COMMON STOCK PURCHASE AGREEMENT
 
This Common Stock Purchase Agreement (this “Agreement”) is dated as of November
___, 2009, by and between China Kangtai Cactus Bio-Tech, Inc., a Nevada
corporation (the “Company”), and Seaside 88, LP, a Florida limited partnership
(such investor, including its successors and assigns, “Seaside”).
 
WHEREAS, subject to the terms and conditions set forth in this Agreement, the
Company desires to issue and sell to Seaside, and Seaside desires to purchase
from the Company, up to 2,100,000 shares of Common Stock on the Closing Dates;
 
NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Company and Seaside agree as
follows:
 
ARTICLE I
DEFINITIONS
 
1.1           Definitions
 
.  In addition to the terms defined elsewhere in this Agreement, for all
purposes of this Agreement, the following terms have the meanings indicated in
this Section 1.1:
 
“3-Day VWAP” means the daily volume weighted average of actual trading prices
measured in hundredths of cents of the Common Stock of the Company on the
Trading Market for the three consecutive Trading Days immediately prior to a
Subsequent Closing Date.
 
“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.
 
“Closing” means the Initial Closing and each Subsequent Closing.
 
“Closing Dates” means the Initial Closing Date and each Subsequent Closing Date.
 
“Commission” means the Securities and Exchange Commission.
 
“Common Stock” means the common stock of the Company, par value $0.001 per
share, and any securities into which such common stock may hereafter be
reclassified.
 
“Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time
Common Stock, including without limitation, any debt, preferred stock, rights,
options, warrants or other instrument that is at any time convertible into or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock.
 
“Company Counsel” means The Crone Law Group, or other counsel (including
in-house counsel) reasonably acceptable to Seaside.
 
“Dollar Limit” shall have the meaning ascribed to such term in Section 2.6(b).
 
 
 

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“DTC” means the Depository Trust Company.
 
“DWAC” means DTC’s Deposit Withdrawal Agent Commission system.
 
“Disclosure Schedules” means the disclosure schedules of the Company delivered
concurrently herewith.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Floor” shall mean $1.25 (as the same may be proportionately adjusted in respect
of any stock split, stock dividend, combination, recapitalization or the like
with respect to the Common Stock).
 
 “GAAP” shall have the meaning ascribed to such term in Section 3.1(h).
 
“Initial Closing” means the closing of the purchase and sale of the Common Stock
pursuant to Section 2.1.
 
“Initial Closing Date” means two business days after the Registration Statement
is declared effective by the Commission or such later date when all of the
Transaction Documents have been executed and delivered by the applicable parties
thereto, and all conditions precedent to (i) Seaside’s obligations to purchase
the Shares and (ii) the Company’s obligations to issue and deliver the Shares
have been satisfied or waived.
 
“Intellectual Property” shall have the meaning ascribed to such term in Section
3.1(q).
 
“Lien” means a lien, charge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.
 
“Material Adverse Effect” means any condition, event, change or effect that
could reasonably be expected to have a material adverse effect on (i) the
legality, validity or enforceability of any Transaction Document, (ii) the
results of operations, assets, business, prospects or financial condition of the
Company and its Subsidiaries, taken as a whole, or (iii) the Company’s ability
to perform in any material respect on a timely basis its obligations under any
Transaction Document, but shall not mean or include any condition, event, change
or effect which (1) is or results from events or occurrences relating to the
economy in general (including arising from terrorist attacks, acts of war or
civil unrest) or the Company’s industry in general and not specifically relating
to the Company or having a disproportionate impact on the Company, or (2)
results from the announcement of this Agreement or the transactions contemplated
hereby or by the other Transaction Documents.
 
“Minimum Share Number” shall have the meaning ascribed to such term in Section
2.6(c).
 
“Per Share Purchase Price” shall be an amount equal to the daily volume weighted
average of actual trading prices measured in hundredths of cents of the Common
Stock of the Company on the Trading Market for the ten consecutive Trading Days
immediately prior to a Closing Date multiplied by 0.87.
 
 
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“Permits” shall have the meaning ascribed to such term in Section 3.1(r).
 
“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.
 
“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
 
“Prospectus Supplement” means the supplement or supplements to the base
prospectus contained in the Registration Statement to be filed in connection
with the sale to Seaside, or the resale by Seaside, of the Shares.
 
“Registration Statement” means the registration statement of the Company
covering the sale to Seaside, or the resale by Seaside, of the Shares.
 
“Required Approvals” shall have the meaning ascribed to such term in Section
3.1(e).
 
“Rule 144” means Rule 144 promulgated by the 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 Commission having substantially the
same effect as such Rule.
 
“Seaside Party” shall have the meaning ascribed to such term in Section 4.6.
 
“SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Shares” means the shares of Common Stock issued or issuable to Seaside pursuant
to this Agreement.
 
“Short Sales” shall include, without limitation, all “short sales” as defined in
Rule 200 of Regulation SHO of the Exchange Act.
 
“Subsequent Closing” means each closing of the purchase and sale of the Common
Stock pursuant to Section 2.2.
 
“Subsequent Closing Date” means the day two weeks subsequent to the prior
Closing Date (or, if such day is not a Trading Day, then the first day
thereafter that is a Trading Day) commencing two weeks following the Initial
Closing Date and ending or about the date that results in 14 Closings (including
the Initial Closing), subject to reduction pursuant to Section 2.6, over a
26-week period, or such later dates when all conditions precedent to (i)
Seaside’s obligations to purchase the Shares and (ii) the Company’s obligations
to issue and deliver the Shares have been satisfied or waived, in each event
with respect to such Subsequent Closing.
 
 
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 “Subsidiary” shall have the meaning ascribed to such term in Section 3.1(a).
 
