SECURITIES
PURCHASE AGREEMENT

     

    Dated
as of March  13, 2009

     

    among

     

    FREZER,
INC.

     

    and

     

    THE
PURCHASERS LISTED ON EXHIBIT A

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Table of
Contents

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  
                                                                                    
                                                                                      
                                                                                        
                                                                                          
                                                                                            
                                                                                              
                                                                                                
                                                                                                  
                                                                                                    
                                                                                                      
                                                                                                        
                                                                                                          
                                                                                                            
                                                                                                              	 
      	 
      	
                                                                                                                      Page

                                                                                                                    
	 	 	 
	
                                                                                                                      ARTICLE
      I

                                                                                                                    	
                                                                                                                      Purchase
      and Sale of Securities

                                                                                                                    	
                                                                                                                      1

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      1.1

                                                                                                                    	
                                                                                                                      Purchase
      and Sale of Securities

                                                                                                                    	
                                                                                                                      1

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      1.2

                                                                                                                    	
                                                                                                                      Conversion
      Shares

                                                                                                                    	
                                                                                                                      2

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      1.3

                                                                                                                    	
                                                                                                                      Purchase
      Price and Closing

                                                                                                                    	
                                                                                                                      2

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      1.4

                                                                                                                    	
                                                                                                                      Share
      Exchange Transaction

                                                                                                                    	
                                                                                                                      2

                                                                                                                    
	 	 	 
	
                                                                                                                      ARTICLE
      II

                                                                                                                    	
                                                                                                                      Representations
      and Warranties

                                                                                                                    	
                                                                                                                      2

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      2.1

                                                                                                                    	
                                                                                                                      Representations
      and Warranties of the Company

                                                                                                                    	
                                                                                                                      2

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      2.2

                                                                                                                    	
                                                                                                                      Representations
      and Warranties of the Purchasers

                                                                                                                    	
                                                                                                                      12

                                                                                                                    
	 	 	 
	
                                                                                                                      ARTICLE
      III

                                                                                                                    	
                                                                                                                      Covenants

                                                                                                                    	
                                                                                                                      15

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.1

                                                                                                                    	
                                                                                                                      Securities
      Compliance

                                                                                                                    	
                                                                                                                      15

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.2

                                                                                                                    	
                                                                                                                      Registration
      and Listing

                                                                                                                    	
                                                                                                                      15

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.3

                                                                                                                    	
                                                                                                                      Compliance
      with Laws

                                                                                                                    	
                                                                                                                      15

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.4

                                                                                                                    	
                                                                                                                      Keeping
      of Records and Books of Account

                                                                                                                    	
                                                                                                                      15

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.5

                                                                                                                    	
                                                                                                                      Amendments

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.6

                                                                                                                    	
                                                                                                                      Other
      Agreements

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.7

                                                                                                                    	
                                                                                                                      Distributions

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.8

                                                                                                                    	
                                                                                                                      Use
      of Proceeds

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.9

                                                                                                                    	
                                                                                                                      Reservation
      of Shares

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.10

                                                                                                                    	
                                                                                                                      Disposition
      of Assets

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.11

                                                                                                                    	
                                                                                                                      Reporting
      Status

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.12

                                                                                                                    	
                                                                                                                      Disclosure
      of Material Information

                                                                                                                    	
                                                                                                                      16

                                                                                                                    
	 	 	 
	
                                                                                                                      Section
      3.13

                                                                                                                    	
                                                                                                                      No
      Commissions in connection with Conversion of Notes

                                                                                                                    	
                                                                                                                      17

                                                                                                                    
	 
      	 
      	 
      
	
                                                                                                                      Section
      3.14

                                                                                                                    	
                                                                                                                      Reverse
      Stock Split

                                                                                                                    	
                                                                                                                      17

                                                                                                                    


                                                                                                            

                                                                                                          

                                                                                                        

                                                                                                      

                                                                                                    

                                                                                                  

                                                                                                

                                                                                              

                                                                                            

                                                                                          

                                                                                        

                                                                                      

                                                                                    

                                                                                  

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
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    Table of
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                                                                                                                            ARTICLE
      IV

                                                                                                                          	
                                                                                                                            CONDITIONS

                                                                                                                          	
                                                                                                                            17

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      4.1

                                                                                                                          	
                                                                                                                            Conditions
      Precedent to the Obligation of the Company to Sell the
    Units

                                                                                                                          	
                                                                                                                            17

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      4.2

                                                                                                                          	
                                                                                                                            Conditions
      Precedent to the Obligation of the Purchasers to Purchase the
      Units

                                                                                                                          	
                                                                                                                            18

                                                                                                                          
	 	 	 
	
                                                                                                                            ARTICLE
      V

                                                                                                                          	
                                                                                                                            Legend

                                                                                                                          	
                                                                                                                            19

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      5.1

                                                                                                                          	
                                                                                                                            Legend

                                                                                                                          	
                                                                                                                            19

                                                                                                                          
	 	 	 
	
                                                                                                                            ARTICLE
      VI

                                                                                                                          	
                                                                                                                            Indemnification

                                                                                                                          	
                                                                                                                            21

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      6.1

                                                                                                                          	
                                                                                                                            General
      Indemnity

                                                                                                                          	
                                                                                                                            21

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      6.2

                                                                                                                          	
                                                                                                                            Indemnification
      Procedure

                                                                                                                          	
                                                                                                                            21

                                                                                                                          
	 	 	 
	
                                                                                                                            ARTICLE
      VII

                                                                                                                          	
                                                                                                                            Miscellaneous

                                                                                                                          	
                                                                                                                            22

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.1

                                                                                                                          	
                                                                                                                            Fees
      and Expenses

                                                                                                                          	
                                                                                                                            22

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.2

                                                                                                                          	
                                                                                                                            Capital
      Contribution

                                                                                                                          	
                                                                                                                            22

                                                                                                                          
	 
      	 
      	 
      
	
                                                                                                                            Section
      7.4

                                                                                                                          	
                                                                                                                            Specific
      Enforcement, Consent to Jurisdiction

                                                                                                                          	
                                                                                                                            23

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.5

                                                                                                                          	
                                                                                                                            Entire
      Agreement; Amendment

                                                                                                                          	
                                                                                                                            23

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.6

                                                                                                                          	
                                                                                                                            Notices

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.7

                                                                                                                          	
                                                                                                                            Waivers

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.8

                                                                                                                          	
                                                                                                                            Headings

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.9

                                                                                                                          	
                                                                                                                            Successors
      and Assigns

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.10

                                                                                                                          	
                                                                                                                            No
      Third Party Beneficiaries

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.11

                                                                                                                          	
                                                                                                                            Governing
      Law

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.12

                                                                                                                          	
                                                                                                                            Survival

                                                                                                                          	
                                                                                                                            24

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.13

                                                                                                                          	
                                                                                                                            Counterparts

                                                                                                                          	
                                                                                                                            25

                                                                                                                          
	 	 	 
	
                                                                                                                            Section
      7.14

                                                                                                                          	
                                                                                                                            Publicity

                                                                                                                          	
                                                                                                                            25

                                                                                                                          


                                                                                                                  

                                                                                                                

                                                                                                              

                                                                                                            

                                                                                                          

                                                                                                        

                                                                                                      

                                                                                                    

                                                                                                  

                                                                                                

                                                                                              

                                                                                            

                                                                                          

                                                                                        

                                                                                      

                                                                                    

                                                                                  

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
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    Table of Contents

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              	
                                                                    	 
      	
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                                                                      Section
      7.15

                                                                    	
                                                                      Severability

                                                                    	
                                                                      25

                                                                    
	 	 	 
	
                                                                      Section
      7.16

                                                                    	
                                                                      Further
      Assurances

                                                                    	
                                                                      25

                                                                    


                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
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    SECURITIES
PURCHASE AGREEMENT

     

    This
SECURITIES PURCHASE AGREEMENT (the “Agreement”) is dated
as of March 13, 2009 by and among Frezer, Inc, a Nevada corporation (the “Company”), and each
of the Purchasers of Units whose names are set forth on Exhibit A hereto
(individually, a “Purchaser” and
collectively, the “Purchasers”).

     

    The
parties hereto agree as follows:

     

    ARTICLE
I

     

    Purchase
and Sale of Securities

     

    Section
1.1     Purchase and Sale of
Securities.  Upon the following terms and conditions, the
Company shall issue and sell to the Purchasers and each of the Purchasers shall
purchase from the Company, Units (the “Units”), each Unit
consisting of a convertible secured promissory note in the principal amount of
$10,000  (the “Notes”), convertible
into shares of the Company’s common stock, par value $0.001 per share (the
“Common Stock”)
at the initial rate of one share of Common Stock for each $0.1597 in principal
amount without any interest on the Note converted, and a warrant (the “Warrants”) to
purchase 14,401 shares of Common Stock at an exercise price of $0.1916 per
share, such number of shares and exercise price being subject to adjustment in
certain circumstances to protect the holder from dilution. The Notes shall be in
the form of Exhibit
A attached hereto and the Warrants shall be in the form of Exhibit B attached
hereto. The outstanding principal amount of the Notes shall bear interest at the
rate of 15% per annum. All principal with or without accrued interest on the
Notes shall be due and payable on the first anniversary of the issuance of the
Notes. The number of shares of Common Stock initially issuable upon exercise of
all of the Warrants shall be equal to 23% of the total number of shares of
Common Stock issuable upon conversion of the original principal amount of all of
the Notes which are issued. The Warrants shall expire on the date which is the
earlier of (a) five (5) years following the Closing Date (as hereinafter
defined) and (b) thirty (30) days after delivery of audited financial statements
of the Company for certain fiscal year that shows that the consolidated net
income of the Company and its subsidiaries exceeded $20 million for such fiscal
year and consolidated net income of the Company and its subsidiaries per share
on a fully diluted basis exceeded $.26 per share, which amount shall be subject
to adjustment for the issuance of additional shares of the
Company.  The number of Units and the aggregate purchase price of such
Units being purchased by each Purchaser are set forth opposite such Purchaser’s
name on Exhibit
C hereto. The Company and the Purchasers are executing and delivering
this Agreement in accordance with and in reliance upon the exemption from
securities registration afforded by Rule 506 of Regulation D (“Regulation D”) as
promulgated by the United States Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended (the “Securities Act”) or
Section 4(2) of the Securities Act.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    Section
1.2     Conversion
Shares.  The Company has authorized and has reserved and
covenants to continue to reserve, free of preemptive rights and other similar
contractual rights of stockholders, a number of shares of Common Stock equal to
the number of shares of Common Stock as shall from time to time be sufficient to
effect the conversion of all of the Notes and exercise of all of the Warrants
then outstanding. Any shares of Common Stock issuable upon conversion of the
Notes and exercise of the Warrants (and such shares when issued) are herein
referred to as the “Conversion Shares”
and the “Warrant
Shares”, respectively. The Notes, the Conversion Shares and the Warrant
Shares are sometimes collectively referred to as the “Securities”.

