January
      2, 2008

     

    Benda
      Pharmaceutical, Inc.

    Sunny
      New
      World Tower, 25th Floor, Room 13

    231
      Xin
      Hua Road, Jianghan District

    Wuhan,
      Hubei Province, PRC 430015

     

    
      	Attention:	
              Wan
                Yi Qing

            


    

    
      	Title:	
              Chairman
                and Chief Executive Officer

            


    

    


    Dear
      Wan
      Yi Qing:

    


    We
      are
      pleased that Benda Pharmaceutical, Inc. (the “Company”) has selected CRT Capital
      Group LLC (“CRT”) to act as its lead financial advisor in connection with
      reviewing the Company’s strategic and capital market alternatives, including
      exploration of any merger or acquisition, joint venture, divestiture, spin-off,
      financing or other strategic or capital market transaction (each, a
“Transaction”) that the Company may choose to pursue. This letter (this
“Engagement Letter”) sets forth the terms of CRT’s financial advisory engagement
      (the “Engagement”).

    


    
      	
              1.

            	
              Engagement.
                The Company hereby engages CRT to act as its lead financial advisor
                with
                respect to the advisory services set forth in paragraph 2 below.
                The
                parties acknowledge that (i) there can be no assurance that a Transaction
                will be completed and (ii) this Engagement Letter is solely for the
                use of
                the parties hereto and may not be relied on by any third
                party.

            


    

    


    
      	
              2.

            	
              Advisory
                Services.
                CRT shall provide such financial advice and assistance as the Company
                may
                reasonably request in connection with a review and, if applicable,
                and
                subject to future further engagement of CRT by the Company to effect
                a
                specific Transaction, the implementation of its strategic and capital
                markets alternatives. Such services may include, among other things,
                the
                following:

            


    

     

    
      	 	
              (a)

            	
              investigating
                the business, properties, operations and prospects of the
                Company;

            


    

     

    
      	 	
              (b)

            	
              assisting
                the Company in identifying its strategic and financial
                alternatives;

            


    

     

    
      	 	
              (c)

            	
              assisting
                the Company in defining and implementing its strategic and financial
                objectives;

            


    

     

    
      	 	
              (d)

            	
              reviewing
                the Company’s strategic and capital market plans and identifying and
                evaluating potential Transactions to give effect
                thereto;

            


    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      Benda
        Pharmaceutical, Inc.

      January
        2, 2008

      Page
        2

    

     

    
      	 	
              (e)

            	
              creating
                such financial models, valuation analyses and other analytical tools,
                as
                well as such written summaries or presentation materials, as may
                be
                necessary in connection with any of the
                foregoing;

            


    

     

    
      	 	
              (f)

            	
              assisting
                the Company in analyzing, planning and, on a preliminary basis,
                structuring any proposed
                Transaction;

            


    

     

    
      	 	
              (g)

            	
              identifying
                potential investors in any
                Transaction;

            


    

     

    
      	 	
              (h)

            	
              identifying
                potential counterparties in any
                Transaction;

            


    

     

    
      	 	
              (i)

            	
              assisting
                the Company in enhancing its institutional profile with the investor
                community (e.g.,
                non-deal marketing and expanding the Company’s equity and scientific
                research coverage, etc.);

            


    

     

    
      	 	
              (j)

            	
              advising
                the Company of its capital markets alternatives for improving the
                trading
                dynamics for its common stock (e.g.,
                market making opportunities and potential future listings on securities
                exchanges); and

            


    

     

    
      	 	
              (k)

            	
              assisting
                the Company in establishing an investor relations office in New York,
                New
                York, to support the Company’s capital market
                initiatives.

            


    

    


    
      	
              3.

            	
              Retainer.
                As partial compensation for services to be rendered hereunder by
                CRT, the
                Company agrees to issue to CRT, upon signing of this Engagement Letter,
                a
                to be determined number of stock purchase warrants (collectively,
                the
                “Retainer Stock Purchase Warrants” and individually, a “Retainer Stock
                Purchase Warrant”) with a total economic value equal to $400,000 (the
                “Non-Cash Retainer Fee”). Each Retainer Stock Purchase Warrant shall be
                entitled to purchase one share of the Company’s common stock, expire five
                years from the date of issuance, have an exercise price equal to
                the
                closing share price on the date this Engagement Letter is executed
                and be
                exercisable at any time after issuance on a cashless basis. For purposes
                of determining the specific number of Retainer Stock Purchase Warrants
                to
                be issued in connection with the Non-Cash Retainer Fee, the value
                of a
                Retainer Stock Purchase Warrant shall be determined using Bloomberg’s
                warrant valuation model with an assumed volatility for the Company’s
                common stock equal to 30%. A print out of the Bloomberg warrant valuation
                model output valuing a Retainer Stock Purchase Warrant with the terms
                set
                forth in this Section 3 and using the closing price of the Company’s
                common stock on the date of this Engagement Letter and 30% volatility
                has
                been attached for purposes of determining the number of Retainer
                Stock
                Purchase Warrants to be issued.

