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Exhibit 10.1

Execution Copy

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”) is dated as of November 2,
2010, by and among THT Heat Transfer Technology, Inc., a Nevada corporation (the
“Company”), and the investors identified on the signature pages hereto and
listed on Schedule I attached hereto (each, an “Investor” and collectively, the
“Investors”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and in
reliance upon the applicable exemptions from securities registration under the
Securities Act (as defined below), the Company desires to issue and sell to each
Investor, and each Investor, severally and not jointly, desires to purchase from
the Company certain securities of the Company, as more fully described in this
Agreement; and

WHEREAS, contemporaneous with the sale and purchase of the certain securities
the parties hereto will execute and deliver a Registration Rights Agreement, in
the form attached hereto as Exhibit A, pursuant to which the Company will agree
to provide to the Investors certain registration rights under the Securities
Act.

NOW THEREFORE, the Company and the Investors agree as follows:

ARTICLE 1.
DEFINITIONS

1.1. Definitions. In addition to the terms defined elsewhere in this Agreement,
for all purposes of this Agreement, the following terms shall have the meanings
indicated in this Section 1.1:

“2010 Annual Report” means the Annual Report of the Company for the fiscal year
ending December 31, 2010, as filed with the Commission on Form 10-K (or such
other form appropriate for such purpose as promulgated by the Commission).

“2010 Guaranteed ATNI” has the meaning set forth in Section 4.9(b) .

“2010 Make Good Shares” has the meaning set forth in Section 4.9(b) .

“2010 Audited ATNI” shall have the meaning set forth in Section 4.9(b) .

“2011 Annual Report” means the Annual Report of the Company for the fiscal year
ending December 31, 2011, as filed with the Commission on Form 10-K (or such
other form appropriate for such purpose as promulgated by the Commission).

“2011 Guaranteed ATNI” has the meaning set forth in Section 4.9(c) .

“2011 Make Good Shares” has the meaning set forth in Section 4.9(c) .

“2011 Audited ATNI” shall have the meaning set forth in Section 4.9(c) .

“Action” means any action, suit, inquiry, notice of violation, proceeding
(including any partial proceeding such as a deposition) or investigation pending
or threatened in writing against or affecting the Company, any Subsidiary or any
of their respective properties before or by any court, arbitrator, governmental
or administrative agency, regulatory authority (federal, state, county, local or
foreign), stock market, stock exchange or trading facility.

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“Affiliate” means, with respect to any Person, any other Person that, directly
or indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, such Person.

“After Tax Net Income” has the meaning set forth in Section 4.9(d) .

“Business Day” means any day except Saturday, Sunday and any day on which on
which banking institutions in the State of New York or the PRC are authorized or
required by law or other governmental action to close.

“Closing” means the closing of the purchase and sale of the Shares pursuant to
Article II.

“Closing Date” means the Business Day on which all of the conditions set forth
in Sections 5.1 and 5.2 hereof are satisfied, or such other date as the parties
may agree.

"Closing Escrow Agreement" means the Closing Escrow Agreement, dated as of the
date hereof, between the Company, the Investors and the escrow agent (the
“Escrow Agent”) identified therein, in the form of Exhibit E hereto.

“Commission” means the Securities and Exchange Commission.

“Common Stock” means the shares of the Company’s common stock, par value $0.001
per share and any securities into which such shares may hereafter be
reclassified.

“Company Counsel” means Pillsbury Winthrop Shaw Pittman LLP.

“Company Deliverables” has the meaning set forth in Section 2.3(a) .

“Disclosure Materials” has the meaning set forth in Section 3.1(h) .

“Effective Date” means the date that the Registration Statement required by
Section 2(a) of the Registration Rights Agreement is first declared effective by
the Commission.

“Evaluation Date” has the meaning set forth in Section 3.1(r) .

“Escrow Agent” means Escrow, LLC.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“GAAP” means U.S. generally accepted accounting principles.

“Intellectual Property Rights” means all of the following: (i) patents, patent
applications, patent disclosures and inventions (whether or not patentable and
whether or not reduced to practice); (ii) trademarks, service marks, trade
dress, trade names, corporate names, logos, slogans and Internet domain names,
together with all goodwill associated with each of the foregoing; (iii)
copyrights and copyrightable works; and (iv) registrations, applications and
renewals for any of the foregoing.

“Investment Amount” means, with respect to each Investor, the Investment Amount
indicated on such Investor’s signature page to this Agreement, which is also
reflected on the Schedule of Investors attached hereto as Schedule I.

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“Investor Deliverables” has the meaning set forth in Section 2.3(b) .

“IRC” means the Internal Revenue Code of 1986, as amended (or any successor
statute thereto) and the regulations thereunder.

“Knowledge” or “knowledge” means the knowledge of the Company’s chairman of the
Board, Chief Executive Officer and Chief Financial Officer, after due enquiry.

“Lead Investor” means Infinity I-China Fund (Cayman) L.P.

“Lien” means any lien, charge, encumbrance, security interest, right of first
refusal or other restrictions of any kind.

“Lock Up Agreement(s)” means the Lock Up Agreements, dated as of the date of
this Agreement, among the Company, its directors and executive officers and the
Investors, in the form of Exhibit G hereto.

“Make Good Escrow Agent” means Escrow, LLC.

“Make Good Escrow Agreement” means the Make Good Escrow Agreement, dated as of
the date of this Agreement, among the Company, the Make Good Pledgor(s) and the
Investors, in the form of Exhibit F hereto.

“Make Good Pledgor” means Wisetop International Holdings Limited.

“Material Adverse Effect” means any of (i) a material and adverse effect on the
legality, validity or enforceability of any Transaction Document, (ii) a
material and adverse effect on the results of operations, assets, prospects,
business or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (iii) a material and adverse impairment to
the Company’s ability to perform on a timely basis its obligations under any
Transaction Document.

“New York Courts” means the state and federal courts sitting in the City of New
York, Borough of Manhattan.

“Nevada Counsel” means Holland & Hart.

“Option Agreement” means an option agreement entered into on June 30, 2009 by
and between Ms. Jinhua Zhao, the sole shareholder of Wisetop International
Holdings Limited, which holds 92.5% of issued and outstanding shares of Common
Stock of the Company, and Mr. Guohong Zhao, the chairman and president of the
Company, pursuant to which Mr. Guohong Zhao was granted an option, exercisable
after 180 days, to acquire all of the equity interests of Wisetop owned by Ms.
Jinghua Zhao at an exercise price of $3,246,160. This option expires on June 30,
2011.

“Outside Date” means the sixtieth (60th) calendar day following the date of this
Agreement; provided, that if such day should fall on a day that is not a
Business Day, the Outside Date shall be deemed the next day that is a Business
Day.

“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.

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“PRC” means for the purpose of this Agreement, the People’s Republic of China,
not including Taiwan, Hong Kong and Macau.

“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.

“Purchase Price” means $3.20 per share.

“Registrable Securities” means: (i) the Shares and (ii) any securities issued or
issuable upon any stock split, dividend or other distribution, recapitalization
or similar events with respect to, or in exchange for, or in replacement of the
Shares and the Total Make Good Shares. Notwithstanding the foregoing, a security
shall cease to be a Registrable Security for purposes of this Agreement from and
after such time (x) as the Holder of such security may resell such security
without volume restrictions under Rule 144, as determined by the counsel to the
Company pursuant to a written opinion letter to such effect, addressed and
acceptable to the Company’s transfer agent and the affected holders; or (y) such
security has been sold by a Holder pursuant to a registration statement under
the Securities Act that has been declared effective and such Registrable
Securities have been disposed of pursuant to such effective registration
statement.

“Registration Rights Agreement” means the Registration Rights Agreement, dated
as of the date of this Agreement, among the Company and the Investors, in the
form of Exhibit A hereto.

“Registration Statement” means a registration statement meeting the requirements
set forth in the Registration Rights Agreement and covering the resale by the
Investors of the Shares.

“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.

“SEC Reports” has the meaning set forth in Section 3.1(h) .

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Shares” means the Common Stock of the Company issued or issuable to the
Investors pursuant to this Agreement.

“Short Sales” include, without limitation, all “short sales” as defined in Rule
200 promulgated under Regulation SHO under the Exchange Act and all types of
direct and indirect stock pledges, forward sale contracts, options, puts, calls,
swaps and similar arrangements (including on a total return basis), and sales
and other transactions through non-US broker dealers or foreign regulated
brokers.

“Subsequent Registration Statement” means each registration statement meeting
the requirements set forth in the Section 4.10 hereof and covering the resale by
the Investors of the 2010 Released Escrow Shares or the 2011 Released Escrow
Shares.

“Subsidiary” means, as to the Company, any “subsidiary” as defined in Rule
1-02(x) of the Regulation S-X promulgated by the Commission under the Exchange
Act.

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“Trading Day” means a day on which the Common Stock is traded on the Trading
Market; provided, that in the event that the Common Stock is not listed or
quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a
Business Day.

“Trading Market” means the NASDAQ Capital Market or other trading market on
which the Common Stock is listed or quoted for trading on the date in question.

“Transaction Documents” means this Agreement, the Registration Rights Agreement
and any other documents or agreements executed in connection with the
transactions contemplated hereunder.

“Transfer Agent” means Securities Transfer Corporation, or any successor
transfer agent for the Company.

“Transfer Agent Instructions” means, with respect to the Company, the transfer
agent instructions letter, in the form of Exhibit B, executed by the Company and
delivered to and acknowledged in writing by the Transfer Agent.

“US Counsel” means Pillsbury Winthrop Shaw Pittman LLP.

ARTICLE 2.
PURCHASE AND SALE

2.1. Purchase of Shares. Subject to the terms and conditions set forth in this
Agreement, at the Closing, the Company shall issue and sell to each Investor,
and each Investor shall, severally and not jointly, purchase from the Company,
the Shares in the respective amounts set forth below the Investors’ names on the
signature pages hereto for the Purchase Price.

2.2. Closing. The Closing shall take place at the offices of Pillsbury Winthrop
Shaw Pittman, LLP, 2300 N Street, NW, Washington, DC 20037 at 9:30 a.m. local
time on the Closing Date or at such other location and on such other date as the
parties may mutually agree.