     

    Section
1.3     Purchase Price and
Closing.  Subject to the terms and conditions hereof, the
Company agrees to issue and sell to the Purchasers and, in consideration of and
in express reliance upon the representations, warranties, covenants, terms and
conditions of this Agreement, the Purchasers, severally but not jointly, agree
to purchase the Units for an aggregate purchase price of $500,000, or $10,000
per Unit (the “Purchase Price”). The
closing of the purchase and sale of the Units to be acquired by the Purchasers
from the Company under this Agreement shall take place at the offices of Guzov
Ofsink, LLC, 600 Madison Avenue, 14th Floor,
New York, New York 10022 (the “Closing”) at 10:00
a.m., New York time on such date as the Purchasers and the Company may agree
upon; provided,
that all of the conditions set forth in Article IV hereof and applicable to the
Closing shall have been fulfilled or waived in accordance herewith (the “Closing Date”).
Subject to the terms and conditions of this Agreement, at the Closing the
Company shall deliver or cause to be delivered to each Purchaser (i) a Note in
the principal amount set forth opposite the name of such Purchaser on Exhibit C
hereto, (ii) a Warrant to purchase the number of shares of Common Stock as is
set forth opposite the name of such Purchaser on Exhibit C attached hereto, and
(iii) any other documents required to be delivered pursuant to Article IV
hereof. At the Closing, each Purchaser shall deliver its Purchase Price by wire
transfer to the Company’s designated account.

     

    Section
1.4     Share Exchange
Transaction.  The parties acknowledge that immediately prior to
the consummation of the transaction contemplated by this Agreement, the Company
will issue shares of its Common Stock to BEFUT International Co., Limited, a
company incorporated in the British Virgin Islands (“BVI Co”), pursuant to that
certain Exchange Agreement dated as of the date hereof by and among the Company
and BVI Co (the “Reverse Merger”). Upon the consummation of the Reverse Merger,
Hongkong BEFUT Co., Limited, a company incorporated in Hong Kong (“Hongkong
Befut”), will become an indirect wholly-owned subsidiary of the Company which
owns Befut Electric (Dalian) Co., Ltd. (“WFOE”), a company incorporated under
the laws of the People’s Republic of China (the “PRC”). The parties further
acknowledge that WFOE has entered into a series of agreements that establishes
an exclusive business relationship with Dalian Befut Wire & Cable
Manufacturing Co., Ltd. (“Dalian Befut”), a company incorporated under the laws
of the PRC.

     

    ARTICLE
II

     

    Representations
and Warranties

     

    Section
2.1    Representations and
Warranties of the Company.  The Company hereby represents and
warrants to the Purchasers, as of the date hereof and the Closing Date (except
as set forth on the Schedule of Exceptions attached hereto with each numbered
Schedule corresponding to the section number herein), as follows:

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    (a)     Organization, Good Standing
and Power. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Nevada and has the
requisite corporate power to own, lease and operate its properties and assets
and to conduct its business as it is now being conducted. The Company is duly
qualified as a foreign corporation to do business and is in good standing in
every jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary except for any jurisdiction(s)
(alone or in the aggregate) in which the failure to be so qualified will not
have a Material Adverse Effect (as defined in Section 2.1(c) hereof) on the
Company’s financial condition.

     

    (b)     Authorization;
Enforcement. The Company has the requisite corporate power and authority
to enter into and perform this Agreement, the Notes and the Warrants
(collectively, the “Transaction
Documents”) and to issue and sell the Units, the Notes, the Warrants, the
Conversion Shares, and the Warrant Shares in accordance with the terms hereof.
The execution, delivery and performance of the Transaction Documents by the
Company and the consummation by it of the transactions contemplated hereby and
thereby have been duly and validly authorized by all necessary corporate action,
and no further consent or authorization of the Company or its Board of Directors
or stockholders is required. This Agreement has been duly executed and delivered
by the Company. The other Transaction Documents will be duly executed and
delivered by the Company at or prior to the Closing. Each of the Transaction
Documents constitutes, or shall constitute when executed and delivered, a 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,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditor’s rights and remedies or by other
equitable principles of general application.

     

    (c)     Capitalization. The
authorized capital stock of the Company as of the date hereof is set forth on
Schedule 2.1(c)
hereto. All of the outstanding shares of the Common Stock have been duly and
validly authorized. Except as contemplated by the Transaction Documents or as
set forth on Schedule
2.1(c) hereto, no shares of Common Stock are entitled to preemptive
rights or registration rights and there are no outstanding options, warrants,
scrip, rights to subscribe to, call or commitments of any character whatsoever
relating to, or securities or rights convertible into, any shares of capital
stock of the Company. Except as contemplated by the Transaction Documents, there
are no contracts, commitments, understandings, or arrangements by which the
Company is or may become bound to issue additional shares of the capital stock
of the Company or options, securities or rights convertible into shares of
capital stock of the Company. Except as contemplated by the Transaction
Documents or as set forth on Schedule 2.1(c)
hereto, the Company is not a party to any agreement granting registration or
anti-dilution rights to any person with respect to any of its equity or debt
securities. The Company is not a party to, and it has no knowledge of, any
agreement restricting the voting or transfer of any shares of the capital stock
of the Company. The offer and sale of all capital stock, convertible securities,
rights, warrants, or options of the Company issued prior to the Closing complied
with all applicable United States Federal and state securities laws, and no
stockholder has a right of rescission or claim for damages with respect thereto
which would have a Material Adverse Effect (as defined below). The Company has
furnished or made available to the Purchasers true and correct copies of the
Company’s Articles of Incorporation as in effect on the date hereof (the “Articles”), and the
Company’s Bylaws as in effect on the date hereof (the “Bylaws”). For the
purposes of this Agreement, “Material Adverse
Effect” means any material adverse effect on the business, operations,
properties, or financial condition of the Company, its subsidiaries and Dalian
Befut and/or any condition, circumstance, or situation that would prohibit or
otherwise materially interfere with the ability of the Company to perform any of
its obligations under this Agreement in any material respect.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (d)     Issuance of Shares.
The Units, the Notes and the Warrants to be issued at the Closing have been duly
authorized by all necessary corporate action. When the Conversion Shares and the
Warrant Shares are issued in accordance with the terms of the Notes and the
Warrants, respectively, such shares will be duly authorized by all necessary
corporate action and validly issued and outstanding, fully paid and
nonassessable, and the holders shall be entitled to all rights accorded to a
holder of Common Stock.

     

    (e)     No Conflicts. The
execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated herein and
therein do not and will not (i) violate any provision of the Company’s Articles
or By-laws, (ii) conflict with, or constitute a default (or an event which 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 of, any
agreement, mortgage, deed of trust, indenture, note, bond, license, lease
agreement, instrument or obligation to which the Company is a party or by which
it or its properties or assets are bound, (iii) create or impose a lien,
mortgage, security interest, charge or encumbrance of any nature on any property
of the Company under any agreement or any commitment to which the Company is a
party or by which the Company is bound or by which any of its respective
properties or assets are bound, or (iv) result in a violation of any Federal,
state, local or foreign statute, rule, regulation, order, judgment or decree
(including Federal and state securities laws and regulations) applicable to the
Company or any of its subsidiaries or by which any property or asset of the
Company or any of its subsidiaries are bound or affected, except, in all cases
other than violations pursuant to clauses (i) and (iv) above, for such
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect.  The business of the Company, its subsidiaries and
Dalian Befut is not being conducted in violation of any laws, ordinances or
regulations of any governmental entity, except for possible violations which
singularly or in the aggregate do not and will not have a Material Adverse
Effect.  The Company is not required under Federal, state or local
law, rule or regulation to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency in order
for it to execute, deliver or perform any of its obligations under the
Transaction Documents, or issue and sell the Notes, the Warrants, the Conversion
Shares and the Warrant Shares in accordance with the terms hereof or thereof
(other than (x) any consent, authorization or order that has been obtained as of
the date hereof, (y) any filing or registration that has been made as of the
date hereof or (z) any filings which may be required to be made by the Company
with the Commission or state securities administrators subsequent to the
Closing; provided, that, for
purposes of the representation made in this sentence, the Company is assuming
and relying upon the accuracy of the relevant representations and agreements of
the Purchasers herein.

     

    
      
        
        

      

      
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    (f)      Commission Documents,
Financial Statements. The Company is currently subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The
Company has not provided to the Purchasers any material non-public information
or other information which, according to applicable law, rule or regulation, was
required to have been disclosed publicly by the Company, but which has not been
so disclosed, other than with respect to the transactions contemplated by this
Agreement. The Dalian Befut Financial Statements (as defined in Section 4.2(o)
hereof) comply in all material respects with United States General Accepted
Accounting Principles.