“Trading Day” means a day on which the Common Stock is traded on a Trading
Market.
 
“Trading Market” means whichever of the following markets or exchanges on which
the Common Stock is listed or quoted for trading on the date in question: the
New York Stock Exchange, the NYSE Alternext Exchange, the NYSE AMEX, the Nasdaq
Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the
NASD OTC Bulletin Board.
 
“Transaction Documents” means this Agreement and any other documents or
agreements executed in connection with the transactions contemplated hereunder.
 
ARTICLE II
PURCHASE AND SALE
 
2.1           Initial Closing.  On the Initial Closing Date, Seaside shall
purchase from the Company, and the Company shall issue and sell to Seaside,
150,000 Shares at the Per Share Purchase Price.  Upon satisfaction or waiver of
the conditions set forth in Sections 2.3, 2.4, 2.5 and 2.6, the Initial Closing
shall occur at the offices of White White & Van Etten PC, 55 Cambridge Parkway,
Cambridge, MA 02142, or such other location as the parties shall mutually agree.
 
2.2           Subsequent Closings.  On each Subsequent Closing Date, subject to
Section 2.6, Seaside shall purchase from the Company, and the Company shall
issue and sell to Seaside, 150,000 Shares at the Per Share Purchase Price.  Upon
satisfaction or waiver of the conditions set forth in Sections 2.3, 2.4, 2.5 and
2.6, each Subsequent Closing shall occur at the offices of White White & Van
Etten PC, 55 Cambridge Parkway, Cambridge, MA 02142, or such other location as
the parties shall mutually agree.
 
2.3           Deliveries by the Company.  On each Closing Date, the Company
shall deliver or cause to be delivered to Seaside the following:
 
(a)         subject to Section 2.6(b), 150,000 Shares, registered in the name of
Seaside, via the DTC DWAC system, as specified on the signature pages hereto;
 
(b)         an officer’s certificate of the Company’s Chief Executive Officer or
Chief Financial Officer in the form of Exhibit A attached hereto; and
 
(c)         solely on the Initial Closing Date, a legal opinion of Company
Counsel, in the form of Exhibit B attached hereto.
 
2.4           Deliveries by Seaside.  On each Closing Date, Seaside shall
deliver or cause to be delivered to the Company an amount equal to (a) the Per
Share Purchase Price multiplied by (b) 150,000, subject to Section 2.6(b), in
each case by wire transfer to the account as specified in writing by the Company
and in each case less the amount due Seaside for reimbursement of its expenses
pursuant to Section 5.2 hereof.
 
 
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2.5           Closing Conditions.
 
(a)           The obligations of the Company hereunder in connection with each
Closing are subject to the satisfaction by Seaside, or waiver by the Company, of
the following conditions:
 
(i)           the accuracy on the Closing Date of the representations and
warranties of Seaside contained herein;
 
(ii)          all obligations, covenants and agreements of Seaside required to
be performed at or prior to the Closing Date shall have been performed;
 
(iii)         the delivery by Seaside of the items set forth in Section 2.4 of
this Agreement; and
 
(iv)         with respect to any Subsequent Closing, the Floor, as set forth in
Section 2.6(a) of this Agreement, has been reached.
 
(b)           The obligations of Seaside hereunder in connection with each
Closing are subject to the satisfaction by the Company, or waiver by Seaside, of
the following conditions:
 
(i)           the accuracy on the Closing Date of the representations and
warranties of the Company contained herein;
 
(ii)          all obligations, covenants and agreements of the Company required
to be performed at or prior to the Closing Date shall have been performed, and
all Required Approvals shall have been obtained;
 
(iii)         the delivery by the Company of the items set forth in Section 2.3
of this Agreement;
 
(iv)         with respect to any Subsequent Closing, the Floor, as set forth in
Section 2.6(a) of this Agreement, has been reached;
 
(v)          the Registration Statement shall have been declared effective by
the Commission and shall be in full force and effect;
 
(vi)         there shall have been no Material Adverse Effect with respect to
the Company since the date hereof that has not been cured by the Company;
 
(vii)        the purchase of Shares at a Subsequent Closing from the Company
shall not cause Seaside’s beneficial ownership of the Company’s Common Stock,
calculated in accordance with Rule 13d-3 promulgated by the Commission, to
exceed ten percent (10%); and
 
(viii)        from the date hereof to each Closing Date, trading in the Common
Stock shall not have been suspended by the Commission and trading in securities
generally as reported by Bloomberg Financial Markets shall not have been
suspended or limited, or minimum prices shall not have been established on
securities whose trades are reported by such service, or on any Trading Market,
nor shall a banking moratorium have been declared either by the United States or
New York State authorities nor shall there have occurred any material outbreak
or escalation of hostilities or other national or international calamity of such
magnitude in its effect on, or any material adverse change in, any financial
market which, in each case, in the reasonable judgment of Seaside, makes it
impracticable or inadvisable to purchase the Shares at the Closing.
 
 
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2.6           The Floor; Dollar Limit on Purchases; Minimum Share Number.
 
(a)           In the event that the 3-Day VWAP does not equal or exceed the
Floor, as calculated with respect to any Subsequent Closing Date, then such
Subsequent Closing will not occur.  In each such event, there will be one fewer
Subsequent Closing pursuant to this Agreement and the aggregate number of Shares
to be purchased hereunder shall be reduced by 150,000 Shares for each such
Subsequent Closing that does not occur because the Floor has not been reached.
 
(b)           If for any Subsequent Closing the amount of the proposed
investment by Seaside at such Closing is greater than two times the amount
invested by Seaside at the immediately preceding Subsequent Closing (the “Dollar
Limit”), then Seaside shall have the option to reduce the number of Shares
purchased at such Subsequent Closing such that the amount of the investment at
such Closing is an amount no greater than the Dollar Limit.
 
