha” Shen Chairman and CFO Chia Hsiang “Peter” Chang Director and President Employment Agreements

Year 2007 2006 2007 2006

Total ($) 94,697 94,697 113,636 113,636

Shing Mei has entered into employment agreements with each of Yu Ping “Agatha” Shen, Peter Chang and Michael Ho to act as its President, General Manager and Vice President, respectively. Other than the compensation provisions, the agreements are identical in al material respects. Under the terms of the agreement, the Company will pay compensation to each as follows (based on $1 USD = 31.68 TWD): Agatha Shen Salary: $94, 697 USD (TWD 3,000,000) base salary per annum, payable monthly. Peter Chang Salary: $113,636 USD (TWD 3,600,000) base salary per annum, payable monthly. Under the terms of Mr. Chang’s employment agreement as amended, the Company, at the closing of the Reverse Merger, deposited into escrow 1,000,000 shares of Common Stock that will be released to him as follows: Shares Released 125,000 125,000 125,000 625,000 86

Event Timely filing of the Company’s 2007 annual report on Form 10-K 2007 pre tax income greater than $4,000,000 Timely filing of the Company’s 2008 annual report on Form 10-K 2008 pre tax income equal to or greater than $11,000,000

The first two milestones have been achieved and on June 27, 2008, 250,000 shares of our Common Stock were released to Mr. Chang from the escrow. Our stock price on June 27, 2008 was $2.75 per share as reported by OTCBB. Therefore, the dollar value of the stock grant to Mr. Chang was $687,500. Mike Ho Salary: $29,545 USD (TWD 936,000) base salary per annum, payable monthly Annual bonus (not guaranteed): one month salary Performance bonus: 20% of the annual base Each of the agreements has a term of one year. The Company may terminate Ms. Shen for cause without paying any compensation. As used in the agreement, the term “for cause” means:(i) commission of a crime involving dishonesty, breach of trust, or physical harm to any person; (ii) willful engagement in conduct that is in bad faith and materially injurious to the Company, including but not limited to, misappropriation of trade secrets, fraud or embezzlement; (iii) a material breach of the agreement, which breach is not cured within 10 days after written notice of such breach is delivered by the Company; (iv) willful refusal to implement or follow a reasonable and lawful policy or directive of the Company, which breach is not cured within 10 days after written notice is delivered by the Company; or (v) malfeasance demonstrated by a pattern of failure to perform job duties diligently and professionally. Each of the agreements contains standard non-disclosure and prohibits the employee from competing with the Company in its territory for a period of two years following the termination of employment for any reason Outstanding Equity Awards at Fiscal Year-End As of December 31, 2007 and 2006, we did not have any stock option plan or stock incentive plan and there were no outstanding equity awards. 87

Director Compensation We have no formal or informal arrangements or agreements to compensate our directors for services they provide as directors. We plan to implement a compensation program for our independent directors, as and when they are appointed, which we anticipate will include such elements as an annual retainer, meeting attendance fees and stock options. The details of such compensation program will be negotiated with each such director. None of our officers and directors received any option grants or exercised any options during the last fiscal year. Compensation Discussion and Analysis SJEL strives to provide its named executive officers (as defined in Item 402 of Regulation S-K) with a competitive base salary that is in line with their roles and responsibilities when compared to peer companies of comparable size in the same or similar locality. It is not uncommon for Taiwan and PRC private corporations to have base salaries as the sole and only form of compensation. The base salary level is established and reviewed based on the level of responsibilities, the experience and tenure of the individual and the current and potential contributions of the individual. The base salary is compared to the list of similar positions within comparable peer companies and with consideration of the executive’s relative experience in his or her position. Base salaries are reviewed periodically and at the time of promotion or other changes in responsibilities. We plan to implement a more comprehensive compensation program, which takes into account other elements of compensation, including without limitation, short and long term compensation, cash and non-cash, and other equity-based compensation such as stock options. Such compensation program shall be comparative to our peers in the industry and aimed to retain and attract talented individuals. 88

We will also consider forming a Compensation Committee comprising predominantly of independent directors to oversee the compensation of our named executive officers. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Except for the ownership of the Company’s securities, and except as set forth below and in Note 15 “Related Party Transactions ” to our Consolidated Financial Statements as of December 31, 2007 and 2006, none of the directors, executive officers, holders of more than five percent of the Company’s outstanding common stock, or any member of the immediate family of any such person have, to the knowledge of the Company, had a material interest, direct or indirect, in any transaction or proposed transaction which may materially affect the Company. Procedures for Approval of Related Party Transactions Our board of directors is charged with reviewing and approving all potential related party transactions. All such related party transactions must then be reported under applicable SEC rules. We have not adopted other procedures for review, or standards for approval, of such transactions, but instead review them on a case-by-case basis. Director Independence We are not subject to listing requirements of any national securities exchange or national securities association and, as a result, we are not at this time required to have our board comprised of a majority of independent directors. Zheng James Chen has not had any relationship with us (either as a partner, stockholder or employee) in the past three years and he is qualified as an independent director as defined by rules of the Nasdaq Stock Market. LEGAL PROCEEDINGS To our knowledge, there is no material litigation pending or threatened against us. 89

DESCRIPTION OF SECURITIES TO BE REGISTERED Our authorized capital stock consists of (i) 100,000,000 shares of Common Stock, par value $0.001 per share, of which there are 21,984,215 shares issued and outstanding, and (ii) 5,000,000 shares of preferred stock, par value $0.001 per share (“Preferred Stock”) . The following is a summary of the material terms of our capital stock. This summary is subject to and qualified in its entirety by our Articles of Incorporation, our By-laws and by the applicable provisions of Nevada law. Common Stock All shares of Common Stock have one vote per share on all matters including election of directors, without provision for cumulative voting. The Common Stock is not redeemable and has no conversion or preemptive rights. In the event of liquidation of the Company, the holders of Common Stock will share equally in any balance of the Company's assets available for distribution to them after satisfaction of creditors and preferred shareholders, if any. The holders of Common Stock are entitled to equal dividends and distributions per share with respect to the Common Stock when, as and if, declared by the board of directors from funds legally available. Preferred Stock and Warrants For a more detailed description of our preferred stock and warrants, please see the discussion in the “Business” section of this prospectus. In addition to the 100,000,000 shares of Common Stock, we are authorized to issue 5,000,000 shares of Preferred Stock. Shares of the Preferred Stock may be issued from time to time in one or more classes or series, each of which class or series shall have such distinctive designation or title as shall be fixed by the board of directors prior to the issuance any shares thereof. 90

The issuance of shares of Preferred Stock, or the issuance of rights to purchase such shares, could be used to discourage an unsolicited acquisition proposal. For instance, the issuance of a series of Preferred Stock might impede a business combination by including class voting rights that would enable the holder to block such a transaction, or facilitate a business combination by including voting rights that would provide a required percentage vote of the shareholders. In addition, under certain circumstances, the issuance of Preferred Stock could adversely affect the voting power of the holders of the common stock. Although the board of directors is required to make any determination to issue such stock based on its judgment as to the best interests of our shareholders, the board of directors could act in a manner that would discourage an acquisition attempt or other transaction that some, or a majority, of the shareholders might believe to be in their best interests or in which shareholders might receive a premium for their stock over the then market price of such stock. The board of directors does not at present intend to seek stockholder approval prior to any issuance of currently authorized preferred stock, unless otherwise required by law. LEGAL MATTERS Our counsel, Guzov Ofsink, LLC, located at 600 Madison Avenue, 14th Floor, New York, New York 10022, is passing upon the validity of the issuance of the common stock that we are offering under this prospectus. EXPERTS Kempisty & Company Certified Public Accountants, P.C., independent registered public accountants, have audited our financial statements included in this registration statement to the extent and for the periods set forth in their report. We have relied on such reports given upon the authority of such firm as experts in accounting and auditing. INTERESTS OF NAMED EXPERTS AND COUNSEL No "expert" or "counsel" as defined by Item 509 of Regulation S-K promulgated under the Securities Act, whose services were used in the preparation of this Form S-1, was hired on a contingent basis or will receive a direct or indirect interest in us or our parents or subsidiaries, nor was any of them a promoter, underwriter, voting trustee, director, officer or employee of the Company. 91

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS Previous Independent Accountants On April 23, 2008, we dismissed Kempisty & Company Certified Public Accountants, P.C., as our independent accountant. The reports of Kempisty & Company Certified Public Accountants, P.C., on our financial statements for each of the past two fiscal years contained no adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles. The decision to change independent accountants was approved by our Board of Directors on April 23, 2008. During our two most recent fiscal years and through the date of this report, we have had no disagreements with Kempisty & Company Certified Public Accountants, P.C., on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Kempisty & Company Certified Public Accountants, P.C., would have caused it to make reference to the subject matter of such disagreements in its report on our financial statements for such periods. We provided Kempisty & Company Certified Public Accountants, P.C., with a copy of this disclosure before its filing with the SEC. We requested that Kempisty & Company Certified Public Accountants, P.C., provide us with a letter addressed to the SEC stating whether or not it agrees with the above statements, and we received a letter from Kempisty & Company Certified Public Accountants, P.C., stating that it does agree with the above statements. A copy of such letter, dated as of April 28, 2008, is filed as Exhibit 16.1 to our current report on Form 8-K filed with the SEC on April 29, 2008. 92

New Independent Accountants Our Board of Directors appointed Bagell, Josephs, Levine & Company, L.L.C. as our new independent registered public accounting firm effective as of April 23, 2008. During the two most recent fiscal years and through the date of our engagement, we did not consult with Bagell, Josephs, Levine & Company, L.L.C. regarding either (1) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements, or (2) any matter that was either the subject of a disagreement (as defined in Regulation S-K Item 304(a)(1)(v)), during the two most recent fiscal years. FINANCIAL STATEMENTS Our consolidated audited financial statements for the fiscal years ended December 31, 2007 and 2006, together with the report of the independent certified public accounting firm thereon and the notes thereto, are presented beginning at page F-1. Our unaudited consolidated financial statements for the three months ended March 31, 2008 and 2007 are presented beginning at page F-22. WHERE YOU CAN FIND MORE INFORMATION We have filed with the U.S. Securities and Exchange Commission, 100 F. Street, N.E., Washington, D.C. 20549, a registration statement on Form S-1 under the Securities Act for the common stock offered by this prospectus. We have not included in this prospectus all the information contained in the registration statement and you should refer to the registration statement and its exhibits for further information. The registration statement and other information may be read and copied at the SEC's Public Reference Room at 100 F. Street N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains a web site (HTTP://WWW.SEC.GOV.) that contains the registration statements, reports, proxy and information statements and other information regarding registrants that file electronically with the SEC such as us. 93

You may also read and copy any reports, statements or other information that we have filed with the SEC at the addresses indicated above and you may also access them electronically at the web site set forth above. These SEC filings are also available to the public from commercial document retrieval services. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES Our bylaws provide that we will indemnify our directors and officers from all liabilities incurred by them in connection with any action, suit or proceeding in which they are involved by reason of their acting as our directors and officers. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. 94

PART II: INFORMATION NOT REQUIRED IN PROSPECTUS Item 13. Other Expenses of Issuance and Distribution Although we will not receive any of the proceeds from the sale of the shares being registered in this registration statement, we have agreed to bear the costs and expenses of the registration of those shares. Our expenses in connection with the issuance and distribution of the securities being registered, other than the underwriting discount, are as follows: SEC Registration Fee Professional Fees and Expenses* Filing, Printing and Shipping Fees * Total $ $ $ $ 1,190 90,000 2,000 93,190 *

* Estimates Item 14. Indemnification of Directors and Officers Our by-laws provide for the indemnification of our directors, officers, employees, and agents, under certain circumstances, against attorney's fees and other expenses incurred by them in any litigation to which they become a party arising from their association with or activities on our behalf. We will also bear the expenses of such litigation for any of our directors, officers, employees, or agents, upon such persons promise to repay us therefore if it is ultimately determined that any such person shall not have been entitled to indemnification. This indemnification policy could result in substantial expenditures by us, which it may be unable to recoup. II-1

Item 15. Recent Sales of Unregistered Securities On May 15, 2008 we entered into and consummated the Note Purchase Agreement to sell to certain accredited investors and to non-US persons 15% Notes at closings to occur on or before July 31, 2008. On May 15, 2008 the first closing under the Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $2,950,000. On May 30, 2008 the second closing under the Note Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $700,000. On June 10, 2008 the third and the final closing under the Note Purchase Agreement took place at which we sold to certain investors and to non-US persons 15% Notes in the aggregate principal amount of $2,150,000. The aggregate principal amount of the 15% Notes sold at all three closings under the Note Purchase Agreement was $5,800,000. The transaction qualified as an exempt transaction under Section 4(2) of the Securities Act, as amended, and Rule 506 of Regulation D and Regulation S promulgated thereunder. On February 13, 2008 we acquired Shing Mei Enterprises Ltd. (“Shing Mei”) by entering into a reverse merger transaction. In the reverse merger, pursuant to a Securities Exchange Agreement (the “Exchange Agreement”) we acquired all of the equity of Shing Mei, a Samoa corporation engaged in the business of manufacturing computer components, in exchange for issuing 15,000,000 shares of Common Stock, representing approximately 68% of our outstanding common stock, to the owner of Shing Mei. Under the Exchange Agreement, we also issued to a number of investors who previously had provided bridge financing to Shing Mei, 3,698,937 shares of our common stock in exchange for promissory notes evidencing debt obligations by Shing Mei, and warrants to purchase 2,250,000 shares of our common stock at $1.00 per share in exchange for warrants of Shing Mei issued to the investors in the bridge financing. The transaction qualified as an exempt transaction under Section 4(2) of the Securities Act, as amended, and Rule 506 of Regulation D and Regulation S promulgated thereunder. II-2

On November 15, 2007, Shing Mei entered into an engagement agreement with Primary Capital, LLC (“PC”) for the provision of investment banking and other services as in contemplation of a reverse merger of Shing Mei with a publicly traded shell company and a future financing transaction. Under the terms of this agreement Shing Mei must pay the following:    annual retainer of $175,000; a cash fee to PC equal to 10% of the gross proceeds invested in a financing to the investors introduced by PC; warrants to purchase 10% of shares of common stock sold in a financing or underlying securities sold in a financing.