     

    (g)     Subsidiaries. Schedule 2.1(g),
which shall be delivered to the Purchasers and attached hereto on the Closing
Date hereto shall sets forth each subsidiary of the Company, as of the Closing
Date and show the jurisdiction of its incorporation or organization and showing
the percentage of each person’s ownership. For the purposes of this Agreement,
“subsidiary”
shall mean any corporation or other entity of which at least a majority of the
securities or other ownership interest having ordinary voting power (absolutely
or contingently) for the election of directors or other persons performing
similar functions are at the time owned directly or indirectly by the Company
and/or any of its other subsidiaries. As of the Closing Date, all of the
outstanding shares of capital stock of each subsidiary will have been duly
authorized and validly issued, and will be fully paid and nonassessable. Other
than as contemplated by the Transaction Documents, as of the Closing Date there
will be no outstanding preemptive, conversion or other rights, options, warrants
or agreements granted or issued by or binding upon any subsidiary for the
purchase or acquisition of any shares of capital stock of such subsidiary or any
other securities convertible into, exchangeable for or evidencing the rights to
subscribe for any shares of such capital stock. Other than as contemplated by
the Transaction Documents, the Company is not presently subject to, and as of
the Closing Date, neither the Company nor any subsidiary of the Company, will be
subject to, any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any shares of the capital stock of any subsidiary or any
convertible securities, rights, warrants or options of the type described in the
preceding sentence. The Company has no knowledge of any agreement restricting
the voting or transfer of any shares of the capital stock of the Company or any
subsidiary. For the purposes of this Agreement, “Group Companies”
means the Company, its subsidiaries, Dalian Befut and its
subsidiary.

     

    (h)     No Undisclosed
Liabilities. Group Companies do not have any liabilities, obligations,
claims or losses (whether liquidated or unliquidated, secured or unsecured,
absolute, accrued, contingent or otherwise) other than those incurred in their
ordinary course of business .

     

    (i)      No Undisclosed Events or
Circumstances. To the Company’s knowledge, no event or circumstance has
occurred or exists with respect to Group Companies or their respective
businesses, properties, prospects, 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.

     

    (j)      Indebtedness. Schedule 2.1(k) sets
forth all outstanding secured and unsecured Indebtedness of Group Companies, or
for which Group Companies have commitments. For the purposes of this Agreement,
“Indebtedness”
shall mean (a) any liabilities for borrowed money or amounts owed in excess of
$50,000 (other than trade accounts payable incurred in the ordinary course of
business), (b) all guaranties, endorsements and other contingent obligations in
respect of Indebtedness of others, whether or not the same are or should be
reflected in the Company’s balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business; and (c) the present
value of any lease payments in excess of $25,000 due under leases required to be
capitalized in accordance with GAAP. Except as set forth in Schedule 2.1(k), none
of the Group Companies is in default with respect to any
Indebtedness.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    (k)     Title to Assets. Each
of the Group Companies has good and marketable title to all of its real and
personal property free and clear of any mortgages, pledges, charges, liens,
security interests or other encumbrances, all properties and assets purportedly
owned or used by it or necessary for the conduct of its business as currently
conducted, except for those disclosed in Schedule 2.1(l). All
leases of the Company and each of its Intended Subsidiaries are valid and
subsisting and in full force and effect.

     

    (l)      Actions Pending.
There is no action, suit, claim, investigation, arbitration, alternate dispute
resolution proceeding or any other proceeding pending or, to the knowledge of
the Group Companies, threatened against Group Companies which questions the
validity of this Agreement or any of the other Transaction Documents or the
transactions contemplated hereby or thereby or any action taken or to be taken
pursuant hereto or thereto. There is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or any other proceeding
pending or, to the knowledge of the Company, threatened, against or involving
Group Companies, any subsidiary or any of their respective properties or assets.
There are no outstanding orders, judgments, injunctions, awards or decrees of
any court, arbitrator or governmental or regulatory body against Group Companies
or any executive officers or directors of the Group Companies in their
capacities as such.

     

    (m)    Compliance with Law.
The business of Group Companies has been and is presently being conducted in
material compliance with all applicable federal, state and local governmental
laws, rules, regulations and ordinances. Group Companies have all franchises,
permits, licenses, consents and other governmental or regulatory authorizations
and approvals necessary for the conduct of its business in all material respects
as now being conducted by them unless the failure to possess such franchises,
permits, licenses, consents and other governmental or regulatory authorizations
and approvals, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

     

    (n)     Taxes. Each of Group
Companies has accurately prepared and filed all federal, state and other tax
returns required by law to be filed by it, has paid or made provisions for the
payment of all taxes shown to be due and all additional assessments, and
adequate provisions have been and are reflected in the financial statements of
the Company and Dalian Befut for all current taxes and other charges to which
the Company or Dalian Befut is subject and which are not currently due and
payable. None of the federal income tax returns of the Company has been audited
by the Internal Revenue Service. The Company has no knowledge of any additional
assessments, adjustments or contingent tax liability (whether federal or state)
of any nature whatsoever, whether pending or threatened against Group Companies
for any period, nor of any basis for any such assessment, adjustment or
contingency.

     

    (o)     Certain Fees. Except
as set forth on Schedule 2.1(o)
hereto, no brokers, finders or financial advisory fees or commissions will be
payable by the Company or any subsidiary or any Purchaser with respect to the
transactions contemplated by this Agreement and the other Transaction
Documents.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    (p)     Disclosure. Neither
this Agreement nor the Schedules hereto nor any other documents, certificates or
instruments furnished to the Purchasers by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made herein or therein, taken as a
whole and in the light of the circumstances under which they were made herein or
therein, not false or misleading.

     

    (q)     Operation of
Business. The Company and each of its Subsidiaries owns or possesses all
patents, trademarks, domain names (whether or not registered) and any patentable
improvements or copyrightable derivative works thereof, websites and
intellectual property rights relating thereto, service marks, trade names,
copyrights, licenses and authorizations, and all rights with respect to the
foregoing, which are necessary for the conduct of its business as now conducted
without any conflict with the rights of others, except where the failure to so
own or possess would not have a Material Adverse Effect.

     

    (r)      Environmental
Compliance. Since their  inception,  neither none of
the Group Companies  has been,  in  violation of
any applicable law relating to the  environment
or  occupational  health and safety, where
such  violation  would have a material  adverse
effect on their business or financial  condition.  Each of
the Group Companies has operated all facilities and properties owned, leased or
operated by it in material compliance with the Environmental Laws. “Environmental Laws”
shall mean all applicable laws relating to the protection of the environment
including, without limitation, all requirements pertaining to reporting,
licensing, permitting, controlling, investigating or remediating emissions,
discharges, releases or threatened releases of hazardous substances, chemical
substances, pollutants, contaminants or toxic substances, materials or wastes,
whether solid, liquid or gaseous in nature, into the air, surface water,
groundwater or land, or relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of hazardous
substances, chemical substances, pollutants, contaminants or toxic substances,
material or wastes, whether solid, liquid or gaseous in nature. The Group
Companies have all necessary governmental approvals required under all
Environmental Laws and used in their respective businesses. The Group Companies
are also in compliance with all other limitations, restrictions, conditions,
standards, requirements, schedules and timetables required or imposed under all
Environmental Laws. There are no past or present events, conditions,
circumstances, incidents, actions or omissions relating to or in any way
affecting the Group Companies that violate or may violate any Environmental Law
after the Closing Date or that may give rise to any environmental liability, or
otherwise form the basis of any claim, action, demand, suit, proceeding,
hearing, study or investigation (i) under any Environmental Law, or (ii) based
on or related to the manufacture, processing, distribution, use, treatment,
storage (including without limitation underground storage tanks), disposal,
transport or handling, or the emission, discharge, release or threatened release
of any hazardous substance.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    (s)     Books and Record Internal
Accounting Controls. The books and records of the Group Companies, as
applicable, accurately reflect in all material respects the information relating
to their business, the location and collection of their assets, and the nature
of all transactions giving rise to the obligations or accounts receivable of the
Group Companies. The Group Companies, as applicable, maintain a system of
internal accounting controls sufficient, in their judgment, 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 actions are taken with respect to any
differences.

     

    (t)      Material Agreements.
Except as set forth under Schedule 2.1 (t), none of the Group Companies is a
party to any written or oral contract, instrument, agreement, commitment,
obligation, plan or arrangement, a copy of which would be required to be filed
with the Commission as an exhibit to a registration statement on Form S-1
(collectively, the “Material Agreements”)
if the Company or such subsidiary were registering securities under the
Securities Act.  The Group Companies have in all material respects
performed all the obligations required to be performed by them to date under the
foregoing agreements, have received no notice of default and are not in default
under any Material Agreement now in effect the result of which would cause a
Material Adverse Effect. Except as restricted under applicable laws and
regulations, the incorporation documents, certificates of designations or the
Transaction Documents, no written or oral contract, instrument, agreement,
commitment, obligation, plan or arrangement of the Company or any of its
Intended Subsidiaries limits or shall limit the payment of interest on the Notes
or dividends on the Company’s Common Stock.

     

    (u)     Transactions with
Affiliates. Except as set forth in the Transaction Documents or the OEM
Agreements (as defined in Section 2.1(gg)(i) below) there are no loans, leases,
agreements, contracts, royalty agreements, management contracts or arrangements
or other continuing transactions between (a) the Company or any Subsidiary on
the one hand, and (b) on the other hand, any officer, employee, consultant or
director of the Company, or any of its Intended Subsidiaries, or any person
owning any capital stock of the Company or any Subsidiary or any member of the
immediate family of such officer, employee, consultant, director or stockholder
or any corporation or other entity controlled by such officer, employee,
consultant, director or stockholder, or a member of the immediate family of such
officer, employee, consultant, director or stockholder.