2.3. Closing Deliveries.

(a) At the Closing, the Company shall deliver or cause to be delivered to each
Investor the following (the “Company Deliverables”):

(i) a certificate, processed by the Transfer Agent, representing the number of
Shares set forth below such Investor’s name on the signature pages hereto,
registered in the name of such Investor against payment of such Investor’s
Purchase Price in United States dollars and in immediately available funds, by
wire transfer to an account designated in writing by the Company to be wired by
the Escrow Agent pursuant to terms of the Closing Escrow Agreement;

(ii) the Make Good Escrow Agreement, duly executed and delivered by the Company;

(iii) the Lock Up Agreement(s), duly executed and delivered by the Company;

(iv) the Closing Escrow Agreement, duly executed by the Company and delivered by
the Company;

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(v) a legal opinion of US Counsel of the Company in the form of Exhibit C,
executed by such counsel and delivered to the Investors;

(vi) a legal opinion of Nevada Counsel of the Company in the form of Exhibit E,
executed by such counsel and delivered to the Investors;

(vii) approval by the Trading Market of an additional shares listing application
covering all of the Registrable Securities;

(viii) a certificate, executed on behalf of the Company by its Chief Executive
Officer or its Chief Financial Officer, dated as of the Closing Date, certifying
the fulfillment of the condition specified in Section 5.1(b);

(ix) a certificate, executed on behalf of the Company by its Secretary or other
authorized person, dated as of the Closing Date, certifying the resolutions
adopted by the Board of Directors of the Company approving the transactions
contemplated by the Transaction Documents, certifying the current versions of
the Articles of Incorporation and Bylaws of the Company and certifying as to the
signatures and authority of Persons signing the Transaction Documents and
related documents on behalf of the Company;

(x) the Indemnity Agreement, duly executed and delivered by Mr. Guohong Zhao;
and

(xi) an amended Option Agreement, which should extend the option exercise period
up until June 30, 2012, duly executed by Mr. Guohong Zhao and Ms. Jinhua Zhao
and delivered by the Company.

(b) By the Closing, each Investor, severally and not jointly, shall deliver or
cause to be delivered to the Company the following:

(i) the Purchase Price for the Shares in United States dollars and in
immediately available funds, by wire transfer to an account designated in
writing by the Company for such purpose; and

(ii) the agreements specified in Section 5.2(d), each duly signed by such
Investor (collectively, the “Investor Deliverables”).

(c) Within fifteen calendar days following the filing of the definitive Schedule
14C Information Statement related to this Agreement with the SEC, each Investor
shall deliver to the Escrow Agent for deposit and disbursement in accordance
with the Closing Escrow Agreement, its Investment Amount, in United States
dollars and in immediately available funds, by wire transfer to an account
designated in writing by the Escrow Agent for such purpose.

ARTICLE 3.
REPRESENTATIONS AND WARRANTIES

3.1. Representations and Warranties of the Company. The Company hereby makes the
following representations and warranties to each of the Investors as of the date
hereof and the Closing Date:

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(a) Subsidiaries. The Company has no direct or indirect Subsidiaries other than
as specified in the SEC Reports. The Company owns, directly or indirectly, all
of the shares or comparable equity interests of each Subsidiary free and clear
of any and all Liens, and all the issued and outstanding shares of each
Subsidiary are validly issued and are fully paid, non-assessable and free of
preemptive and similar rights.

(b) Organization and Qualification. The Company and each Subsidiary are 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 of any of the provisions
of its respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. The Company and each Subsidiary are duly
qualified to conduct its respective businesses and are 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, would not, individually or in the aggregate, have a Material
Adverse Effect. To the Company’s best knowledge, no Proceeding has been
instituted in any 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
any Subsidiary and no further action is required by the Company or any
Subsidiary in connection therewith. 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 as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws relating to,
or affecting generally the enforcement of, creditors’ rights and remedies or by
other equitable principles of general application.

(d) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company and any of its Subsidiaries and the consummation by the
Company of the 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 as in effect on the date hereof, or (ii) conflict with, or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding
contained in the SEC Reports 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) 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) above, such as would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect.

(e) Filings, Consents and Approvals. Neither the Company nor any Subsidiary is
required to obtain any consent, waiver, authorization or order of, give any
notice to, or make any filing or 7 registration with, any United States or PRC
court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by the Company
or any of its Subsidiaries of the Transaction Documents, other than (i) the
filing with the Commission of one or more Registration Statements in accordance
with the requirements of the Registration Rights Agreement, (ii) filings
required by state securities laws, (iii) the filing of a Notice of Sale of
Securities on Form D with the Commission under Regulation D of the Securities
Act, (iv) the filings required in accordance with Section 4 hereof, (v) the
filing with NASDAQ of an applicable additional shares listing application
relating to the Shares issuable hereunder, and (vi) those that have been made or
obtained prior to the date of this Agreement.

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(f) Issuance of the Shares. The Shares have been duly authorized and, when
issued and paid for in accordance with the Transaction Documents, will be duly
and validly issued, fully paid and non-assessable, free and clear of all Liens
and will not be subject to preemptive or similar rights of shareholders (other
than those imposed by the Investors).

(g) Capitalization. The number of shares and type of all authorized, issued and
outstanding shares of the Company, all shares of Common Stock reserved for
issuance under the Company’s various option and incentive plans and all shares
of Common Stock issuable and reserved for issuance pursuant to securities
exercisable for, or convertible into or exchangeable for any shares of the
Company, are as specified in the SEC Reports. All of the issued and outstanding
shares of the Common Stock have been duly authorized and validly issued and are
fully paid and non-assessable, and have been issued in compliance in all
material respects with all applicable federal and state securities laws, and
none of such outstanding shares was issued in violation of any preemptive rights
or similar rights to subscribe for or purchase any capital stock of the Company.
Except as specified in the SEC Reports, no securities of the Company are
entitled to preemptive or similar rights, and 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 or
with respect to any securities of the Company. Except as specified in the SEC
Reports, there are no outstanding options, warrants, scrip 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
securities or rights convertible or exchangeable into shares of Common Stock.
Except as specified in the SEC Reports, there are no financing statements
securing obligations in any material amounts, either singly or in the aggregate,
filed in connection with the Company. Except as specified in the SEC Reports,
there are no agreements or arrangements under which the Company is obligated to
register the sale of any of their securities under the Securities Act (except
the Registration Rights Agreement). Except as specified in the SEC Reports,
there are no outstanding securities or instruments of the Company which contain
any redemption or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company is or may become bound to
redeem a security of the Company. Except as specified in the SEC Reports, there
are no securities or instruments containing anti-dilution or similar provisions
that will be triggered by the issuance of the Shares. Except as specified in the
SEC Reports, the Company does not have any stock appreciation rights or “phantom
stock” plans or agreements or any similar plan or agreement. Except as specified
in the SEC Reports, the Company has no liabilities or obligations required to be
disclosed in the SEC Reports (as defined herein) but not so disclosed in the SEC
Reports, other than those incurred in the ordinary course of the Company's
businesses and which, individually or in the aggregate, do not or would not have
a Material Adverse Effect. Except for customary adjustments as a result of stock
dividends, stock splits, combinations of shares, reorganizations,
recapitalizations, reclassifications or other similar events, there are no
anti-dilution or price adjustment provisions contained in any security issued by
the Company (or in any agreement providing rights to security holders) and the
issue and sale of the Shares will not, immediately or with the passage of time,
obligate the Company to issue Common Stock or other securities to any Person
(other than the Investors) 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.

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(h) SEC Reports; Financial Statements. The Company has filed all reports
required to be filed by it under the Securities Act and the Exchange Act,
including pursuant to Section 13(a) or 15(d) of the Exchanges Act, for the
twelve months preceding the date hereof (or such shorter period as the Company
was required by law to file such reports) (the foregoing materials being
collectively referred to herein as the “SEC Reports” and, together with the
Schedules to this Agreement (if any), the “Disclosure Materials”) on a timely
basis or has timely filed a valid extension of such time of filing and has filed
any such SEC Reports prior to the expiration of any such extension. As of their
respective dates, the SEC Reports complied in all material respects with the
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 made therein, in the 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 have been prepared in accordance with GAAP applied on a
consistent basis during the periods involved, except as may be otherwise
specified in such financial statements or the notes thereto, and 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, immaterial, year-end audit adjustments. All
material agreements to which the Company or any Subsidiary is a party or to
which the property or assets of the Company or any Subsidiary are subject are
included as part of or identified in the SEC Reports, to the extent such
agreements are required to be included or identified pursuant to the rules and
regulations of the SEC.

(i) Material Changes. Except as specifically disclosed in the SEC Reports, since
the date of the latest financial statements included within the SEC Reports, (i)
there has been no event, occurrence or development that has had or that would
reasonably be expected to result in a Material Adverse Effect, (ii) neither the
Company nor any Subsidiary has incurred any liabilities (direct, indirect,
contingent, or otherwise) other than those incurred in the ordinary course of
business consistent with past practice, (iii) the Company has not altered its
method of accounting or the identity of its auditors, (iv) the Company has not
declared or made any dividend or distribution of cash or other property to its
shareholders or purchased, redeemed or made any agreements to purchase or redeem
any of its shares, (v) neither the Company nor any Subsidiary has waived any
material debt owed to it, (vi) neither the Company nor any Subsidiary has
changed or amended its certificate or articles of incorporation, bylaws or other
organizational or charter documents, or change any material contract included as
an Exhibit to any of the SEC Reports by which the Company or Subsidiary is bound
or to which its assets or properties is subject, (vii) the Company has not
issued any equity securities to any officer, director or Affiliate of the
Company or any of its Subsidiaries, except pursuant to existing Company stock
option plans or stock option agreements as disclosed in the Company’s SEC
Reports, and (viii) neither the Company nor any Subsidiary has entered into any
transaction other than in the ordinary course of business. The Company does not
have pending before the Commission any request for confidential treatment of
information. The Company has not taken any steps to seek protection pursuant to
PRC or U.S. bankruptcy law nor does the Company have any knowledge or reason to
believe that its creditors intend to initiate involuntary bankruptcy proceedings
or any actual knowledge of any fact which would reasonably lead a creditor to do
so.

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(j) Litigation. There is no pending or, to the knowledge of the Company,
threatened Action which (i) adversely affects or challenges the legality,
validity or enforceability of any of the Transaction Documents or the Shares or
the Total Make Good Shares or (ii) except as specifically disclosed in the SEC
Reports, would, if there were an unfavorable decision, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect. Neither the Company nor any Subsidiary, nor any director or officer
thereof (in his or her capacity as such), is or has been the subject of any
Action involving a claim of violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty, except as specifically
disclosed in the SEC Reports. There has not been, and to the knowledge of the
Company, there is not pending 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.

