Employment Agreement, dated August 3, 2007



 Exhibit 10.9(b) 
 EMPLOYMENT AGREEMENT 
 THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and
entered into this 3rd day of August 2007, effective as of April 20, 2007 (the “Effective Date”), between American Oriental Bioengineering, Inc., a Nevada corporation with its principal place of business located at No. 4018
Jintian Road, Anlian Plaza, 12F Suite B02, Futian, District Shenzhen, PRC 518026 (the “Company”), and Yanchun Li, residing at Haidian District, Beijing, China (the “Executive”). 
 WHEREAS, the business of the Company and its affiliates consists of the development and production of bioengineered products and traditional Chinese
medicinal products that combine modern biotechnology and traditional Chinese medical technology, and activities incidental thereto (the “Business”); 
 WHEREAS, the Company has expended considerable time, effort and resources in the development of certain Confidential Information, as defined in paragraph 10 herein below, which must be maintained as confidential in
order to ensure the success of the Business; 
 WHEREAS, prior to the Effective Date, the Executive has been employed by the Company in the
position of, and has been performing the services required of, Chief Operating Officer and Chief Financial Officer of the Company; 
 WHEREAS, the Executive and the Company desire to memorialize the terms and conditions of the Executive’s employment by the Company in the position of Chief Operating Officer and Chief Financial Officer; and 
 WHEREAS, the Executive has had, prior to the Effective Date, and will continue to have, as of the Effective Date, access to such Confidential
Information, as defined in paragraph 10 herein below. 
 NOW, THEREFORE, in consideration of the covenants and promises contained herein, the
compensation and benefits received by the Executive from the Company, and the access given the Executive to the aforesaid Confidential Information, as defined in paragraph 10 herein below, and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, the Company and the Executive agree as follows: 
 1. EMPLOYMENT PERIOD. The Company
offers to employ the Executive, and the Executive agrees to be employed by the Company, in accordance with the terms and subject to the conditions of this Agreement commencing on the Effective Date and terminating on the first anniversary of the
Effective Date (the “Scheduled Termination Date”), unless terminated prior thereto in accordance with the provisions of paragraph 9 herein below. The term of this Agreement shall be automatically renewed for successive one (1) year
terms, unless either party gives the other party written notice of its intention not to renew the Agreement no later than 90 days prior to the expiration of the then current term. A determination by the Company not to renew this Agreement without
“Company Cause” shall be deemed a termination of employment for purposes of paragraph 9(d) and the terms thereof shall apply. 







 2. POSITION AND DUTIES. During the term of the Executive’s employment hereunder, the Executive will
serve in the position, and assume duties and responsibilities consistent with the position of Chief Operating Officer and Chief Financial Officer unless and until otherwise instructed by the Company. The Executive agrees to devote substantially all
of her working time, skill, energy and best business efforts during the term of her employment with the Company. The Executive covenants and agrees that for so long as she is employed by the Company, the Executive shall inform the Company of each
and every business opportunity related to the business of the Company of which the Executive becomes aware, and that the Executive will not, directly or indirectly, exploit any such opportunity for the Executive’s own account, nor will the
Executive render any services to any other person or business, acquire any interest of any type in any other business or engage in any activities that conflict with the Company’s best interests or which is in competition with the Company. The
Executive affirms that no obligation exists between the Executive and any other entity which would prevent or impede the Executive’s immediate and full performance of every obligation of this Agreement. 
 3. HOURS OF WORK. The Executive’s normal days and hours of work shall coincide with the Company’s regular business hours. The nature of the
Executive’s employment with the Company requires flexibility in the days and hours that the Executive must work, and may necessitate that the Executive work on other or additional days and hours. The Company reserves the right to require the
Executive, and the Executive agrees, to work during other or further days or hours than the Company’s normal business hours. 
 4.
LOCATION. The locus of the Executive’s employment with Company shall be the Company’s office located at No. 4018 Jintian Road, Anlian Plaza, 12F Suite B02, Futian, District Shenzhen, PRC 518026. The Company may, in its sole
discretion, require the Executive to travel to and reside in, on a temporary, indefinite or permanent basis, in any other location throughout the world in which the Company or any of its affiliates has offices. 
 5. BASE SALARY. In consideration of the Executive’s services under this Agreement, the Company shall pay or cause to pay, and the Executive agrees
to accept, during the one year period following the Effective Date (the “First Year”), an annual base salary of US$160,000, less all applicable taxes and other appropriate deductions, paid in accordance with the Company’s standard
payroll practices. Following the First Year, the Executive’s base salary shall be reviewed annually by the Board of Directors of the Company. The decision to increase or decrease the Executive’s base salary and the amount of any such
increase or decrease are within the sole discretion of the Board of Directors. Nothing contained in this paragraph 5 is intended to be, or should be construed as, a promise or guarantee by the Company to increase the Executive’s base salary.
The Company reserves the right, in its sole discretion, and the Executive hereby acknowledges the Company’s right, to make no such payments or make reduced payments in connection with any periods of unauthorized or unjustified absence from work
or in the event that the Executive is unavailable or unable to perform the Executive’s duties for the Company without adequate justification, as determined by the Company in its sole discretion. 