     

    (v)     Securities Act of
1933. Assuming the accuracy of the representations of the Purchasers set
forth in Section 2.2 (d)-(h) hereof, the Company has complied and will comply
with all applicable federal and state securities laws in connection with the
offer, issuance and sale of the Notes and the Warrants hereunder. Neither the
Company nor anyone acting on its behalf, directly or indirectly, has or will
sell, offer to sell or solicit offers to buy any of the Units, the Notes, the
Warrants or similar securities to, or solicit offers with respect thereto from,
or enter into any preliminary conversations or negotiations relating thereto
with, any person, or has taken or will take any action so as to bring the
issuance and sale of any of the Units, the Notes and the Warrants in violation
of the registration provisions of the Securities Act and applicable state
securities laws, and neither the Company nor any of its affiliates, nor any
person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with the offer or sale of any of the Units,
the Notes and the Warrants.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    (w)    Governmental
Approvals. Except for the filing of any notice prior or subsequent to the
Closing Date that may be required under applicable state and/or Federal
securities laws (which if required, shall be filed on a timely basis), including
the filing of a Form D, no authorization, consent, approval, license, exemption
of, filing or registration with any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, is or
will be necessary for, or in connection with, the execution or delivery of the
Units, the Notes and the Warrants, or for the performance by the Company of its
obligations under the Transaction Documents.

     

    (x)     Employees. Except as
set forth on Schedule 2.1(x), none of the Group Company has any collective
bargaining arrangements or agreements covering any of its employees. None of the
Group Companies has any employment contract, agreement regarding proprietary
information, non-competition agreement, non-solicitation agreement,
confidentiality agreement, or any other similar contract or restrictive
covenant, relating to the right of any officer, employee or consultant to be
employed or engaged by the Company or such Subsidiary.

     

    (y)     Absence of Certain
Developments. Since December 31, 2008, none of the Group Companies
has:

     

    
       
(i)          issued
any stock, bonds or other corporate securities or any rights, options or
warrants with respect thereto;

    

     

    
      
         
(ii)         borrowed
any amount or incurred or become subject to any liabilities (absolute or
contingent) except current liabilities incurred in the ordinary course of
business which are comparable in nature and amount to the current liabilities
incurred in the ordinary course of business during the comparable portion of its
prior fiscal year, as adjusted to reflect the current nature and volume of the
Company’s or such Subsidiary’s business;

      

    

     

    
      
         
(iii)       discharged
or satisfied any lien or encumbrance or paid any obligation or liability
(absolute or contingent), other than current liabilities paid in the ordinary
course of business;

      

    

     

    
      
         
(iv)       declared
or made any payment or distribution of cash or other property to stockholders
with respect to its stock, or purchased or redeemed, or made any agreements so
to purchase or redeem, any shares of its capital stock;

      

    

     

    
      
         
(v)        sold,
assigned or transferred any other tangible assets, or canceled any debts or
claims, except in the ordinary course of business;

      

    

     

    
      
         
(vi)       sold,
assigned or transferred any patent rights, trademarks, trade names, copyrights,
trade secrets or other intangible assets or intellectual property rights, or
disclosed any proprietary confidential information to any person except to
customers in the ordinary course of business or to the Purchasers or their
representatives;

      

    

     

    
      
         
(vii)      suffered
any substantial losses or waived any rights of material value, whether or not in
the ordinary course of business, or suffered the loss of any material amount of
prospective business;

      

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    
      
          (viii)     made
any changes in employee compensation, except in the ordinary course of business
and consistent with past practices;

      

    

     

    
      
         
(ix)        made
capital expenditures or commitments therefore that aggregate in excess of
$50,000;

      

    

     

    
       
(x)         entered
into any other transaction other than in the ordinary course of business, or
entered into any other material transaction, whether or not in the ordinary
course of business;

    

     

    
       
(xi)        made
charitable contributions or pledges in excess of $10,000;

    

     

    
       
(xii)       suffered
any material damage, destruction or casualty loss, whether or not covered by
insurance;

    

     

    
       
(xiii)      experienced
any material problems with labor or management in connection with the terms and
conditions of their employment;

    

     

    
       
(xiv)      effected
any two or more events of the foregoing kind which in the aggregate would be
material to the Company or its Intended Subsidiaries, taken as a whole;
or

    

     

    
       
(xv)       entered
into an agreement, written or otherwise, to take any of the foregoing
actions.

    

     

    (z)     Public Utility Holding
Company Act and Investment Company Act Status. The Company is not a
“holding company” or a “public utility company” as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended. The Company is not, and
as a result of and immediately upon the Closing will not be, an “investment
company” or a company “controlled” by an “investment company,” within the
meaning of the Investment Company Act of 1940, as amended.

     

    (aa)   ERISA. No liability
to the Pension Benefit Guaranty Corporation has been incurred with respect to
any Plan (as defined below) by the Company or any of its Intended Subsidiaries
which is or would be materially adverse to the Company and its Intended
Subsidiaries, taken as a whole. The execution and delivery of this Agreement and
the other Transaction Documents and the issuance and sale of the Units, the
Notes and the Warrants will not involve any transaction which is subject to the
prohibitions of Section 406 of ERISA or in connection with which a tax could be
imposed pursuant to Section 4975 of the Internal Revenue Code of 1986, as
amended, provided, that, if any of the Purchasers, or any person or entity that
owns a beneficial interest in any of the Purchasers, is an “employee pension
benefit plan” (within the meaning of Section 3(2) of ERISA) with respect to
which the Company is a “party in interest” (within the meaning of Section 3(14)
of ERISA), the requirements of Sections 407(d)(5) and 408(e) of ERISA, if
applicable, are met. As used in this Section 2.1(bb), the term “Plan” shall mean an
“employee pension benefit plan” (as defined in Section 3 of ERISA) which is or
has been established or maintained, or to which contributions are or have been
made, by the Company or any subsidiary or by any trade or business, whether or
not incorporated, which, together with the Company or any subsidiary, is under
common control, as described in Section 414(b) or (c) of the Code.

     

    
      
        
        

      

      
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    (bb) 
 Dilutive
Effect. The Company understands and acknowledges that it has an
obligation to issue Conversion Shares upon conversion of the Notes in accordance
with this Agreement and to issue the Warrant Shares upon the exercise of the
Warrants in accordance with this Agreement and the Warrants regardless of the
dilutive effect that such issuance may have on the ownership interest of other
stockholders of the Company.

     

    (cc)   No Integrated
Offering. Neither the Company, nor any of its affiliates, nor any person
acting on its or their behalf, has directly or indirectly made any offers or
sales of any security or solicited any offers to buy any security under
circumstances that would cause the offering of the Securities pursuant to this
Agreement to be integrated with prior offerings by the Company for purposes of
the Securities Act which would prevent the Company from selling the Notes and
Warrants pursuant to Rule 506 under the Securities Act, or any applicable
exchange-related stockholder approval provisions, nor will the Company or any of
its affiliates take any action or steps that would cause the offering of the
Securities to be integrated with other offerings. The Company does not have any
registration statement pending before the Commission or currently under the
Commission’s review.

     

    (dd)  Independent Nature of
Purchasers. The Company acknowledges that the obligations of each
Purchaser under the Transaction Documents are several and not joint with the
obligations of any other Purchaser, and no Purchaser shall be responsible in any
way for the performance of the obligations of any other Purchaser under the
Transaction Documents. The Company acknowledges that the decision of each
Purchaser to purchase securities pursuant to this Agreement has been made by
such Purchaser independently of any other purchase and independently of any
information, materials, statements or opinions as to the business, affairs,
operations, assets, properties, liabilities, results of operations, condition
(financial or otherwise) or prospects of the Company or of its Intended
Subsidiaries which may have made or given by any other Purchaser or by any agent
or employee of any other Purchaser, and no Purchaser or any of its agents or
employees shall have any liability to any Purchaser (or any other person)
relating to or arising from any such information, materials, statements or
opinions. The Company acknowledges that nothing contained herein, or in any
Transaction Document, and no action taken by any Purchaser pursuant hereto or
thereto, shall be deemed to constitute the Purchasers as a partnership, an
association, a joint venture or any other kind of entity, or create a
presumption that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the
Transaction Documents. The Company acknowledges that each Purchaser 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 Purchaser to
be joined as an additional party in any proceeding for such purpose. The Company
acknowledges that for reasons of administrative convenience only, the
Transaction Documents have been prepared by counsel for one of the Purchasers
and such counsel does not represent all of the Purchasers, but only such
Purchaser and the other Purchasers have retained their own individual counsel
with respect to the transactions contemplated hereby.  The Company
acknowledges that it has elected to provide all Purchasers with the same terms
and Transaction Documents for the convenience of the Company and not because it
was required or requested to do so by the Purchasers.

     

    (ee)   Subject
to the consummation of the Share Exchange Transaction, the Company represents on
behalf of Dalian Befut:

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

     
(i)          that Dalian Befut
has the legal right, power and authority (corporate and other) to enter into and
perform its obligations under each of agreements as set forth on Schedule 2.1(ee)
(collectively, the “OEM Agreements”) to
which it is a party and has taken all necessary corporate action to authorize
the execution, delivery and performance of, and has authorized, executed and
delivered, each of the OEM Agreements to which WFOE is a party; and each of the
OEM Agreements to which Dalian Befut is a party constitutes a valid and legally
binding obligation of Dalian Befut, enforceable in accordance with its terms,
subject, as to enforceability, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors’ rights and to general equity principles.

     

     
(ii)         that Dalian Befut does
not own or lease properties or conduct any business outside of the PRC and that
Dalian Befut does not need to be duly qualified as a foreign corporation for the
transaction of business under the laws of any jurisdiction in which it is not
now so qualified.