(c)           Subject to the terms hereof, in the event Seaside does not
purchase an aggregate of at least 1,680,000 Shares (the “Minimum Share Number”)
on or before the end of the 26th week following the Initial Closing Date,
Seaside shall reimburse the Company in an amount equal to $20,000 for expenses
incurred in connection with the Registration Statement.  The Minimum Share
Number will be subject to adjustment in the event (i) of the cancellation of one
or more Subsequent Closings pursuant to subsection (a) of this Section 2.6 for
failure to reach the Floor, and (ii) Seaside elects pursuant to subsection (b)
of this Section 2.6 to reduce the number of Shares purchased at any Subsequent
Closing as a result of the amount of investment at such Closing exceeding the
Dollar Limit.  In furtherance and not in limitation of the foregoing, in no
event shall Seaside be liable for the payment of any amount hereunder if the
Minimum Share Number has not been reached as set forth herein if the Company
fails to consummate one or more Closings despite all conditions to the Company’s
obligation to close having been satisfied or waived.
 
ARTICLE III
REPRESENTATIONS AND WARRANTIES
 
3.1           Representations and Warranties of the Company.  Except as set
forth under the corresponding section of the Disclosure Schedules, which
Disclosure Schedules shall be deemed a part hereof, the Company hereby makes the
representations and warranties set forth below to Seaside as of the date hereof
and as of each Closing Date:
 
(a)         Subsidiaries.  All of the direct and indirect subsidiaries of the
Company are listed in the Company’s most recent Annual Report on Form 10-K as
modified by any subsequent SEC Reports filed with the SEC (each a
“Subsidiary”).  The Company owns, directly or indirectly, all of the capital
stock or other equity interests of each Subsidiary free and clear of any Liens,
and all the issued and outstanding shares of capital stock of each Subsidiary
are validly issued and are fully paid, non-assessable and free of preemptive and
similar rights to subscribe for or purchase securities.  If the Company has no
subsidiaries, then references in the Transaction Documents to the Subsidiaries
will be disregarded.
 
 
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(b)         Organization and Qualification.  The Company and each of the
Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization (as applicable), with the requisite power and
authority to own and use its properties and assets and to carry on its business
as currently conducted.  Neither the Company nor any Subsidiary is in violation
or default of any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter documents.  Each of the
Company and the Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation or other entity in each jurisdiction in
which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, could not reasonably be expected to result in a
Material Adverse Effect and, to the knowledge of the Company, no Proceeding has
been instituted in any such jurisdiction revoking, limiting or curtailing or
seeking to revoke, limit or curtail such power and authority or qualification.
 
(c)         Authorization; Enforcement.  The Company has the requisite corporate
power and authority to enter into and to consummate the transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations thereunder.  The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary action on the
part of the Company and its stockholders, and no further action is required by
the Company or its stockholders in connection therewith other than in connection
with the Required Approvals.  Each Transaction Document has been (or upon
delivery will have been) duly executed by the Company and, when delivered in
accordance with the terms hereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms except (i) as limited by general equitable principles and applicable
bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable law.
 
(d)         No Conflicts.  The execution, delivery and performance of the
Transaction Documents by the Company, the issuance and sale of the Shares at
each Closing and the consummation by the Company of the other transactions
contemplated thereby do not and will not (i) conflict with or violate any
provision of the Company’s or any Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii)
conflict with, violate or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or result in the creation
of any Lien upon any of the properties or assets of the Company or any
Subsidiary pursuant to, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of,
any agreement (written or oral), credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) to which the Company or
any Subsidiary is a party or by which any property or asset of the Company or
any Subsidiary is bound or affected, or (iii) subject to the Required Approvals,
conflict with or result in a violation of any law, rule, regulation, order,
judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and
state securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected, except in the case of each of
clauses (ii) and (iii), such as could not reasonably be expected to result in a
Material Adverse Effect.
 
 
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(e)         Filings, Consents and Approvals.  The Company is not required to
obtain any consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal, state, local
or other governmental authority, the Trading Market or other Person in
connection with the execution, delivery and performance by the Company of the
Transaction Documents, other than (i) the filing of the Registration Statement
and the Prospectus Supplement and (ii) any notice filings or SEC Reports as are
required to be made following each Closing Date under applicable federal and
state securities laws or under applicable rules and regulations of the Trading
Market (collectively, the “Required Approvals”).
 
(f)         Issuance of the Shares.  The Shares are duly authorized and, when
issued and paid for in accordance with the Transaction Documents, will be duly
and validly issued, fully paid and nonassessable, free and clear of all
Liens.  The Company has reserved from its duly authorized capital stock the
maximum number of shares of Common Stock issuable pursuant to this
Agreement.  The issuance by the Company to Seaside at each Closing, or the
resale by Seaside, of the Shares is or will be registered under the Securities
Act as of each Closing Date and all of the Shares when delivered will be freely
transferable and tradable on the Trading Market by Seaside without restriction
(other than any restrictions arising solely from an act or omission of
Seaside).  The Registration Statement will be effective and available at each
Closing for the issuance or resale of the Shares thereunder and the Company has
not and will have not received any notice that the Commission has issued or
intends to issue a stop-order with respect to the Registration Statement or that
the Commission otherwise has suspended or withdrawn the effectiveness of the
Registration Statement, either temporarily or permanently, or intends or has
threatened in writing to do so.  The “Plan of Distribution” section under the
Registration Statement as supplemented by the Prospectus Supplement will permit
the issuance and sale or resale of the Shares hereunder.
 