 6. BONUS COMPENSATION. During the term hereof, the Executive shall have the opportunity to earn an annual
performance based bonus equal to up to US$30,000 based upon the Company’s attainment of certain annual net income targets, as set by the Board of Directors in its sole discretion on an annual basis. Such bonus amount may be increased in the
event the annual net income target is exceeded, however, shall not exceed 300% of the annual performance based bonus. The Board of Directors may, from time to time, also pay such other bonus or bonuses to the Executive as the Board of Directors, in
its sole discretion, deems appropriate. In order to receive the annual performance based bonus, the Executive must continue to be employed by the Company through the end of the period with respect to which the annual performance bonus has been
earned. The annual performance based bonus will be paid to the Executive at such time as bonuses for the applicable period are regularly paid to senior executives of the Company. 
 7. STOCK OPTIONS. The Executive shall receive stock options to purchase 160,000 shares of common stock of the Company for the First Year. The exercise
price per share shall be determined by the Compensation Committee of the Board and shall be at least equal to the last closing price of the Company’s common stock, as reported by Bloomberg LP, on the New York Stock Exchange, or any such
securities exchange on which the Company’s common stock is listed or quoted for trading, on April 20, 2007, the date of grant (the “Stock Options”). The Stock Options shall vest in five equal installments on each April 19 of
the first, second, third, fourth and fifth anniversary of the grant, subject to the Executive’s continued employment with the Company on each vesting date, and further to subject to accelerated vesting under the applicable incentive plan, the
applicable grant agreement and the terms of this Agreement. The Stock Options shall be granted under the Company’s 2006 Equity Incentive Plan and pursuant to the terms of the Company’s standard form of stock option agreement approved by
the Board of Directors. The Compensation Committee shall determine, on an annual basis, the number of Stock Options to be granted to the Executive for each renewal period. 
 8. REIMBURSEMENT OF EXPENSES. During the term of this Agreement, in accordance with the Company’s expense reimbursement policy, the Executive shall
be entitled to reimbursement for reasonable expenses (including, without limitation, reasonable travel expenses) paid or incurred by her, in connection with and related to the performance of her duties and responsibilities hereunder for the Company.
All requests by Executive for reimbursement for such expenses must be supported by appropriate invoices, vouchers, receipts or such other supporting documentation in such form and containing such information as the Company may from time to time
require, evidencing that the Executive, in fact, incurred or paid said expenses. 
 9. TERMINATION. 
 a. DEATH OR RESIGNATION. If the Executive dies or resigns during the term of this Agreement, this Agreement shall automatically terminate on the date of
the Executive’s death or resignation and, following the date of the Executive’s death or resignation, the Company shall have no further obligations or liability to the Executive or her heirs, administrators or executors with respect to
compensation and benefits thereafter, except for the obligation to pay the Executive (i) any earned but unpaid base salary through the Executive’s date of death or resignation, (ii) for any unused accrued and unforfeited vacation, and
(iii) subject to 