     

     
(iii)        that the execution and
delivery by Dalian Befut of, and the performance by Dalian Befut  of
its obligations under, each of the OEM Agreements to which it is a party and the
consummation by Dalian Befut of the transactions contemplated therein will not:
(A) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which Dalian Befut is
a party or by which Dalian Befut  is bound or to which any of the
properties or assets of Dalian Befut  is subject; (B) result in any
violation of the provisions of the articles of association or business license
of Dalian Befut; and (C) will not result in any violation of any laws,
regulations, rules, orders, decrees, guidelines or notices of the PRC, except
that, with respect to (A) and (C), such conflict, breach or violation would not
reasonably be expected to have a Material Adverse Effect on Dalian
Befut.

     

     
(iv)        that each of the OEM
Agreements is in proper and enforceable legal form under the laws of the PRC and
to ensure the legality, validity, enforceability or admissibility in evidence of
each of the OEM Agreements in the PRC, it is not necessary that any such
document be filed or recorded with any court or other authority in the PRC or
that any stamp or similar tax be paid on or in respect of any of the OEM
Agreements.

     

    Section
2.2      Representations and
Warranties of the Purchasers.  Each Purchaser hereby makes the
following representations and warranties to the Company as of the date hereof
and Closing Date, with respect solely to itself and not with respect to any
other Purchaser:

     

    (a)     Organization and Good
Standing of the Purchasers. If the Purchaser is an entity, such Purchaser
is a corporation, partnership or limited liability company duly incorporated or
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    (b)     Authorization and
Power. Each Purchaser has the requisite power and authority to enter into
and perform this Agreement and each of the other Transaction Documents to which
such Purchaser is a party and to purchase the Notes and Warrants being sold to
it hereunder. The execution, delivery and performance of this Agreement and each
of the other Transaction Documents to which such Purchaser is a party by such
Purchaser and the consummation by it of the transactions contemplated hereby and
thereby have been duly authorized by all necessary corporate or partnership
action, and no further consent or authorization of such Purchaser or its Board
of Directors, stockholders, or partners, as the case may be, is required. This
Agreement and each of the other Transaction Documents to which such Purchaser is
a party has been duly authorized, executed and delivered by such Purchaser and
constitutes, or shall constitute when executed and delivered, a valid and
binding obligation of such Purchaser enforceable against such Purchaser in
accordance with the terms thereof.

     

    (c)     No Conflicts. The
execution, delivery and performance of this Agreement and each of the other
Transaction Documents to which such Purchaser is a party and the consummation by
such Purchaser of the transactions contemplated hereby and thereby or relating
hereto do not and will not (i) result in a violation of such Purchaser’s charter
documents, bylaws, operating agreement, partnership agreement or other
organizational documents or (ii) conflict with, or constitute a default (or an
event which 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 of any agreement, indenture or instrument or obligation to which
such Purchaser is a party or by which its properties or assets are bound, or
result in a violation of any law, rule, or regulation, or any order, judgment or
decree of any court or governmental agency applicable to such Purchaser or its
properties (except for such conflicts, defaults and violations as would not,
individually or in the aggregate, have a material adverse effect on such
Purchaser). Such Purchaser is not required to obtain any consent, authorization
or order of, or make any filing or registration with, any court or governmental
agency in order for it to execute, deliver or perform any of its obligations
under this Agreement or any other Transaction Document to which such Purchaser
is a party or to purchase the Notes or acquire the Warrants in accordance with
the terms hereof, provided, that for
purposes of the representation made in this sentence, such Purchaser is assuming
and relying upon the accuracy of the relevant representations and agreements of
the Company herein.

     

    (d)     Acquisition for
Investment. Each Purchaser is acquiring the Units, and the underlying
Notes and the Warrants solely for its own account for the purpose of investment
and not with a view to or for sale in connection with distribution. Each
Purchaser does not have a present intention to sell the Notes or the Warrants,
nor a present arrangement (whether or not legally binding) or intention to
effect any distribution of the Notes or the Warrants to or through any person or
entity. Each Purchaser acknowledges that it is able to bear the financial risks
associated with an investment in the Notes and the Warrants and that it has been
given full access to such records of the Group Companies and to the officers of
the Group Companies and received such information as it has deemed necessary or
appropriate to conduct its due diligence investigation and has sufficient
knowledge and experience in investing in companies similar to the Company in
terms of the Company’s stage of development so as to be able to evaluate the
risks and merits of its investment in the Company.  Each Purchaser
further acknowledges that such Purchaser understands the risks of investing in
companies domiciled and/or which operate primarily in the People’s Republic of
China and that the purchase of the Notes and Warrants involves substantial
risks.

     

    (e)     Status of Purchasers.
Each Purchaser is an “accredited investor” as defined in Regulation D
promulgated under the Securities Act. Such Purchaser is not required to be
registered as a broker-dealer under Section 15 of the Exchange Act and such
Purchaser is not a broker-dealer, nor an affiliate of a
broker-dealer.

     

    
      
        
        

      

      
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    (f)      Opportunities for Additional
Information. Each Purchaser acknowledges that such Purchaser has had the
opportunity to ask questions of and receive answers from, or obtain additional
information from, the executive officers of the Company concerning the financial
and other affairs of the Company.  In making the decision to invest in
the Company and its business, each Purchaser hereby acknowledges that such
Purchaser has relied solely upon the Dalian Befut Financial Statements and other
written information provided to such Purchaser by the Group
Companies.

     

    (g)     No General
Solicitation. Each Purchaser acknowledges that the Units were not offered
to such Purchaser by means of any form of general or public solicitation or
general advertising, or publicly disseminated advertisements or sales
literature, including (i) any advertisement, article, notice or other
communication published in any newspaper, magazine, or similar media, or
broadcast over television or radio, or (ii) any seminar or meeting to which such
Purchaser was invited by any of the foregoing means of
communications.

     

    (h)     Rule 144. Such
Purchaser understands that the Notes, the Conversion Shares and Warrant Shares
must be held indefinitely unless such Securities are registered under the
Securities Act or an exemption from registration is available. Such Purchaser
acknowledges that such Purchaser is familiar with Rule 144 of the rules and
regulations of the Commission, as amended, promulgated pursuant to the
Securities Act (“Rule
144”), and that such person has been advised that Rule 144 permits
resales only under certain circumstances. Such Purchaser understands that to the
extent that Rule 144 is not available, such Purchaser will be unable to sell any
Securities without either registration under the Securities Act or the existence
of another exemption from such registration requirement.

     

    (i)      General. Such
Purchaser understands that the Notes and Warrants are being offered and sold in
reliance on a transactional exemption from the registration requirement of
Federal and state securities laws and the Company is relying upon the truth and
accuracy of the representations, warranties, agreements, acknowledgments and
understandings of such Purchaser set forth herein in order to determine the
applicability of such exemptions and the suitability of such Purchaser to
acquire the Notes and Warrants.

     

    (j)      Independent
Investment. No Purchaser has agreed to act with any other Purchaser for
the purpose of acquiring, holding, voting or disposing of the Notes and Warrants
purchased hereunder for purposes of Section 13(d) under the Exchange Act, and
each Purchaser is acting independently with respect to its investment in the
Notes and Warrants.

     

    (k)     Trading Activities.
Each Purchaser agrees that it shall not, directly or indirectly, engage in any
short sales with respect to the Common Stock for a period of one (1) year
following the Closing.

     

    (l)      Brokers.  No
Purchaser has any knowledge of any brokerage or finder’s fees or commissions
that are or will be payable by the Group Companies to any broker, financial
advisor or consultant, finder, placement agent, investment banker, bank or other
person or entity with respect to the transactions contemplated by this
Agreement.

     

    
      
        
        

      

      
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    ARTICLE
III

     

    Covenants

     

    The
Company covenants with each of the Purchasers as follows, which covenants are
for the benefit of the Purchasers and their permitted assignees (as defined
herein).

     

    Section
3.1     Securities
Compliance.  The Company shall notify the Commission in
accordance with their rules and regulations, of the transactions contemplated by
any of the Transaction Documents, including filing a Form D with respect to the
Units, the Notes, Warrants, Conversion Shares and Warrant Shares as required
under Regulation D and applicable “blue sky” laws, and shall take all other
necessary action and proceedings as may be required and permitted by applicable
law, rule and regulation, for the legal and valid issuance of the Units, the
Notes, the Warrants, the Conversion Shares and the Warrant Shares to the
Purchasers or subsequent holders.

     

    Section
3.2     Registration and
Listing.  The Company shall (a) comply in all respects with its
reporting and filing obligations under the Exchange Act  and (b) not
take any action or file any document (whether or not permitted by the Securities
Act or the rules promulgated thereunder) to terminate or suspend its reporting
and filing obligations under the Exchange Act or Securities Act, except as
permitted under the Transaction Documents. The Company will take all action
necessary to continue the quotation or listing of its Common Stock on the OTC
Bulletin Board or other exchange or market on which the Common Stock is trading.
If the Company’s Common Stock is no longer quoted on the OTC Bulletin Board or
listed on an exchange within 12 months after the Closing, then, upon written
demand from a Purchaser the Company shall promptly, and in any event within
thirty (30) days from the date of such written demand, pay to that Purchaser, an
amount equal to that Purchaser’s entire purchase price with an annual rate of
15% pro rata for the period from the Closing date until the date paid. Subject
to the terms of the Transaction Documents, the Company further covenants that it
will take such further action as the Purchasers may reasonably request, all to
the extent required from time to time to enable the Purchasers to sell the
Notes, Conversion Shares and Warrant Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
promulgated under the Securities Act, as amended.

     

    Section
3.3      Compliance with
Laws.  The Company shall comply, and cause each subsidiary to
comply in all material respects, with all applicable laws, rules, regulations
and orders.

     

    Section
3.4     Keeping of Records and Books
of Account.  The Company shall keep and cause each subsidiary
to keep adequate records and books of account, in which complete entries will be
made in accordance with US GAAP consistently applied, reflecting all financial
transactions of Group Companies, and in which, for each fiscal year, all proper
reserves for depreciation, depletion, obsolescence, amortization, taxes, bad
debts and other purposes in connection with its business shall be
made.