(g)         Capitalization.  The capitalization of the Company is as set forth
in Section 3.1(g) of the Disclosure Schedules.  The Company has not issued any
capital stock since its most recently filed periodic report under the Exchange
Act, other than pursuant to the exercise of employee stock options under the
Company’s stock option plans, the issuance of shares of Common Stock to
employees pursuant to the Company’s employee stock purchase plan and pursuant to
the conversion or exercise of outstanding Common Stock Equivalents, and as
otherwise set forth in the Disclosure Schedules.  No Person has any right of
first refusal, preemptive right, right of participation, or any similar right to
participate in the transactions contemplated by the Transaction
Documents.  Except as disclosed in the SEC Reports or Section 3.1(g) of the
Disclosure Schedules, there are no outstanding options, warrants, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exchangeable for, or
giving any Person any right to subscribe for or acquire, any shares of Common
Stock, or contracts, commitments, understandings or arrangements by which the
Company or any Subsidiary is or may become bound to issue additional shares of
Common Stock or Common Stock Equivalents.  Except as disclosed in the SEC
Reports or Section 3.1(g) of the Disclosure Schedules, the issue and sale of the
Shares will not obligate the Company to issue shares of Common Stock or other
securities to any Person (other than Seaside) and will not result in a right of
any holder of Company securities to adjust the exercise, conversion, exchange or
reset price under such securities.  All of the outstanding shares of capital
stock of the Company are validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws and requirements
of the Trading Market, and none of such outstanding shares was issued in
violation of any preemptive rights or similar rights to subscribe for or
purchase securities.  No further approval or authorization of any stockholder or
the Board of Directors of the Company is required for the issuance and sale of
the Shares, other than the Required Approvals.  There are no stockholders
agreements, voting agreements or other similar agreements with respect to the
Company’s capital stock to which the Company is a party or, to the knowledge of
the Company, between or among any of the Company’s stockholders.
 
 
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(h)         SEC Reports; Financial Statements.  Except as set forth in Section
3.1(h) of the Disclosure Schedules, the Company has filed or furnished all
reports, schedules, forms, statements and other documents required to be filed
or furnished by it under the Securities Act and the Exchange Act (including all
required exhibits thereto), including pursuant to Section 13(a) or 15(d)
thereof, for the 12 months preceding the date hereof (or such shorter period as
the Company was required by law to file such material) (the foregoing materials,
as the same may be amended, and including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to herein as the
“SEC Reports”) and any notices, reports or other filings pursuant to applicable
requirements of the Trading Market, on a timely basis or has received a valid
extension of such time of filing, and has filed any such SEC Reports and
notices, reports or other filings pursuant to applicable requirements of the
Trading Market prior to the expiration of any such extension.  As of their
respective dates, the SEC Reports complied in all material respects with the
applicable requirements of the Securities Act and the Exchange Act and the rules
and regulations of the Commission promulgated thereunder, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.  The financial statements of the Company
included in the SEC Reports comply in all material respects with applicable
accounting requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing.  Such financial statements
(i) have been prepared in accordance with United States generally accepted
accounting principles applied on a consistent basis during the periods involved
(“GAAP”), except as may be otherwise specified in such financial statements or
the notes thereto and except that unaudited financial statements may not contain
all footnotes required by GAAP, and (ii) fairly present in all material respects
the financial position of the Company and its consolidated Subsidiaries as of
and for the dates thereof and the results of operations and cash flows for the
periods then ended, subject, in the case of unaudited statements, to normal,
year-end audit adjustments.
 
(i)         Material Changes.  Since the date of the latest audited financial
statements included within the SEC Reports, except as specifically disclosed in
the SEC Reports, (i) there has been no event, occurrence or development that has
had or that could reasonably be expected to result in a Material Adverse Effect,
except as has been reasonably cured by the Company, (ii) the Company has not
incurred any liabilities (contingent or otherwise) other than (A) trade payables
and accrued expenses incurred in the ordinary course of business consistent with
past practice and (B) liabilities not required to be reflected in the Company’s
financial statements pursuant to GAAP or required to be disclosed in filings
made with the Commission, (iii) the Company has not altered its method of
accounting except as otherwise required pursuant to GAAP, (iv) the Company has
not declared or made any dividend or distribution of cash or other property to
its stockholders or purchased, redeemed or made any agreements to purchase or
redeem any shares of its capital stock and (v) the Company has not issued any
equity securities to any officer, director or Affiliate, except pursuant to
existing Company stock option and incentive plans.
 
 
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(j)         Litigation.  Except as disclosed in the SEC Reports, there is no
Proceeding pending or, to the knowledge of the Company, threatened against or
affecting the Company, any Subsidiary or any of their respective properties
before or by any court, arbitrator, governmental or administrative agency or
regulatory authority (federal, state, county, local or foreign) which (i)
adversely affects or challenges the legality, validity or enforceability of any
of the Transaction Documents or the Shares or (ii) could, if there were an
unfavorable decision, have or reasonably be expected to result in a Material
Adverse Effect.  Neither the Company nor any Subsidiary, nor, to the knowledge
of the Company, any director or officer thereof (in his or her capacity as
such), is or has been the subject of any Proceeding involving a claim or
violation of or liability under federal or state securities laws or a claim of
breach of fiduciary duty. There has not been and, to the knowledge of the
Company, there is not currently pending or contemplated, any investigation by
the Commission involving the Company or any current or former director or
officer of the Company (in his or her capacity as such).  The Commission has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company or any Subsidiary under the Exchange
Act or the Securities Act and, to the Company’s knowledge, no proceeding for
such purpose is pending before or threatened by the Commission.
 