Under the terms of this agreement, for services provided by PC, including payment of fees and expenses associated with the reverse merger, PC and its affiliates shall collectively control ten percent of the shares of common stock of the post-reverse merger entity as of the date of the closing of the 15% Notes financing. On February 13, 2008, we issued to PC 1,828,222 shares of common stock and warrants to purchase 450,000 shares of common stock. On June 10, 2008, we issued to PC warrants to purchase 446,154 shares of common stock. The transaction qualified as an exempt transaction under Section 4(2) of the Securities Act, as amended, and Rule 506 of Regulation D promulgated thereunder. In April 2006, we issued 4,000,000 post-split shares of common stock to Steven L. White for $10,000. In May 2006, we issued an additional 4,000,000 post-split shares of common stock to Steven L. White for $10,000. Also in May 2006 the Company issued 500,000 shares of restricted common stock to an investor for $2,500 and 500,000 shares to an investor for $2,500. In June 2006 the Company issued two convertible promissory notes for $2,500 each for a total of $5,000, bearing interest at 8% per annum and convertible into 500,000 shares of common stock each. The transactions qualified as exempt transactions under Section 4(2) of the Securities Act, as amended. II-3

Other than the securities mentioned above, we have not issued or sold any securities without registration for the past three years from the date of this registration statement. Item 16. Exhibits and Financial Statement Schedules (a) Exhibits Exhibit No. 3.1 3.2 3.3 3.4 4.1 4.2 5.1 10.1 10.2

Description of Exhibit Articles of Incorporation of SJ Electronics, Inc., as amended.(1) Amended and Restated Bylaws of SJ Electronics, Inc. (1) Specimen Common Stock Certificate* Form of 15% Senior Secured Convertible Note due 2009 (2) Form of Warrant* Form of Placement Agent Warrant issued on June 10, 2008* Legal Opinion of Guzov Ofsink, LLC regarding legality of the common stock being registered.* Securities Exchange Agreement, dated as of February 13, 2008, by and between the Company and Shing Mei* Form of Note Purchase Agreement, dated as of May 15, 2008, by and among the Company and each of the other investors party thereto (2) II-4

10.3

Form of Pledge and Security Agreement dated as of May 15, 2008 by the Company and Agatha Shen in favor of Tri-State Title & Escrow, LLC in its capacity as Collateral Agent for and on behalf of the noteholders (2) Form of Lockbox Agreement dated as of May 15, 2008 by and among the Company, the Collateral Agent and Ming Liu in his capacity as Lockbox Agent (2) Form of Collateral Agency Agreement dated as of May 15, 2008 by and among the Collateral Agent and the noteholders listed as parties thereto (2) Engagement Agreement dated November 15, 2007 by and between Shing Mei and Primary Capital, LLC* Modification Agreement dated February 12, 2008 to the Engagement Agreement dated November 15, 2007 by and between Shing Mei and Primary Capital, LLC.* Employment Agreement dated January 31, 2008 by and between Shing Mei and Agatha Shen. (3) Employment Agreement dated January 31, 2008 by and between Shing Mei and Peter Chang. (3) Addendum dated March 5, 2008 to the Employment Agreement dated January 31, 2008 by and between Shing Mei and Peter Chang. (4) Employment Agreement dated January 31, 2008 by and between Shing Mei and Mike Ho. (3) Securities Purchase Agreement dated December 20, 2007 by and among Shing Mei and the purchasers listed as parties thereto.* II-5

10.4

10.5

10.4 10.5

10.6 10.7 10.8

10.9 10.10

16.1 21.1 23.1

Letter from Kempisty & Company Certified Public Accountants, PC to the SEC (5) List of Subsidiaries* Consent of counsel to the use of the opinion annexed at Exhibit 5.1 (contained in the opinion annexed at Exhibit 5.1)

23.2 Consent of Kempisty & Company Certified Public Accountants, PC, for use of their report.* __________________ (1) Incorporated by reference to the Company’s Registration Statement on Form 10-SB filed November 21, 2006. (2) (3) (4) (5) * Incorporated by reference to the Company’s Current Report on Form 8-K filed May 25, 2008. Incorporated by reference to the Company’s Current Report on Form 8-K filed February 14, 2008. Incorporated by reference to the Company’s Current Report on Form 8-K filed March 10, 2008. Incorporated by reference to the Company’s Current Report on Form 8-K filed April 29, 2008. Filed herewith. (b) Financial Statement Schedules. None II-6

Item 17. Undertakings The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

i. To include any prospectus required by Section 10(a)(3) of the Securities Act; ii. To reflect in the prospectus any facts or events arising after the effective date of the registration statement(or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective Registration Statement; iii. To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; (3) File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering. II-7

(4)

That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

Each prospectus filed by the Registrant pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. Insofar as indemnification for liabilities arising under the Act may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the small business issuer will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-8

SIGNATURES In accordance with the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned thereunto duly authorized in the City of Taipei, Taiwan, on August 1, 2008. SJ Electronics, Inc. s/ Peter Chang By Peter Chang President and Director (principal executive officer) In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates indicated. Name and Title /s/ Peter Chang Peter Chang, President and Director (principal executive officer) /s/ Agatha Shen Agatha Shen, Chairman and Chief Financial Officer and Director (principal financial officer) /s/ Mike Ho Mike Ho, Director /s/ James Chen James Chen, Director II-9 August 1, 2008 Date

August 1, 2008

August 1, 2008

August 1, 2008

ACHERON, INC. CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2007

ACHERON, INC. INDEX PAGE REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM CONSOLIDATED BALANCE SHEETS CONSOLIDATED STATEMENTS OF OPERATIONS CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY AND COMPREHENSIVE INCOME (LOSS) CONSOLIDATED STATEMENTS OF CASH FLOWS NOTES TO CONSOLIDATED FINANCIAL STATEMENTS F-1 F-2 F-3 F-4

F-5 F-6 F-7-F-21

KEMPISTY & COMPANY
CERTIFIED PUBLIC ACCOUNTANTS, P.C. 15 MAIDEN LANE - SUITE 1003 - NEW YORK, NY 10038 - TEL (212) 406-7272 - FAX (212) 513-1930 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors Acheron, Inc. We have audited the accompanying balance sheets of Acheron, Inc. as of December 31, 2007 and 2006 and the related consolidated statements of operations, changes in stockholder’s equity and comprehensive income (loss) and cash flows for each of the years in the two year period ended December 31, 2007. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required at this time, to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As discussed in Note 1 to the consolidated financial statements, the accompanying consolidated balance sheets as of December 31, 2007 and 2006, and the related consolidated statements of operations, changes in stockholders’ equity and comprehensive income (loss) and cash flows for the years then ended have been restated. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Acheron, Inc. at December 31, 2007 and 2006 and the results of its operations and its cash flows for each of the years in the two year period ended December 31, 2007 in conformity with accounting principles generally accepted in the in the United States of America. [sig] Kempisty & Company Certified Public Accountants PC New York, New York March 14, 2008 (Except for Note 1, July 31, 2008) F-2

Acheron, Inc.
Consolidated Balance Sheets (In US Dollars) December 31, 2007 (restated) ASSETS Current Assets Cash and cash equivalents Accounts receivable, net (Note 4) Inventory (Note 5) Due from related parties (Note 15) Prepaid expenses and other receivables Security deposit Total Current Assets Deferred debt issuance cost Property, plant and equipment, net (Note 7) Total Assets LIABILITIES Current Liabilities Accounts payable and accrued liabilities Short-term loans (Note 8) Convertible notes payable (Note 16) Wages payable Capital lease payable (Note 9) Interest payable Due to related parties (Note 15) Total Current Liabilities Capital lease payable (Note 9) Total Liabilities Commitments and Contingencies (Note 11) Stockholder's Equity Preferred stock ($0.001 par value, 5,000,000 shares authorized, none issued and outstanding) (Note 2) Common stock ($0.001 par value, 40,000,000 shares authorized, 15,000,000 issued and outstanding) (Note 2) Additional Paid-in Capital (Note 2) Retained earnings-Restricted (Note 10) Retained earnings-Unrestricted Accumulated other comprehensive income (loss) Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ $ December 31, 2006 (restated)

$

812,274 21,990,170 7,274,943 104,514 114,703 30,296,604 185,123 5,205,148 35,686,875

$

464,693 17,470,588 5,437,952 214,632 91,189 23,679,054 4,039,132

$

27,718,186

$

13,566,018 10,652,538 2,250,000 671,010 179,305 24,478 4,578,420 31,921,769 226,220 32,147,989 -

$

11,860,099 3,099,265 653,804 2,526,330 18,139,498 18,139,498 -

15,000 3,611,503 (87,617 ) 3,538,886 35,686,875 $

15,000 8,683,710 1,010,218 (130,240 ) 9,578,688 27,718,186

The accompanying notes are an integral part of these financial statements. F-3

Acheron, Inc.
Consolidated Statements of Operations (In US Dollars) For The Year Ended December 31, 2007 2006 (restated) Sales Cost of goods sold Gross Profit Operating Costs and Expenses: Selling expenses General and administrative (Gain) loss on disposal of assets Total operating costs and expenses Income From Operations Interest income (expenses) - net Other income (expenses) - net Income Before Income Taxes Income taxes Net income Other Comprehensive Income: Foreign currency translation adjustment Comprehensive income Basic and diluted earnings per share Basic and diluted weighted average shares outstanding $ $ $ 56,355,689 $ (48,634,296 ) 7,721,393 504,937 2,264,487 (13,358 ) 2,756,066 4,965,327 (585,382 ) (113,352 ) 4,266,593 4,266,593 (restated) 42,262,512 (39,071,833 ) 3,190,679 458,075 1,890,253 600,115 2,948,443 242,236 (86,031 ) 52,515 208,720 208,720

42,623 4,309,216 0.28 15,000,000 $ $

(227,590 ) (18,870 ) 0.01 15,000,000

The accompanying notes are an integral part of these financial statements. F-4

Acheron, Inc.
Consolidated Statements of Changes in Stockholder’s Equity and Comprehensive Income (Loss) For the years ended December 31, 2007 and 2006 (In US Dollars) (Restated) Accumulated Other Comprehensive Income (Loss) 97,350 $ -

Common Stock $0.001 par value Shares Amount Balance, December 31, 2005 Additional paid-in capital Net income Foreign currency translation adjustment Balance, December 31, 2006 Additional paid-in capital Dividend Net income Foreign currency translation adjustment Balance, December 31, 2007 15,000,000 $ 15,000 $ -

Additional Paid-in Capital 5,614,185 $ 3,069,525 -

Retained Earnings Restricted - $ -

Retained Earnings Unrestricted 801,498 $ 208,720

Total 6,528,033 3,069,525 208,720

15,000,000 -

15,000 -

8,683,710 (2,039,751 ) (3,032,456 ) -

-

1,010,218 (5,276,811 ) 4,266,593

(227,590 ) (130,240 ) -

(227,590 ) 9,578,688 (2,039,751 ) (8,309,267 ) 4,266,593

-

-

3,611,503 $

- $

- $

42,623 (87,617 ) $

42,623 3,538,886

15,000,000 $ 15,000 $

The accompanying notes are an integral part of these financial statements. F-5

Acheron, Inc.
Consolidated Statements of Cash Flows (In US Dollars) For The Year Ended December 31, 2007 2007 (restated) (restated) Operating activities Net income Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation (Gain) loss on disposal of assets Changes in operating assets and liabilities: Accounts receivable, net Prepaid expenses and other receivables Security deposit Inventory Interest payable Wages payable Accounts payable and accrued liabilities Net cash provided by (used in) operating activities Investing activities Property, plant and equipment additions Net cash provided by (used in) investing activities Financing activities Due from related parties Due to related parties Short term loan proceeds Long-term Loans Payable Additional Paid-in Capital Dividend Net cash provided by (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year Interest paid Income taxes paid $ $ $ $ 4,266,593 691,112 (13,358 ) (4,519,582 ) (13,325 ) (114,703 ) (1,850,349 ) 24,478 17,206 1,705,919 193,991 (1,857,128 ) (1,857,128 ) 214,632 2,052,090 9,618,150 405,525 (2,039,751 ) (8,309,267 ) 1,941,379 69,339 347,581 464,693 812,274 590,304 $ $ $ $ 208,720 491,307 600,115 (7,707,919 ) (89,404 ) (1,609,050 ) 506,551 5,420,832 (2,178,848 ) (3,445,093 ) (3,445,093 ) (142,600 ) 2,526,330 1,994,699 3,069,525 7,447,954 (1,427,820 ) 396,193 68,500 464,693 89,066 -

The accompanying notes are an integral part of these financial statements. F-6

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007

NOTE 1 – RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS SJ’s previously issued financial statements are being restated as a result of an internal review of its previously issued financial statements. SJ determined that it incorrectly calculated its foreign exchange gain (loss) and incorrectly reflected a related party liability as a contribution to capital. SJ also believes such restatements reflect the correction of any errors and omissions of material disclosures in the financial statements in accordance with SFAS 154: Accounting changes and error corrections (as amended). The following are explanations of the restatement adjustments and presentation of affected accounts in the consolidated balance sheet and statement of operations as previously reported and restated. Statements of Operations and Statements of Changes in Stockholders’ Equity and Comprehensive Income for the years ended December 31, 2007 and 2006 The Company restated its operating income and comprehensive income (loss) for the years ended December 31, 2007 and 2006 due to an incorrect calculation of the foreign exchange gain (loss). The losses on foreign change charged to operations in 2007 and 2006 were $240,167 and $133,330, respectively. Balance Sheets December 31, 2007 and 2006 Adjustments were made to Due to affiliates and additional paid in capital to reflect the $4,566,081 and $2,526,330 related party liabilities reflected as contributed capital at December 31, 2007 and 2006. The consolidated financial statements as of December 31, 2007 and 2006 and for the ended December 31, 2007 and 2006, and the notes thereto, have been restated to include the items identified above. The following financial statement line items were impacted: Consolidated Balance Sheet As Previously Reported Year Ended December 31, 2007 Due to related parties Additional paid in capital Retained earnings Accumulated other comprehensive income (loss) $ 12,339 $ 8,551,081 (461,114 )

Restated Year Ended December 31, 2007 4,578,420 3,611,503 (87,617 )

As Previously Reported Year Ended December 31, 2006 Due to related parties Additional paid in capital Retained earnings Accumulated other comprehensive income (loss) F-7 $ - $ 11,210,040 1,143,548 (263,570 )

Restated Year Ended December 31, 2006 2,526,330 8,683,710 1,010,218 (130,240 )

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 1 – RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (continued) Consolidated Statement of Operations As Previously Reported Year Ended December 31, 2007 General and administrative Total operating costs and expenses Income From Operations Income Before Income Taxes Net income Foreign currency translation adjustment Basic and diluted earnings per share $ 2,024,320 $ 2,515,899 5,205,494 4,506,760 4,506,760 (197,544 ) 0.30 As Previously Reported Year Ended December 31, 2006 General and administrative Total operating costs and expenses Income From Operations Income Before Income Taxes Net income Foreign currency translation adjustment Basic and diluted earnings per share F-8 $ 1,756,923 $ 2,815,113 375,566 342,050 342,050 (360,920 ) 0.02

Restated Year Ended December 31, 2007 2,264,487 2,756,066 4,965,327 4,266,593 4,266,593 42,623 0.28

Restated Year Ended December 31, 2006 1,890,253 2,948,443 242,236 208,720 208,720 (227,590 ) 0.01