     

    
      
        
        

      

      
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    Section
3.5      Amendments.  The
Company shall not amend or waive any provision of the Articles or Bylaws of the
Company in any way that would adversely affect the rights of the
Notes;

     

    Section
3.6     Other
Agreements.  The Company shall not enter into any agreement in
which the terms of such agreement would restrict or impair the right or ability
to perform of the obligations by the Company or any subsidiary under any
Transaction Document.

     

    Section
3.7     Distributions.  So
long as any Notes remain outstanding, the Company agrees that it shall not (i)
declare or pay any dividends or make any distributions to any holder(s) of
Common Stock unless such dividends or distributions are also simultaneously paid
or made to the holders of the Notes on an as-converted basis or (ii) purchase or
otherwise acquire for value, directly or indirectly, any Common Stock or other
equity security of the Company.

     

    Section
3.8     Use of
Proceeds.  The net proceeds from the sale of the Units
hereunder shall be used by the Company for working capital and general corporate
purposes and not to redeem any Common Stock or securities convertible,
exercisable or exchangeable into Common Stock or to settle any outstanding
litigation.

     

    Section
3.9      Reservation of
Shares.  So long as any of the Notes or Warrants remain
outstanding, the Company shall take all action necessary at all times to have
authorized, and reserved for the purpose of issuance, no less than the aggregate
number of shares of Common Stock needed to provide for the issuance of the
Conversion Shares and the Warrant Shares.

     

    Section
3.10    Disposition of
Assets.  So long as any Notes remain outstanding, none of the
Group Companies shall sell, transfer or otherwise dispose of any of its
properties, assets and rights including, without limitation, its software and
intellectual property, to any person, other than from Dalian Befut to WFOE,
except for (i) sales to customers in the ordinary course of business (ii) sales
or transfers among Group Companies or (iii) otherwise with the prior written
consent of the holders of a majority of the Notes then outstanding.

     

    Section
3.11    Reporting
Status.  So long as a Purchaser beneficially owns any of the
Securities, the Company shall timely file all reports required to be filed with
the Commission pursuant to the Exchange Act, and the Company shall not terminate
its status as an issuer required to file reports under the Exchange Act even if
the Exchange Act or the rules and regulations thereunder would permit such
termination.

     

    Section
3.12    Disclosure of Material
Information.  The Company covenants and agrees that neither it
nor any other person acting on its behalf has provided or will provide any
Purchaser or its agents or counsel with any information that the Company
believes constitutes material non-public information (other than with respect to
the transactions contemplated by this Agreement), unless prior thereto such
Purchaser shall have executed a written agreement regarding the confidentiality
and use of such information.  The Company understands and confirms
that each Purchaser shall be relying on the foregoing representations in
effecting transactions in securities of the Company.

     

    
      
        
        

      

      
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    Section
3.13    No Commissions in connection
with Conversion of Notes.  In connection with the conversion of
the Notes into Conversion Shares, neither the Company nor any Person acting on
its behalf will take any action that would result in the Conversion Shares being
exchanged by the Company other than with the then existing holders of the Notes
exclusively where no commission or other remuneration is paid or given directly
or indirectly for soliciting the exchange in compliance with Section 3(a)(9) of
the Securities Act.

     

    Section
3.14    Reverse Stock
Split.   Immediately after the Closing, the Company will
use its best efforts to complete a 1 for 4.07 reverse stock split (the “Reverse
Split”) of the Company’s Common Stock. As a result of the Reverse Split, the
conversion price of the Notes will be multiplied by 4.07, which is to be
$0.65.

     

    ARTICLE
IV


     

    CONDITIONS

     

    Section
4.1      Conditions Precedent to the
Obligation of the Company to Sell the Notes and Warrants.  The
obligation hereunder of the Company to issue and sell the Units, and the
underlying Notes and the Warrants to the Purchasers is subject to the
satisfaction or waiver, at or before the Closing, of each of the conditions set
forth below. These conditions are for the Company’s sole benefit and may be
waived by the Company at any time in its sole discretion.

     

    (a)     Accuracy of Each Purchaser’s
Representations and Warranties. The representations and warranties of
each Purchaser in this Agreement and each of the other Transaction Documents to
which such Purchaser is a party shall be true and correct in all material
respects as of the date when made and as of the Closing Date as though made at
that time, except for representations and warranties that are expressly made as
of a particular date, which shall be true and correct in all material respects
as of such date.

     

    (b)     Performance by the
Purchasers. Each Purchaser shall have performed, satisfied and complied
in all respects with all covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by such Purchaser at or
prior to the Closing.

     

    (c)     No Injunction. No
statute, rule, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction which prohibits the consummation of any of
the transactions contemplated by this Agreement.

     

    (d)     Delivery of Purchase
Price. The Purchase Price for the Units, the Notes and Warrants has been
delivered to the escrow agent pursuant to the Escrow Agreement.

     

    (e)     Delivery of Transaction
Documents. The Transaction Documents to which the Purchasers are parties
have been duly executed and delivered by the Purchasers to the
Company.

     

    
      
        
        

      

      
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    (f)      Share Exchange
Transaction. Immediately prior to the Closing, the Reverse Merger shall
have been consummated.

     

    Section
4.2      Conditions Precedent to the
Obligation of the Purchasers to Purchase the Units.  The
obligation hereunder of each Purchaser to acquire and pay for the Units is
subject to the satisfaction or waiver, at or before the Closing, of each of the
conditions set forth below. These conditions are for each Purchaser’s sole
benefit and may be waived by such Purchaser at any time in its sole
discretion.

     

    (a)     Accuracy of the Company’s
Representations and Warranties. Each of the representations and
warranties of the Company in this Agreement and the other Transaction Documents
shall be true and correct in all respects as of the date when made and as of the
Closing Date as though made at that time (except for representations and
warranties that are expressly made as of a particular date), which shall be true
and correct in all respects as of such date.

     

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

     

    (c)     No Injunction. No
statute, rule, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction which prohibits the consummation of any of
the transactions contemplated by this Agreement.

     

    (d)     No Proceedings or
Litigation. No action, suit or proceeding before any arbitrator or any
governmental authority shall have been commenced, and no investigation by any
governmental authority shall have been threatened, against the Company or any
subsidiary, or any of the officers, directors or affiliates of the Company or
any subsidiary seeking to restrain, prevent or change the transactions
contemplated by this Agreement, or seeking damages in connection with such
transactions.

     

    (e)     Opinions of Counsel,
Etc. At the Closing, the Purchasers shall have received an opinion of
counsel to the Company, in substantially the form of Exhibit F-1 hereto,
and such other certificates and documents as the Purchasers or its counsel shall
reasonably require incident to the Closing.

     

    (f)      Certificates. The
Company shall have executed and delivered to the Purchasers the certificates (in
such denominations as such Purchaser shall request) for the Notes and the
Warrants being acquired by such Purchaser at the Closing (in such denominations
as such Purchaser shall request) to such address set forth next to each
Purchasers name on Exhibit C
hereto.

     

    (g)     Resolutions. The
Board of Directors of the Company shall have adopted resolutions consistent with
Section 2.1(b) hereof in a form reasonably acceptable to such Purchaser (the
“Resolutions”).

     

    
      
        
        

      

      
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    (h)     Reservation of
Shares. As of the Closing Date, the Company shall have reserved out of
its authorized and unissued Common Stock, solely for the purpose of effecting
the conversion of the Notes and the exercise of the Warrants, a number of shares
of Common Stock equal to the aggregate number of Conversion Shares issuable upon
conversion of the Notes issued or to be issued pursuant to this Agreement and
the number of Warrant Shares issuable upon exercise of the number of Warrants
issued or to be issued pursuant to this Agreement.

     

    (i)      Secretary’s
Certificate. The Company shall have delivered to such Purchaser a
secretary’s certificate, dated as of the Closing Date, as to (i) the
Resolutions, (ii) the Articles and (iii) the By-laws, each as in effect at the
Closing, and (iv) the authority and incumbency of the officers of the Company
executing the Transaction Documents and any other documents required to be
executed or delivered in connection therewith.

     

    (j)      Officer’s
Certificate. The Company shall have delivered to the Purchasers a
certificate of an executive officer of the Company, dated as of the Closing
Date, confirming the accuracy of the Company’s representations, warranties and
covenants as of the Closing Date and confirming the compliance by the Company
with the conditions precedent set forth in this Section 4.2 as of the Closing
Date.

     

    (k)     Material Adverse
Effect. No Material Adverse Effect shall have occurred at or before the
Closing Date.

     

    (l)      Share Exchange
Transaction. Immediately prior to the Closing, the Reverse Merger shall
have been consummated.

     

    (m)    Financial Statements.
No later than the fifth Business Day prior to the Closing Date, the Company
shall have delivered to the Purchasers the audited financial statements of
Dalian Befut for the fiscal years ended June 30, 2008 audited by U.S. Certified
Public Accountants (the “Dalian Befut Financial
Statements”), which shall be acceptable to the Purchasers.

     

    (n)     Capitalization Table.
No later than the third Business Day prior to the Closing Date, the Company
shall have delivered to each of the Purchasers a capitalization table setting
forth (i) its capitalization, on a fully diluted basis immediately prior to the
Closing and (ii) its pro forma capitalization, on a fully diluted basis, giving
effect to the consummation of the transactions contemplated by this
Agreement.  In each case, the table shall list all outstanding
options, warrants and other securities convertible into equity of the
Company.