(k)         Compliance.  Neither the Company nor any Subsidiary (i) is in
default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, could reasonably be expected
to result in a default by the Company or any Subsidiary under), nor has the
Company or any Subsidiary received notice of a claim that it is in default under
or that it is in violation of, any indenture, loan or credit agreement or any
other agreement or instrument to which it is a party or by which it or any of
its properties is bound (whether or not such default or violation has been
waived), (ii) is in violation of any order of any court, arbitrator or
governmental body, or (iii) is in violation of any statute, rule or regulation
of any governmental authority or the Trading Market, including without
limitation all foreign, federal, state and local laws applicable to its
business, except in each case as would not have a Material Adverse Effect.
 
(l)         Listing and Maintenance Requirements.  The Company’s Common Stock is
registered pursuant to Section 12(g) of the Exchange Act, and the Company has
taken no action designed to, or which to its knowledge is likely to have the
effect of, terminating the registration of the Common Stock under the Exchange
Act nor has the Company received any notification that the Commission is
contemplating terminating such registration.  The Company has not, in the 12
months preceding the date hereof or any Closing Date, received notice from any
Trading Market on which the Common Stock is or has been listed or quoted (as
applicable) to the effect that the Company is not in compliance with the listing
or quotation (as applicable) and maintenance requirements of such Trading
Market.  The Company is, and immediately after the consummation of the
transactions contemplated hereby will be, in compliance with all such listing or
quotation (as applicable) and maintenance requirements.
 
 
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(m)           Application of Takeover Protections.  The Company and its Board of
Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company’s certificate of incorporation (or
similar charter documents) and the laws of its state of incorporation that is or
could become applicable to Seaside as a result of Seaside and the Company
fulfilling their obligations or exercising their rights under the Transaction
Documents, including without limitation the Company’s issuance of the Shares and
Seaside’s ownership of the Shares.
 
(n)         Effective Registration Statement.  The Registration Statement has
been, or will be no later than the Initial Closing Date, declared effective by
the Commission and will remain effective as of the Initial Closing Date and any
Subsequent Closing Date hereof and the Company knows of no reason why the
Registration Statement will not continue to remain effective for the foreseeable
future following its effective date.(o)Acknowledgment Regarding Seaside’s
Purchase of Shares.  The Company acknowledges and agrees that Seaside is acting
solely in the capacity of an arm’s length purchaser with respect to this
Agreement and the other Transaction Documents and the transactions contemplated
hereby and thereby.  The Company further acknowledges that Seaside is not acting
as a financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to this Agreement or the other Transaction Documents and the
transactions contemplated hereby and thereby and any advice given by Seaside or
any of its representatives or agents in connection with this Agreement and the
other Transaction Documents and the transactions contemplated hereby and thereby
is merely incidental to Seaside’s purchase of the Shares.  The Company further
represents to Seaside that the Company’s decision to enter into this Agreement
and the other Transaction Documents has been based solely on the independent
evaluation of the transactions contemplated thereby by the Company and its
representatives.
 
(p)         Approvals.  The issuance and listing or quotation (as applicable) on
the Trading Market of the Shares requires no further approvals, including but
not limited to, the approval of stockholders.
 
(q)         Intellectual Property.  The Company possesses such right, title and
interest in and to, or possesses legal rights to use, all patents, patent
rights, trade secrets, inventions, know-how, trademarks, trade names,
copyrights, service marks and other proprietary rights (“Intellectual Property”)
material to the conduct of the Company’s business except Intellectual Property
the failure of which to possess would not have a Material Adverse
Effect.  Except as disclosed in the SEC Reports, the Company has not received
any notice of infringement, misappropriation or conflict from any third party as
to Intellectual Property owned by or exclusively licensed to the Company that
has not been resolved or disposed of, which infringement, misappropriation or
conflict would if adversely decided have a Material Adverse Effect.  To the
Company’s knowledge, it has not infringed, misappropriated, or otherwise
conflicted with the Intellectual Property of any third parties, which
infringement, misappropriation or conflict would if adversely decided have a
Material Adverse Effect.
 
 
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(r)         Permits.  The Company has made all filings, applications and
submissions required by, and possesses all approvals, licenses, certificates,
certifications, clearances, consents, exemptions, marks, notifications, orders,
permits and other authorizations issued by, the appropriate federal, state or
foreign regulatory authorities necessary to own or lease its properties and to
conduct its businesses (collectively, “Permits”), except for such Permits the
failure of which to possess or obtain would not reasonably be expected to have a
Material Adverse Effect.  The Company has not received any written notice of
proceedings relating to the limitation, revocation, cancellation, suspension,
modification or non-renewal of any such Permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
have a Material Adverse Effect, and has no reason to believe that any such
Permit will not be renewed in the ordinary course.
 
(s)         Disclosure.  The Company confirms that neither the Company nor any
officer, director or employee of the Company acting on its behalf (as such term
is used in Regulation FD) has provided Seaside or its agents or counsel with any
information that constitutes or might reasonably be expected to constitute
material, non-public information except insofar as the existence and terms of
the proposed transactions hereunder may constitute such information.  The
Company understands and confirms that Seaside will rely on the foregoing
representations and covenants in effecting transactions in securities of the
Company.  None of the representations and warranties of the Company contained
herein, nor any statement made by the Company in any disclosure, schedule,
exhibit, certificate or other document furnished or to be furnished to Seaside
in connection herewith, contains or will contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.
 