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 2 – ORGANIZATION AND NATURE OF BUSINESS Organization and Operations Acheron was formed as a Nevada corporation on June 23, 1994 as Harvest E-xpress. On May 1, 1997, it changed its name to HLS (USA), Inc. On April 13, 2006, it changed its name to Acheron, Inc. Originally, Acheron’s business was grain cutting and custom machine hire. It did not succeed in its business and it began seeking another opportunity. In 1997, Acheron purchased HLS Corporation Unlimited to pursue the business of HLS whose asset consisted of securities representing approximately a 46% indirect interest in Henan Xinfei Co. Ltd., a Sino-foreign equity joint venture engaged in the manufacture and sale of refrigerators and freezers in China. The terms of the acquisition were never met and in August 1999, it completed the unwinding of the transaction with HLS and Acheron has been inactive since that time. On February 13, 2008, Acheron, Inc. (the “Acheron”) entered into and completed the transactions contemplated under a Securities Exchange Agreement (the “Exchange Agreement”) with the shareholder (the “Shareholder”) of Shing Mei Enterprises Ltd., a corporation organized under the laws of Samoa (the ”Company,” “we” or “Shing Mei”), pursuant to which the Acheron purchased from the Shareholder all issued and outstanding shares of the Company’s common stock in consideration for the issuance of 15,000,000 shares of common stock of the Company, (the "Share Exchange"). The Share Exchange resulted in a change in control of Acheron with the Shareholder owning 15,000,000 shares of common stock of the Company out of a total of 21,984,215 issued and outstanding shares after giving effect to the Share Exchange, or approximately 68%. Also, the Shareholder was elected a director of the Company (as well as certain of Shareholder’s nominees, subject to the Company’s disclosure obligations under the Securities Exchange Act of 1934, as amended) and appointed as its executive officer. As a result of the Exchange Agreement, (i) Shing Mei became a wholly-owned subsidiary of Acheron and (ii) Acheron succeeded to the business of Shing Mei as its sole business. Accordingly, Acheron intends to change its name to Shing Mei Enterprises Limited. In addition, Acheron issued into escrow for the benefit of one of Shing Mei’s executive officers, 1,000,000 shares that will be released to that individual upon the Company meeting certain earnings and other milestones . As part of a Securities Exchange Agreement in February, 2008, Acheron issued 4,567,500 shares of its common stock and five year warrants to purchase 2,250,000 shares at $1.00 per share to a number of accredited investors who previously had provided bridge financing to Shing Mei. These issuances were made in exchange for promissory notes evidencing debt obligations by Shing Mei and warrants to purchase Shing Mei shares. In addition, Acheron agreed to issue a total of 1,828,222 Acheron shares and warrants to purchase 450,000 shares of Acheron common stock to the placement agent for a bridge financing that was recently completed by the Company and for other investment banking services. As a result of the Exchange Agreement, (i) Shing Mei became a wholly-owned subsidiary of Acheron and (ii) Acheron succeeded to the business of Shing Mei as its sole business. Shing Mei Enterprises Ltd. (“ShingMei”) was incorporated in SAMOA in August of 2003. In September 2004, the Company increased its registered capital to $4,000,000. The incremental part of $3,000,000 was the result of new investment from the shareholder. As at December 31, 2006, the Company has had registered capital of $4,000,000 $1.00 par value capital shares authorized, issued and outstanding. In October 2004, ShingMei acquired 100% ownership of S.J. Electronics (Gongming loutsun Shenzhen) Co., Ltd., located in the City of Shenzhen in the Peoples Republic of China (“PRC”). In November 2005, ShingMei established its own 100% subsidiary, Xujun Electronic (Ganzhou) Co., Ltd, located in the city of Quannan of Jiangxi Province in PRC. In January 2006, ShingMei established its own 100% subsidiary, Guangxi Hezhou Xujun Electronics Co., Ltd. located in the city of Hezhou of Guangxi Province in PRC. F-9

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 2 – ORGANIZATION AND NATURE OF BUSINESS (continued) In August 2006, ShingMei established its own 100% subsidiary, S.J. Electronics Technology (Shenzhen) Co., Ltd. located in the city of Shenzhen of Guangdong Province in PRC. In August 2007, ShingMei established its own 100% subsidiary, FuChuan Xujun science and Technology Electronics Co., Ltd. located in the city of FuChuan of Guangxi Province in PRC. ShingMei owns 100% equity interest on its five subsidiaries (collectively referenced throughout as the “Company”) as at September 30, 2007, located in Shenzhen of Guangdong Province, Jiangxi Province and Guangxi Province in PRC individually. The Company’s primary business activities are the manufacture of electronic cable products and assembling on wire harness by its five subsidiaries in PRC, and sales of overseas by the Company. NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Principles of Consolidation The consolidated financial statements include the accounts of the ShingMei and its subsidiaries. Significant intercompany transactions have been eliminated on consolidation. In the opinion of the management, the consolidated financial statements reflect all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position of the Company as of December 31, 2007 and as of December 31, 2006 and the results of operations and cash flow for the years ended December 31, 2007 and 2006, respectively. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as well as the reported amounts of revenues and expenses. Actual results could differ from these estimates. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, cash on deposit with various financial institutions in PRC, and all highly-liquid investments with original maturities of three months or less at the time of purchase. Banks and other financial institutions in PRC do not provide insurance for funds held on deposit. Accounts Receivable Accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts based on a review of all outstanding amounts on a monthly basis. The Company analyzes the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in our customer payment terms. Significant changes in customer concentration or payment terms, deterioration of customer credit-worthiness or weakening in economic trends could have a significant impact on the collectibility of receivables and our operating results. The Management’s judgment and assessment on customers credit is severely to approve. The Company does not provide for a bad debt allowance but uses the direct write-off method due to its historical collection experiences. There was no bad debt as at December 31, 2007 and 2006. F-10

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Inventories Inventories, which are primarily comprised of raw materials, work-in-process goods, packaging materials, and finished goods, are stated at the lower of cost or net realizable value, using the first-in, first-out (“FIFO”) method. Cost is determined on the basis of a moving average. The Company evaluates the need for reserves associated with obsolete, slow-moving and non-salable inventory by reviewing net realizable values on a periodic basis. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method, with an estimated 0% salvage value of original cost, over the estimated useful lives of the assets as follows: Molds Machinery and equipment Electronic equipment Computer equipment Office equipment Automobile Leasehold improvement Other equipment 2 years 10 years 10 years 10 years 10 years 10 years 10 years 10 years

Expenditures for repairs and maintenance, which do not improve or extend the expected useful lives of the assets, are expensed as incurred while major replacements and improvements are capitalized. When property or equipment is retired or disposed of, the cost and accumulated depreciation are removed from the accounts, with any resulting gains or losses being included in net income or loss in the year of disposition. Impairment of Long-Lived Assets The Company evaluates potential impairment of long-lived assets, in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “ Accounting for the Impairment or Disposal of Long-Lived Assets ”, which requires the Company to (a) recognize an impairment loss only if the carrying amount of a long-lived asset is not recoverable from its undiscounted cash flows and (b) measure an impairment loss as the difference between the carrying amount and fair value of the asset. The Company believes that long-lived assets in the accompanying balance sheets are appropriately valued as at December 31, 2007 and 2006. Revenue Recognition The Company recognizes revenue when the significant risks and rewards of ownership have been transferred pursuant to PRC law, including such factors as when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, sales and value-added tax laws have been complied with, and collectibility is reasonably assured. The Company generally recognizes revenue when its products are shipped. Comprehensive Income The Company has adopted SFAS No. 130, “ Reporting Comprehensive Income ”, which establishes standards for reporting and displaying comprehensive income, its components, and accumulated balances in a full-set of general-purpose financial statements. Accumulated other comprehensive income represents the accumulated balance of foreign currency translation adjustments. F-11

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Concentration of Credit Risk The Company maintains cash balances at various financial institutions in PRC which do not provide insurance for amounts on deposit. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. The Company mitigates this risk by spreading its deposits over 20 banks. The Company operates principally in PRC and grants credit to its customers. Although the PRC is economically stable, it is always possible that unanticipated events both domestically and in foreign countries could disrupt either the Company’s operations or those of its customers. Foreign Currency Translation The functional currency of ShingMei is Hong Kong Dollar (“HKD”). The Company maintains its financial statements using the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. However, the functional currency of all four subsidiaries of the Company is the Renminbi (“RMB”), the PRC’s currency. Those Subsidiaries maintain their financial statements using their own functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. For financial reporting purposes, the financial statements of ShingMei, which are prepared in HKD, are translated into the Company’s reporting currency, United States Dollars (“USD”). All the financial statements of its four subsidiaries, which are prepared in RMB, are translated into the Company’s reporting currency, USD. Balance sheet accounts are translated using the closing exchange rate in effect at the balance sheet date and income and expense accounts are translated using the average exchange rate prevailing during the reporting period. Adjustments resulting from the translation, if any, are included in accumulated other comprehensive income (loss) in the owners’ equity. The exchange rates used for foreign currency translation were as follows (USD$1 = RMB): Period Covered Year ended December 31, 2005 Year ended December 31, 2006 Year ended December 31, 2007 Balance Sheet Date Rates 8.06704 7.79750 7.29410 Average Rates 8.18197 7.96369 7.44713

The exchange rates used for foreign currency translation were as follows (USD$1 = HKD): Period Covered Year ended December 31, 2005 Year ended December 31, 2006 Year ended December 31, 2007 F-12 Balance Sheet Date Rates 7.75353 7.77938 7.80190 Average Rates 7.77788 7.76895 7.80153

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Fair Value of Financial Instruments The Company's financial instruments include cash equivalents, accounts receivable, other receivables, accounts payable, accrued expenses, value-added taxes, short-term and long-term bank loans, and loans payable to related parties. The carrying amounts of financial instruments other than long-term obligations approximate fair value due to their short maturities. Long-term obligations approximate fair value based upon rates currently available for similar instruments. Debt Issuance Costs Certain costs associated with the issuance of debt instruments are capitalized and included in non-current assets on the consolidated balance sheet. These costs are amortized to interest expense over the terms of the related debt agreements on a straight-line basis. Amortization of deferred financing costs included in interest expense was $22,377 in 2007. Recent Accounting Pronouncements In July 2006, the FASB issued FASB Interpretation (“FIN”) No. 48, “ Accounting for Uncertainty in Income Taxes ”, which prescribes a comprehensive model for how a company should recognize, measure, present and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return (including a decision whether to file or not to file a return in a particular jurisdiction). The accounting provisions of FIN No.48 are effective for fiscal years beginning after December 15, 2006. The adoption of this Interpretation had no impact on our financial position or results of operations. In September 2006, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 157, “ Fair Value Measurements ”, which establishes a framework for reporting fair value and expands disclosures about fair value measurements. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The adoption of this standard will have no impact on our financial statements. In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “ The Fair Value Option for Financial Assets and Financial Liabilities ”, which includes an amendment of FASB Statement No. 115, (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of this Statement apply only to entities that elect the fair value option. However, the amendment to FASB Statement No. 115, “ Accounting for Certain Investments in Debt and Equity Securities ”, (“SFAS No. 115”), applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective for the Company’s consolidated financial statements for the annual reporting period beginning after November 15, 2007. The Company is currently evaluating the impact of this new pronouncement on its consolidated financial statements. On December 4, 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 160, Noncontrolling interest in Consolidated Financial Statements (SFAS No. 160). SFAS No. 160 requires all entities to report noncontrolling (minority) interests in subsidiaries as equity in the consolidated financial statements. The statement establishes a single method of accounting for changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation and expands disclosures in the consolidated financial statements. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years. We have not yet determined the impact of the adoption of SFAS No. 160 on our consolidated financial statements and footnote disclosures. On December 4, 2007, the FASB issued SFAS No.141R, Business Combinations ( SFAS No. 141R). SFAS No. 141R requires the acquiring entity in a business combination to recognize all the assets acquired and liabilities assumed, establishes the acquisition date fair value as the measurement objective for all assets acquired and liabilities assumed, and requires the acquirer to expand disclosures about the nature and financial effect of the business combination. SFAS No. 141R is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. We have not yet determined the impact of the adoption of SFAS No. 141R on our consolidated financial statements and footnote disclosures. F-13

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 4 – ACCOUNTS RECEIVABLE Accounts receivable consist of the following: December 31, 2007 Accounts receivable $ 21,990,170 $ 2006 17,470,588

There was no allowance for a bad debt provision for all periods as the Company, since inception, has adopted the direct write-off method for bad debts. Given the Company’s positive collection experience, there have been no bad debt write-offs from inception to the date of this filing. Accounts receivables from the customers have been factored to banks as collateral to bank loans to obtain working capital. The above customers, all publicly listed companies in Taiwan, have passed creditability investigation of the lending banks. According to the bank loan agreement, when the accounts receivables are factored, the banks will collect the payments when due, charge interest on amount paid, and return the balance to the Company. The following details the accounts receivable factored as collaterals to the short-term bank loans: December 31, 2007 A/R FACTORING: Delta Electronics International Ltd. FSP Technology Inc Hipro Overseas (BVI) Inc. Chicony Electronics (Dongguan) Co., Ltd. Chicony Electronics (Suzou) Co., Ltd. Li Shin International Ent Corp. The short term loans of A/R Factoring NOTE 5 – INVENTORY Inventory consists of the following: December 31, 2007 Raw materials Work in process Finished goods Less: Declines in inventory value $ $ 2,090,579 1,584,957 3,715,971 7,391,507 (116,565 ) 7,274,942 $ $ 2006 1,286,811 997,941 3,255,277 5,540,029 (102,077 ) 5,437,952 $ 185,675 2,716,000 619,000 113,000 1,535,896 5,169,571 $ 2006 787,331 1,820,633 318,538 172,763 3,099,265

$

$

F-14

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 6 – ADVANCES TO SUPPLIERS AND OTHER RECEIVABLES Advances to suppliers and other receivables consist of the following: December 31, 2007 Prepaid expenses and other receivables $ 104,514 $ 2006 91,189

Advances to suppliers represent amounts prepaid for production to assure a continued supply of materials. The advances are applied against amounts due the supplier as the materials are shipped. NOTE 7 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: December 31, 2007 Equipment and machinery Automobiles Other equipment Computer equipment Molds Office equipment Electronic equipment Leasehold improvements Less: Accumulated depreciation $ $ 5,418,553 52,789 178,660 82,170 50,219 13,573 350,951 500,641 6,647,556 (1,442,408 ) 5,205,148 $ $ 2006 4,033,464 49,381 72,523 71,345 12,696 169,051 396,953 4,805,413 (766,281 ) 4,039,132

F-15

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 8 – BANK LOANS As of December 31, 2007, the Company had several outstanding bank loans which were used primarily for general working capital purposes. These are recurring loans which carry annual interest rates of 5.5% ~7.5% with maturity dates of 6 months. These loans are secured by the Company’s bank deposit. All bank credit facilities are created under Account Receivables Factoring with collectable authority from the customers or the Company. Those bank credit lines are rollover within one-year terms.. The outstanding bank loans are as below table: December 31, 2007 Short term loans A/R Factoring Far Eastern International Bank Taipei Fubon Bank Hong Kong Branch En Tie Commercial Bank A/R Factoring Total: L/C loans Taipei Fubon Bank Hong Kong Branch The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch L/C loans Total: Primary Capital, LLC $ 2006

$

185,675 3,448,000 1,535,896 5,169,571

$

787,331 2,311,934 3,099,265

486,500 4,996,467 5,482,967 2,250,000 12,902,538 $

3,099,265

NOTE 9–CAPITAL LEASE PAYABLE December 31, 2007 Chialease International Finance Corporation (ShenZhen Office) Capital lease payable Less: Current portion Capital lease-long term portion 2006

$ $

405,525 $ (179,305 ) 226,220 $

-

Effective interest rate 14.70286% 36-month repayment from February 2007 to January 2010. The capital lease has been arranged from Chailease International Finance Corporation in Jan 2007. The principal value is RMB 4,000,000 at inception and is to be repaid in 36 months from February 2007 to January 2010. The effective interest rate is 14.7% per annum. The balance of discount was $142,863 and the balance principal was $405,525 as at December 31, 2007. NOTE 10 – STATUTORY RESERVES As stipulated by the relevant laws and regulations for enterprises operating in PRC, the subsidiaries of the Company are required to make annual appropriations to a statutory surplus reserve fund. Specifically, the subsidiaries of the Company are required to allocate 10% their profits after taxes, as determined in accordance with the PRC accounting standards applicable to the subsidiaries of the Company, to a statutory surplus reserve until such reserve reaches 50% of the registered capital of the subsidiaries of the Company. The date the PRC subsidiaries have not allocated any statement reserves.