     

    ARTICLE
V

     

    Legend

     

    Section
5.1      Legend.  Each
certificate representing the Notes and the Warrants, and, if appropriate,
securities issued upon conversion thereof, shall be stamped or otherwise
imprinted with a legend substantially in the following form (in addition to any
legend required by applicable state securities or “blue sky” laws):

     

    
      
        
        

      

      
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    THESE
SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”)
OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
STATE SECURITIES LAWS OR THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL
THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE
PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

     

    The
Company agrees to reissue certificates representing any of the Conversion Shares
and the Warrant Shares, without the legend set forth above if at such time,
prior to making any transfer of any such securities, such holder thereof shall
give written notice to the Company describing the manner and terms of such
transfer and removal as the Company may reasonably request. Such proposed
transfer and removal will not be effected until: (a) either (i) the Company has
received an opinion of counsel reasonably satisfactory to the Company, to the
effect that the registration of the Conversion Shares or the Warrant Shares
under the Securities Act is not required in connection with such proposed
transfer, (ii) a registration statement under the Securities Act covering such
proposed disposition has been filed by the Company with the Commission and has
become effective under the Securities Act, (iii) the Company has received other
evidence reasonably satisfactory to the Company that such registration and
qualification under the Securities Act and state securities laws are not
required, or (iv) the holder provides the Company with reasonable assurances
that such security can be sold pursuant to Rule 144 under the Securities Act;
and (b) either (i) the Company has received an opinion of counsel reasonably
satisfactory to the Company, to the effect that registration or qualification
under the securities or “blue sky” laws of any state is not required in
connection with such proposed disposition, or (ii) compliance with applicable
state securities or “blue sky” laws has been effected or a valid exemption
exists with respect thereto. The Company will respond to any such notice from a
holder within five (5) business days. In the case of any proposed transfer under
this Section 5.1, the Company will use reasonable efforts to comply with any
such applicable state securities or “blue sky” laws, but shall in no event be
required, (x) to qualify to do business in any state where it is not then
qualified, (y) to take any action that would subject it to tax or to the general
service of process in any state where it is not then subject, or (z) to comply
with state securities or “blue sky” laws of any state for which registration by
coordination is unavailable to the Company. The restrictions on transfer
contained in this Section 5.1 shall be in addition to, and not by way of
limitation of, any other restrictions on transfer contained in any other section
of this Agreement. Whenever a certificate representing the Conversion Shares or
Warrant Shares is required to be issued to a Purchaser without a legend, in lieu
of delivering physical certificates representing the Conversion Shares or
Warrant Shares (provided that a registration statement under the Securities Act
providing for the resale of the Warrant Shares and Conversion Shares is then in
effect), the Company may cause its transfer agent to electronically transmit the
Conversion Shares or Warrant Shares to a Purchaser by crediting the account of
such Purchaser or such Purchaser’s Prime Broker with the Depository Trust
Company (“DTC”)
through its Deposit Withdrawal Agent Commission (“DWAC”) system (to the
extent not inconsistent with any provisions of this Agreement).

     

    
      
        
        

      

      
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    ARTICLE
VI

     

    Indemnification

     

    Section
6.1      General
Indemnity.  The Company agrees to indemnify and hold harmless
the Purchasers (and their respective directors, officers, managers, partners,
members, shareholders, affiliates, agents, successors and assigns) from and
against any and all losses, liabilities, deficiencies, costs, damages and
expenses (including, without limitation, reasonable attorneys’ fees, charges and
disbursements) incurred by the Purchasers as a result of any inaccuracy in or
breach of the representations, warranties or covenants made by the Company
herein.  Each Purchaser severally, but not jointly, agrees to
indemnify and hold harmless the Company and its directors, officers, affiliates,
agents, successors and assigns from and against any and all losses, liabilities,
deficiencies, costs, damages and expenses (including, without limitation,
reasonable attorneys’ fees, charges and disbursements) incurred by the Company
as a result of any inaccuracy in or breach of the representations, warranties or
covenants made by such Purchaser herein.  The maximum aggregate
liability of each Purchaser pursuant to its indemnification obligations under
this Article VII shall not exceed the portion of the Purchase Price paid by such
Purchaser hereunder.

     

    Section
6.2      Indemnification
Procedure.  Any party entitled to indemnification under this
Article VI (an “indemnified party”) will give written notice to the indemnifying
party of any matters giving rise to a claim for indemnification; provided, that the
failure of any party entitled to indemnification hereunder to give notice as
provided herein shall not relieve the indemnifying party of its obligations
under this Article VI, except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice. In case any action,
proceeding or claim is brought against an indemnified party in respect of which
indemnification is sought hereunder, the indemnifying party shall be entitled to
participate in and, unless in the reasonable judgment of the indemnified party a
conflict of interest between it and the indemnifying party may exist with
respect of such action, proceeding or claim, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. In the event that the
indemnifying party advises an indemnified party that it will contest such a
claim for indemnification hereunder, or fails, within thirty (30) days of
receipt of any indemnification notice to notify, in writing, such person of its
election to defend, settle or compromise, at its sole cost and expense, any
action, proceeding or claim (or discontinues its defense at any time after it
commences such defense), then the indemnified party may, at its option, defend,
settle or otherwise compromise or pay such action or claim. In any event, unless
and until the indemnifying party elects in writing to assume and does so assume
the defense of any such claim, proceeding or action, the indemnified party’s
costs and expenses arising out of the defense, settlement or compromise of any
such action, claim or proceeding shall be losses subject to indemnification
hereunder. The indemnified party shall cooperate fully with the indemnifying
party in connection with any negotiation or defense of any such action or claim
by the indemnifying party and shall furnish to the indemnifying party all
information reasonably available to the indemnified party which relates to such
action or claim. The indemnifying party shall keep the indemnified party fully
apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. If the indemnifying party elects to defend
any such action or claim, then the indemnified party shall be entitled to
participate in such defense with counsel of its choice at its sole cost and
expense. The indemnifying party shall not be liable for any settlement of any
action, claim or proceeding effected without its prior written consent.
Notwithstanding anything in this Article VI to the contrary, the indemnifying
party shall not, without the indemnified party’s prior written consent, settle
or compromise any claim or consent to entry of any judgment in respect thereof
which imposes any future obligation on the indemnified party or which does not
include, as an unconditional term thereof, the giving by the claimant or the
plaintiff to the indemnified party of a release from all liability in respect of
such claim. The indemnification required by this Article VI shall be made by
periodic payments of the amount thereof during the course of investigation or
defense, as and when bills are received or expense, loss, damage or liability is
incurred, so long as the indemnified party irrevocably agrees to refund such
moneys if it is ultimately determined by a court of competent jurisdiction that
such party was not entitled to indemnification. The indemnity agreements
contained herein shall be in addition to (a) any cause of action or similar
rights of the indemnified party against the indemnifying party or others, and
(b) any liabilities the indemnifying party may be subject to pursuant to the
law.

     

    
      
        
        

      

      
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    ARTICLE
VII

     

    Miscellaneous

     

    Section
7.1      Fees and
Expenses.  Except as otherwise set forth in this Agreement and
the other Transaction Documents, each party shall pay the fees and expenses of
its advisors, counsel, accountants and other experts, if any, and all other
expenses, incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.  The Company
shall also pay all reasonable fees and expenses incurred by the Purchasers in
connection with the enforcement of this Agreement or any of the other
Transaction Documents, including, without limitation, all reasonable attorneys’
fees and expenses, but only if the Purchasers are successful in any litigation
or arbitration relating to such enforcement.

     

    Section
7.2      Capital
Contribution.  No later than May 11, 2009, the Company shall
cause the contribution of no less than $450,000 (15% to the registered capital
of WFOE) by Hongkong BEFUT, Co., Ltd., its indirect wholly owed subsidiary, to
WFOE.

     

    Section
7.3       Specific Enforcement,
Consent to Jurisdiction.

     

    (a)     The
Company and the Purchasers acknowledge and agree that irreparable damage would
occur in the event that any of the provisions of this Agreement or the other
Transaction Documents were not performed in accordance with their specific terms
or were otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent or cure breaches of the
provisions of this Agreement or the other Transaction Documents and to enforce
specifically the terms and provisions hereof or thereof, this being in addition
to any other remedy to which any of them may be entitled by law or
equity.

     

    
      
        
        

      

      
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    (b)     Each
of the Company and the Purchasers (i) hereby irrevocably submits to the
jurisdiction of the United States District Court sitting in the Southern
District of New York and the courts of the State of New York located in New York
county for the purposes of any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Transaction Documents or the
transactions contemplated hereby or thereby and (ii) hereby waives, and agrees
not to assert in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit,
action or proceeding is improper. Each of the Company and the Purchasers
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof 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 in this Section 7.3
shall affect or limit any right to serve process in any other manner permitted
by law.

     

    Section
7.4      Entire Agreement;
Amendment.  This Agreement and the other Transaction Documents
contains the entire understanding and agreement of the parties with respect to
the matters covered hereby and, except as specifically set forth herein or in
the Transaction Documents, neither the Company nor any of the Purchasers makes
any representations, warranty, covenant or undertaking with respect to such
matters and they supersede all prior understandings and agreements with respect
to said subject matter, all of which are merged herein. No provision of this
Agreement nor any of the Transaction Documents may be waived or amended other
than by a written instrument signed by the Company and the holders of at least
fifty percent (50%) of the Notes then outstanding, and no provision hereof may
be waived other than by an a written instrument signed by the party against whom
enforcement of any such amendment or waiver is sought. No such amendment shall
be effective to the extent that it applies to less than all of the holders of
the Notes then outstanding. No consideration shall be offered or paid to any
person to amend or consent to a waiver or modification of any provision of any
of the Transaction Documents unless the same consideration is also offered to
all of the parties to the Transaction Documents or holders of Notes, as the case
may be.

     

    Section
7.5      Notices.  Any
notice, demand, request, waiver or other communication required or permitted to
be given hereunder shall be in writing and shall be effective (a) upon hand
delivery by telex (with correct answer back received), telecopy or facsimile at
the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received) or (b) on the
second business day following the date of mailing by express courier service,
fully prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such communications
shall be:

     

    If to the
Company:

    


    Frezer,
Inc.