(k) Labor Relations. Neither the Company nor any Subsidiary is a party to any
collective bargaining agreement. No material labor dispute exists or, to the
knowledge of the Company, is imminent with respect to any of the employees of
the Company or any Subsidiary. To the knowledge of the Company or any such
Subsidiary, no executive officer of the Company or any of its Subsidiaries is in
violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or
any other contract or agreement or any restrictive covenant, and the continued
employment of each such executive officer does not subject the Company or any
such Subsidiary to any liability with respect to any of the foregoing matters.
The Company and its Subsidiaries are in compliance with all U.S. federal, state,
local and foreign laws and regulations relating to employment and employment
practices, terms and conditions of employment and wages and hours, except where
the failure to be in compliance would not, individually or in the aggregate,
have a Material Adverse Effect. None of the execution, delivery and performance
by the Company of this Agreement and each of the other Transaction Documents to
which it is a party and the consummation by the Company of the transactions
contemplated hereby or thereby (alone or in conjunction with any other event,
including any termination of employment) will (A) entitle any of the Company’s
or its Subsidiaries’ employees to any compensation or benefit, except as
required by any statute, rule or regulation of any governmental authority
applicable to the Company, (B) accelerate the time of payment or vesting, or
trigger any payment or funding, of any compensation or benefit, including any
stock options, restricted stock, or restricted stock units, or trigger any other
material obligation or (C) result in any material breach or violation of, or
default under, or limit the Company’s right to amend, modify or terminate, any
Company employee compensation or benefit plan, program, policy, agreement or
arrangement (each, an “Employee Transaction Benefit”). Each Company benefit plan
or arrangement that is a “nonqualified deferred compensation plan” within the
meaning of Section 409A(d)(1) of the IRC subject to Section 409A of the IRC has
been in operational compliance with Section 409A of the IRC since January 1,
2005, and has been in documentary compliance with Section 409A of the IRC since
January 1, 2009, based upon a good faith, reasonable interpretation of Section
409A of the IRC and the final Treasury Regulations and other guidance issued by
the Internal Revenue Service thereunder. Neither the execution and delivery of
this Agreement, nor the consummation of the transactions contemplated by this
Agreement will (either alone or upon the occurrence of termination of
employment) constitute an event that may result in (either alone or in
connection with any other circumstance or event) or give rise directly or
indirectly to any “parachute payment” within the meaning of Section 280G(b)(2)
of the IRC. The Company is not a party to any agreement to compensate any Person
for excise taxes payable pursuant to Section 4999 of the IRC.

(l) 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, would 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
contained in the SEC Reports 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 or has been in violation of any statute, rule or regulation of any
governmental authority, including without limitation all foreign, federal, state
and local laws relating to taxes, environmental protection, occupational health
and safety, product quality and safety and employment and labor matters, except
in each case as would not, individually or in the aggregate, have or reasonably
be expected to result in a Material Adverse Effect.

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(m) Regulatory Permits. The Company and the Subsidiaries possess all
certificates, approvals, authorizations and permits issued by the appropriate
United States federal, state, local, PRC national, provincial or local, and
other foreign regulatory authorities necessary to conduct their respective
businesses as described in the SEC Reports, all of which are valid and in full
force and effect, except where the failure to possess such certificates,
approvals, authorizations and permits would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect. The Company and the Subsidiaries have performed in all material respects
all of their obligations with respect to such certificates, approvals,
authorizations and permits and no event has occurred that allows, or after
notice or lapse of time, would allow, revocation or termination thereof, and
neither the Company nor any Subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificates, approvals,
authorizations and permits.

(n) Title to Assets. The Company and the Subsidiaries have valid land use rights
for all real property that is material to their respective businesses and good
and marketable title in all personal property owned by them that is material to
their respective businesses, in each case free and clear of all Liens, except
for Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property
by the Company and the Subsidiaries. Any real property and facilities held under
lease by the Company and the Subsidiaries are held by them under valid,
subsisting and enforceable leases of which the Company and the Subsidiaries are
in compliance, except as would not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect.

(o) Patents and Trademarks. The Company and its Subsidiaries own, or possess
adequate rights or licenses to use, all trademarks, trade names, service marks,
service mark registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade secrets and
other intellectual property rights (the “Intellectual Property Rights”)
necessary to conduct their respective businesses now conducted. Except as set
forth in the SEC Reports, all such Intellectual Property Rights are valid and
enforceable, there is no existing infringement by another Person of any of the
Intellectual Property Rights and no Intellectual Property Rights are involved in
any cancellation, dispute or Action and, to the knowledge of the Company and the
Subsidiaries, no such Action is threatened. Neither the Company nor any of its
Subsidiaries has received a written or oral notice that the Intellectual
Property Rights used by any of them violates or infringes upon the rights of any
Person. The Company and its Subsidiaries have taken reasonable security measures
to protect the secrecy, confidentiality and value of all of their intellectual
properties, except where failure to do so would not have, either individually or
in the aggregate, a Material Adverse Effect. The Company has duly and properly
filed or caused to be filed with applicable foreign patent authorities all
patent applications owned by the Company (the “Company Patent Applications”). To
the best knowledge of the Company, the Company has made no material
misrepresentation in the Company Patent Applications. The Company is not aware
of any information material to a determination of patentability regarding the
Company Patent Applications not called to the attention of the foreign patent
authority. The Company is not aware of any information not called to the
attention of the foreign patent authority that would preclude the grant of a
patent for the Company Patent Applications. The Company has no knowledge of any
information that would preclude the Company from having clear title to the
Company Patent Applications.

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(p) Insurance. The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and
the Subsidiaries are engaged. The Company has no reason to believe that it will
not be able to renew its and the Subsidiaries’ existing insurance coverage as
and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business on terms consistent with
market for the Company’s and such Subsidiaries’ respective lines of business.

(q) Transactions With Affiliates and Employees. Except as set forth in the SEC
Reports, none of the officers or directors of the Company and, to the knowledge
of the Company, none of the employees of the Company is presently a party to any
transaction with the Company or any Subsidiary (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the
Company, any entity in which any officer, director, or any such employee has a
substantial interest or is an officer, director, trustee or partner.

(r) Internal Accounting Controls. Except as disclosed in the SEC Reports, the
Company is in material compliance with the provisions of the Sarbanes-Oxley Act
of 2002 currently applicable to the Company. The Company and the Subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
GAAP and to maintain asset accountability, (iii) access to assets is permitted
only in accordance with management’s general or specific authorization, and (iv)
the recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. The Company has established disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and
designed such disclosure controls and procedures to ensure that material
information relating to the Company, including its Subsidiaries, is made known
to the certifying officers by others within those entities, particularly during
the period in which the Company’s Form 10-K has been prepared. The Company’s
certifying officers have evaluated the effectiveness of the Company’s controls
and procedures in accordance with Item 307 of Regulation S-K under the Exchange
Act for the Company’s most recently ended fiscal quarter or fiscal year-end
(such date, the “Evaluation Date”). The Company presented in its most recently
filed Form 10-K the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have
been no significant changes in the Company’s internal controls (as such term is
defined in Item 308(c) of Regulation S-K under the Exchange Act) or, to the
Company’s knowledge, in other factors that could significantly affect the
Company’s internal controls. The books, records and accounts of the Company
accurately and fairly reflect the transactions in, and dispositions of, the
assets of, and the results of operations of, the Company. The Company maintains
and will continue to maintain a standard system of accounting established and
administered in accordance with GAAP and the applicable requirements of the
Exchange Act.

(s) Certain Fees. Except for fees and compensation payable to Halter Financial
Advisory Co., Ltd. or its assigns, and fees payable to Roth Capital Partners, no
brokerage or finder’s fees or commissions are or will be payable by the Company
to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions
contemplated by this Agreement. The Investors shall have no obligation with
respect to any fees or with respect to any claims (other than such fees or
commissions owed by an Investor pursuant to written agreements executed by such
Investor which fees or commissions shall be the sole responsibility of such
Investor) made by or on behalf of other Persons for fees of a type contemplated
in this Section that may be due in connection with the transactions contemplated
by this Agreement. The Company shall pay, and hold each Investor harmless
against, any liability, loss or expense (including, without limitation,
reasonable attorneys’ fees and out-of-pocket expenses) arising in connection
with any such claim for fees arising out of the issuance of the Securities
pursuant to this Agreement.

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(t) Certain Registration Matters. Assuming the accuracy of the Investors’
representations and warranties set forth in Section 3.2(b) -(e), the offer and
sale of the Shares by the Company to the Investors under the Transaction
Documents is exempt from the registration requirements of the Securities Act..
Except as set forth in the SEC Reports and Section 4.10 hereof, the Company has
not granted or agreed to grant to any Person any rights (including “piggy-back”
registration rights) to require the Company to register any securities of the
Company registered under the Securities Act that have not been satisfied.
Neither the Company nor any of its Affiliates nor, any Person acting on the
Company’s behalf has, directly or indirectly, at any time within the past six
months, made any offer or sale of any security or solicitation of any offer to
buy any security under circumstances that would (i) eliminate the availability
of the exemption from registration under Regulation D or Regulation S under the
Securities Act in connection with the offer and sale by the Company of the
Securities as contemplated hereby or (ii) cause the offering of the Securities
pursuant to the Transaction Documents to be integrated with prior offerings by
the Company for purposes of any applicable law, regulation or shareholder
approval provisions, including, without limitation, under the rules and
regulations of any Trading Market.

(u) Listing and Maintenance Requirements. The Company is, and has no reason to
believe that it will not in the foreseeable future continue to be, in compliance
with the listing and maintenance requirements for continued listing of the
Common Stock on the Trading Market on which the Common Stock is currently listed
or quoted. The issuance and sale of the Shares under the Transaction Documents
do not contravene the rules and regulations of the Trading Market on which the
Common Stock is currently listed or quoted, and no approval of the shareholders
of the Company thereunder is required for the Company to issue and deliver to
the Investors the Shares contemplated by Transaction Documents.

(v) Investment Company. The Company is not, and is not an Affiliate of, and
after giving effect to the offer and sale of the Shares will not have become, an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.

(w) No Additional Agreements. Except for the Indemnity Agreement, the Company
does not have any agreement or understanding with any Investor with respect to
the transactions contemplated by the Transaction Documents other than as
specified in the Transaction Documents.