            


    

    


    In
      the
      event that the Company raises any new capital or consummates any M&A
      transaction as described in Section 4 (a “Future Transaction”) resulting in a
      cash fee payable to CRT, CRT will credit $200,000 of economic value (which
      represents fifty percent of the economic value of the Non-Cash Retainer Fee)
      against any such cash fee for a Future Transaction.

     

    
      	
              4.

            	
              Engagement
                for Future Transactions.
                During the term of the Engagement and for a period of 12 months following
                the termination of this Engagement Letter, if the Company proposes
                to
                raise any new capital (as defined below) or engage in any M&A
                transaction (as defined below), then the Company shall give CRT notice
                of
                its intention to engage in such Transaction and an irrevocable,
                preferential right of first refusal to act as the Company’s lead managing
                underwriter, lead placement agent or lead financial advisor, as the
                case
                may be, and agree to negotiate an engagement pursuant thereto and
                as
                further specified below:

            


    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

      Benda
        Pharmaceutical, Inc.

      January
        2, 2008

      Page
        3

    

     

    
      	 	
              (a)

            	
              Capital
                Raises.
                If the Company raises new capital in debt (including without limitation
                equity-linked debt) or equity securities (in any case, the “Securities”),
                it is contemplated that, in connection with any Transaction, the
                Company
                and CRT, as lead managing underwriter or lead placement agent, will
                enter
                into an underwriting or placement agent agreement (in either case,
                the
                “Underwriting Agreement”) in form and in substance satisfactory to CRT,
                the Company and their respective counsel. The precise amount, terms
                and
                rights of the Securities will be determined after discussion between
                the
                Company and CRT immediately prior to any
                offering.

            


    

    


    CRT’s
      compensation for capital raising transactions will be as follows:

    


    
      	 	
              i.

            	
              In
                the case where the Company raises non-equity linked debt securities,
                the
                Underwriting Agreement will provide, among other things, that CRT
                will
                purchase the debt from the Company at a 5% discount from the stated
                aggregate principal amount of the debt securities, provided that
                in the
                event the offering of debt securities takes the form of a placement
                in
                lieu of an underwriting, CRT shall be paid a placement fee in cash
                upon
                consummation of the offering in an amount equal to 5% of the aggregate
                principal amount of debt securities sold in the
                offering.

            


    

    


    
      	 	
              ii.

            	
              In
                the case where the Company raises equity or equity-linked securities,
                the
                Underwriting Agreement will provide, among other things, that CRT
                will
                purchase the equity or equity-linked securities from the Company
                at a 6%
                discount to the aggregate gross proceeds of the equity or equity-linked
                securities sold in the offering, provided that in the event the offering
                of equity or equity-linked securities takes the form of a placement
                in
                lieu of an underwriting, CRT shall be paid a placement fee in cash
                equal
                to 6% of the aggregate gross proceeds of the equity or equity-linked
                securities sold in the offering and, in both the case of an underwriting
                or a placement, will also be issued by the Company stock purchase
                warrants
                (in either case, the “Underwriter Stock Purchase Warrants”) to purchase
                shares of the Company’s common stock representing 8% of the number of
                shares underlying the equity and equity-linked securities sold in
                the
                offering. 

            


    

    


    The
      Underwriter Stock Purchase Warrants will have a term of five years and an
      exercise price equal to the lowest price paid by investors in the equity or
      equity-linked offering. The Underwriter Stock Purchase Warrants shall, among
      other things: (i) be transferable to any affiliate, including officers and
      directors, of CRT, (ii) permit exercise on a cashless basis, (iii) grant CRT
      registration rights equal to those granted to investors in the equity or
      equity-linked offering, and (iv) contain such other terms, including
      anti-dilution provisions, as are customarily included in warrants of similar
      type.


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      Benda
        Pharmaceutical, Inc.

      January
        2, 2008

      Page
        4

    

     

    
      	 	
              (b)

            	
              M&A
                Transactions.
                If the Company engages in any M&A transaction (including without
                limitation acquisition of assets or capital stock of another company,
                merger, divestiture or spin-off), it is contemplated that, in connection
                with any Transaction, the Company and CRT, as lead financial advisor,
                will
                enter into an advisory agreement (“Advisory Agreement”) specific to such
                transaction in form and in substance satisfactory to CRT, the Company
                and
                their respective counsel. The Advisory Agreement will provide, among
                other
                things, for an advisory success fee in an amount to be mutually agreed
                for
                each transaction, such advisory success fee to be negotiated pursuant
                to
                provisions for customary fees for transactions of similar size and
                nature
                for CRT and the investment banking
                industry.