F-16

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 11 – COMMITMENTS AND CONTINGENCIES Operating lease commitments The Company and its subsidiaries have entered into several tenancy agreements for the lease of factory premises and staff quarters. The Company’s commitment for minimum lease payments under these non-cancelable operating leases for the next five years and thereafter are as follows as follows: Year Ending December 31, 2008 2009 2010 and thereafter

$

232,101 243,706 304,632 780,439

$

Social insurance for employees According to the prevailing laws and regulations of the PRC, the Company and its subsidiaries are required to cover their employees with medical, retirement and unemployment insurance programs. Management believes that due to the transient nature of its employees, the Company does not need to provide all employees with such social insurances, and has paid the social insurances for the Company’s employees who have completed three months’ continuous employment with the Company. The three month period is a probation period after which the employee becomes part of permanent staff. The initial determination of whether an employee is entitled to coverage is made by the Company, based on the statutory provisions for included employees. The employees have a right to appeal the Company’s decision not to provide the coverage, and, if an employee exercises this right and files a complaint against the Company and prevails, the Company may be required to pay for the insurance retroactively and pay an administrative fine. The Company believes that it is in compliance with applicable law and that any liability which it may incur will not be material. Principal Customer A significant percentage of the Company’s business is generated from one customer. The following table sets forth information as to the revenue derived from this customer that accounted for more than 10% of our revenue in for the years ended December 31, 2007 and 2006 (dollars in thousands). Year Ended December 31, 2007 Customer Lite-on Dollars 28,126 F-17 Percent 50 % Dollars 24,050 2006 Percent 57 %

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 12 – INCOME TAXES The Company is registered in the Samoa and wholly owns its four subsidiaries in PRC. The Company has no any tax issue in Samoa. The subsidiary, S.J. Electronics (Gongming Loutsun Shenzhen) Co., Ltd., is registered as an assembling factory which is no income tax obligation according to the Income tax regulation of PRC. The other four subsidiaries owned by the Company are under the tax laws of PRC, those Subsidiaries are entitled to a preferential Enterprise Income Tax (“EIT”) rate of 15%, which a full exemption for the first two profitable years, followed by a 50% reduction on EIT for the following three consecutive years. As a result of the above tax exemptions, there were no income taxes payable for the Company for at December 31, 2007 and 2006. Under current law, the Company is entitled to a 50% tax exemption for the following three years. The tax authority of the PRC Government conducts periodic and ad hoc tax filing reviews on business enterprises operating in the PRC after those enterprises had completed their relevant tax filings, hence the Company’s tax filings may not be finalized. It is therefore uncertain as to whether the PRC tax authority may take different views about the Company’s tax filings which may lead to additional tax liabilities. NOTE 13 – SEGMENT INFORMATION SFAS No. 131, “Disclosures About Segments of an Enterprise and Related Information”, requires certain financial and supplementary information to be disclosed on an annual and interim basis for each reportable segment of an enterprise. The Group believes that it operates in one business segment (research, development, production, marketing and sales of electronic products) and in one geographical segment (China), as all of the Company’s current operations are carried out in China. NOTE 14 – OPERATING RISK Country risk The Company has significant investments in the PRC. The operating results of the Company may be adversely affected by changes in the political and social conditions in the PRC and by changes in Chinese government policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. The Company can give no assurance that those changes in political and other conditions will not result in have a material adverse effect upon the Company’s business and financial condition. F-18

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 15- RELATED PARTY TRANSACTIONS Name and relationship of related parties Company Name As at Dec 31, 2006 S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd. Xujun Electronic (Ganzhou) Co., Ltd S.J. Electronics Technology (Shenzhen) Co., Ltd. TechPower-Semi Enterprise Co., Ltd. (1) S.J. International Pte., Ltd. (2) S.J. Electronics Ltd. (3) All Safe Cable Co., Ltd. S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd. Xujun Electronic (Ganzhou) Co., Ltd S.J. Electronics Technology (Shenzhen) Co., Ltd. FuChuan Xujun Science and Technology Elec. Co., Ltd. TechPower-Semi Enterprise Co., Ltd. (1) S.J. International Pte., Ltd. (2) S.J. Electronics Ltd. (3) All Safe Cable Co., Ltd. Relationship Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei

As at Dec 31, 2007

Significant transactions with related parties: (1) During 2007 and 2006 Shing Mei had sales of $3,224,998 and $0, respectively to this affiliate. The affiliate then reinvoiced the sale for the same amount to the end customer. (2) During 2007 and 2006 Shing Mei had sales of $2,422,370 and $503,022, respectively to this affiliate. The affiliate then reinvoiced the sale for the same amount to the end customer. (3) During 2007 and 2006 Shing Mei had sales of $29,156,626 and $28,829,427, respectively to this affiliate. The affiliate then reinvoiced the sale for the same amount to the end customer. F-19

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 15- RELATED PARTY TRANSACTIONS (continued) Due from related parties December 31, 2007 Techpower-Semi Enterprise PTE Ltd. $ $ 2006 214,63

Due to related parties December 31, 2007 (restated) SJ Electronics Ltd (Taipei) Peter Chang-Officer/Shareholder $ $ 4,566,081 12,339 4,578,420 $ $ 2006 (restated) 2,526,330 2,526,330

Purchases December 31, 2007 All Safe Cable Co., Ltd. $ 20,971,223 $ 2006 14,976,661

For 2007, All Safe Cable Co., Ltd agreed to rebate 5% plus and additional 2.5% of purchase back to the Company. For the years ended December 31, 2007 this amounted to a reduction in purchases of $1,700,369. The above related party transactions are not necessarily indicative of the transactions that would have been entered into had comparable transactions been entered into with independent parties. Dividends Paid As a result of the above noted sales and purchases with affiliates, during 2006 and 2005 the shareholder contributed amounts due for purchases from All Safe Cable Co., Ltd. to Additional Paid in Capital of approximately $ 7,225,000 which left the affiliated companies with an amount due the Company for collecting the Company’s accounts receivable of $8,309,269. On December 31, 2007, Shing Mei distributed these accounts receivable to its sole shareholder as a dividend of $8,309,269. NOTE 16- BRIDGE LOAN In December, 2007 Shing Mei borrowed $2,250,000 by issuing a $2,250,000 face value convertible note due March 31, 2008 with a 10% interest rate. The note is convertible into the common stock of Shing Mei at a price of $0.50 per share. As part of the financing Shing Mei issued the lender 2,250,000 five year warrants to purchase the common stock of Shing Mei for $1.00 per share. The note is secured by 100% of the Company stock owned by Shing Mei’s management. Additionally, the Company paid a fee of $207,500 fo rthe debt issuance. The debt issuance expense is being amortized over the life of the loan. A balance of $185,183 remaining at December 31, 2007. $22,377 was charged to interest expense in 2007. As part of a Securities Exchange Agreement in February,2008, Acheron issued 4,567,500 shares of its common stock and five year warrants to purchase 2,250,000 shares at $1.00 per share to a number of accredited investors who previously had provided bridge financing to Shing Mei.

These issuances were made in exchange for promissory notes evidencing debt obligations by Shing Mei and warrants to purchase Shing Mei shares. F-20

Acheron, Inc.
Notes to Consolidated Financial Statements December 31, 2007 NOTE 17- INVESTMENT ADVISORY AGREEMENT In November 2007, the Company entered into an investment advisory agreement whereby the Company has agreed to pay the advisor a fee of $175,000 annually beginning January, 2008. Additionally, at the closing of a reverse merger and PIPE transaction the advisor and shell shareholders will own a combined 10% of the reorganized public company. The investment advisory fee is payable from the proceeds of a future financing. NOTE 18- SUBSEQUENT EVENTS Capital restructure - On January 21, 2008, the Board of Directors approved a resolution to reduce the Authorized Common from 100,000,000 to 40,000,000 shares. As a result of this restructure the outstanding common shares will be reverse split on a 1 for 2.5 basis. The financial statements have been restated to reflect the reverse split. F-21

SJ ELECTRONICS, INC. (FORMERLY ACHERON, INC.) CONDENSED CONSOLIDATED FINANCIAL STATEMENTS March 31, 2008 F-22

SJ ELECTRONICS, INC. (FORMERLY ACHERON, INC.) INDEX PAGE CONDENSED CONSOLIDATED BALANCE SHEET CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS F-23 F-24 F-25 F-26 F-27-F-39

SJ ELECTRONICS, INC. (FORMERLY ACHERON, INC.) CONDENSED CONSOLIDATED BALANCE SHEET (In US Dollars) March 31, 2008 (Unaudited) ASSETS Current Assets Cash and cash equivalents Accounts receivable, net Inventories Due from related parties Prepaid expenses and other receivables Total Current Assets Property, plant and equipment, net Total Assets LIABILITIES AND STOCKHOLDER'S EQUITY Current Liabilities Accounts payable and accrued liabilities Short-term loans Wages payable Capital lease payable Interest payable Due to related parties Convertible debt, net of debt discount of $434,281 Warrant liability Common stock to be issued Total Current Liabilities Capital lease payable Total Liabilities Stockholder's Equity Preferred stock ($0.001 par value, 5,000,000 shares authorizd, Nil issued and outstanding) Common stock ($0.001 par value,40,000,000 shares authorizd, 21,984,215 and 8,560,000 issued and outstanding as of March 31, 2008 Additional Paid-in Capital Retained earnings-Restricted Retained earnings-Unrestricted Accumulated other comprehensive income Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ $

$

697,907 20,801,201 8,690,973 682,508 3,118,327 33,990,916 5,258,012 39,248,928

$

13,148,406 18,190,808 990,702 193,459 24,541 243,201 107,275 327,006 33,225,398 184,275 33,409,673

21,984 6,250,920 (839,664 ) 406,015 5,839,255 39,248,928

The accompanying notes are an integral part of these condensed consolidated financial statements. F-24

SJ ELECTRONICS, INC. (FORMERLY ACHERON, INC.) CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In US Dollars) For The Three Months Ended March 31, 2008 2007 (Unaudited) (Unaudited) Sales Cost of goods sold Gross Profit Operating Expenses: Selling expenses General and administrative (Gain) on Disposal of Assets Total operating costs and expenses Income (Loss) From Operations Interest income (expenses)-net Other income (expenses )-net Income (loss) Before Income Taxes Provision for Income taxes Net income (loss) Other Comprehensive Income: Foreign currency translation adjustment Comprehensive income (loss) Net income (loss) per share Basic Diluted Weighted average shares outstanding Basic Diluted $ $ 12,961,563 $ (11,306,485 ) 1,655,078 256,935 1,968,875 25,856 2,251,666 (596,588 ) (367,234 ) 124,158 (839,664 ) (839,664 ) 10,838,325 (9,955,843 ) 882,482 290,551 237,955 (177,706 ) 350,800 531,682 (99,986 ) 231,231 662,927 662,927

487,632 (352,032 ) $

(18,677 ) 644,250

$ $

(0.06 ) $ (0.05 ) $

0.08 0.08

14,462,122 16,123,661

8,560,000 8,560,000

The accompanying notes are an integral part of these condensed consolidated financial statements. F-25

SJ ELECTRONICS, INC. (FORMERLY ACHERON, INC.) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In US Dollars) For The Three Months Ended March 31, 2008 2007 (Unaudited) (Unaudited) Operating activities Net Income (loss) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation Loss (gain) on Disposal of Assets Amortization of stock issued for consulting services Changes in operating assets and liabilities: Accounts receivable, net Prepaid expenses and other receivables Security deposit Inventory Wages payable Accounts payable and accrued liabilities Net cash used in operating activities Investing activities Property, plant and equipment additions Net cash used in investing activities Financing activities Due from related parties Due to related parties Short term loans Long-term Loans Payable Net cash provided by financing activities Effect of exchange rate changes on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period Supplemental Disclosures of Cash Flow Information: Interest paid $ $ (839,664 ) $ 184,265 (25,856 ) 457,185 1,188,969 (2,828,690 ) 114,703 (1,390,174 ) 319,692 (417,612 ) (3,237,182 ) (23,644 ) (23,644 ) (682,508 ) (3,955,722 ) 7,538,270 (27,791 ) 2,872,249 274,211 (114,367 ) 812,274 697,907 $ 662,927 179,954 177,706 (427,204 ) (19,044 ) (1,717,327 ) (90,731 ) 27,239 (1,206,480 ) (981,867 ) (981,867 ) 214,632 446,705 1,757,562 494,310 2,913,209 (261,494 ) 463,367 464,693 928,060

$ $

367,452

$

100,162

Income taxes paid Non-cash investing and financing activities Common stock issued for conversion of short-term debt Common stock issued for consulting services

$

$ $

1,815,719 457,185

$ $

-

The accompanying notes are an integral part of these condensed consolidated financial statements. F-26