(x) Tax Matters. The Company and each Subsidiary has timely prepared and filed
all tax returns required to have been filed with all appropriate governmental
agencies and timely paid all taxes shown thereon or otherwise owed by it, except
as would not have a Material Adverse Effect. The charges, accruals and reserves
on the books of the Company and each Subsidiary in respect of taxes for all
fiscal periods are adequate in all material respects, and there are no material
unpaid assessments against the Company or any Subsidiary. All taxes and other
assessments and levies that the Company and each Subsidiary is required to
withhold or to collect for payment have been duly withheld and collected and
paid to the proper governmental entity or third party when due. There are no tax
liens or claims pending or, to the Company’s knowledge, threatened against the
Company or any of its assets or property, other than Liens disclosed in the SEC
Reports. There are no tax audits or investigations pending, which if adversely
determined would result in a Material Adverse Effect. There are no outstanding
tax sharing agreements or other such arrangements between the Company and any
other Person. The Company does not have any deferred compensation arrangements
and has not paid or is not required to pay any deferred compensation that would
be subject to Section 409A of the IRC.

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(y) General Solicitation. Neither the Company nor any Person acting on its
behalf has conducted any general solicitation or general advertising (as those
terms are used in Regulation D under the Securities Act) in connection with the
offer or sale of the Shares.

(z) Application of Takeover Protections; Rights Agreements. The Company and the
Board 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 charter documents or the laws of the State of Nevada that is
or could reasonably be expected to become applicable to any of the Investors as
a result of the Investors 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 the Investors’ ownership of
the Shares. The Company has not adopted a stockholder rights plan or similar
arrangement relating to accumulations of beneficial ownership of Common Stock or
a change in control of the Company.

(aa) Off Balance Sheet Arrangements. There is no transaction, arrangement, or
other relationship between the Company and an unconsolidated or other off
balance sheet entity that is required to be disclosed by the Company in its
Exchange Act filings and is not so disclosed or that otherwise would have a
Material Adverse Effect.

(bb) Additional PRC Representations and Warranties.

(i) All material consents, approvals, authorizations or licenses required under
PRC law for the due and proper establishment and operation of the Company and
the Subsidiaries have been duly obtained from the relevant PRC governmental
authorities and are in full force and effect.

(ii) The Company and the Subsidiaries have conducted their respective business
activities within their permitted scope of business or have otherwise operated
their respective businesses in compliance with all relevant legal requirements
and with all requisite licenses and approvals granted by competent PRC
governmental authorities other than such non-compliance that do not, and would
not, individually or in the aggregate, have a Material Adverse Effect. As to
licenses, approvals and government grants and concessions requisite or material
for the conduct of any part of the Company or any Subsidiaries’ business which
is subject to periodic renewal, neither the Company nor such Subsidiary has any
knowledge of any grounds on which such requisite renewals will not be granted by
the relevant PRC governmental authorities.

(iii) Mr. Guohong Zhao’s option rights under the Option Agreement are not
subject to any consents, approvals, authorizations or licenses required under
PRC law.

(cc) Disclosure. Except for any information provided to an Investor pursuant to
a specific due diligence request by such Investor to receive material nonpublic
information, the Company confirms that neither it nor any officers, directors or
Affiliates, has provided any of the Investors or their agents or counsel with
any information that constitutes or might constitute material, nonpublic
information (other than the existence and terms of the issuance of Securities,
as contemplated by this Agreement). The Company understands and confirms that
each of the Investors will rely on the foregoing representations in effecting
transactions in securities of the Company (other than Excluded Investors). All
disclosure provided by the Company to the Investors regarding the Company, its
business and the transactions contemplated hereby, including the Schedules to
this Agreement, furnished by or on the 14 behalf of the Company are true and
correct in all material respects and do not 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 the light of the circumstances under which they were
made, not misleading. To the Company’s knowledge, except for the transactions
contemplated by this Agreement, no event or circumstance has occurred or
information exists with respect to the Company or any of its Subsidiaries or its
or their business, properties, operations or financial condition, which, under
applicable law, rule or regulation, requires public disclosure or announcement
by the Company but which has not been so publicly announced or disclosed. The
Company acknowledges and agrees that no Investor (other than Excluded Investors)
makes or has made any representations or warranties with respect to the
transactions contemplated hereby other than those set forth in the Transaction
Documents.

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(dd) Foreign Corrupt Practices. Neither the Company nor any of its Subsidiaries
nor, to the knowledge of the Company, any director, officer, agent, employee or
other Person acting on behalf of the Company or any of its Subsidiaries has, in
the course of its actions for, or on behalf of, the Company (i) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv)
made any unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any foreign or domestic government official or employee.

(ee) Indebtedness. Except as disclosed in the SEC Reports, neither the Company
nor any of its Subsidiaries (i) has any outstanding Indebtedness (as defined
below), (ii) is in violation of any term of or in default under any contract,
agreement or instrument relating to any Indebtedness, except where such
violations and defaults could not result, individually or in the aggregate, in a
Material Adverse Effect, or (iii) is a party to any contract, agreement or
instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company’s officers, has or is expected to have a Material
Adverse Effect. For purposes of this Agreement: (x) “Indebtedness” of any Person
means, without duplication (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with generally accepted
accounting principles, consistently applied for the periods covered thereby, is
classified as a capital lease, and (G) all indebtedness referred to in clauses
(A) through (F) above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness.

(ff) PRC Environmental Laws. Except as set forth on Schedule III hereto, the
Company and its Subsidiaries (i) are in compliance in all material respects with
any and all PRC Environmental Laws (as hereinafter defined), (ii) have received
all permits, licenses or other approvals required of them under applicable PRC
Environmental Laws to conduct their respective businesses and (iii) are in
compliance in all material respects with all terms and conditions of any such
permit, license or approval where, in each of the foregoing clauses (i), (ii)
and (iii), the failure to so comply would be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect. The term “PRC
Environmental Laws” means all national, provincial, local or foreign laws
relating to pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata), including, without limitation, laws relating to
emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, or toxic or hazardous substances or wastes (collectively,
“Hazardous Materials”) into the environment, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, as well as all authorizations,
codes, decrees, demands or demand letters, injunctions, judgments, licenses,
notices or notice letters, orders, permits, plans or regulations issued,
entered, promulgated or approved thereunder.

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(gg) Solvency. As of the Closing Date, each of the Company and its Subsidiaries
is and will be Solvent. As used herein, “Solvent” means, with respect to the
Company on a particular date, that on such date, in each case including the fair
value of the Company’s Intellectual Property, (a) the fair value of the property
of the Company is greater than the total amount of liabilities, including
contingent liabilities, of the Company; (b) the present fair salable value of
the assets of the Company is not less than the amount that will be required to
pay the probable liability of the Company on its debts as they become absolute
and matured; (c) the Company does not intend to, and does not believe that it
will, incur debts or liabilities beyond the Company’s ability to pay as such
debts and liabilities mature; (d) the Company is not engaged in a business or
transaction, and is not about to engage in a business or transaction, for which
the Company’s property would constitute an unreasonably small capital; and (e)
as of the date hereof, the Company is not “insolvent” within the meaning of
Section 101(32) of the United States Bankruptcy Code (11 U.S.C. § 101, et. seq),
as amended from time to time (the “Bankruptcy Code”). The amount of contingent
liabilities (such as litigation, guaranties and pension plan liabilities) at any
time shall be computed as the amount that, in light of all the facts and
circumstances existing at the time, represents the amount that can be reasonably
be expected to become an actual or matured liability. The Company does not
intend to incur debts beyond its ability to pay such debts as they mature
(taking into account the timing and amounts of cash to be payable on or in
respect of its debt). The Company has no Knowledge of any facts or circumstances
which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year
from the Closing Date. The SEC Reports set forth as of the date thereof all
outstanding secured and unsecured indebtedness of the Company or any Subsidiary,
or for which the Company or any Subsidiary has commitments, which are required
to be disclosed in such SEC Reports.

3.2. Representations and Warranties of the Investors. Each Investor hereby,
severally and not jointly, represents and warrants to the Company as of the date
hereof and the Closing Date:

(a) Organization; Authority. Such Investor, (i) if an entity, is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization with the requisite corporate or partnership power and authority
and, (ii) if an individual, has full capacity to enter into and to consummate
the transactions contemplated by the applicable Transaction Documents and
otherwise to carry out its obligations thereunder. The execution, delivery and
performance by such Investor of the transactions contemplated by this Agreement
has been duly authorized by all necessary corporate or, if such Investor is not
a corporation, such partnership, limited liability company or other applicable
like action, on the part of such Investor. Each of this Agreement and the
Registration Rights Agreement has been duly executed by such Investor, and when
delivered by such Investor in accordance with the terms hereof, will constitute
the valid and legally binding obligation of such Investor, enforceable against
it in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles of general application.

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(b) Investment Intent. Such Investor is acquiring the Shares as principal for
its own account for investment purposes only and not with a view to or for
distributing or reselling such Shares or any part thereof, without prejudice,
however, to such Investor’s right at all times to sell or otherwise dispose of
all or any part of such Shares in compliance with applicable federal and state
securities laws. Subject to the immediately preceding sentence, nothing
contained herein shall be deemed a representation or warranty by such Investor
to hold the Shares for any period of time. Such Investor is acquiring the Shares
hereunder in the ordinary course of its business. Such Investor does not have
any agreement or understanding, directly or indirectly, with any Person to
distribute any of the Shares.

(c) Investor Status. At the time such Investor was offered the Shares, it was,
and at the date hereof it is, an “accredited investor” as defined in Rule 501(a)
under the Securities Act. Such Investor is not a registered broker-dealer under
Section 15 of the Exchange Act. Such Investor has such experience in business
and financial matters that it is capable of evaluating the merits and risks of
an investment in the Shares. Such Investor acknowledges that an investment in
the Shares is speculative and involves a high degree of risk. Such Investor has
completed and executed the U.S. Accredited Investor Certificate attached as
Schedule II to this Agreement.

(d) General Solicitation. Such Investor is not purchasing the Shares as a result
of any advertisement, article, notice or other communication regarding the
Shares published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or any other general
solicitation or general advertisement.

(e) Access to Information. Such Investor acknowledges that it has reviewed the
Disclosure Materials and has been afforded (i) the opportunity to ask such
questions as it has deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Shares and the merits and risks of investing in the Shares; (ii)
access to information about the Company and the Subsidiaries and their
respective financial condition, results of operations, business, properties,
management and prospects sufficient to enable it to evaluate its investment; and
(iii) the opportunity to obtain such additional information that the Company
possesses or can acquire without unreasonable effort or expense that is
necessary to make an informed investment decision with respect to the
investment. Neither such inquiries nor any other investigation conducted by or
on behalf of such Investor or its representatives or counsel shall modify, amend
or affect such Investor’s right to rely on the truth, accuracy and completeness
of the Disclosure Materials and the Company’s representations and warranties
contained in the Transaction Documents.