3.2           Representations and Warranties of Seaside.  Seaside hereby makes
the representations and warranties set forth below to the Company:
 
(a)         Organization; Authority.  Seaside is a limited partnership duly
organized, validly existing and in good standing under the laws of the state of
Florida, with full right, power and authority to own and use its properties and
assets and to carry on its business as currently conducted and to enter into and
to consummate the transactions contemplated by this Agreement and the other
Transaction Documents and otherwise to carry out its obligations hereunder and
thereunder.  The execution, delivery and performance by Seaside of the
transactions contemplated by this Agreement and each other Transaction Document
have been duly authorized by all necessary action on the part of Seaside and no
such further action is required.  Each Transaction Document to which Seaside is
a party has been (or upon delivery will have been) duly executed by Seaside,
and, when delivered by Seaside in accordance with the terms thereof, will
constitute the valid and legally binding obligation of Seaside, enforceable
against it in accordance with its terms, except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
 
 
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(b)         Experience of Seaside.  Seaside, either alone or together with its
representatives, has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
the prospective investment in the Shares, and has so evaluated the merits and
risks of such investment.  Seaside is able to bear the economic risk of an
investment in the Shares and, at the present time, is able to afford a complete
loss of such investment.
 
(c)         Short Sales.  Seaside has not directly or indirectly executed any
Short Sales or other hedging transactions in the securities of the Company
through the date hereof.
 
ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
 
4.1           No Transfer Restrictions.  Certificates evidencing the Shares
shall not contain any legend restricting their transferability by Seaside.  The
Company shall cause its counsel to issue a legal opinion to the Company’s
transfer agent if required by the Company’s transfer agent to effect a transfer
of any of the Shares; such opinion shall be provided by the Company’s counsel at
no expense to Seaside.

 
4.2           Furnishing of Information.  As long as Seaside owns Shares, the
Company covenants to use its best efforts to timely file (or obtain extensions
in respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the
Exchange Act.  As long as Seaside owns Shares that are “restricted securities”
as that term is defined in Rule 144 that it has owned for less than one year in
accordance with Rule 144(d), if the Company is not required to file reports
pursuant to the Exchange Act, it will prepare and furnish to Seaside and make
publicly available in accordance with Rule 144(c) such information as is
required for Seaside to sell the Shares under Rule 144.
 
4.3           Securities Laws Disclosure; Publicity.  The Company shall, by 9:00
a.m. Eastern time on the Trading Day following the date hereof, file a Current
Report on Form 8-K which attaches as exhibits all agreements relating to this
transaction, in each case reasonably acceptable to Seaside and its counsel,
disclosing the material terms of the transactions contemplated hereby.
 
4.4           Shareholders Rights Plan.  No claim will be made or enforced by
the Company or, with the consent of the Company, any other Person that Seaside
is an “Acquiring Person” or similar designation under any shareholders rights
plan or similar plan or arrangement in effect or hereafter adopted by the
Company, or that Seaside could be deemed to trigger the provisions of any such
plan or arrangement, by virtue of receiving Shares under the Transaction
Documents or under any other agreement between the Company and Seaside.  The
Company shall conduct its business in a manner so that it will not become
subject to the Investment Company Act of 1940, as amended.
 
4.5           Non-Public Information.  The Company covenants and agrees that
neither it nor any other Person acting on its behalf will provide Seaside or its
agents or counsel with any information that the Company believes constitutes
material non-public information.  The Company understands and confirms that
Seaside shall be relying on the foregoing representations in effecting
transactions in securities of the Company.
 
 
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4.6           Indemnification of Seaside.  Subject to the provisions of this
Section 4.6, the Company will indemnify and hold Seaside, Seaside’s Affiliates
and their respective directors, officers, stockholders, partners, members,
employees and agents (each, a “Seaside Party”) harmless from any and all losses,
liabilities, obligations, claims, demands, contingencies, damages, costs and
expenses, including all judgments, amounts paid in settlements, court costs and
reasonable attorneys’ fees and costs of investigation reasonably incurred in
connection with defending or investigating any suit or action in respect thereof
to which any Seaside Party is or may become a party under the Securities Act,
the Exchange Act or any other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, liabilities, obligations,
claims, demands, contingencies, damages, costs and expenses arise out of or are
based on (a) any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any Prospectus Supplement, or (b) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
provided that the Company will not be liable in any such case to the extent that
any such liability, obligation, claim, demand, contingency, damage, cost or
expense arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by and regarding
Seaside expressly for inclusion therein.  If any action shall be brought against
any Seaside Party in respect of which indemnity may be sought pursuant to this
Agreement, such Seaside Party shall promptly notify the Company in writing, and
the Company shall have the right to assume the defense thereof with counsel of
its own choosing.  Any Seaside Party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Seaside Party
except to the extent that (i) the employment thereof has been specifically
authorized by the Company in writing, (ii) the Company has failed after a
reasonable period of time to assume such defense and to employ counsel or (iii)
in such action there is, in the reasonable opinion of such separate counsel, a
material conflict on any material issue between the position of the Company and
the position of such Seaside Party.  The Company will not be liable to any
Seaside Party under this Agreement (x) for any settlement by a Seaside Party
effected without the Company’s prior written consent, which consent shall not be
unreasonably withheld or delayed; or (y) to the extent, but only to the extent,
that a loss, liability, obligation, claim, demand, damage, cost or expense is
attributable to any Seaside Party’s breach of any of the representations,
warranties, covenants or agreements made by Seaside in this Agreement or in the
other Transaction Documents.
 
               4.7           Listing or Quotation of Common Stock.  The Company
hereby agrees to use its best efforts to maintain the listing or quotation (as
applicable) of the Common Stock on its current Trading Market.  The Company
further agrees that, if the Company applies to have the Common Stock traded on
any other Trading Market, it will include in such application all of the Shares
and will take such other action as is necessary to cause all of the Shares to be
listed or quoted on such other Trading Market as promptly as possible.  The
Company will take all action reasonably necessary to continue the listing or
quotation (as applicable) and trading of its Common Stock on each Trading Market
on which the Common Stock is listed or quoted (as applicable) and will comply in
all respects with the Company’s reporting, filing and other obligations under
the bylaws or rules of such Trading Market(s).
 