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS Organization and Operations SJ Electronics, Inc. (the “Company” or “SJ Electronics”) was originally formed in the State of Nevada on June 23, 1994 as Harvest E-xpress. On May 1, 1997, it changed its name to HLS (USA), Inc. On April 13, 2006, it changed its name to Acheron, Inc. On March 20, 2008, the Company, once again, changed its name to SJ Electronics, Inc. Originally, SJ Electronics’s business was grain cutting and custom machine hire. It did not succeed in its business and it began seeking another opportunity. In 1997, SJ Electronics purchased HLS Corporation Unlimited to pursue the business of HLS whose asset consisted of securities representing approximately a 46% indirect interest in Henan Xinfei Co. Ltd., a Sino-foreign equity joint venture engaged in the manufacture and sale of refrigerators and freezers in China. The terms of the acquisition were never met and in August 1999, it completed the unwinding of the transaction with HLS and SJ Electronics has been inactive since that time. On February 13, 2008, SJ Electronics entered into and completed the transactions contemplated under a Securities Exchange Agreement (the “Exchange Agreement”) with the shareholder (the “Shareholder”) of Shing Mei Enterprises Ltd. (“Shing Mei”), a corporation organized under the laws of Samoa, pursuant to which the SJ Electronics purchased from the Shareholder all issued and outstanding shares of Shing Mei’s common stock in consideration for the issuance of 15,000,000 shares of common stock of the Company, (the "Share Exchange"). Prior to the closing of the Share Exchange, the Company has 21,400,000 shares of common stock issued and outstanding. The Company effected a 2 for 5 reverse split on its outstanding common stock, which left the Company with 8,560,000 shares of common stock outstanding. Immediately after the reverse split, the Company also retired 8,102,944 shares of post-split common stock, which resulted in 457,056 shares of common stock outstanding at the closing of the Share Exchange. Consequently, the Board of Directors also approved a resolution to reduce the Authorized Common from 100,000,000 to 40,000,000 shares. As part of a Securities Exchange Agreement, SJ Electronics agreed to issue 4,567,500 shares of its common stock and five year warrants to purchase 2,250,000 shares at $1.00 per share to a number of accredited investors who previously had provided bridge financing to Shing Mei. These issuances were made in exchange for promissory notes evidencing debt obligations by Shing Mei and warrants to purchase Shing Mei shares. In addition, SJ Electronics also issued a total of 1,828,222 SJ Electronics shares and warrants to purchase 450,000 shares of SJ Electronics common stock to the placement agent for a bridge financing that was recently completed by the Company and for other investment banking services. In conjunction with the Share Exchange, SJ Electronics also issued into escrow for the benefit of one of Shing Mei’s executive officers, 1,000,000 shares that will be released to that individual upon the Company meeting certain earnings and other milestones. The Share Exchange resulted in a change in control of SJ Electronics as the Shareholder of Shing Mei became the majority shareholder of the Company, owning approximately 68% of the total shares issued and outstanding. Also, the Shareholder was elected a director of the Company (as well as certain of Shareholder’s nominees, subject to the Company’s disclosure obligations under the Securities Exchange Act of 1934, as amended) and appointed as its executive officer. As a result of the Exchange Agreement, (i) Shing Mei became a wholly-owned subsidiary of SJ Electronics and (ii) SJ Electronics succeeded to the business of Shing Mei as its sole business. On March 20, 2008, the Board of Directors also approved a resolution to change the Company’s name to SJ Electronics, Inc. This name change became effective on March 26, 2008 upon filing of the Articles of Merger reflecting the change with the Secretary of State of the State of Nevada. Concurrently with the resolution to change the name of the Company, the Board of Directors also approved a resolution to increase the Authorized Common Stock from 40,000,000 to 100,000,000 shares which effectiveness is subject to the Company’s disclosure obligations under the Securities Exchange Act of 1934, as amended, and to the filing of a certificate of change with the Secretary of State of the State of Nevada For accounting purpose, the transaction has been accounted for as a reverse acquisition under the purchase method. Accordingly, Shing Mei and its subsidiaries are treated as the continuing entity for accounting purposes. Shing Mei Enterprises Ltd. (“ShingMei”) was incorporated in SAMOA in August of 2003 with a registered capital of $4,000,000. In October 2004, ShingMei acquired 100% ownership of S.J. Electronics (Gongming loutsun Shenzhen) Co., Ltd., located in the City of Shenzhen in the Peoples Republic of China (“PRC”). F-27

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS (continued) In November 2005, ShingMei established its own 100% subsidiary, Xujun Electronic (Ganzhou) Co., Ltd, located in the city of Quannan of Jiangxi Province in PRC. In January 2006, ShingMei established its own 100% subsidiary, Guangxi Hezhou Xujun Electronics Co., Ltd. located in the city of Hezhou of Guangxi Province in PRC. In August 2006, ShingMei established its own 100% subsidiary, S.J. Electronics Technology (Shenzhen) Co., Ltd. located in the city of Shenzhen of Guangdong Province in PRC. In August 2007, ShingMei established its own 100% subsidiary, FuChuan Xujun science and Technology Electronics Co., Ltd. located in the city of FuChuan of Guangxi Province in PRC. ShingMei owns 100% equity interest on its five subsidiaries (collectively referenced throughout as the “Company”) as of March 31, 2008, located in Shenzhen of Guangdong Province, Jiangxi Province and Guangxi Province in PRC individually. The Company’s primary business activities are the manufacture of electronic cable products and assembling on wire harness by its five subsidiaries in PRC, and sales of overseas by the Company. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Item 310 of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2008 and 2007 are not necessarily indicative of the results that may be expected for the full years. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis and the financial statements and notes to thereto included in the Company’s Form 8-K filing on February 14, 2008. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of the management, the consolidated financial statements reflect all adjustments (which include only normal recurring adjustments) necessary to present them in conformity with US GAAP. Principles of Consolidation The consolidated financial statements include the accounts of the ShingMei and its subsidiaries. Significant intercompany transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as well as the reported amounts of revenues and expenses. Actual results could differ from these estimates. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, cash on deposit with various financial institutions in PRC, and all highly-liquid investments with original maturities of three months or less at the time of purchase. Banks and other financial institutions in PRC do not provide insurance for funds held on deposit.

F-28

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Accounts Receivable Accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts based on a review of all outstanding amounts on a monthly basis. The Company analyzes the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in our customer payment terms. Significant changes in customer concentration or payment terms, deterioration of customer credit-worthiness or weakening in economic trends could have a significant impact on the collectibility of receivables and our operating results. The Management’s judgment and assessment on customers credit is severely to approve. The Company does not have any bad debt allowance as at March 31,2008 and 2007. Inventories Inventories, which are primarily comprised of raw materials, work-in-process goods, packaging materials, and finished goods, are stated at the lower of cost or net realizable value, using the first-in, first-out (“FIFO”) method. Cost is determined on the basis of a moving average. The Company evaluates the need for reserves associated with obsolete, slow-moving and non-salable inventory by reviewing net realizable values on a periodic basis. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method, with an estimated 0% salvage value of original cost, over the estimated useful lives of the assets as follows: Molds Machinery and equipment Electronic equipment Computer equipment Office equipment Automobile Leasehold improvement Other equipment 2 years 5-10 years 5-10 years 5-10 years 5-10 years 5-10 years 5-10 years 5-10 years

Expenditures for repairs and maintenance, which do not improve or extend the expected useful lives of the assets, are expensed as incurred while major replacements and improvements are capitalized. When property or equipment is retired or disposed of, the cost and accumulated depreciation are removed from the accounts, with any resulting gains or losses being included in net income or loss in the year of disposition. Impairment of Long-Lived Assets The Company evaluates potential impairment of long-lived assets, in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “ Accounting for the Impairment or Disposal of Long-Lived Assets ”, which requires the Company to (a) recognize an impairment loss only if the carrying amount of a long-lived asset is not recoverable from its undiscounted cash flows and (b) measure an impairment loss as the difference between the carrying amount and fair value of the asset. The Company believes that long-lived assets in the accompanying balance sheets are appropriately valued as at March 31, 2008 and 2007. Revenue Recognition The Company recognizes revenue when the significant risks and rewards of ownership have been transferred pursuant to PRC law, including such factors as when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, sales and value-added tax laws have been complied with, and collectibility is reasonably assured. The Company generally recognizes revenue when its products are shipped. F-29

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Comprehensive Income The Company has adopted SFAS No. 130, “ Reporting Comprehensive Income ”, which establishes standards for reporting and displaying comprehensive income, its components, and accumulated balances in a full-set of general-purpose financial statements. Accumulated other comprehensive income represents the accumulated balance of foreign currency translation adjustments. Concentration of Credit Risk The Company maintains cash balances at various financial institutions in PRC which do not provide insurance for amounts on deposit. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. The Company mitigates this risk by spreading its deposits over 20 banks. The Company operates principally in PRC and grants credit to its customers. Although the PRC is economically stable, it is always possible that unanticipated events both domestically and in foreign countries could disrupt either the Company’s operations or those of its customers. Foreign Currency Translation The functional currency of ShingMei is Hong Kong Dollar (“HKD”). The Company maintains its financial statements using the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. However, the functional currency of all four subsidiaries of the Company is the Renminbi (“RMB”), the PRC’s currency. Those Subsidiaries maintain their financial statements using their own functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income (loss) for the respective periods. For financial reporting purposes, the financial statements of ShingMei, which are prepared in HKD, are translated into the Company’s reporting currency, United States Dollars (“USD”). All the financial statements of its four subsidiaries, which are prepared in RMB, are translated into the Company’s reporting currency, USD. Balance sheet accounts are translated using the closing exchange rate in effect at the balance sheet date and income and expense accounts are translated using the average exchange rate prevailing during the reporting period. Adjustments resulting from the translation, if any, are included in accumulated other comprehensive income (loss) as a component of stockholders’ equity. The exchange rates used for foreign currency translation were as follows (USD$1 = RMB): Period Covered Three months ended March 31, 2007 Three months ended March 31, 2008 Balance Sheet Date Rates 7.72950 7.01200 Average Rates 7.75180 7.1622

The exchange rates used for foreign currency translation were as follows (USD$1 = HKD): Period Covered Three months ended March 31, 2007 Three months ended March 31, 2008 F-30 Balance Sheet Date Rates 7.81270 7.78190 Average Rates 7.81350 7.79433

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Fair Value of Financial Instruments The Company's financial instruments include cash equivalents, accounts receivable, other receivables, accounts payable, accrued expenses, value-added taxes, short-term and long-term bank loans, and loans payable to related parties. The carrying amounts of financial instruments other than long-term obligations approximate fair value due to their short maturities. Long-term obligations approximate fair value based upon rates currently available for similar instruments. Debt Issuance Costs Certain costs associated with the issuance of debt instruments are capitalized and included in non-current assets on the consolidated balance sheet. These costs are amortized to interest expense over the terms of the related debt agreements on a straight-line basis. Amortization of deferred financing costs included in interest expense was $185,183 for the three months ended March 31, 2008. Recent Accounting Pronouncements In July 2006, the FASB issued FASB Interpretation (“FIN”) No. 48, “ Accounting for Uncertainty in Income Taxes ”, which prescribes a comprehensive model for how a company should recognize, measure, present and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return (including a decision whether to file or not to file a return in a particular jurisdiction). The accounting provisions of FIN No.48 are effective for fiscal years beginning after December 15, 2006. The adoption of this Interpretation had no impact on our financial position or results of operations. In September 2006, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 157, “ Fair Value Measurements ”, which establishes a framework for reporting fair value and expands disclosures about fair value measurements. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The adoption of this standard will have no impact on our financial statements. In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “ The Fair Value Option for Financial Assets and Financial Liabilities ”, which includes an amendment of FASB Statement No. 115, (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of this Statement apply only to entities that elect the fair value option. However, the amendment to FASB Statement No. 115, “ Accounting for Certain Investments in Debt and Equity Securities ”, (“SFAS No. 115”), applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective for the Company’s consolidated financial statements for the annual reporting period beginning after November 15, 2007. The Company is currently evaluating the impact of this new pronouncement on its consolidated financial statements. On December 4, 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 160, Noncontrolling interest in Consolidated Financial Statements (SFAS No. 160). SFAS No. 160 requires all entities to report noncontrolling (minority) interests in subsidiaries as equity in the consolidated financial statements. The statement establishes a single method of accounting for changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation and expands disclosures in the consolidated financial statements. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years. We have not yet determined the impact of the adoption of SFAS No. 160 on our consolidated financial statements and footnote disclosures. On December 4, 2007, the FASB issued SFAS No.141R, Business Combinations ( SFAS No. 141R). SFAS No. 141R requires the acquiring entity in a business combination to recognize all the assets acquired and liabilities assumed, establishes the acquisition date fair value as the measurement objective for all assets acquired and liabilities assumed, and requires the acquirer to expand disclosures about the nature and financial effect of the business combination. SFAS No. 141R is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. We have not yet determined the impact of the adoption of SFAS No. 141R on our consolidated financial statements and footnote disclosures. F-31

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 3 - ACCOUNTS RECEIVABLE Accounts receivable consist of the following: March 31, 2008 Accounts receivable $ 20,801,201

There was no allowance for a bad debt provision for all periods as the Company, since inception, has a positive collection experience. No allowance is considered necessary. Accounts receivables from the customers have been factored to banks as collateral to bank loans to obtain working capital. The above customers, all publicly listed companies in Taiwan, have passed creditability investigation of the lending banks. According to the bank loan agreement, when the accounts receivables are factored, the banks will collect the payments when due, charge interest on amount paid, and return the balance to the Company. The following details the accounts receivable factored as collaterals to the short-term bank loans: March 31, 2008 A/R FACTORY: Delta Electronics International Ltd. FSP Technology Inc Canon Group. Lite-On Technology Corp. Yet Foundate Ltd Lite-On Overseas Trading Co., Ltd. Chicony Electronics (Dongguan) Co., Ltd. Chicony Electronics (Suzou) Co., Ltd. Li Shin International Ent Corp. The short term loans of A/R Factory TOTAL: NOTE 4 - INVENTORY Inventory consists of the following: March 31, 2008 Raw materials Work in process Finished goods subtotal less:declines in inventory value Inventory total F-32 $ 2,432,817 2,494,902 3,881,671 8,809,390 (118,417 ) 8,690,973 $ 1,316,652 1,974,600 73,065 2,957,085 1,002,757 284,454 473,622 165,448 1,160,000 9,407,683

$

$ $

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 5 - ADVANCES TO SUPPLIERS AND OTHER RECEIVABLES Advances to suppliers and other receivables consist of the following: March 31, 2008 Prepaid expenses and other receivables $ 3,118,327

Advances to suppliers represent amounts prepaid for production to assure a continued supply of materials. The advances are applied against amounts due the supplier as the materials are shipped. NOTE 6 - PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: March 31, 2008 Equipment & Machinery Automobiles Other Equipment Computer Equipment Molds Office Equipment Electronic Equipment Leasehold Improvements Fixed Assets Accumulated Depreciation Total Fixed Assets - Net $ 5,446,886 60,331 86,755 85,475 299,909 14,119 415,723 529,439 6,938,637 (1,680,625 ) 5,258,012

$ $

NOTE 7 - BANK LOANS As of March 31, 2008, the Company had several outstanding bank loans which were used primarily for general working capital purposes. These are recurring loans which carry annual interest rates of 5.5% ~7.5% with maturity dates of 6 months. These loans are secured by the Company’s bank deposit. All bank credit facilities are created under Account Receivables Factoring with collectable authority from the customers or the Company. Those bank credit lines are rollover within one-year terms.. F-33

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 7 - BANK LOANS (Continued) The outstanding bank loans are as below table: March 31 , 2008 Short term loans A/R Factoring Taipei Fubon Bank Hong Kong Branch The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch En Tie Commercial Bank A/R Factoring Total: Export loans The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch L/C loans Taipei Fubon Bank Hong Kong Branch The Hongkong and Shanghai Banking Corporation Ltd. Mong Kok Branch L/C loans Total: Short term loans TOTAL:

$

2,613,670 5,634,013 1,160,000 9,407,683 542,950 168,795 8,071,380 8,240,175 18,190,808

$ $ $ $ $

NOTE 8-CAPITAL LEASE PAYABLE March 31, 2008 Chailease Internaitonal Finance Corporation (ShenZhen Office) Capital lease payable Less:Current portion Capital lease - long term portion Interest rate range $ $ 377,734 (193,459 ) 184,275 14.70286 %

The capital lease has been arranged from Chailease International Finance Corporation in Jan 2007. The principal value is RMB 4,000,000 at inception and is to be repaid in 36 months from February 2007 to January 2010. The effective interest rate is 14.7% per annum. The balance of discount was $192,689 and the balance principal was $377,680 as at March 31, 2008. F-34