(f) Independent Investment Decision. Such Investor has independently evaluated
the merits of its decision to purchase Shares pursuant to the Transaction
Documents, and such Investor confirms that it has not relied on the advice of
any other Investor’s business and/or legal counsel in making such decision.

(g) Certain Trading Activities. Such Investor has not directly or indirectly,
nor has any Person acting on behalf of or pursuant to any understanding with
such Investor, engaged in any transactions in the securities of the Company
(including, without limitations, any Short Sales involving the Company’s
securities) since the earlier to occur of (1) the time that such Investor was
first contacted by the Company regarding an investment in the Company and (2)
the 30th day prior to the date of this Agreement. Such Investor covenants that
neither it nor any Person acting on its behalf or pursuant to any understanding
with it will engage in any transactions in the securities of the Company
(including Short Sales) prior to the time that the transactions contemplated by
this Agreement are publicly disclosed.

(h) Regulation S. If such Investor is not a U.S. Person (as such term is defined
in Section 902(a) of Regulation S), such Investor (i) acknowledges that the
certificate(s) representing or evidencing the Shares contain a customary
restrictive legend restricting the offer, sale or transfer of any Shares except
in accordance with the provisions of Regulation S, pursuant to registration
under the Securities Act, or pursuant to an available exemption from
registration, (ii) agrees that all offers and sales by such Investor of Shares
shall be made pursuant to an effective registration statement under the
Securities Act or pursuant to an exemption from, or a transaction not subject to
the registration requirements of, the Securities Act, (iii) represents that the
offer to purchase the Shares was made to such Investor outside of the United
States, and such Investor was, at the time of the offer and will be, at the time
of the sale and is now, outside the United States, (iv) has not engaged in or
directed any unsolicited offers to purchase Shares in the United States, (v) is
neither a U.S. Person nor a Distributor (as such terms are defined in Section
902(a) and 902(c), respectively, of Regulation S), (vi) has purchased the Shares
for its own account and not for the account or benefit of any U.S. Person, and
(vii) is the sole beneficial owner of the Shares specified on the Investor
signature page attached hereto opposite his name and has not pre-arranged any
sale with an Investor in the United States., and (ix) is familiar with and
understands the terms and conditions and requirements contained in Regulation S,
specifically, without limitation, each Investor understands that the statutory
basis for the exemption claimed for the sale of the Shares would not be present
if the sale, although in technical compliance with Regulation S, is part of a
plan or scheme to evade the registration provisions of the Securities Act.

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The Company acknowledges and agrees that no Investor has made or makes any
representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in this Section 3.2.

ARTICLE 4.
OTHER COVENANTS AND AGREEMENTS

4.1. Transfers; Stock Certificates.

(a) Shares may only be disposed of in compliance with U.S. state and federal
securities laws. In connection with any transfer of the Shares other than
pursuant to an effective registration statement, to the Company, to an Affiliate
of an Investor or in connection with a pledge as contemplated in Section 4.1(b),
the Company may require the transferor thereof to provide to the Company an
opinion of counsel selected by the transferor, the form and substance of which
opinion shall be reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred Shares under the
Securities Act.

(b) Certificates evidencing Shares offered in reliance on Regulation D will
contain the following legend, until such time as they are not required under
Section 4.1(c):

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. THESE SECURITIES
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. THESE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED
BY SUCH SECURITIES.

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Certificates evidencing Shares offered in reliance on Regulation S will contain
the following legend, until such time as they are not required under Section
4.1(c):

THE SECURITIES ARE BEING OFFERED TO INVESTORS WHO ARE NOT U.S. PERSONS (AS
DEFINED IN REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(“SECURITIES ACT”)) AND WITHOUT REGISTRATION WITH THE UNITED STATES SECURITIES
AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT IN RELIANCE UPON REGULATION S
PROMULGATED UNDER THE SECURITIES ACT. TRANSFER OF THESE SECURITIES IS
PROHIBITED, EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S, PURSUANT
TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AVAILABLE EXEMPTION
FROM REGISTRATION. HEDGING TRANSACTIONS MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE SECURITIES ACT.

The Company acknowledges and agrees that an Investor may from time to time
pledge, and/or grant a security interest in some or all of the Shares pursuant
to a bona fide margin agreement in connection with a bona fide margin account
and, if required under the terms of such agreement or account, such Investor may
transfer pledged or secured Shares to the pledgees or secured parties. Such a
pledge or transfer would not be subject to approval or consent of the Company
and no legal opinion of legal counsel to the pledgee, secured party or pledgor
shall be required in connection with the pledge, but such legal opinion may be
required in connection with a subsequent transfer following default by the
Investor transferee of the pledge. No notice shall be required of such pledge.
At the appropriate Investor’s expense, the Company will execute and deliver such
reasonable documentation as a pledgee or secured party of Shares may reasonably
request in connection with a pledge or transfer thereof including the
preparation and filing of any required prospectus supplement under Rule
424(b)(3) of the Securities Act or other applicable provision of the Securities
Act to appropriately amend the list of selling shareholders thereunder. Except
as otherwise provided in Section 4.1(c), any Shares subject to a pledge or
security interest as contemplated by this Section 4.1(b) shall continue to bear
the legend set forth in this Section 4.1(b) and be subject to the restrictions
on transfer set forth in Section 4.1(a) .

(c) Certificates evidencing Shares shall not contain any legend (including the
legend set forth in Section 4.1(b)): (i) while a registration statement
(including the Registration Statement) covering such Shares is then effective,
or (ii) following a sale or transfer of such Shares pursuant to Rule 144
(assuming the transferee is not an Affiliate of the Company), or (iii) while
such Shares are eligible for sale by the selling Investor without volume
restrictions under Rule 144. The Company agrees that following the Effective
Date or such other time as legends are no longer required to be set forth on
certificates representing Shares under this Section 4.1(c), it will, no longer
than three Trading Days following the delivery by an Investor to the Company or
the Transfer Agent of a certificate representing such Shares containing a
restrictive legend, deliver or instruct the Transfer Agent to deliver to such
investor Shares which are free of all restrictive and other legends. Fees with
respect to the Transfer Agent and Company Counsel associated with the removal of
such legend shall be borne by the Company.

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4.2. Furnishing of Information. As long as any Investor owns any Shares or any
part of the Total Make Good Shares , the Company covenants 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 with the Commission
after the date hereof pursuant to the Exchange Act. As long as any Investor owns
Shares or any of the Total Make Good Shares, if the Company is not required to
file reports pursuant to such laws, it will prepare and furnish to the Investors
and make publicly available in accordance with Rule 144(c) such information as
is required for the Investors to sell the Shares or any of the Total Make Good
Shares under Rule 144. The Company further covenants that it will take such
further action as any holder of Shares and the Total Make Good Shares may
reasonably request, including but not limited to providing the Investor with a
written statement confirming that the Company has complied with the reporting
requirements set forth in Rule 144, all to the extent required from time to time
to enable such Person to sell the Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144.

4.3. Integration. The Company shall not, and shall use its best efforts to
ensure that no Affiliate of the Company shall, sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Shares in a manner that would require the registration under the
Securities Act of the sale of the Shares to the Investors, or that would be
integrated with the offer or sale of the Shares for purposes of the rules and
regulations of any Trading Market in a manner that would require shareholder
approval of the sale of the securities to the Investors.

4.4. Securities Laws Disclosure; Publicity. By 9:30 a.m. (New York City time) on
the Trading Day following the execution of this Agreement, and by 9:30 a.m. (New
York City time) on the Trading Day following the Closing Date, the Company shall
issue press releases disclosing the transactions contemplated hereby and the
Closing. On the Trading Day following the execution of this Agreement the
Company will file a Report on Form 8-K disclosing the material terms of the
Transaction Documents (and attach as exhibits thereto the Transaction
Documents), and on the Trading Day following the Closing Date the Company will
file an additional Report on Form 8-K to disclose the Closing. In addition, the
Company will make such other filings and notices and comply with any other
obligations in the manner and time required by the Commission and the Trading
Market on which the Common Stock is listed. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Investor, or include the
name of any Investor in any filing with the Commission (other than a
Registration Statement and any exhibits to filings made in respect of this
transaction in accordance with periodic filing requirements under the Exchange
Act) or any regulatory agency or Trading Market, without the prior written
consent of such Investor, except to the extent such disclosure is required by
law or Trading Market regulations.

4.5. Limitation on Issuance of Future Priced Securities. During the six months
following the Closing Date, the Company shall not issue any “Future Priced
Securities” as such term is described by NASD IM-4350-1.

4.6. Non-Public Information. The Company covenants and agrees that neither it
nor any other Person acting on its behalf will provide any Investor or its
agents or counsel with any information that the Company believes constitutes
material non-public information, unless prior thereto such Investor shall have
executed a written agreement regarding the confidentiality and use of such
information. The Company understands and confirms that each Investor shall be
relying on the foregoing representations in effecting transactions in securities
of the Company.

4.7. Listing of Shares. The Company agrees that (i) to the extent not already
included, it will include the Shares in its application to list the Common Stock
for trading on The NASDAQ Capital 20 Market and will take such other action as
is necessary or desirable to cause the Shares to be listed on The NASDAQ Stock
Market LLC as promptly as possible, and (ii) it will take all action reasonably
necessary to continue the listing and trading of its Common Stock on a Trading
Market and will comply in all material respects with the Company’s reporting,
filing and other obligations under the bylaws or rules of all applicable Trading
Markets.

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4.8. Use of Proceeds. The Company will use the net proceeds from the sale of the
Shares hereunder for working capital purposes and not for the satisfaction of
any portion of the Company’s debt (other than payment of trade payables and
accrued expenses in the ordinary course of the Company’s business and consistent
with prior practices) or to redeem any Common Stock or any securities of the
Company or any Subsidiary which entitle the holder thereof to acquire Common
Stock at any time, 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 or other securities that entitle the holder to receive, directly or
indirectly, Common Stock.