 
paragraph 8 hereinabove, for any unreimbursed business expenses incurred by the Executive prior to her death or resignation. The Company shall deduct, from
all payments made hereunder, all applicable taxes, including income tax, FICA and FUTA, and other appropriate deductions. 
 b. DISABILITY.
At any time during the term of this Agreement, the Company may terminate this Agreement and the Executive’s employment with the Company because of the Executive’s “Disability,” by written notice to the Executive. For purposes of
this Agreement, “Disability” shall mean, if at the end of any calendar month during the term of this Agreement, the Executive, as a result of mental or physical illness or injury, is or has been unable to perform her duties under this
Agreement, with or without reasonable accommodation, for (i) the four (4) preceding consecutive calendar months, or (ii) any 180 days in the previous twelve (12) months. If this Agreement is terminated because of the
Executive’s “Disability,” the Company shall have no further obligations or liability to the Executive or her heirs, administrators or Executors with respect to compensation and benefits thereafter, except for the obligation to pay the
Executive (x) any earned but unpaid base salary through the date of termination for “Disability”, at the rate then in effect, (y) for any unused accrued and unforfeited vacation, and (z) subject to paragraph 8 hereinabove,
for any unreimbursed business expenses incurred by the Executive prior to her last date of employment with the Company. The Company shall deduct, from all payments made hereunder, all applicable taxes, including income tax, FICA and FUTA, and other
appropriate deductions. 
 c. “CAUSE.” At any time during the term of this Agreement, the Company may terminate this Agreement and
the Executive’s employment with the Company, at any time, for “Company Cause.” For purposes of this Agreement, “COMPANY CAUSE” shall mean: (i) the good faith determination by the Company’s Board of Directors that
there has been continued neglect by the Executive of her duties hereunder, or (ii) willful misconduct on the Executive’s part in connection with the performance of her duties hereunder, PROVIDED HOWEVER, that the Executive shall have been
given one (1) written notice of such determination by the Company’s Board of Directors of continued neglect or willful misconduct and thereafter the Executive shall not have cured such neglect or willful misconduct to the satisfaction of
the Company’s Board of Directors within fifteen (15) days of the Executive’s receipt of such written notice, (iii) the Executive is convicted of or pleads guilty or no contest to a felony or other conduct involving moral
turpitude. If this Agreement and the Executive’s employment is terminated for “Company Cause,” following the Executive’s last date of employment with the Company, the Company shall have no further obligations or liability to the
Executive or her heirs, administrators or Executors with respect to compensation and benefits thereafter, except for the obligation to pay the Executive (x) any earned but unpaid base salary through the Executive’s last date of employment,
at the rate then in effect, (y) for any unused accrued and unforfeited vacation, and (z) subject to paragraph 8 hereinabove, for any unreimbursed business expenses incurred by the Executive prior to the last date of employment with the
Company. The Company shall deduct, from all payments made hereunder, all applicable taxes, including income tax, FICA and FUTA, and other appropriate deductions. 
 d. TERMINATION BY THE CHIEF EXECUTIVE OFFICER. At any time during the term of this Agreement, the Chief Executive Offficer of the Company, in his sole discretion, may terminate this Agreement and the Executive’s
employment with the 