 
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4.8           Stockholder Approval.  The Company shall not issue shares of
Common Stock or Common Stock Equivalents if such issuance would require
stockholder approval pursuant to applicable rules of the Trading Market unless
and until such stockholder approval is obtained.
 
4.9           Short Sales.  Seaside covenants that neither it nor any Affiliates
acting on its behalf or pursuant to any understanding with it will execute any
Short Sales in the securities of the Company from the date hereof until the
final Subsequent Closing contemplated hereby.
 
4.10           Prospectus Supplement.  The Company will use its best efforts to
file the Prospectus Supplement in accordance with the requirements of Rule 424
promulgated under the Securities Act on or before the Initial Closing Date and,
if required, before each Subsequent Closing Date.
 
ARTICLE V
MISCELLANEOUS
 
5.1           Termination; Liquidated Damages.  This Agreement may be
terminated:
 
(a)           by Seaside, by written notice to the Company, if the Initial
Closing has not been consummated on or before March 31, 2010, provided, however,
if the Company receives comments from the SEC on the Registration Statement,
this date shall be extended until April 30, 2010.
 
(b)           by Seaside, immediately upon written notice to the Company, if at
any time prior to the final Subsequent Closing Date the Company consummates a
financing to which Seaside is not a party, and
 
(c)           by the Company, upon at least 30 days’ prior written notice to
Seaside, at any time after the fifth Subsequent Closing Date,
 
provided, however, that no such termination pursuant to this Section 5.1 will
affect the right of any party to sue for any breach by the other party (or
parties) and provided, further, that in the event the Company exercises its
termination right pursuant to subsection (c) of this Section 5.1 and within six
months of such termination initiates another financing having committed funding
dates scheduled at pre-determined intervals of between one week and two months
then the Company shall be obligated to pay to Seaside liquidated damages in the
amount of $200,000 immediately upon the first closing of any such subsequent
financing.
 
5.2           Fees and Expenses.  Except as otherwise set forth in this
Agreement and as set forth in this Section 5.2 below, each party shall pay the
fees and expenses of its own advisers, counsel, accountants and other experts,
if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this
Agreement.  The Company shall pay all stamp and other taxes and duties levied in
connection with the delivery of the Shares.  Notwithstanding the foregoing, at
the Initial Closing the Company shall reimburse Seaside for the fees and
expenses of its counsel, White White & Van Etten PC, in an amount equal to
$20,000 and at each Subsequent Closing the Company shall reimburse Seaside for
the fees and expenses of its counsel, White White & Van Etten PC, in an amount
equal to $1,200.  Such legal fees may be withheld by Seaside from the amount to
be paid for the Shares purchased at the Initial Closing and any Subsequent
Closing.
 
 
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5.3           Entire Agreement.  The Transaction Documents, together with the
exhibits and schedules thereto (including the Disclosure Schedules), contain the
entire understanding of the parties with respect to the subject matter hereof
and supersede all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into
such documents, exhibits and schedules.
 
5.4           Notices.  Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via electronic mail
or facsimile at the facsimile number set forth on the signature pages attached
hereto prior to 5:30 p.m. (Eastern time) on a Trading Day, (b) the next Trading
Day after the date of transmission, if such notice or communication is delivered
via electronic mail or facsimile at the facsimile number set forth on the
signature pages attached hereto on a day that is not a Trading Day or later than
5:30 p.m. (Eastern time) on any Trading Day, (c) the second Trading Day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service, or (d) upon actual receipt by the party to whom such notice is
required to be given.  The address for such notices and communications shall be
as set forth on the signature pages attached hereto.
 
5.5           Amendments; Waivers.  No provision of this Agreement may be waived
or amended except in a written instrument signed, in the case of an amendment,
by the Company and Seaside or, in the case of a waiver, by the party against
whom enforcement of any such waiver is sought.  No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either party to exercise any right hereunder in
any manner impair the exercise of any such right.
 
5.6           Headings.  The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.  The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.
 
5.7           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted
assigns.  The Company may not assign this Agreement or any rights or obligations
hereunder without the prior written consent of Seaside.  Seaside may assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Company, provided that any assignee of Seaside must reimburse the
Company for all reasonable out-of-pocket expenses incurred as a direct result of
the assignment.
 
5.8           No Third-Party Beneficiaries.  This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.6.
 
 
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5.9           Governing Law.  All questions concerning the construction,
validity, enforcement and interpretation of the Transaction Documents shall be
governed by and construed and enforced in accordance with the internal laws of
the State of New York, without regard to the principles of conflicts of law
thereof.  The parties hereby waive all rights to a trial by jury.  If either
party shall commence an action or proceeding to enforce any provisions of the
Transaction Documents, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for its attorneys’ fees and other costs
and expenses incurred with the investigation, preparation and prosecution of
such action or proceeding.
 
5.10           Survival.  The representations and warranties herein shall
survive the Closings and delivery of the Shares.
 
5.11           Execution.  This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart.  In the event that any signature is
delivered by facsimile or email transmission, such signature shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such facsimile or
email signature page were an original thereof.
 
5.12           Severability.  If any provision of this Agreement is held to be
invalid or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
 
5.13           Rescission and Withdrawal Right.  Notwithstanding anything to the
contrary contained in (and without limiting any similar provisions of) the
Transaction Documents, whenever Seaside exercises a right, election, demand or
option under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then Seaside may
rescind or withdraw, in its sole discretion from time to time upon written
notice to the Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and rights.
 
5.14           Remedies.  In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, Seaside and
the Company will be entitled to specific performance under the Transaction
Documents.  The parties agree that monetary damages may not be adequate
compensation for any loss incurred by reason of any breach of the obligations
set forth herein and hereby agree to waive in any such action for specific
performance of any such obligation the defense that a remedy at law would be
adequate.
 