4.9. Make Good Obligation.

(a) Escrowed Shares. Within five Trading Days following the Closing, the Make
Good Pledgor agrees to place 2,000,000 shares of Common Stock owned by such Make
Good Pledgor (the “Total Make Good Shares”) into escrow in accordance with the
Make Good Escrow Agreement along with stock powers executed in blank (or such
other signed instrument of transfer acceptable to the Company’s transfer agent)
to be held in an escrow account by the Make Good Escrow Agent for the benefit of
the Investors and disbursed in accordance with this Section 4.9. Mr. Guohong
Zhao and Ms. Jinghua Zhao each undertakes to provide guarantee for the Make Good
Pledgor’s performance in accordance of this Agreement and the Make Good Escrow
Agreement. The Company shall notify the Investors as soon as the Escrowed Shares
have been deposited with the Make Good Escrow Agent. If within fifteen (15)
Trading Days following the Closing, the Make Good Pledgor shall not have
deposited all Total Make Good Shares into escrow in accordance with this
Agreement and the Make Good Escrow Agreement along with stock powers executed in
blank (or such other signed instrument of transfer acceptable to the Company’s
transfer agent), then, the Lead Investor shall have the right, at its sole
discretion and selection, to either (i) cash damages, as liquidated damages and
not as a penalty, equal to [0.1% of the aggregate value of the Total Make Good
Shares calculated by the closing price of the Company’s Common Stock on the
fifth day following the Closing] on a daily basis during the period between the
sixth day following the Closing and the date on which the Total Make Good Shares
are actually deposited into escrow; or (ii) issue a written demand to the
Company, upon which the Company shall promptly, and in any event within thirty
(30) days from the date of such written demand, pay to Investors as listed on
the written demand, as liquidated damages, an amount equal to those listed
Investors’ entire Investment Amount without interest thereon. As a condition to
the receipt of such payment, such Investors shall return to the Company for
cancellation of the certificates evidencing the Shares acquired by such
Investors under this Agreement.

(b) 2010 Make Good Obligation. If the Company’s After Tax Net Income as reported
in its 2010 Annual Report (the “2010 Audited ATNI”) is less than $8,000,000 (the
“2010 Guaranteed ATNI”), the Make Good Pledgor agrees that a portion of the
Total Escrowed Shares (calculated based on the formula below) which have been
pledged with respect to the 2010 Guarantee ATNI (the “2010 Make Good Shares”)
shall be transferred to the Investors, on a pro rata basis (determined by
dividing the number of shares purchased by each Investor hereunder by the sum
total number of shares purchased by all Investors hereunder) for no
consideration and without the need of any Investor to take any action with
respect thereto. If the Company’s 2010 Audited ATNI is less than the 2010
Guaranteed ATNI, the total number of 2010 Make Good Shares (as equitably
adjusted for any stock splits, stock combinations, stock dividends or similar
transactions) to be transferred to the Investors shall be calculated using the
following formula:

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“2010 Make Good Shares” = [(2010 Guaranteed ATNI – 2010 Audited
ATNI)/$8,000,000] * 50% of the Total Make Good Shares”

If the Company’s 2010 Audited ATNI is equal to or greater than the 2010
Guaranteed ATNI, no transfer of any 2010 Make Good Shares shall be required to
be made by the Make Good Pledgor(s) to the Investors under this Section 4.9(b)
and fifty percent (50%) of the Total Make Good Shares shall be promptly returned
to the Make Good Pledgor(s) without the need of any approval or consent thereto
by any Investor. The remaining fifty percent (50%) of the Total Make Good Shares
shall continue to be held in escrow by the Make Good Escrow Agent and shall
remain subject to Section 4.9(c) below.

(c) 2011 Make Good Obligation. If the Company’s After Tax Net Income as reported
in its 2011 Annual Report (the “2011 Audited ATNI”) is less than $12,000,000
(the “2011 Guaranteed ATNI”), the Make Good Pledgor agrees that a portion of the
Total Make Good Shares (calculated based on the formula below) which have been
pledged with respect to the 2011 Guarantee ATNI (the “2011 Make Good Shares”)
shall be transferred to the Investors on a pro rata basis (determined by
dividing the number of shares purchased by each Investor hereunder by the sum
total number of shares purchased by all Investors hereunder) for no
consideration and without the need of any Investor to take any action with
respect thereto. If the Company’s 2011 Audited ATNI is less than the 2011
Guaranteed ATNI, the total number of 2011 Make Good Shares (as equitably
adjusted for any stock splits, stock combinations, stock dividends or similar
transactions) to be transferred to the Investors shall be calculated using the
following formula:

“2011 Make Good Shares” = [(2011 Guaranteed ATNI – 2011 Audited
ATNI)/$12,000,000] * 50% of the Total Make Good Shares”

If the Company’s 2011 Audited ATNI is equal to or greater than the 2011
Guaranteed ATNI, no transfer of any 2011 Make Good Shares shall be required to
be made by the Make Good Pledgor to the Investors under this Section 4.9(c), the
remaining fifty percent (50%) of the Total Make Good Shares shall be promptly
returned to the Make Good Pledgor without the need of any approval or consent
thereto by any Investor.

(d) For purposes hereof, “After Tax Net Income” shall mean the Company’s net
income after taxes for the fiscal year ending December 31, 2010 or December 31,
2011, as the case may be, determined in accordance with GAAP as reported in the
2010 Annual Report or 2011 Annual Report.

(e) Each of the Investors understands and agrees that the right of each such
Investor to receive 2010 Make Good Shares or 2011 Make Good Shares, as the case
may be, is a unique and personal right of such Investor which requires such
Investor to continue to own the shares when the 2010 Audited ATNI or 2011
Audited ATNI, as the case may be, is determined for purposes of this Section
4.9. The right of any Investor to receive any 2010 Make Good Shares or 2011 Make
Good Shares, as the case may be, will be proportionately reduced if such
Investor does not continue to own the same number of shares on the 2010 Audited
ATNI determination date or 2011 Audited ATNI determination date, as the case may
be, as are owned on the date hereof. Furthermore, the right to receive Make Good
Shares shall not run to the benefit of any transferee of any Shares transferred
by any Investor to a third party, other than an entity affiliated with such
Investor. Notwithstanding the foregoing, the Company covenants and agrees that
if any Investor is permitted to transfer, and desires to transfer, any 2010 Make
Good Shares or 2011 Make Good Shares (after such 2010 Make Good Shares or 2011
Make Good Shares, as the case may be, shall be properly transferable to any such
Investors in accordance with the terms hereof and the Make Good Escrow
Agreement), the Company shall promptly instruct its Transfer Agent to reissue
and deliver such 2010 Make Good Shares or 2011 Make Good Shares in the name of a
permitted transferee as directed by an Investor.

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(f) If any term or provision of this Section 4.9 contradicts or conflicts with
any term or provision of the Make Good Escrow Agreement, the terms of the Make
Good Escrow Agreement shall control.

4.10. Subsequent Registrations. The Company is obliged to file a Subsequent
Registration Statement with the Commission with respect to any securities of the
2010 Make Good Shares and/or the 2011 Make Good Shares that have been
transferred to the Investors (respectively, the “2010 Released Escrow Shares”
and the “2011 Released Escrow Shares”). The Company shall cause one Subsequent
Registration Statement for each of the 2010 Released Escrow Shares and the 2011
Released Escrow Shares required to be filed under this Agreement to be declared
effective under the Securities Act pursuant to this Section 4.10.

(a) The Company shall prepare and file with the Commission a Subsequent
Registration Statement covering the resale of the 2010 Released Escrow Shares or
the 2011 Released Escrow Shares not already covered by an existing and effective
registration statement for an offering to be made on a continuous basis pursuant
to Rule 415. Each initial Subsequent Registration Statement shall be filed
within 45 days after the delivery of 2010 Released Escrow Shares or the 2011
Released Escrow Shares to the Investors (the “Filing Date”). Each Subsequent
Registration Statement required to be filed under this Agreement shall be filed
on Form S-3 (or if the Company is not then eligible to utilize Form S-3, it
shall utilize such other available form appropriate for such purpose) and
contain (except if otherwise required pursuant to written comments received from
the Commission upon a review of such Subsequent Registration Statement, provided
however that no Investor shall be characterized as an underwriter unless such
characterization is consistent with written information provided by the Investor
in the Selling Holder Questionnaire) the “Plan of Distribution.”

(b) If: (i) any Subsequent Registration Statement is not filed on or prior to
its Filing Date covering the 2010 Released Escrow Shares or the 2011 Released
Escrow Shares required under this Agreement to be included therein, or (ii) the
Company fails to file a response letter and an amendment to the Subsequent
Registration Statement within 30 days of receiving comments from the SEC, (any
such failure or breach being referred to as an “Event,” and for purposes of
clauses (i) or (ii) the date on which such Event occurs, being referred to as
“Event Date”), then in addition to any other rights the Investors may have
hereunder or under applicable law: on each such Event Date, and on each monthly
anniversary of each such Event Date (if the applicable Event shall not have been
cured by such date) until the applicable Event is cured, the Company shall pay
to each Investor an amount in cash, as partial liquidated damages and not as a
penalty, equal to 0.5% of the aggregate value of the 2010 Released Escrow Shares
or the 2011 Released Escrow Shares (the “Aggregated Value”) calculated by the
closing price of the Company’s Common Stock on the date of the delivery. The
partial liquidated damages pursuant to the terms hereof shall apply on a daily
pro-rata basis for any portion of a month prior to the cure of an Event, except
for the day of the first Event Date. In no event will the Company be liable for
liquidated damages under this Agreement in excess of 0.5% of the Aggregate Value
in any 30-day period. The Company shall not be liable for liquidated damages
under this Agreement as to any 2010 Released Escrow Shares or 2011 Released
Escrow Shares which are not permitted by the Commission to be included in a
Subsequent Registration Statement due solely to Commission Comments from the
time that it is determined that such 2010 Released Escrow Shares or 2011
Released Escrow Shares are not permitted to be registered solely due to
Commission Comments until such time as the provisions of this Agreement as to
the next applicable Subsequent Registration Statement required to be filed
hereunder are triggered.

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4.11. Form D. The Company will timely file a Form D with the Commission with
respect to the Shares as required under Regulation D under the Securities Act.

4.12. No Conflicting Agreements. The Company will not take any action, enter
into any agreement or make any commitment that would conflict or interfere in
any material respect with the Company’s obligations to the Investors under the
Transaction Documents.

4.13. Appointment of Director. As long as the Lead Investor along with its
Affiliates holds no less than 5% of shares of Common Stock of the Company on a
fully diluted basis, (i)the Lead Investor shall have the right to appoint one
director; and (ii) the Company shall appoint an additional independent director
upon consultation and consent by the Lead Investor.