 
Company without “Company Cause” by delivering to the Executive written notice. If this Agreement and the Executive’s employment with the
Company is terminated without “Company Cause,” following the Executive’s last date of employment with the Company, the Company shall have no further obligations or liability to the Executive or her heirs, administrators or executors
with respect to compensation and benefits thereafter, except for the obligation to pay the Executive (i) any earned but unpaid base salary through the Executive’s last date of employment, at the rate then in effect, (ii) for any
unused accrued and unforfeited vacation, (iii) her base salary in effect at the time of her termination in accordance with paragraph 5 hereinabove through the Scheduled Termination Date or renewal period, as the case may be, and
(iv) subject to paragraph 8 hereinabove, for any unreimbursed business expenses incurred by the Executive prior to her last date of employment with the Company. The Company shall deduct, from all payments made hereunder, all applicable taxes,
including income tax, FICA and FUTA, and other appropriate deductions. 
 10. CONFIDENTIAL INFORMATION. 
 a. The Executive expressly acknowledges that, in the performance of her duties and responsibilities relating to his employment with the Company, she has
been exposed and will continue to be exposed to the trade secrets, business and/or financial secrets and confidential and proprietary information of the Company, its affiliates and/or its clients or customers (“Confidential Information”).
The term “Confidential Information” means information or material that has actual or potential commercial value to the Company, its affiliates and/or its clients or customers and is not generally known to and is not readily ascertainable
by proper means to persons outside the Company, its affiliates and/or its clients or customers, and includes, without limitation, the following, whether or not expressed in a document or medium, regardless of the form in which it is communicated,
whether or not such information is on the Company’s forms, memos, computer disc or tape, or otherwise, whether or not such information is in written or verbal form, and whether or not marked “trade secret” or “confidential”
or any similar legend: (i) sales information, (ii) operations information, (iii) financial information, (iv) administrative information, (v) research information, (vi) customer information, (vii) supplier
information, and (viii) any other information concerning the Company, its business, its properties or its affairs that the Company deems to be confidential or that is confidential according to industry practices. 
 b. Except as authorized in writing by the Company’s Chief Executive Officer, during the term of this Agreement, any renewal periods, and thereafter
until such time as any such Confidential Information becomes generally known to and readily ascertainable by proper means to persons outside the Company, its affiliates and/or its clients or customers, the Executive agrees to keep strictly
confidential and not use or disclose, cause to be used or disclosed, or permit to be used or disclosed, to any person or entity and/or for her personal benefit or the benefit to any other person or entity, any Confidential Information. 

c. The Executive agrees that upon termination of her employment with the Company for any reason, he will promptly return to the Company all
Confidential Information within her possession or within her power to control, including, without limitation all copies of such Confidential Information, all abstracts of such Confidential Information and any other information containing such
Confidential Information in whole or in part. 







 d. The Executive affirms that she did not and does not possess, and has not relied and will not rely upon
the protected trade secrets or confidential or proprietary information of the Executive’s prior employer(s) in providing services to the Company. 
 11. OWNERSHIP AND ASSIGNMENT OF INVENTIONS. 
 a. The Executive acknowledges that, in connection with her
duties and responsibilities relating to her employment with the Company, the Executive and/or other employees of the Company working with the Executive, without the Executive or under the Executive’s supervision, may have created, conceived of,
made, prepared, worked on or contributed to, and/or may create, conceive of, make, prepare, work on or contribute to, the creation of, or may have been or may be asked by the Company and/or its affiliates or customers to create, conceive of, make,
prepare, work on or contribute to the creation of, without limitation, lists, business diaries, business address books, documentation, ideas, concepts, inventions, designs, works of authorship, computer programs, audio/visual works, developments,
proposals, works for hire or other materials (“Inventions”). To the extent that any such Inventions related or relate to any actual or reasonably anticipated business of the Company or any of its affiliates or customers, or falls within,
is suggested by or results from any tasks assigned to the Executive for or on behalf of the Company or any of its affiliates or customers, the Executive expressly acknowledges that all of her activities and efforts relating to any Inventions,
whether or not performed during the Executive’s or the Company’s regular business hours, are within the scope of the Executive’s employment with the Company and that the Company owns all right, title and interest in and to all
Inventions, including, to the extent that they exist, all intellectual property rights thereto, including, without limitation, copyrights, patents and trademarks in and to all Inventions. The Executive also acknowledges and agrees that the Company
owns and is entitled to sole ownership of all rights and proceeds to all Inventions. 
 b. The Executive expressly acknowledges and agrees to
assign to the Company, and hereby assigns to the Company, all of the Executive’s right, title and interest in and to all Inventions, including, to the extent they exist, all intellectual property rights thereto, including, without limitation,
copyrights, patents and trademarks in and to all Inventions. 
 c. In connection with all Inventions, the Executive agrees to disclose any
Invention promptly to the Company and to no other person or entity. The Executive further agrees to execute promptly, at the Company’s request, specific written assignments of the Executive’s right, title and interest in any Inventions,
and do anything else reasonably necessary to enable the Company to secure or obtain a copyright, patent, trademark or other form of protection in or for any Invention in the United States or other countries. The Executive further agrees that the
Company is not required to designate the Executive as an author of or contributor to any Invention or to secure the Executive’s permission to change or otherwise alter any Invention. 
 d. The Executive acknowledges that all rights, waivers, releases and/or assignments granted herein and made by the Executive are freely assignable by the
Company and are made for the benefit of the Company and its affiliates, subsidiaries, licensees, successors and assigns. 