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 9- CONVERTIBLE DEBENTURE In December, 2007, Shing Mei borrowed $2,250,000 by issuing a $2,250,000 face value convertible note due March 31, 2008 with a 10% interest rate. The note is convertible into the common stock of Shing Mei at a price of $0.50 per share. As part of the financing Shing Mei issued the lender 2,250,000 five year warrants to purchase the common stock of Shing Mei for $1.00 per share. The note is secured by 100% of the Company stock owned by Shing Mei’s management. On March 13, 2008, the Note was partially converted into a total of 3,698,937 shares of the Company’s common stock. As of March 31, 2008, the balance of the Note was $434,281, which consists of warrant liability of $107,275 and liability of stock to be issued of $327,006. Additionally, the Company paid a fee of $207,500 for the debt issuance. The debt issuance expense is being amortized over the life of the loan. $22,377 was charged to interest expense at December 31, 2007. $185,183 was charged to interest expense at March 31, 2008. Note 10 - STOCKHOLDERS’ EQUITY A. Issuance of Common Stock Prior to the closing of the Share Exchange, the Company has 21,400,000 shares of common stock issued and outstanding. The Company effected a 2 for 5 reverse split on its outstanding common stock, which left the Company with 8,560,000 shares of common stock outstanding. Immediately after the reverse split, the Company also retired 8,102,944 shares of post-split common stock, which resulted in 457,056 shares of common stock outstanding at the closing of the Share Exchange. As a part of the Securities Exchange Agreement, SJ Electronics agreed to issue 4,567,500 shares of its common stock and five year warrants to purchase 2,250,000 shares at $1.00 per share to a number of accredited investors, in exchange for promissory notes of $2,250,000 (Note 9), evidencing debt obligations by Shing Mei and warrants to purchase Shing Mei shares. As of March 31, 2008, the Company issued a total of 3,698,937 upon conversion of $1,815,719 promissory note. In addition, SJ Electronics also issued a total of 1,828,222 SJ Electronics shares and warrants to purchase 450,000 shares of SJ Electronics common stock to the placement agent for a bridge financing that was recently completed by the Company and for other investment banking services. In conjunction with the Share Exchange, SJ Electronics also issued into escrow for the benefit of one of Shing Mei’s executive officers, 1,000,000 shares that will be released to that individual upon the Company meeting certain earnings and other milestones. As of March 31, 2008, there were 21,984,215 shares of common stock issued and outstanding and no preferred stock. B. Warrants On February 14, 2008, upon the execution of the Share Exchange Agreement, the Company issued to the investors and placement agents (i) 2,250,000 five-year warrants to purchase 2,250,000 shares of the Company’s common stock at $1.00, and (ii)450,000 five-year warrants to purchase 900,000 shares of the Company’s common stock at $0.50 per share. All warrants do not contain a cashless exercise provision. Accordingly, in accordance with EITF 00-19, the warrants are classified as equity. The fair value of the warrants was calculated using the Black-Scholes options pricing model using the following assumptions: Volatility 100%, risk free interest rate of 3.85%, and expected term of 5 years. F-35

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 Note 10 - STOCKHOLDERS’ EQUITY (Continued) Following is a summary of the status of warrants outstanding as of March 31, 2008: Oustanding Warrants Exercise Price $ 1.00 $ 0.50 Number 2,250,000 450,000 2,700,000 NOTE 11 - STATUTORY RESERVES As stipulated by the relevant laws and regulations for enterprises operating in PRC, the subsidiaries of the Company are required to make annual appropriations to a statutory surplus reserve fund. Specifically, the subsidiaries of the Company are required to allocate 10% their profits after taxes, as determined in accordance with the PRC accounting standards applicable to the subsidiaries of the Company, to a statutory surplus reserve until such reserve reaches 50% of the registered capital of the subsidiaries of the Company. So far the PRC subsidiaries have not allocated any statement reserves. NOTE 12 - COMMITMENTS AND CONTINGENCIES Operating lease commitments The Company and its subsidiaries have entered into several tenancy agreements for the lease of factory premises and staff quarters. The Company’s commitment for minimum lease payments under these non-cancelable operating leases for the next five years and thereafter are as follows as follows: Year Ending December 31, 2008 2009 2010 and thereafter Average Remaining Life 4.75 years 4.75 years

$

232,101 243,706 304,632 780,439

$

Social insurance for employees According to the prevailing laws and regulations of the PRC, the Company and its subsidiaries are required to cover their employees with medical, retirement and unemployment insurance programs. Management believes that due to the transient nature of its employees, the Company does not need to provide all employees with such social insurances, and has paid the social insurances for the Company’s employees who have completed three months’ continuous employment with the Company. The three month period is a probation period after which the employee becomes part of permanent staff. The initial determination of whether an employee is entitled to coverage is made by the Company, based on the statutory provisions for included employees. The employees have a right to appeal the Company’s decision not to provide the coverage, and, if an employee exercises this right and files a complaint against the Company and prevails, the Company may be required to pay for the insurance retroactively and pay an administrative fine. The Company believes that it is in compliance with applicable law and that any liability which it may incur will not be material. F-36

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 12 - COMMITMENTS AND CONTINGENCIES (Continued) Principal Customer A significant percentage of the Company’s business is generated from one customer. The following table sets forth information as to the revenue derived from this customer that accounted for more than 10% of our revenue in for the years ended March 31, 2008 and 2007 (dollars in thousands). March 31, 2008 Lite-on Groups NOTE 13 - INCOME TAXES The Company is registered in the Samoa and wholly owns its five Subsidiaries in PRC. The Subsidiary, S.J. Electronics (Gongming Loutsun Shenzhen) Co., Ltd., is registered as an assembling factory which has no income tax obligation according to the Income tax regulation of PRC. The other four subsidiaries owned by the Company are under the tax laws of PRC, those Subsidiaries are entitled to a preferential Enterprise Income Tax (“EIT”) rate of 15%, which a full exemption for the first two profitable years, followed by a 50% reduction on EIT for the following three consecutive years. As a result of the above tax exemptions, there were no income taxes payable for the Company for at December 31, 2007 and 2006. Under current law, the Company is entitled to a 50% tax exemption for the following three years. The tax authority of the PRC Government conducts periodic and ad hoc tax filing reviews on business enterprises operating in the PRC after those enterprises had completed their relevant tax filings, hence the Company’s tax filings may not be finalized. It is therefore uncertain as to whether the PRC tax authority may take different views about the Company’s tax filings which may lead to additional tax liabilities. NOTE 14 - SEGMENT INFORMATION SFAS No. 131, “Disclosures About Segments of an Enterprise and Related Information”, requires certain financial and supplementary information to be disclosed on an annual and interim basis for each reportable segment of an enterprise. The Group believes that it operates in one business segment (research, development, production, marketing and sales of electronic products) and in one geographical segment (China), as all of the Company’s current operations are carried out in China. NOTE 15 - OPERATING RISK Country risk The Company has significant investments in the PRC. The operating results of the Company may be adversely affected by changes in the political and social conditions in the PRC and by changes in Chinese government policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. The Company can give no assurance that those changes in political and other conditions will not result in have a material adverse effect upon the Company’s business and financial condition. F-37 Dollars 7,325 Psercent 57 %

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 16- RELATED PARTY TRANSACTIONS Name and relationship of related parties Company Name S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd. Xujun Electronic (Ganzhou) Co., Ltd S.J. Electronics Technology (Shenzhen) Co., Ltd. TechPower-Semi Enterprise Co., Ltd. S.J. International Pte., Ltd. S.J. Electronics Ltd. FuChuan Xujun Science and Technology Elec. Co., Ltd. S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd. Xujun Electronic (Ganzhou) Co., Ltd S.J. Electronics Technology (Shenzhen) Co., Ltd. FuChuan Xujun Science and Technology Elec. Co., Ltd. TechPower-Semi Enterprise Co., Ltd. S.J. International Pte., Ltd. S.J. Electronics Ltd. Relationship Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei Same chairman as Shing Mei

As at Dec 31, 2007

As at March 31, 2008

Due from related parties March 31, 2008 S.J. electronics Ltd.(Taipei) Due from related parties Total: $ $ 682,508 682,508

Due to related parties March 31, 2008 S.J. electronics Ltd.(Taipei) Shareholder Due to related parties Total F-38 $ $ 243,201 243,201

SJ Electronics, Inc. (Formerly Acheron, Inc.) Notes to Condensed Consolidated Financial Statements March 31, 2008 NOTE 17- INVESTMENT ADVISORY AGREEMENT In November 2007, the Company entered into an investment advisory agreement whereby the Company has agreed to pay the advisor a fee of $175,000 annually beginning January, 2008. Additionally, at the closing of a reverse merger and PIPE transaction the advisor and shell shareholders will own a combined 10% of the reorganized public company. The investment advisory fee is payable from the proceeds of a future financing. F-39

Exhibit 4.1 Warrant No. ____ NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES. COMMON STOCK PURCHASE WARRANT SJ ELECTRONICS, INC. Warrant Shares: __________ Initial Exercise Date: February 13, 2008

THIS COMMON STOCK PURCHASE WARRANT (the “ Warrant ”) certifies that, for value received, _____________ (the “ Holder ”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the “ Initial Exercise Date ”) and on or prior to the close of business on the five year anniversary of the Initial Exercise Date (the “ Termination Date ”) but not thereafter, to subscribe for and purchase from SJ Electronics, Inc., a Nevada corporation (the “ Company ”), up to ___________ shares (the “ Warrant Shares ”) of Common Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b). Section 1 . Definitions . Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement (the “ Purchase Agreement ”), dated November 30, 2007, by and among Shing Mei Enterprises Limited (“Shing Mei”) and the purchasers signatory thereto, and the Securities Exchange Agreement (the “Exchange Agreement”), dated February 12, 2008 by and among the Company, Shing Mei and the shareholders of Shing Mei named therein.

Section 2 .

Exercise .

a) Exercise of Warrant . Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy of the Notice of Exercise Form annexed hereto (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company); and, within 3 Trading Days of the date said Notice of Exercise is delivered to the Company, the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within 3 Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise Form within 1 Business Day of receipt of such notice. In the event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of manifest error. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof. b) Exercise Price . The exercise price per share of the Common Stock under this Warrant shall be $1.00, subject to adjustment hereunder (the “ Exercise Price ”). c) Cashless Exercise . If at any time after the completion of the then-applicable holding period required by Rule 144, or any successor provision then in effect, there is no effective Registration Statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a certificate for the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where: (A) = the average closing price of the Common Stock for the ten Trading Days ending on the day immediately preceding the date of such election; (B) = the Exercise Price of this Warrant, as adjusted; and

(X) = the number of Warrant Shares issuable upon exercise of this Warrant in accordance with the terms of this Warrant by means of a cash exercise rather than a cashless exercise. Notwithstanding anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c). d) Exercise Limitations . The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other person or entity acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this Section 2(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(d) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(d), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent periodic or annual report, as the case may be, (y) a more recent public announcement by the Company or (z) any other notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The “ Beneficial Ownership Limitation ” shall be 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

e)

Mechanics of Exercise .

i. Delivery of Certificates Upon Exercise . Certificates for shares purchased hereunder shall be transmitted by the transfer agent of the Company to the Holder by crediting the account of the Holder’s prime broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission (“ DWAC ”) system if the Company is a participant in such system and there is an effective Registration Statement permitting the resale of the Warrant Shares by the Holder, and otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise within five (5) Trading Days from the delivery to the Company of the Notice of Exercise Form, surrender of this Warrant (if required) and payment of the aggregate Exercise Price as set forth above (“ Warrant Share Delivery Date ”). This Warrant shall be deemed to have been exercised on the date the Exercise Price is received by the Company. The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised by payment to the Company of the Exercise Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(e)(vi) prior to the issuance of such shares, have been paid. If the Company fails for any reason to deliver to the Holder certificates evidencing the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the average closing price of the Common Stock for the ten Trading Days ending on the day immediately prior to the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such certificates are delivered.

ii. Delivery of New Warrants Upon Exercise . If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the certificate or certificates representing Warrant Shares, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant. iii. Rescission Rights . If the Company fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the Warrant Shares pursuant to Section 2(e)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.. iv. No Fractional Shares or Scrip . No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which Holder would otherwise be entitled to purchase upon such exercise, the Company shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share. v. Charges, Taxes and Expenses . Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided , however , that in the event certificates for Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder; and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. vi. Closing of Books . The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

f) Call Provision . Subject to the provisions of Section 2(d) and this Section 2(f), if, after the Effective Date, (i) the average closing price of the Common Stock for ten consecutive Trading Days (the “ Measurement Period ,” which period shall not have commenced until after the Effective Date) exceeds $2.00 (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and the like after the Initial Exercise Date), (ii) the average daily volume of the Common Stock for such Measurement Period exceeds 50,000 shares of Common Stock per Trading Day (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and the like after the Initial Exercise Date), (iii) the Holder is not in possession of any information that constitutes, or might constitute, material non-public information which was provided by the Company, and (iv) there is an effective Registration Statement pursuant to which the Holder is permitted to utilize the prospectus thereunder to resell all of the shares issuable pursuant to the Transaction Documents (and the Company believes, in good faith, that such effectiveness will continue uninterrupted for the foreseeable future), then the Company may, within 1 Trading Day of the end of such Measurement Period, call for cancellation of all or any portion of this Warrant for which a Notice of Exercise has not yet been delivered (such right, a “ Call ”) for consideration equal to $.001 per Share. To exercise this right, the Company must deliver to the Holder an irrevocable written notice (a “ Call Notice ”), indicating therein the portion of unexercised portion of this Warrant to which such notice applies. If the conditions set forth below for such Call are satisfied from the period from the date of the Call Notice through and including the Call Date (as defined below), then any portion of this Warrant subject to such Call Notice for which a Notice of Exercise shall not have been received by the Call Date will be cancelled at 6:30 p.m. (New York City time) on the fifth Trading Day after the date the Call Notice is received by the Holder (such date and time, the “ Call Date ”). Any unexercised portion of this Warrant to which the Call Notice does not pertain will be unaffected by such Call Notice. In furtherance thereof, the Company covenants and agrees that it will honor all Notices of Exercise with respect to Warrant Shares subject to a Call Notice that are tendered through 6:30 p.m. (New York City time) on the Call Date. Section 3 . Certain Adjustments .

a) Stock Dividends and Splits . If the Company, at any time while this Warrant is outstanding: (A) pays a stock dividend or otherwise make a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (B) subdivides outstanding shares of Common Stock into a larger number of shares, (C) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (D) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

b) Subsequent Equity Sales . If the Company or any Subsidiary thereof, as applicable, at any time while this Warrant is outstanding, shall sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any option to purchase or other disposition) any Common Stock or Common Stock Equivalents entitling any Person to acquire shares of Common Stock, at an effective price per share less than the then Exercise Price (such lower price, the “ Base Share Price ” and such issuances collectively, a “ Dilutive Issuance ”) (if the holder of the Common Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share which is less than the Exercise Price, such issuance shall be deemed to have occurred for less than the Exercise Price on such date of the Dilutive Issuance), then the Exercise Price shall be reduced and only reduced to equal the Base Share Price. Additionally, the number of Warrant Shares issuable hereunder shall be increased such that the aggregate Exercise Price payable hereunder, after taking into account the decrease in the Exercise Price, shall be equal to the aggregate Exercise Price prior to such adjustment. Such adjustment shall be made whenever such Common Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustments shall be made, paid or issued under this Section 3(b) in respect of an Exempt Issuance. The Company shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Stock or Common Stock Equivalents subject to this Section 3(b), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion price and other pricing terms (such notice the “ Dilutive Issuance Notice ”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Section 3(b), upon the occurrence of any Dilutive Issuance, after the date of such Dilutive Issuance the Holder is entitled to receive a number of Warrant Shares based upon the Base Share Price regardless of whether the Holder accurately refers to the Base Share Price in the Notice of Exercise. c) Subsequent Rights Offerings . If the Company, at any time while the Warrant is outstanding, shall issue rights, options or warrants to all holders of Common Stock (and not to Holders) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the average closing price of the Common Stock for the ten Trading Days ending on the day immediately prior to the record date mentioned below, then the Exercise Price shall be multiplied by a fraction, of which the denominator shall be the number of shares of the Common Stock outstanding on the date of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the numerator shall be the number of shares of the Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate offering price of the total number of shares so offered (assuming receipt by the Company in full of all consideration payable upon exercise of such rights, options or warrants) would purchase at such average closing price. Such adjustment shall be made whenever such rights or warrants are issued, and shall become effective immediately after the record date for the determination of stockholders entitled to receive such rights, options or warrants.