4.14. Indemnification. Each of the directors, agents or officers of the Company
shall be indemnified out of the assets of the Company against any liability
incurred by him as a result of any act or failure to act in carrying out his
functions other than such liability (if any) that he may incur by his own fraud
or willful default. No such Director, agent or officer shall be liable to the
Company for any loss or damage in carrying out his functions unless that
liability arises through the fraud or willful default of such Director, agent or
officer. In addition to the indemnity provided in the Registration Rights
Agreement, the Company agrees to indemnify and hold each Investor and all of
their respective directors, officers, stockholders, members, partners, employees
and agents (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other
title), each Person who controls an Investor (within the meaning of Section 15
of the Securities Act and Section 20 of the Exchange Act), and the directors,
officers, stockholders, agents, members, partners or employees (and any other
Persons with a functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such controlling
person (each, an “Investor Party”) harmless from any and all losses,
liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable
attorneys’ fees and costs of investigation (collectively, “Losses”) that any
such Investor Party may suffer or incur whether direct, indirect or
consequential, as a result of or arising from or relating to or in connection
with (a) any breach of any of the representations, warranties, covenants or
agreements made by the Company in this Agreement or in the other Transaction
Documents, provided that such a claim for indemnification relating to any breach
of any of the representations or warranties made by the Company in this
Agreement is made within two years from the Closing or (b) any action instituted
against an Investor, or any of their respective Affiliates, by any Person who is
not an Affiliate of such Investor, with respect to any of transactions
contemplated by the Transaction Documents (unless such action is based upon any
agreements or understanding such Investor may have with any such Person or any
violations by the Investor of state or federal securities laws or any conduct by
such Investor which constitutes fraud, gross negligence or willful misconduct).

4.15. Participation Right. Within 24 months of the Closing, the Lead Investor
shall have the right to participate proportionally in the Company’s financing
activities, excluding the following: 1) underwritten offering; 2) issuance
related to acquisition; 3) issuance pursuant to stock option plans; and 4)
issuance below $500,000.

4.16. SAFE 75 Filing. The Company covenants to the Investors that Mr. Guohong
Zhao will not exercise his option rights under the Option Agreement, as amended,
unless (i) he has obtained or completed all applicable approvals, registrations
or filings then required under PRC laws and regulations, including but not
limited to the Notice Regarding Certain Administrative Measures on Financing and
Round-trip Investments by PRC Residents Through Offshore Special Purpose
Vehicles effective as of November 1, 2005 issued by PRC’s State Administration
of Foreign Exchanges (“SAFE 75”). Evidence showing that Mr. Guohong Zhao has
completed SAFE 75 filing, if applicable, shall be provided to the Investors by
the Company prior to Mr. Guohong Zhao’s exercise of his option rights under the
Option Agreement. or (ii) Mr. Guohong Zhao has provided the Lead Investor with
an alternative solution or assurance which results in the Lead Investor agreeing
to waive Mr. Guohong Zhao’s obligations under 4.16 (i) above, or (iii) the
Investors in the transaction contemplated by this Agreement have collectively
sold one hundred percent (100%) of the shares purchased under this Agreement and
received under the Make Good Escrow Agreement.

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ARTICLE 5.
CONDITIONS PRECEDENT TO CLOSING

5.1. Conditions Precedent to the Obligations of the Investors to Purchase
Shares. The obligation of each Investor to acquire Shares at the Closing is
subject to the satisfaction, at or before the Closing, of each of the following
conditions, any of which may be waived by such Investor (as to itself only):

(a) Representations and Warranties. The representations and warranties of the
Company contained herein shall be true and correct in all material respects as
of the date when made and as of the Closing as though made on and as of such
date;

(b) Performance. The Company shall have performed, satisfied and complied in all
material respects with all covenants, agreements and conditions required by the
Transaction Documents to be performed, satisfied or complied with by it at or
prior to the Closing;

(c) No Injunction. No judgment, writ, order, injunction, award or decree of or
by any court, or judge, justice or magistrate, including any bankruptcy court or
judge, or any statute, rule, regulation, order of or by any governmental
authority, shall have been enacted, promulgated or issued, and no action or
proceeding shall have been instituted by any governmental authority, enjoining
or preventing the consummation of the transactions contemplated by the
Transaction Documents;

(d) Adverse Changes. Since the date of execution of this Agreement, no event or
series of events shall have occurred that reasonably could have or result in a
Material Adverse Effect;

(e) No Suspensions of Trading in Common Stock; Listing. Trading in the Common
Stock shall not have been suspended by the Commission, any Trading Market or any
governmental or regulatory body (except for any suspensions of trading of not
more than one Trading Day solely to permit dissemination of material information
regarding the Company) at any time since the date of execution of this
Agreement, the Common Stock shall have been at all times since such date listed
for trading on a Trading Market, and the Company shall not have received notice
of any delisting or removal from trading on any Trading Market or that it is in
violation of any rule, regulation or interpretation of any Trading Market that
could lead to delisting or removal from trading;

(f) Company Deliverables. The Company shall have delivered the Company
Deliverables in accordance with Section 2.3(a);

(g) Permits. The Company shall have obtained any and all consents, permits,
approvals, registrations and waivers necessary or appropriate for consummation
of the purchase and sale of the Shares and the consummation of the other
transactions contemplated by the Transaction Documents to be consummated on or
prior to the Closing Date, all of which shall be in full force and effect;

(h) Termination. This Agreement shall not have been terminated as to such
Investor in accordance with Section 6.6;

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(i) SEC Form 14C Filing. The Company shall have duly filed the preliminary
Schedule 14C Information Statement and the definitive Schedule 14C Information
Statement, and shall cause the definitive Schedule 14C information Statement to
become effective pursuant to relevant SEC rules. Among others, the effectiveness
of Schedule 14C Information Statement shall be confirmed by the U.S. legal
counsel of the Company.

5.2. Conditions Precedent to the Obligations of the Company to Sell Shares. The
obligation of the Company to sell and issue Shares at the Closing is subject to
the satisfaction or waiver by the Company, at or before the Closing, of each of
the following conditions:

(a) Representations and Warranties. The representations and warranties of each
Investor contained herein shall be true and correct in all material respects as
of the date when made and as of the Closing Date as though made on and as of
such date;

(b) Performance. Each Investor shall have performed, satisfied and complied in
all material respects with all covenants, agreements and conditions required by
the Transaction Documents to be performed, satisfied or complied with by such
Investor at or prior to the Closing;

(c) No Injunction. No judgment, writ, order, injunction, award or decree of or
by any court, or judge, justice or magistrate, including any bankruptcy court or
judge, or any statute, rule, regulation, order of or by any governmental
authority, shall have been enacted, promulgated or issued, and no action or
proceeding shall have been instituted by any governmental authority, enjoining
or preventing the consummation of the transactions contemplated by the
Transaction Documents;

(d) Investor Deliverables. Each Investor shall have delivered its Purchase Price
in accordance with Section 2.3(b) and the Registration Rights Agreement, duly
executed by such Investor. Each Investor shall have delivered a duly completed
certificate in the form attached as Schedule II; and

(e) Termination. This Agreement shall not have been terminated as to such
Investor in accordance with Section 6.6.

ARTICLE 6.
MISCELLANEOUS

6.1. Fees and Expenses. The fees and expenses of up to $65,000 incurred by the
Lead Investor incident to the negotiation, preparation, execution, delivery and
performance of the Transaction Documents shall be deducted from the proceeds of
the financing.

6.2. Entire Agreement. The Transaction Documents, together with the Exhibits and
Schedules thereto, contain the entire understanding of the parties with respect
to the subject matter hereof and supersede all prior agreements, understandings,
discussions and representations, oral or written, with respect to such matters,
which the parties acknowledge have been merged into such documents, exhibits and
schedules.

6.3. 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 facsimile (provided the sender receives
a machine-generated confirmation of successful transmission) at the facsimile
number specified in this Section prior to 6:30 p.m. (New York City time) on a
Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section on a day that is not a Trading Day or later than 6:30
p.m. (New York City time) on any Trading Day, (c) the 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
follows:

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    If to the Company: THT Heat Transfer Technology, Inc.   THT Industrial Park
 

No. 5 Nanhuan Road, Tiexi District 

  Siping, Jilin Province 136000   People’s Republic of China   Attn: Jianjun He,
Chief Financial Officer     With a copy to: Pillsbury Winthrop Shaw Pittman LLP
  2300 N Street, NW   Washington, D.C. 20037   Facsimile: (202) 663-8007  
Attn.: Joseph R. Tiano, Jr., Esq.       If to an Investor: To the address set
forth under such Investor’s name on the signature pages hereof;     With a copy
to: Winston & Strawn LLP    Suite 718, China World Office 1    1 Jianguomenwai
Avenue   Beijing, China 100004   Attn: Jem Li, Esq.

or such other address as may be designated in writing hereafter, in the same
manner, by such Person.

6.4. Amendments; Waivers; No Additional Consideration. No provision of this
Agreement may be waived or amended except in a written instrument signed by the
Company and the Investors purchasing a majority of the Shares issued and sold
pursuant hereto. 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. No consideration shall be offered or paid to any
Investor to amend or consent to a waiver or modification of any provision of any
Transaction Document unless the same consideration is also offered to all
Investors who then hold Shares.

6.5. Termination. This Agreement may be terminated prior to Closing:

(a) by written agreement of the Investors purchasing a majority of the Shares
and the Company;

(b) by the Company if any of the conditions set forth in Section 5.2 shall have
become incapable of fulfillment, and shall not have been waived by the Company;

27

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(c) by an Investor (with respect to itself only) if any of the conditions set
forth in Section 5.1 shall have become incapable of fulfillment, and shall not
have been waived by such Investor; or

(d) by either the Company or an Investor (with respect to itself only) upon
written notice to the other parties, if the Closing shall not have taken place
by 5:00 p.m. Eastern time on the Outside Date;

provided, however, that, except in the case of clause (a) above, the right to
terminate this Agreement under this Section 6.6(b) shall not be available to any
Person whose failure to comply with its obligations under this Agreement has
been the cause of or resulted in the failure of the Closing to occur on or
before such time.

In the event of a termination pursuant to this Section, the Company shall
promptly notify all nonterminating Investors. Upon a termination in accordance
with this Section 6.6, the Company and the terminating Investor(s) shall not
have any further obligation or liability (including as arising from such
termination) to the other and no Investor will have any liability to any other
Investor under the Transaction Documents as a result therefrom.

6.6. Construction. 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. This Agreement
shall be construed as if drafted jointly by the parties, and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Agreement or any of the Transaction
Documents.

6.7. 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 the Investors. Any Investor may assign any
or all of its rights under this Agreement to any Person to whom such Investor
assigns or transfers any Shares, provided such transferee agrees in writing to
be bound, with respect to the transferred Shares, by the provisions hereof that
apply to the “Investors.”