5.15           Payment Set Aside.  To the extent that either party hereto makes
a payment or payments to the other party hereto pursuant to any Transaction
Document or enforces or exercises its rights thereunder, and such payment or
payments or the proceeds of such enforcement or exercise or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside,
recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to the other party, a trustee, receiver or any other person under any
law (including, without limitation, any bankruptcy law, state or federal law,
common law or equitable cause of action), then to the extent of any such
restoration the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such enforcement or setoff had not occurred.
 
 
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5.16           Construction.  The parties agree that each of them and/or their
respective counsel has reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of the Transaction Documents or any amendments hereto.
 
(Signature Pages Follow)
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.
 
China Kangtai Cactus Bio-Tech, Inc.
 
 
Address for Notice:
 
By:_____________________________________
     Name:
     Title:
 
99 Taibei Road
Limin Economic and Technological   Development Zone
Harbin, Heilongjiang Province
Peoples Republic of China 150025
Fax:
 
With a copy (which shall not constitute notice) to:
 
 
Crone Law Group
101 Montgomery Street, Suite 1950
San Francisco, CA  94104
Attention:  Mark E. Crone, Esq.
Fax:  (415) 955-8910

Seaside 88, LP
 
By:  Seaside 88 Advisors, LLC
Address for Notice:
 
 
By:_____________________________________
     Name: William J. Ritger
     Title:  Manager
 
750 Ocean Royale Way
Suite 805
North Palm Beach, FL 33408
Attention:  William J. Ritger and
Denis M. O’Donnell, M.D.
Fax:  866-358-6721
 
With a copy (which shall not constitute notice) to:
 
 
 
White White & Van Etten PC
55 Cambridge Parkway
Cambridge, MA 02142
Attention:  David A. White, Esq.
Fax:  617-225-0205

DWAC Instructions for Common Stock:

DTC # - 0571 -  
Account number - G53-1348923
 
 
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Exhibit A

Officer’s Certificate

In connection with a Closing on the date set forth below pursuant to that
certain Common Stock Purchase Agreement dated as of ______________, 2009 (the
“Agreement”) by and between China Kangtai Cactus Bio-Tech, Inc., a Nevada
corporation (the “Company”) and Seaside 88, LP, a Florida limited partnership
(“Seaside”), the undersigned, the duly elected and qualified ________________ of
the Company, does hereby certify to the Company as follows:

 
(i)
all representations and warranties of the Company contained in the Agreement are
true and correct in all material respects (without giving effect to any
limitation as to “materiality” or “knowledge” set forth therein) on and as of
the date hereof as if made on and as of the date hereof (provided that
representations and warranties that speak as of a specific date shall continue
to be true and correct as of the Closing with respect to such date);

 
(ii)
the Company has performed or complied with all of its covenants and agreements
contained in the Agreement and required to be performed or complied with by the
Company on or before the date hereof; and

 
(iii)
the Registration Statement has been declared effective by the Commission and
remains effective on and as of the date hereof.

Capitalized terms used but not defined herein shall have the meanings given to
them in the Agreement.

IN WITNESS WHEREOF, the undersigned has caused this Officer’s Certificate to be
executed this _____ day of _____________, 20__.
 

  CHINA KANGTAI CACTUS BIO-TECH, INC.          
 
By:
        Name        Title           

 
 
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Exhibit B

1.           The Company is a corporation duly organized under the General
Corporation Law of the State of Nevada, with corporate power and authority to
enter into the Agreement and perform its obligations thereunder.  The Company is
validly existing and in good standing under the laws of the State of
____________ and is qualified to do business and in good standing under the laws
of ____________ and _________, the only states where the failure to be so
qualified and in good standing could have a Material Adverse Effect.

2.           The execution and delivery of the Agreement and the issuance and
sale of the Shares thereunder has been duly authorized by all necessary
corporate action of the Company, no further action is required by the Company or
its stockholders in connection therewith and the Agreement has been duly
executed and delivered by the Company and is enforceable against the Company in
accordance with its terms.

3.           We have been advised by the staff of the Commission that the
Registration Statement became effective under the Act on _______________,
2009.  With your consent, based solely on a telephonic confirmation by a member
of the staff of the Commission on ___________, 2009, we confirm that no stop
order suspending the effectiveness of the Registration Statement has been issued
under the Act and no proceedings therefor have been initiated by the Commission.

4.           The Shares have been duly authorized and, when issued and delivered
in accordance with the terms of the Agreement, will be validly issued, fully
paid and non-assessable, and the issuance of such Shares will not be subject to
any preemptive or similar rights set forth in the Company’s Certificate of
Incorporation or Bylaws (or similar organizational documents) or any agreement
known to us or filed as an exhibit to any SEC Report.

5.           The execution and delivery by the Company of, and the performance
by the Company of its obligations under, the Agreement (including the issuance
and sale of the Shares) will not contravene any provision of any statute, law,
rule or regulation applicable to the Company, any agreement filed as an exhibit
to any SEC Report, or any judgment, order or decree of any governmental body,
agency or court having jurisdiction over the Company that is applicable to the
Company or its properties.

6.           No consent, approval, authorization, order, registration or
qualification of or with any court or arbitrator or governmental body,
regulatory authority or Trading Market is required for the execution, delivery
and performance by the Company of its obligations under the Agreement, other
than the filing of the Prospectus Supplement and any notice filings as are
required to be made following the Closing Date under applicable federal and
state securities laws.

7.           The Company is not, and will not be after consummation of the
Agreement, the sale of the Shares to Seaside and the application of the proceeds
thereof, an “investment company” as defined in the Investment Company Act of
1940, as amended.