    Address:

    No. 90-1
Hongji Street

    Xigang
District Dalian City

    Liaoning
Province, PRC, 116011

    Attn:
Hongbo Cao

    Telephone:
0411-83678755

    Fax:  0411-83670955

    


    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

    with
copies to:

    Guzov
Ofsink, LLC

    600
Madison Avenue, 14th Floor

    New York,
New York 10022

    Attention:  Elizabeth
Chen, Esq.

    Tel.
No.:  (212) 371-8008, ext. 107

    Fax
No.:  (212) 688-7273

     

    If to any
Purchaser:     At the address of such Purchaser set
forth on Exhibit A to this Agreement.

     

    Any party
hereto may from time to time change its address for notices by giving at least
ten (10) days written notice of such changed address to the other party
hereto.

     

    Section
7.6      Waivers.  No
waiver by either party 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 other provisions, condition or requirement hereof,
nor shall any delay or omission of any party to exercise any right hereunder in
any manner impair the exercise of any such right accruing to it
thereafter.

     

    Section
7.7       Headings.  The
article, section and subsection headings in this Agreement are for convenience
only and shall not constitute a part of this Agreement for any other purpose and
shall not be deemed to limit or affect any of the provisions
hereof.

     

    Section
7.8       Successors and
Assigns.  This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and assigns.

     

    Section
7.9      No Third Party
Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
person.

     

    Section
7.10    Governing
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to any of the conflicts of law principles which would result in the
application of the substantive law of another jurisdiction. This Agreement shall
not be interpreted or construed with any presumption against the party causing
this Agreement to be drafted.

     

    Section
7.11    Survival.  The
representations and warranties of the Company and the Purchasers shall survive
the execution and delivery hereof and the Closings hereunder for a period of two
years following the Closing Date.

     

    Section
7.12    Counterparts.  This
Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Agreement and shall become effective when
counterparts have been signed by each party and delivered to the other parties
hereto, it being understood that all parties need not sign the same counterpart.
In the event that any signature is delivered by facsimile transmission, such
signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

       

    

    Section
7.13    Publicity.  The
Company agrees that it will not disclose, and will not include in any public
announcement, the name of the Purchasers without the consent of the Purchasers
unless and until such disclosure is required by law or applicable regulation,
and then only to the extent of such requirement.

     

    Section
7.14    Severability.  The
provisions of this Agreement and the Transaction Documents are severable and, in
the event that any court of competent jurisdiction shall determine that any one
or more of the provisions or part of the provisions contained in this Agreement
or the Transaction Documents shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of
this Agreement or the Transaction Documents and such provision shall be reformed
and construed as if such invalid or illegal or unenforceable provision, or part
of such provision, had never been contained herein, so that such provisions
would be valid, legal and enforceable to the maximum extent
possible.

     

    Section
7.15    Further
Assurances.  From and after the date of this Agreement, upon
the request of any Purchaser or the Company, each of the Company and the
Purchasers shall execute and deliver such instrument, documents and other
writings as may be reasonably necessary or desirable to confirm and carry out
and to effectuate fully the intent and purposes of this Agreement, the Notes,
the Conversion Shares, the Warrants, the Warrant Shares and the other
Transaction Documents.

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

       

    

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

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	
                                    Frezer,
      Inc.

                                  
	 
	
                                    By:  

                                  	 
      
	 
      	
                                    Name:  Hongbo
      Cao

                                  
	 
      	
                                    Title:  President
      and Chief Executive Officer

                                  
	 
      	 
      
	
                                    PURCHASERS

                                  
	 
      	 
      
	
                                    By:

                                  	 
      
	 
      	
                                    Name:  Yong
      Li

                                  
	 
      	 
      
	 
      	 
      
	
                                    By:

                                  	 
      
	 
      	
                                    Name:  Yuming
      Ning

                                  
	 
      	 
      
	 
      	 
      
	
                                    By:

                                  	 
      
	 
      	
                                    Name:  Chunying
      Diao

                                  
	 
      	 
      
	 
      	 
      
	
                                    By:

                                  	 
      
	 
      	
                                    Name:  Yining
      Xia

                                  


                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
A TO THE

    SECURITIES
PURCHASE AGREEMENT

    ______________________________________________

    FORM
OF CONVERTIBLE PROMISSORY NOTE

    


     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

       

    

    EXHIBIT
B TO THE

    SECURITIES
PURCHASE AGREEMENT

    _________________________________________________

     

    FORM
OF WARRANT

    


    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
C- TO THE

    SECURITIES
PURCHASE AGREEMENT

    _______________________________________________

     

    LIST
OF PURCHASERS

     

    
      
        
          	
                  Name 

                	 	
                  Number of

                  Units/Notes

                  (Principal

                  Amount for each

                  Unit is $10,000)

                	 	 	
                  Number of

                  Warrants

                	 	 	
                  Purchase Price

                	 
	 
      	 	 	 	 	 	 	 	 	 
	
                  Yong
      Li

                	 	 	10	 	 	 	144,015	 	 	$	100,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Yuming
      Ning

                	 	 	10	 	 	 	144,015	 	 	$	100,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Chunying
      Diao

                	 	 	13	 	 	 	187,220	 	 	$	130,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Yining
      Xia

                	 	 	17	 	 	 	244,826	 	 	$	170,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Total

                	 	 	50	 	 	 	720,076	 	 	$	500,000	 


        

      

    

    


    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
F-1 TO THE

     

    SECURITIES
PURCHASE AGREEMENT

    __________________________________________

     

    FORM
OF OPINION OF COUNSEL

    


    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
F-2 TO THE

     

    SECURITIES
PURCHASE AGREEMENT

    __________________________________________

     

    FORM
OF OPINION OF PRC COUNSEL TO WFOE AND DALIAN BEFUT

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

     

    Disclosure
Schedules to Securities Purchase Agreement dated March 13, 2009 by and among
Frezer, Inc, a Nevada corporation (the “Company”), and each
of the Purchasers of Units whose names are set forth on Exhibit A
hereto.

    


    Schedule
2.1(a)

    Organization, Good Standing
and Power.

    


    Subsidiaries
of Frezer, Inc. after giving effect to the Reverse Merger:

    


    
      
        
          
            
              
                	
                        Names

                      	 	
                        Jurisdiction

                      	 	
                        Ownership

                      
	
                        BEFUT
      Corporation (“Befut Nevada”)

                      	 	
                        State
      of Nevada

                      	 	
                        100%
      owned by Frezer, Inc.

                      
	
                        Hongkong
      BEFUT Co., Limited (“Befut HongKong”)

                      	 	
                        Hong
      Kong

                      	 	
                        100%
      owned by Befut Nevada

                      
	
                        Befut
      Electric (Dalian) Co., Ltd.*

                      	 	
                        P.R.
      China

                      	 	
                        100%
      owned by Befut
Hongkong

                      


              

            

          

        

      

    

    


    * Dalian
Befut Wire & Cable Manufacturing Co., Ltd. (“Dalian Befut”) has entered
three agreements as disclosed in Schedule 2.1 (ee) through which 1) WFOE will
entrust Dalian Befut to manufacture certain of its products on an exclusive
basis. Dalian Befut is the exclusive manufacturer to the WFOE and it shall not
undertake any order from a third party without WFOE’s prior written consent; 2)
WFOE provides all the raw materials and affords related costs, provides design
requirements of the products; 3) WFOE is responsible for marketing and
distributing the products. 4) WFOE shall be permitted to use the intellectual
property rights such as trademark and technologies for the marketing and sale of
the products; and 5) Dalian Befut shall not compete against WFOE for the same or
similar business it has compared to WFOE.

    


    Schedule
2.1(c)

    


    Cap Table
of the Company [See an excel sheet to be sent together with this Word
File]

    


    Piggy
Back Registration Rights by three sellers of the majority interests of the
Company:

    


    The
Company has obligations under the following agreements, commitments and
instruments (Note: Demand Registration Rights as set forth in the agreements
below is terminated prior to the Closing Date.):

    


    REGISTRATION
RIGHTS AGREEMENT dated 22nd day of February, 2007, by and among Frezer, Inc. and
KI Equity Partners IV, LLC and amended March 12, 2009.


    
      
         


      

      
        1

        
          

        

      

      
         


      

    

    


    REGISTRATION
RIGHTS AGREEMENT dated 27th day of February, 2007, by and among Frezer, Inc. and
Garisch Financial, Inc. and amended March 12, 2009.

    


    REGISTRATION
RIGHTS AGREEMENT dated 27th day of February, 2007, by and among Frezer, Inc. and
Kevin R. Keating and amended March 12, 2009.

    


    Schedule
2.1(g)

    Subsidiaries.

    See
Schedule 2.1(a)

    


    Schedule
2.1(k)

    Indebtedness.

    None.

    


    Schedule
2.1(l)

    Title to
Assets.

    Please
refer to a PDF file regarding the pledge of certain facilities
attached.

    


    Schedule
2.1(o)

    Certain
Fees.

    None.

    


    Schedule
2.1(t)

    Material
Agreements.

    See
Schedule 2.1(c) regarding the three amendment registration rights agreements
with the three sellers of the majority equity interests of the Company prior to
the Closing Date.

    


    Schedule 2.1
(ee)

    List of
Agreements between WFOE and Dalian Befut:

     

    
      	
            	
              1、

            	
              Original
      Equipment Manufacturer Agreement, dated February 16, 2009, between the
      WFOE and Dalian Befut;

            


    

     

    
      	
            	
              2、

            	
              Intellectual
      Property License Agreement, dated February 16, 2009, between the WFOE and
      Dalian Befut;

            


    

     

    
      	
            	
              3、

            	
              Non-Competition
      Agreement, dated  February 16, 2009, between the WFOE and Dalian
      Befut.

            


    

     

    
      
         


      

      
        2