6.8. 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.

6.9. Governing Law and Waiver of Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement 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. Each party agrees that all Proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and
any other Transaction Documents (whether brought against a party hereto or its
respective Affiliates, employees or agents) shall be commenced exclusively in
the New York Courts. Each party hereto hereby irrevocably submits to the
exclusive jurisdiction of the New York Courts for the adjudication of any
dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein (including with respect to the enforcement of the any
of the Transaction Documents), and hereby irrevocably waives, and agrees not to
assert in any Proceeding, any claim that it is not personally subject to the
jurisdiction of any such New York Court, or that such Proceeding has been
commenced in an improper or inconvenient forum. Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such Proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. If either party shall commence
a Proceeding to enforce any provisions of a Transaction Document, then the
prevailing party in such Proceeding shall be reimbursed by the other party for
its reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such Proceeding.

28

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EACH PARTY HERETO HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE OTHER TRANSACTION
DOCUMENTS, THE SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF. THE SCOPE OF
THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY
BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN
FULLY DISCUSSED BY EACH OF THE PARTIES HERETO AND THESE PROVISIONS WILL NOT BE
SUBJECT TO ANY EXCEPTIONS. EACH PARTY HERETO HEREBY FURTHER WARRANTS AND
REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND
THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER WILL APPLY TO ANY
SUBSEQUENT AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS TO (OR ASSIGNMENTS OF) THIS
AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL (WITHOUT A JURY) BY THE COURT.

6.10. Survival. The representations, warranties, agreements and covenants
contained herein shall survive the Closing and the delivery of the Shares, until
the second anniversary of the date hereof.

6.11. 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 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 signature page
were an original thereof.

6.12. 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.

6.13. Rescission and Withdrawal Right. Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever any Investor 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 such Investor 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.

29

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6.14. Replacement of Shares. If any certificate or instrument evidencing any
Shares is mutilated, lost, stolen or destroyed, the Company shall issue or cause
to be issued in exchange and substitution for and upon cancellation thereof, or
in lieu of and substitution therefor, a new certificate or instrument, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction and customary and reasonable indemnity, if requested. The
applicants for a new certificate or instrument under such circumstances shall
also pay any reasonable third-party costs associated with the issuance of such
replacement Shares. If a replacement certificate or instrument evidencing any
Shares is requested due to a mutilation thereof, the Company may require
delivery of such mutilated certificate or instrument as a condition precedent to
any issuance of a replacement.

6.15. Remedies. In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, each of the Investors
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 obligations
described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate.

6.16. Independent Nature of Investors’ Obligations and Rights. The obligations
of each Investor under any Transaction Document are several and not joint with
the obligations of any other Investor, and no Investor shall be responsible in
any way for the performance of the obligations of any other Investor under any
Transaction Document. The decision of each Investor to purchase Shares pursuant
to the Transaction Documents has been made by such Investor independently of any
other Investor. Nothing contained herein or in any Transaction Document, and no
action taken by any Investor pursuant thereto, shall be deemed to constitute the
Investors as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Investors are in any way acting in
concert or as a group with respect to such obligations or the transactions
contemplated by the Transaction Documents. Each Investor acknowledges that no
other Investor has acted as agent for such Investor in connection with making
its investment hereunder and that no Investor will be acting as agent of such
Investor in connection with monitoring its investment in the Shares or enforcing
its rights under the Transaction Documents. Each Investor shall be entitled to
independently protect and enforce its rights, including without limitation the
rights arising out of this Agreement or out of the other Transaction Documents,
and it shall not be necessary for any other Investor to be joined as an
additional party in any proceeding for such purpose. The Company acknowledges
that each of the Investors has been provided with the same Transaction Documents
for the purpose of closing a transaction with multiple Investors and not because
it was required or requested to do so by any Investor.

6.17. Limitation of Liability. Notwithstanding anything herein to the contrary,
the Company acknowledges and agrees that the liability of an Investor arising
directly or indirectly, under any Transaction Document of any and every nature
whatsoever shall be satisfied solely out of the assets of such Investor, and
that no trustee, officer, other investment vehicle or any other Affiliate of
such Investor or any investor, shareholder or holder of shares of beneficial
interest of such a Investor shall be personally liable for any liabilities of
such Investor.

6.18. Further Assurances. The parties shall execute and deliver all such further
instruments and documents and take all such other actions as may reasonably be
required to carry out the transactions contemplated hereby and to evidence the
fulfillment of the agreements herein contained.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK SIGNATURE PAGES FOLLOW]

 

30

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

THT HEAT TRANSFER TECHNOLOGY, INC.   By: Name: Title:

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK SIGNATURE PAGES FOR INVESTORS
FOLLOW]

 

S-1

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

INVESTORS:     By: Name: Title: Purchase Price: Number of Shares: Tax ID No.:  
ADDRESS FOR NOTICE   c/o: Street: City/State/Zip: Attention: Tel: Fax:  
DELIVERY INSTRUCTIONS (if different from above)   c/o: Street: City/State/Zip:
Attention: Tel:

S-2

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    By: Name: Title: Purchase Price: Number of Shares: Tax ID No.:   ADDRESS FOR
NOTICE   c/o: Street: City/State/Zip: Attention: Tel: Fax:   DELIVERY
INSTRUCTIONS (if different from above)   c/o: Street: City/State/Zip: Attention:
Tel:

S-3

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Schedule I

SCHEDULE OF INVESTORS

Investor

Address and Facsimile Number Investment Amount Shares

Infinity I-China Fund (Cayman), L.P.

      2,333,968     729,365  

Infinity I-China Fund (Israel), L.P.

      1,191,246     372,265  

Infinity I-China Fund (Israel 2), L.P.

      1,018,078     318,149  

Infinity I-China Fund (Israel 3), L.P.

      456, 708     142,721  

Infinity I-China (Suzhou) L.P.

      3,000,000     937,500  

Infinity I-China (Changzhou) L.P.

      1,000,000     312,500  

MC Capital Asia Pacific Private Equity Fund

      3,200,000     1,000,000  

Zhejiang Jinqiao Hong Kong Limited

      1,000,000     312,500  

Chunyan Zhang

        500,000     156,250  

Haiyu Mao

        432,000     135,000  

ACG Investment Partners, Inc.

      116,000     36,250  

Naomichi Komuro

        1,600     500  

Shunichi Nawa

        1,600     500  

Total

        14,251,200     4,453,500  

Schedule I

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Schedule II

ACCREDITED INVESTOR CERTIFICATE

TO: THT HEAT TRANSFER TECHNOLOGY, INC.

In connection with the proposed purchase of the shares of Common Stock of THT
HEAT TRANSFER TECHNOLOGY, INC. (the “Company”), the undersigned represents and
warrants that the undersigned has read the following definition of a “U.S.
Accredited Investor” and certifies that the undersigned is a U.S. Accredited
Investor as indicated below (check one):

“U.S. Accredited Investor” shall mean any of (check one):

A bank, as defined in Section 3(a)(2) of the 1933 Act, or savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the 1933
Act, whether acting in its individual or fiduciary capacity;

[ ]

 

 

A broker or dealer registered pursuant to section 15 of the United States
Securities Exchange Act of 1934, as amended;

[ ]

 

 

An insurance company (as defined in Section 2(13) of the 1933 Act);

[ ]

 

 

An investment company registered under the United States Investment Company Act
of 1940, as amended (the “1940 Act”);

[ ]

 

 

A business development company (as defined in Section 2(a)(48) of the 1940 Act);

[ ]

 

 

A Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the United States Small Business
Investment Act of 1958, as amended;

[ ]

 

 

A plan established and maintained by a state, its political subdivisions, or any
agency or instrumentality of a state or its political subdivisions, for the
benefit of its employees, if such plan has total assets in excess of
U.S.$5,000,000;

[ ]

 

 

An employee benefit plan within the meaning of the United States Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), (1) whose
investment decision is made by a plan fiduciary as defined in Section 3(21) of
ERISA, which is either a bank, savings and loan association, insurance company
or registered investment advisor, or (2) having total assets in excess of
U.S.$5,000,000, or (3) if a self-directed plan, with investment decisions made
solely by persons that are accredited investors;

[ ]

 

 

A private business development company (as defined in Section 202(a)(22) of the
United States Investment Advisers Act of 1940);

[ ]

Schedule II

--------------------------------------------------------------------------------

I

An organization described in Section 501(c)(3) of the Internal Revenue Code of
1986 as amended, company, or similar business trust, or partnership, not formed
for the specific purpose of acquiring the securities offered, having total
assets in excess of U.S.$5,000,000;

[ ]

 

 

A director or executive officer of the Company;

[ ]

 

 

A natural person with individual net worth, or joint net worth with his or her
spouse, at the time of purchase in excess of U.S.$1,000,000;

[ ]

 

 

A natural person with an individual income in excess of U.S.$200,000 in each of
the last two years or joint income with his or her spouse in excess of
U.S.$300,000 in each of those years, and who reasonably expects to reach the
same income level in the current year;

[ ]

 

 

A trust, with total assets in excess of U.S.$5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase is directed
by a sophisticated person as described in section Rule 506 (b)(2)(ii) of the
1933 Act; and

[ ]

 

 

An entity in which all of the equity owners are U.S. Accredited Investors.

[ ]

TERMS NOT DEFINED HEREIN SHALL HAVE THE MEANINGS ASCRIBED TO THEM IN THE
SECURITIES PURCHASE AGREEMENT TO WHICH THIS SCHEDULE IS ATTACHED.

The foregoing representation, warranty and certificate are true and accurate as
of the date of this certificate.

Dated: _______________, 2010.   Print name of Purchaser (or person signing as
agent)   By: _____________________________________  

Signature

 

 _____________________________________

 

Title

 

 _____________________________________

(Please print name of individual whose signature appears above, if different
from name of Purchaser or agent printed above.)

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Exhibit A

Registration Rights Agreement

(See attached.)

 

 

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Exhibit B

Transfer Agent Instructions

(See attached.)

 

 

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Exhibit C

Legal Opinion of US Counsel

(See attached.)

 

 

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Exhibit D

Legal Opinion of Nevada Counsel

(See attached.)

 

 

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Exhibit E

Form of Closing Escrow Agreement

(See attached.)

 

 

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Exhibit F

Form of Make Good Escrow Agreement

(See attached.)

 

 

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Exhibit G

Form of Lock Up Agreement

(See attached.)

 

 

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