d) Pro Rata Distributions . If the Company, at any time while this Warrant is outstanding, shall distribute to all holders of Common Stock (and not to Holders of the Warrants) evidences of its indebtedness or assets (including cash and cash dividends) or rights or warrants to subscribe for or purchase any security other than the Common Stock (which shall be subject to Section 3(b)), then in each such case the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to the record date fixed for determination of stockholders entitled to receive such distribution by a fraction of which the denominator shall be the average closing price of the Common Stock for the ten Trading Days ending on the day immediately prior to the record date mentioned above, and of which the numerator shall be such average closing price on such record date less the then per share fair market value at such record date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of the Common Stock as determined by the Board of Directors in good faith. In either case the adjustments shall be described in a statement provided to the Holder of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record date mentioned above. e) Fundamental Transaction . If, at any time while this Warrant is outstanding, other than a Reverse Merger, (A) the Company effects any merger or consolidation of the Company with or into another Person, (B) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (C) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property, or (D) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (each “ Fundamental Transaction ”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “ Alternate Consideration ”) receivable as a result of such merger, consolidation or disposition of assets by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such event. For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions, any successor to the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions and evidencing the Holder’s right to exercise such warrant into Alternate Consideration. The terms of any agreement pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this Section 3(e) and insuring that this Warrant (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction that is (1) an all cash transaction, (2) a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the Securities Exchange Act of 1934, as amended, or (3) a Fundamental Transaction involving a person or entity not traded on a national securities exchange, the Nasdaq Global Select Market, the Nasdaq Global Market, or the Nasdaq Capital Market, the Company or any successor entity shall pay at the Holder’s option, exercisable at any time concurrently with or within 30 days after the consummation of the Fundamental Transaction, an amount of cash equal to the value of this Warrant as determined in accordance with the Black Scholes Option Pricing Model obtained from the “OV” function on Bloomberg L.P. using (i) a price per share of Common Stock equal to the average closing price of the Common Stock for the ten Trading Days ending on the day immediately preceding the date of consummation of the applicable Fundamental Transaction, (ii) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of the date of consummation of the applicable Fundamental Transaction and (iii) an expected volatility equal to the 100 day volatility obtained from the “HVT” function on Bloomberg L.P. determined as of the Trading Day immediately following the public announcement of the applicable Fundamental Transaction.

f) Calculations . All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding. g) Voluntary Adjustment By Company . The Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company. h) Notice to Holder .

i. Adjustment to Exercise Price . Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment. If the Company enters into a Variable Rate Transaction (as defined in the Purchase Agreement), despite the prohibition thereon in the Purchase Agreement, the Company shall be deemed to have issued Common Stock or Common Stock Equivalents at the lowest possible conversion or exercise price at which such securities may be converted or exercised.

ii. Notice to Allow Exercise by Holder . If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock; (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock; (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights; (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, of any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property; (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company; then, in each case, the Company shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder is entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice. Section 4 . Transfer of Warrant .

a) Transferability . Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions of Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

b) New Warrants . This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto. c) Warrant Register . The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “ Warrant Register ”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary. d) Transfer Restrictions . If , at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase Agreement. Section 5 . Miscellaneous .

a) No Rights as Shareholder Until Exercise . This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(e)(i). b) Loss, Theft, Destruction or Mutilation of Warrant . The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate. c) Saturdays, Sundays, Holidays, etc . If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

d)

Authorized Shares .

The Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue). Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant, and (c) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant. Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

e) Jurisdiction . All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Purchase Agreement and the Exchange Agreement. f) Restrictions . The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon resale imposed by state and federal securities laws. g) Nonwaiver and Expenses . No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder. h) Notices . Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Exchange Agreement. i) Limitation of Liability . No provision hereof, in the absence of any affirmative action by Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of Holder, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company. j) Remedies . Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate. k) Successors and Assigns . Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares. l) Amendment . This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

m) Severability . Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant. n) Headings . The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

********************

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

SJ ELECTRONICS, INC.

Date:

By:

/s/ Name: Title:

NOTICE OF EXERCISE SJ ELECTRONICS, INC. (1) The undersigned hereby elects to purchase_____ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any. (2) Payment shall take the form of (check applicable box): [ ] in lawful money of the United States; or [ ] [if permitted] the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c). (3) Please issue a certificate or certificates representing said Warrant Shares in the name of the undersigned or in such other name as is specified below: TO:

The Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to: _______________________________ _______________________________ _______________________________ (4) Accredited Investor . The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended. [SIGNATURE OF HOLDER] Name of Investing Entity: ________________________________________________________________________ Signature of Authorized Signatory of Investing Entity : _________________________________________________ Name of Authorized Signatory: ___________________________________________________________________ Title of Authorized Signatory: ____________________________________________________________________ Date: ________________________________________________________________________________________

ASSIGNMENT FORM (To assign the foregoing warrant, execute this form and supply required information. Do not use this form to exercise the warrant.)

FOR VALUE RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to __________________________

______________________________________________ whose address is _______________________________________________________________.

_______________________________________________________________ Dated: ______________, _______

Holder’s Signature: Holder’s Address:

_____________________________ _____________________________

_____________________________

Signature Guaranteed: ___________________________________________

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.

Exhibit 4.2 SJ ELECTRONICS, INC. (a Nevada corporation) PLACEMENT AGENT WARRANT to purchase shares of common stock THIS WARRANT WILL BE VOID AFTER 5:00 P.M. EASTERN STANDARD TIME ON JUNE 10, 2013 Original Issuance Date: June 10, 2008 THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR WITH THE SECURITIES COMMISSION OF ANY STATE UNDER ANY APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS. THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OR UNLESS SUCH OFFER, SALE OR TRANSFER IS EXEMPT FROM SUCH REGISTRATION. THIS WARRANT (this "Warrant") certifies that, for value received, Primary Capital, LLC or its registered assigns (the “Holder” or “Holders”) is entitled, at any time or from time to time during the Exercise Period, to subscribe for, purchase and receive 446,154 shares (each such share, a "Warrant Share" and all such shares, the "Warrant Shares") of common stock, $.001 par value (the “Common Stock”), issued by SJ Electronics, Inc., a Nevada corporation (the “Company”) subject to adjustments as set forth in Section 4(d) herein. If the rights represented hereby are not exercised by 5:00 p.m. Eastern Standard Time on the Expiration Date, this Warrant shall automatically become void and of no further force or effect, and all rights represented hereby shall cease and expire. This Warrant has been issued pursuant to a Letter Agreement dated as of November 15, 2007 by and between the Holder and the Company as compensation for placement agent services provided by the Holder in connection with the sale of 15% Senior Secured Convertible Notes Due 2009 (the “15% Notes”) pursuant to that certain Note Purchase Agreement (the “Note Purchase Agreement”) dated as of May 15, 2008 by and among the Company and the investors named therein. As used herein, the term “15% Notes” means securities in the form of the 15% Senior Secured Convertible Notes Due 2009 filed as an exhibit to the Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) by the Company on May 21, 2008. Any terms not specifically defined in this Warrant that are defined in the 15% Notes have the meanings herein so defined therein. 1. Exercise of Warrants . This Warrant may be exercised by the Holder hereof, in whole or in part from time to time, by the delivery of a notice of exercise in the form attached duly executed to the address of the Company provided below for giving notices. Unless the Holder opts for cashless exercise, as provided in Section 2 below, the notice of exercise must be accompanied by payment to the Company, by cash or check, of an amount equal to the Exercise Price specified on the notice of exercise. On the exercise of all or any portion of this Warrant in the manner provided herein, the Holder exercising the same shall be deemed to have become a holder of record of the Shares as to which this Warrant is exercised for all purposes, and certificates for the securities so purchased shall be delivered to the Holder within a reasonable time, but in no event longer than three (3) business days after this Warrant shall have been exercised as set forth above. 2. Cashless Exercise . If the Warrant is exercised to purchase Shares, in lieu of making payment of the Exercise Price in cash or by check, the Holder may elect instead to receive upon such exercise the “Net Number” of shares of Common Stock determined according to the following formula: Net Number = (A x B) - (A x C) B

For purposes of the foregoing formula: A = the total number of Shares with respect to which this Warrant is then being exercised. B = the Closing Bid Price of the Common Stock on the Exercise Date. C = the Exercise Price Per Share in effect on the Exercise Date. For purposes hereof, the “Closing Bid Price” means the average of the closing high bids on the five trading days preceding the Exercise Date, as reported on the principal exchange or trading system on which the Company’s common stock is listed. 3. Delivery of Warrant Shares.

(a) To effect exercises hereunder, the Holder shall not be required to physically surrender this Warrant unless the aggregate Warrant Shares represented by this Warrant is being exercised. Upon delivery of the Exercise Notice (in the form attached hereto) to the Company at its address for notice set forth herein and upon payment of the Exercise Price multiplied by the number of Warrant Shares that the Holder intends to purchase hereunder, the Company shall promptly (but in no event later than five Trading Days after the Date of Exercise (as defined herein)) issue and deliver to the Holder, a certificate for the Warrant Shares issuable upon such exercise. "Date of Exercise" means the date on which the Holder shall have delivered to the Company: (i) the Exercise Notice, appropriately completed and duly signed and (ii) if such Holder is not utilizing the cashless exercise provisions set forth in this Warrant, payment of the Exercise Price for the number of Warrant Shares so indicated by the Holder to be purchased. (b) If by the fifth Trading Day after a Date of Exercise the Company fails to deliver the required number of Warrant Shares, then the Holder will have the right to rescind such exercise. (c) If by the fifth Trading Day after a Date of Exercise the Company fails to deliver the required number of Warrant Shares, and if after such fifth Trading Day and prior to the receipt of such Warrant Shares, the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue by (B) the closing bid price of the Common Stock on the Date of Exercise and (2) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In. 4. Adjustments .

(a) Stock Dividends, Reclassifications, Recapitalizations, Etc. If after the Effective Date the Company: (i) pays a dividend in Common Stock or makes a distribution in Common Stock or of warrants or options to purchase Common Stock, (ii) subdivides its outstanding Common Stock into a greater number of shares, (iii) combines its outstanding Common Stock into a smaller number of shares or (iv) increases or decreases the number of shares of Common Stock outstanding by reclassification of its Common Stock (including a recapitalization in connection with a consolidation or merger in which the Company is the continuing corporation), then (1) the Exercise Price on the record date of such division or distribution or the effective date of such action shall be adjusted by multiplying such Exercise Price by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately before such event and the denominator of which is the number of shares of Common Stock outstanding immediately after such event, and (2) the number of shares of Common Stock for which this Warrant may be exercised immediately before such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the Exercise Price immediately before such event and the denominator of which is the Exercise Price immediately after such event.

2

(b) Cash Dividends and Other Distributions . In the event that at any time or from time to time the Company shall distribute to all holders of Common Stock (i) any dividend or other distribution of cash, evidences of its indebtedness, shares of its capital stock or any other properties or securities or (ii) any options, warrants or other rights to subscribe for or purchase any of the foregoing (other than in each case, (w) the issuance of any rights under a shareholder rights plan, (x) any dividend or distribution described in Section 4(a), (y) any rights, options, warrants or securities described in Section 4(c) and (z) any cash dividends or other cash distributions from current or retained earnings), then the number of shares of Common Stock issuable upon the exercise of this Warrant shall be increased to a number determined by multiplying the number of shares of Common Stock issuable upon the exercise of this Warrant immediately prior to the record date for any such dividend or distribution by a fraction, the numerator of which shall be such Current Market Value (as defined in Section 4(g)) per share of Common Stock on the record date for such dividend or distribution, and the denominator of which shall be such Current Market Value per share of Common Stock on the record date for such dividend or distribution less the sum of (x) the amount of cash, if any, distributed per share of Common Stock and (y) the fair value (as determined in good faith by the Board of Directors of the Company, whose determination shall be evidenced by a board resolution, a copy of which will be sent to the Holders upon request) of the portion, if any, of the distribution applicable to one share of Common Stock consisting of evidences of indebtedness, shares of stock, securities, other property, warrants, options or subscription or purchase rights; and the Exercise Price shall be adjusted to a number determined by dividing the Exercise Price immediately prior to such record date by the above fraction. Such adjustments shall be made whenever any distribution is made and shall become effective as of the date of distribution, retroactive to the record date for any such distribution. No adjustment shall be made pursuant to this Section 4(b) which shall have the effect of decreasing the number of shares of Common Stock issuable upon exercise of this Warrant or increasing the Exercise Price. (c) Combination; Liquidation . (i) In the event of a Combination (as defined below), each Holder shall have the right to receive upon exercise of the Warrant the kind and amount of shares of capital stock or other securities or property which such Holder would have been entitled to receive upon or as a result of such Combination had such Warrant been exercised immediately prior to such event (subject to further adjustment in accordance with the terms hereof). Unless paragraph (ii) is applicable to a Combination, the Company shall provide that the surviving or acquiring Person (the “Successor Company”) in such Combination will assume by written instrument the obligations under this Section 4 and the obligations to deliver to the Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to acquire. “Combination” means an event in which the Company consolidates with, mergers with or into, or sells all or substantially all of its assets to another Person, where “Person” means any individual, corporation, partnership, joint venture, limited liability company, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity; (ii) In the event of (x) a Combination where consideration to the holders of Common Stock in exchange for their shares is payable solely in cash or (y) the dissolution, liquidation or winding-up of the Company, the Holders shall be entitled to receive, upon surrender of their Warrant, distributions on an equal basis with the holders of Common Stock or other securities issuable upon exercise of the Warrant, as if the Warrant had been exercised immediately prior to such event, less the Exercise Price. In case of any Combination described in this Section 4, the surviving or acquiring Person and, in the event of any dissolution, liquidation or winding-up of the Company, the Company, shall deposit promptly with an agent or trustee for the benefit of the Holders the funds, if any, necessary to pay to the Holders the amounts to which they are entitled as described above. After such funds and the surrendered Warrant are received, the Company shall deliver a check in such amount as is appropriate (or, in the case or consideration other than cash, such other consideration as is appropriate) to such Person or Persons as it may be directed in writing by the Holders surrendering such Warrant.