            


    

    


    
      	
              5.

            	
              Finders’
                Fee.
                The Company represents that there are no third party claims for services
                in the nature of a finder’s fee with respect to a
                Transaction.

            


    

    


    
      	
              6.

            	
              Expenses.
                The Company will bear all of its expenses in connection with the
                services
                to be provided under this Engagement Letter, including without limitation
                counsel and accounting fees and roadshow expenses, if any. In addition,
                the Company shall promptly, upon request therefore, reimburse CRT
                for all
                reasonable expenses (including without limitation fees and expenses
                of
                counsel, CRT BioMed LLC, any experts or consultants engaged by CRT
                in
                connection with performing its obligations hereunder and all travel,
                lodging, meals, mailing, telephone, due diligence and all other
                out-of-pocket expenses) incurred by CRT in connection with CRT’s
                engagement hereunder. 

            


    

    


    
      	
              7.

            	
              Due
                Diligence.
                The Company will make available to CRT and its counsel all material
                information regarding the Company and its officers, directors and
                stockholders.

            


    

    


    
      	
              8.

            	
              Termination.
                Each of the Company and CRT may terminate this Engagement Letter
                upon five
                business days written notice to the other party at any time after
                the
                earlier or i) a Future Transaction or ii) July 2, 2008 (the “Termination
                Date”); provided that the Company shall pay to CRT all fees earned
                pursuant to this Engagement Letter through the Termination Date.
                In the
                event that the Company consummates a Transaction substantially similar
                to
                Transactions discussed with CRT herein within 12 months of the Termination
                Date, the Company will pay CRT the compensation with respect to any
                such
                Transaction provided in paragraphs 3 and 4 above (unless CRT terminates
                this Engagement Letter prior thereto, in which event no such compensation
                shall be payable to CRT). The Company's obligations with respect
                to all
                fees and expenses due and payable to CRT pursuant to the terms set
                forth
                herein shall survive any termination of CRT's engagement
                hereunder.

            


    

    


    
      	
              9.

            	
              Indemnification.
                The Company shall indemnify CRT pursuant to the terms and conditions
                set
                forth in Addendum I, which is hereby incorporated by
                reference.

            


    

    


    
      	
              10.

            	
              Governing
                Law; Jurisdiction; Amendment; Headings.
                This Engagement Letter shall be governed by and construed in accordance
                with the laws of the State of New York applicable to agreements made
                and
                to be fully performed therein, without regard to conflicts of law
                principles. Each party hereby consents to submit to the jurisdiction
                of
                the courts of the United States of America located in the Southern
                District of New York. This Engagement Letter may not be modified
                or
                amended except in a writing duly executed by the parties hereto.
                The
                section headings in this Engagement Letter have been inserted as
                a matter
                of convenience of reference and are not part of this Engagement
                Letter.

            


    


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Benda
      Pharmaceutical, Inc.

    January
      2, 2008

    Page
      5

     

    
      	
              11.

            	
              Counterparts.
                For the convenience of the parties, this Engagement Letter may be
                executed
                in any number of counterparts, each of which shall be, and shall
                be deemed
                to be, an original instrument, but all of which taken together shall
                constitute one and the same Engagement
                Letter.

            


    

    


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      remainder of this page intentionally left blank]

    



    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    If
      the
      foregoing correctly sets forth our understanding, please sign this Engagement
      Letter and return it to CRT.

    


    Very
      truly yours, 

    


    
      	
              CRT
                CAPITAL GROUP LLC

            	 
	 	 	 
	 	 	 
	 	 	 
	
              By:

            	
              /s/
                George Bickerstaff

            	 
	
              Name:

            	
              George
                Bickerstaff

            	 
	
              Title:

            	
              Managing
                Director

            	 


    

     

     

    Accepted
      and agreed as of the first date written above:

    


    
      	
              BENDA
                PHARMACEUTICAL, INC.

            	 
	 	 	 
	 	 	 
	 	 	 
	
              By:

            	
              /s/
                Yiqing Wan

            	 
	
              Name:

            	
              Yiqing
                Wan

            	 
	
              Title:

            	
              President

            	 


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    ADDENDUM
      I

     

    This
      Addendum I is attached to and incorporated by reference into the foregoing
      engagement letter (the “Engagement Letter”). Capitalized terms used herein and
      not otherwise defined herein shall have the meanings assigned to such terms
      in
      the Engagement Letter. 

