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      &lt;b&gt;NOTE D &amp;#8211; STOCKHOLDERS&amp;#8217; EQUITY&lt;/b&gt;
    &lt;/p&gt;
    &lt;p align="justify" style="font-family: times new roman,times,serif; font-size: 10pt;"&gt;
      As a result of the reverse merger (see Note A item 6), the common stock of Cybrdi-Maryland has been cancelled and converted into shares of common stock of Certron at an exchange ratio of
      1.566641609
      per share. This resulted in the issuance of
      47,328,263
      shares of Carton&amp;#8217;s common stock to the Cybrdi shareholders. As of June 30, 2013 and December 31, 2012, the Company had
      120,225,323
      shares issued and outstanding, respectively.
    &lt;/p&gt;
    &lt;p align="justify" style="font-family: times new roman,times,serif; font-size: 10pt;"&gt;
      As of June 30, 2013, the balance sheet included total equity of $4,215,416, of which $1,147,059
      was for non-controlling interest, representing
      20% minority interest in Chaoying Biotech and
      16.67% minority interest in SD Chaoying.
    &lt;/p&gt;
    &lt;p align="justify" style="font-family: times new roman,times,serif; font-size: 10pt;"&gt;
      On January 15, 2010, the Board of Directors adopted resolutions that authorized incentive compensation to key management of the Company for services it has provided to the Company. The incentive compensation was paid by the issuance of
      12,000,000
      shares of common stock of the Company to Mr. Yanbiao Bai, Chief Executive Officer and President of the Company, and
      3,300,000
      shares of common stock of the Company to Ms. Xue Bu, the former Chief Financial and Operating Officer of the Company. Compensation cost of $306,000
      was recorded during the first quarter of 2010 at $0.02
      per share, the market price of the Company&amp;#8217;s common stock on January 15, 2010, the grant date.
    &lt;/p&gt;
        &lt;p align="justify" style="font-family: times new roman,times,serif; font-size: 10pt;"&gt;
      On June 30, 2011, the Company entered into a written Debt Conversion Agreement with Shaanxi Chaoying Beauty &amp;amp; Cosmetics Group Co., Ltd. (a related party), Shaanxi NuoQi Healthfood Co., Ltd. (a related party), and Mr. Yanbiao Bai, Chairman and CEO of the Company. In the Agreement, the Company agreed to repay a total of $605,723
      (RMB3,920,000) debt due to Shaanxi Chaoying Beauty &amp;amp; Cosmetics Group Co., Ltd. by issuing the Company's common stock. Simultaneously upon the execution of the repayment, Shaanxi Chaoying Beauty &amp;amp; Cosmetics Group Co., Ltd. agreed to transfer to Mr. Yanbiao Bai the number of shares to be issued through the debt repayment. The number of shares transferred to Mr. Yanbiao Bai was further offset by a number of shares equivalent to $169,973
      (RMB1,100,000) due by Shaanxi NuoQi Health Food Co., Ltd., a company wholly-controlled by Ms. Xue Bu, the spouse of Mr. Yanbiao Bai and former COO and Director of the Company, to offset its debt due to the Company. The Agreement was approved by the Company&amp;#8217;s Board of Directors on June 30, 2011. As a result of the debt conversion and offset, the number of shares of common stock issued to Mr. Yanbiao Bai was
      54,468,756
      shares, which was determined based on the closing price of $0.008
      per share on June 30, 2011. The share issuance for repayment of debt as agreed upon and approved was executed on August 17, 2011.
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