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(d) Sales of Common Stock at less than the Exercise Price . From the Effective Date except for (i) Exempt Issuances (as defined below) or (ii) an issuance of Common Stock upon exercise of warrants or options or upon conversion of other convertible securities for which an adjustment has already been made pursuant to this Section 4, as to all of which this Section 4(d) does not apply, if the Company closes on the sale or issuance of Common Stock at a price, or warrants, options, convertible debt or equity securities with an exercise price per share or a conversion price which is less than the Exercise Price then in effect or makes an adjustment to the conversion price of the 15% Notes so that a new conversion price is less than the Exercise Price then in effect, the Exercise Price shall be adjusted immediately thereafter so that it shall equal such exercise price or such conversion price . Such adjustment shall be made successively whenever such an issuance is made. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. “Exempt Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers, directors of and consultants (other than consultants whose services relate to the raising of funds) of the Company or its subsidiaries pursuant to any stock or option plan that was or may be adopted by the Board of Directors, and (b) securities issued pursuant to acquisitions, licensing agreements, or other strategic transactions. (e) Notice of Adjustment . Whenever the Exercise Price or the number of shares of Common Stock and other property, if any, issuable upon exercise of the Warrant is adjusted, as herein provided, the Company shall deliver to the holders of the Warrant a certificate of the Chief Executive Officer setting forth, in reasonable detail, the event requiring the adjustment and the method by which such adjustment was calculated (including a description of the basis on which (i) the Board of Directors determined the fair value of any evidences of indebtedness, other securities or property or warrants, options or other subscription or purchase rights and (ii) the Current Market Value (as defined below) of the Common Stock was determined, if either of such determinations were required), and specifying the Exercise Price and number of shares of Common Stock issuable upon exercise of Warrant after giving effect to such adjustment. (f) Notice of Certain Transactions . In the event that the Company shall propose (a) to pay any dividend payable in securities of any class to the holders of its Common Stock or to make any other non-cash dividend or distribution to the holders of its Common Stock, (b) to offer the holders of its Common Stock rights to subscribe for or to purchase any securities convertible into shares of Common Stock or shares of stock of any class or any other securities, rights or options, (c) to effect any capital reorganization, reclassification, consolidation or merger affecting the class of Common Stock, as a whole, or (d) to effect the voluntary or involuntary dissolution, liquidation or winding-up of the Company, the Company shall, as promptly as possible, send to the Holder a notice of such proposed action or offer. (g) Current Market Value. “ Current Market Value ” per share of Common Stock or any other security at any date means (i) if the security is not registered under the Securities Exchange Act of 1934 and/or traded on a national securities exchange, quotation system or bulletin board, as amended (the “Exchange Act”), (a) the value of the security, determined in good faith by the Board of Directors and certified in a board resolution, based on the most recently completed arm’s-length transaction between the Company and a Person other than an Affiliate of the Company or between any two such Persons and the closing of which occurs on such date or shall have occurred within the six-month period preceding such date, or (b) if no such transaction shall have occurred within the six-month period, the value of the security as determined by an independent financial expert or an agreed upon financial valuation model or (ii) if the security is registered under the Exchange Act and/or traded on a national securities exchange, inter-dealer quotation system or on the over the counter Bulletin Board or Pink Sheets, the average of the daily closing bid prices (or the equivalent in an over-the-counter market) for each day on which the Common Stock is traded during the period commencing twenty (20) days before such date and ending on the date one day prior to such date. 5. Reservation of Warrant Shares . The Company covenants that it will at all times reserve and keep available out of the aggregate of its authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as herein provided, the number of Warrant Shares which are then issuable and deliverable upon the exercise of this entire Warrant, free from preemptive rights or any other contingent purchase rights of Persons other than the Holder (taking into account the adjustments and restrictions of Section 9). The Company covenants that all Warrant Shares so issuable and deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable.

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6. Assignment of Warrants . The Holder may transfer this Warrant, in whole or in part, by executing the form of assignment attached hereto and delivering such assignment and the Warrant so assigned to the assignee. In the event this Warrant is assigned in the manner provided herein, the Company, upon request and upon surrender of this Warrant by the Holder at the principal office of the Company accompanied by payment of all transfer taxes, if any, payable in connection therewith, shall transfer this Warrant on the books of the Company. If the assignment is in whole, the Company shall execute and deliver a new Warrant of like tenor to this Warrant to the assignee. If the assignment is in part, the Company shall execute and deliver to the assignee and to the Holder each a new Warrant of like tenor. Until such assignment, every Holder hereof agrees that the Company may deem and treat the registered Holder of this Warrant as the true and lawful owner thereof for all purposes, and the Company shall not be affected by any notice to the contrary. 7. Acquisition of Warrant and Shares . The grant to Holder of this Warrant to purchase the Shares and the subsequent exercise thereof constitutes the offer and sale of securities as those terms are defined under the Securities Act of 1933, as amended (the "Securities Act"), and applicable state statutes. Such transactions shall be consummated in reliance on certain exemptions from the registration and prospectus delivery requirements of such statues that depend, among other items, on the circumstances under which such securities are acquired. In order to provide documentation for reliance upon such exemptions from the registration and prospectus delivery requirements for such transactions, the acceptance of this Warrant by the Holder or any assignee thereof shall constitute each of their acceptance of, and concurrence in, the following representations and warranties: (a) Holder acknowledges that neither the Securities and Exchange Commission ("SEC") nor the securities commission of any state or other federal agency has made any determination as to the merits of acquiring the securities of the Company as contemplated by this Warrant and that the exercise of the Warrant as herein contemplated involves certain risks. (b) Holder has been provided information about the business and operations of the Company and has been provided any information requested to verify any information furnished, and has been provided the opportunity for direct communication with the Company and its representatives regarding the purchase made thereby. (c) Holder and Holder's representatives have such knowledge and experience in business and financial matters that they are capable of evaluating the Company, its business operations, and the risks and merits of an investment in the Company. (d) Holder acknowledges that the securities that may be acquired pursuant to this Warrant must be held and may not be sold, or otherwise disposed of for value unless they are subsequently registered under the Securities Act or an exemption from such registration is available. The certificates representing such securities will bear a legend in substantially the following form so restricting the sale of such securities: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED (THE "SECURITIES ACT") AND ARE “RESTRICTED SECURITIES” WITHIN THE MEANING OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT COMPLYING WITH RULE 144 IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OR OTHER COMPLIANCE UNDER THE SECURITIES ACT.

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8. Piggyback Registration Rights . The Company hereby convenants that it will include the Warrant Shares in any registration statement(s) filed pursuant to Section 5 of the Note Purchase Agreement, and will afford to the Holder all of the rights, privileges and remedies provided to the investors by Section 5 thereof. 9. No Impairment of Rights . No prepayment, repurchase or satisfaction of all or any of the outstanding 15% Notes will affect the rights of the Holder of this Warrant. 10. Limitations on Exercise . Notwithstanding anything to the contrary contained herein, the number of Warrant Shares that may be acquired by the Holder upon any exercise of this Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to insure that, following such exercise (or other issuance), the total number of shares of Common Stock then beneficially owned by such Holder and its Affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder's for purposes of Section 13(d) of the Exchange Act, does not exceed 9.99% of the total number of issued and outstanding shares of Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. This provision shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant. This restriction may not be waived. Notwithstanding anything to the contrary contained in this Warrant, (a) no term of this Section may be waived by any party, nor amended such that the threshold percentage of ownership would be directly or indirectly increased, (b) this restriction runs with the Warrant and may not be modified or waived by any subsequent holder hereof and (c) any attempted waiver, modification or amendment of this Section will be void ab initio . 11. Governing Law . This agreement shall be construed under and be governed by the laws of the State of New York.

12. Notices . All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed given to a Party when (a) delivered to the appropriate address by hand or by nationally recognized overnight courier service (costs prepaid), or (b) sent by facsimile or e-mail with confirmation of transmission by the transmitting equipment; in each case to the following addresses, facsimile numbers or e-mail addresses and marked to the attention of the individual (by name or title) designated below (or to such other address, facsimile number, e-mail address or individual as a party may designate by notice to the other parties): If to the Holder: Primary Capital, LLC 14 Wall Street, 20 Floor New York, NY 10005 U.S.A. Attention: John C. Leo Telephone: 212-618-1515 Facsimile: 212-400-4234 E-mail: JLeo@PrimaryLLC.com
th

If to the Company: SJ Electronics, Inc. 5F, No.166, Sinhu 2 Road Neihu District, Taipei City Taiwan Attention: Agatha Shen Telephone No.: 011-8862-8791-8838 Facsimile No.: 011-8862-8791-1368 E-mail: Agatha@sjelect.com.tw
nd

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13. Loss, Theft, Destruction, or Mutilation . Upon receipt by the Company of reasonable evidence of the ownership of and the loss, theft, destruction, or mutilation of this Warrant, the Company will execute and deliver, in lieu thereof, a new Warrant of like tenor. 14. Certain Definitions .

"Affiliate" means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 144. “Effective Date” means the date of issuance of this Warrant. “Exercise Date” means the date on which a notice of exercise, duly completed as required by Section 1 hereof, is received at the offices of the Company. “Exercise Period” means the period commencing on the date of issuance of this Warrant and ending on the Expiration Date. “Exercise Price” means $1.30 per share of Common Stock as adjusted pursuant to Section 4 herein. “Expiration Date” means 5:00 p.m. Eastern Standard Time on June 10, 2013. "Rule 144" means Rule 144 promulgated by the Securities and Exchange Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Securities and Exchange Commission having substantially the same effect as such Rule.

[Signature page follows]

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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of the Original Issuance Date first above written. Dated: ____________, 2008. SJ ELECTRONICS, INC.

By:

/s/ Name: Title:

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Form of Assignment (to be signed only upon assignment of Warrant)

TO:

SJ Electronics, Inc. 5F, No.166, Sinhu 2 Road Neihu District, Taipei City Taiwan Attention: Agatha Shen
nd

ASSIGNMENT FOR VALUE RECEIVED, __________________ does hereby sell, assign, and transfer unto _____________________ the right to purchase _________________ shares of common stock of SJ Electronics, Inc. pursuant to the terms of this Warrant, and does hereby irrevocably constitute and appoint ___________________ attorney to transfer such right on the books of the Company with full power of substitution in the premises.

DATED this ___ day of ____________, 20__.

Signature:

Signature Guaranteed:

****** NOTICE : The signature to the form of assignment must correspond with the name as written upon the face of the attached Warrant in every particular without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership on a registered national securities exchange.

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NOTICE OF EXERCISE (to be signed only upon exercise of Warrant)

TO:

SJ Electronics, Inc. 5F, No.166, Sinhu 2 Road Neihu District, Taipei City Taiwan Attention: Agatha Shen
nd

The undersigned holder hereby exercises the right to purchase shares of Common Stock of SJ Electronics, Inc. (the “ Company ”), evidenced by the attached Placement Agent Warrant dated june 10, 2008 (the “ Warrant ”). Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant. Exercise Price Per Share: $________________ Total Exercise Price: $____________________ Number of Shares: ______________________ Net Number (if cashless): _________________ Specify Method of exercise by check mark: 1. ___ Cash Exercise . The holder shall pay the Total Exercise Price of $______________ to the Company in accordance with the terms of the Warrant. Cashless Exercise . In lieu of making payment of the Total Exercise Price, the holder elects to receive upon such exercise the Net Number of shares of Common Stock determined in accordance with the terms of the Warrant.

2. ___

Date: _______________, ______ Name of Registered Holder By: Name: Title:

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EXHIBIT 5.1

GUZOV OFSINK, LLC
Attorneys-at-Law 600 Madison Avenue, 14 th Floor, New York, NY 10022 Telephone: (212) 371-8008 Telefax: (212) 688-7273 http://www.golawintl.com

August 1, 2008 Board of Directors SJ Electronics, Inc. Re: SJ Electronics, Inc. Form S-1

Board Members: We have acted as counsel to SJ Electronics, Inc., a Nevada corporation (the “ Company ”), in connection with the filing of a Registration Statement on Form S-1 (the “ Registration Statement ”) with the Securities and Exchange Commission (the “ Commission ”), with respect to the registration under the Securities Act of 1933, as amended (the “ Act ”), for resale of an aggregate of 13,457,902 shares of the Company’s common stock, $.001 par value per share (the “ Common Stock ”), comprising 5,850,215 shares of Common Stock (the “ Outstanding Common Stock ”), 4,461,533 shares of Common Stock underlying certain 15% Senior Secured Convertible Notes due 2009 (“ Conversion Shares ”) and 3,146,154 shares of Common Stock underlying certain warrants (“ Warrant Shares ” and together with the Outstanding Common Stock and the Conversion Shares the “ Shares ”). In our capacity as counsel, we are familiar with the proceedings taken by the Company in connection with the authorization, issuance and sale of the Shares. In rendering this opinion, we have (a) assumed (i) the genuineness of all signatures on all documents examined by us, (ii) the authenticity of all documents submitted to us as originals, and (iii) the conformity to original documents of all documents submitted to us as photostatic or conformed copies and the authenticity of the originals of such copies; and (b) relied on (i) certificates of public officials and (ii) as to matters of fact, statements and certificates of officers and representatives of the Company. With respect to our opinion that the Warrant Shares and Conversion Shares will be validly issued, we have assumed that such shares will be evidenced by appropriate certificates duly executed and delivered.

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Based upon the foregoing, we are of the opinion that the shares of Outstanding Common Stock have been duly authorized, validly issued and are fully paid and non-assessable and, assuming proper exercise of and payment of the purchase price for the applicable warrants and proper conversion of the 15% Senior Secured Convertible Notes due 2009, the Warrant Shares and Conversion Shares will be duly authorized, validly issued and fully paid and non-assessable. We hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus included in the Registration Statement. In giving the forgoing consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder. Nothing herein shall be deemed to relate to or constitute an opinion concerning any matters not specifically set forth above. The foregoing opinions relate only to matters of the internal law of the State of Nevada without reference to conflict of laws and to matters of federal law, and we do not purport to express any opinion on the laws of any other jurisdiction. We express no opinion as to compliance with the securities or “blue sky” laws of any state or country in which the Shares are proposed to be offered and sold. Very truly yours,

/s/ Guzov Ofsink, LLC Guzov Ofsink, LLC

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Exhibit 21.1 Subsidiaries of the Registrant Shing Mei Enterprises Limited Indirect Subsidiaries of the Registrant Xujun Electronic (Ganzhou) Co., Ltd. Guangxi Hezhou XU JUN Electronics Co., Ltd. FuChuan Xujun Science and Technology Electronics Co., Ltd. S.J. Electronics Technology (Shenzhen) Co., Ltd. S.J. Electronics (Gongming loutsun Shenzhen ) Co., Ltd.

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the use in this Registration Statement on Form S-1 of our report included herein dated March 14, 2008 (except for Note 1, which is dated July 31, 2008) with respect to the balance sheets of SJ Electronics, Inc (formerly Acheron, Inc.) as of December 31, 2007 and 2006 and the related statements of operations, stockholder’s equity and comprehensive income (loss) and cash flows for each of the years in the two year period ended December 31, 2007. We also consent to the reference of our firm’s name under the caption “Experts” in such Registration Statement and related prospectus. /s/ Kempisty & Company Kempisty & Company, Certified Public Accountants, P.C. New York, New York

Dated: August 1, 2008


								
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