     

    The
      Company hereby agrees to indemnify and hold harmless CRT and its affiliates,
      and
      the respective directors, officers, partners, members, controlling persons
      (within the meaning of Section 15 of the Securities Act of 1933, as amended,
      or
      Section 20 of the Securities Exchange Act of 1934, as amended), agents, counsel
      and employees of CRT or any of its affiliates (CRT and each such other person
      or
      entity being referred to individually as an “Indemnified Person” and,
      collectively, as “Indemnified Persons”), to the full extent lawful, from and
      against any and all claims, liabilities, losses, damages, penalties, judgments,
      awards and expenses incurred by any Indemnified Person (including fees and
      disbursements of counsel) which (A) relate to or arise out of (i) actions taken
      or omitted to be taken (including any untrue statements made or alleged to
      have
      been made or any statements omitted or alleged to have been omitted, whether
      in
      connection with any information or materials prepared by or for the Company
      or
      CRT or any other oral or written statements) by the Company, its affiliates,
      directors, employees or agents, or (ii) actions taken or omitted to be taken
      by
      an Indemnified Person with the Company's consent or in conformity with its
      instructions or its actions or omissions, or (B) otherwise relate to or arise
      out of CRT's activities on the Company's behalf in connection with the
      Engagement Letter (collectively, “Damages”). In addition, the Company will
      reimburse CRT and any other Indemnified Person for all costs and expenses,
      including counsel fees and disbursements, as they are incurred, in connection
      with investigating, preparing and defending any action, formal or informal
      claim, investigation, inquiry or other proceeding (collectively, “Action”),
      whether or not in connection with pending or threatened litigation, caused
      by or
      arising out of or in connection with CRT acting pursuant to the Engagement
      Letter, whether or not CRT or any Indemnified Person is named as a party thereto
      and whether or not any liability results therefrom; provided the Company shall
      have the right to review and comment upon such Indemnified Person’s selection
      and retention of counsel. The Company will not, however, be responsible for
      any
      Damages pursuant to clause (B) above which are finally judicially determined
      by
      a court of competent jurisdiction (not subject to further review) to have
      resulted primarily from CRT's willful misconduct or gross negligence. The
      Company also agrees that neither CRT nor any other Indemnified Person shall
      have
      any liability to the Company for or in connection with such engagement except
      for any such liability for Damages incurred by the Company which are finally
      judicially determined by a court of competent jurisdiction (not subject to
      further review) to have resulted primarily from CRT's willful misconduct or
      gross negligence.

    


    The
      Company will not, without CRT's prior written consent, settle, compromise,
      consent to the entry of any judgment in or otherwise seek to terminate any
      Action in respect of which indemnification may be sought hereunder (whether
      or
      not any Indemnified Person is a party thereto) unless such settlement,
      compromise, consent or termination includes an unconditional release of each
      Indemnified Person from all Damages arising out of such Action.


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    In
      order
      to provide for just and equitable contribution, if a claim for indemnification
      is made pursuant to these provisions, but it is found in a final judgment by
      a
      court of competent jurisdiction (not subject to further appeal) that such
      indemnification is not available for any reason even though the express
      provisions hereof provide for indemnification in such case, then the Company,
      on
      the one hand, and CRT on the other hand, shall contribute to such Damages for
      which such indemnification or reimbursement is held unavailable in such
      proportion as is appropriate to reflect the relative benefits to the Company
      and
      its shareholders and creditors, on the one hand, and CRT on the other hand,
      in
      connection with the actions contemplated by the engagement, subject to the
      limitation that in any event the aggregate contribution of CRT and all
      Indemnified Persons to all Damages to which contribution is available hereunder
      shall not exceed the
      amount of fees actually
      received by CRT pursuant to the Engagement Letter. For the purposes of this
      agreement, the relative benefits to the Company and its shareholders and
      creditors, on the one hand, and CRT, on the other hand, of the Engagement shall
      be deemed to be in the same proportion as (a) the total value paid or
      contemplated to be paid or received or retained or contemplated to be received
      or retained by the Company and its shareholders and creditors in the transaction
      or transactions that are the subject of the Engagement, whether or not any
      such
      transaction is consummated, bears to (b) the fees paid or contemplated to be
      paid to CRT under the Engagement Letter.

    


    The
      foregoing right to indemnity and contribution shall be in addition to any rights
      that CRT or any other Indemnified Person may have at common law or otherwise
      and
      shall remain in full force and effect following the completion or any
      termination of CRT's engagement and shall be binding on and inure to the benefit
      of the successors, assigns, heirs and personal representatives of the Company
      and CRT and any other Indemnified Party.