 e. The Executive agrees to waive, and hereby does waive, for the benefit of all persons, any and all
right, title and interest in the nature of “moral rights” or “droit moral” granted to the Executive in any country in the world. 
 12. NON-COMPETITION AND NON-SOLICITATION. Because of the nature of the Company’s Business, and because, as a result of her employment with the Company, the Executive has been and will continue to be exposed to
Confidential Information, the Executive acknowledges that the Company would sustain grievous harm in the event that she were to disclose Confidential Information, engage in business activities that compete with the Business, appropriate or divert
business or customers of the Company or its affiliates and/or induce employees or consultants of the Company or its affiliates to leave the employment of the Company or its affiliates. The Executive acknowledges that the Company has a legitimate
business interest in protecting itself from the aforementioned harm and in the protection and maintenance of the Confidential Information and of the good will and customer relationships of the Company and its affiliates. Therefore, the Executive
hereby agrees and covenants to be bound by the non-competition and non-solicitation restrictions set forth herein below, which restrictions the Executive agrees and acknowledges are reasonable and necessary and do not impose undue hardship or
burdens on the Executive. 
 a. The Executive agrees that, during her employment with the Company and for a period of three (3) years
following the termination of her employment with the Company, she and her affiliates shall not directly or indirectly own, manage, operate, control, be employed by, consult for, be a shareholder of, be an officer of, participate in, contract with or
be connected in any capacity or any manner with any person or entity whose business activities directly or indirectly (whether through related persons, entities or otherwise) compete with the Business anywhere in the United States, Canada and the
People’s Republic of China, where the Company or its affiliates is engaged in the Business, PROVIDED HOWEVER, that the Executive shall not be prevented from owning an interest in a publicly traded company so long as the fair market value of
such interest at the date of acquisition is less than US$100,000. 
 b. The Executive agrees that during the period of her employment with
the Company and for a period of three (3) years following the termination of her employment with the Company, for any reason, she will not, within the United States, Canada and the People’s Republic of China, where the Company or its
affiliates is engaged in the Business, directly or indirectly recruit, induce, divert, supervise, employ, manage, hire or entice, or cause to be recruited, induced, diverted, supervised, employed, managed, hired or enticed, any employee, consultant
or independent contractor of the Company or its affiliates to leave or terminate the employment or other relationship thereof, for any reason. 
 c. The Executive agrees that during the period of her employment with the Company and for a period of three (3) years following the termination of her employment with the Company, she will not, within the United States, Canada and the
People’s Republic of China, where the Company or its affiliates is engaged in the Business, directly or indirectly appropriate, call on, induce, divert or solicit, or assist another to appropriate, call on, induce, divert or solicit any actual
or potential business or customer away from the Company or its affiliates, or attempt to do any of the foregoing, or otherwise induce or attempt to induce any actual or potential business or customer of the Company or its affiliates, to terminate or
adversely modify its relationship with the Company or 








 
its affiliates, or to enter into a relationship with or conduct business with the Company or its affiliates, which actual or potential business or customer
the Executive was involved with or had a relationship with or whose identity became known to the Executive in connection with the Executive’s employment with the Company. 
 d. If any of the restrictive covenants set forth in paragraphs 12(a), (b) and (c) of this Agreement is held to be invalid, illegal or
unenforceable (in whole or in part), such restrictive covenant shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability, and a court of competent jurisdiction shall have the power to modify,
any such restrictive covenant to the extent necessary to render such provision enforceable, and the remaining restrictive covenant shall not be affected thereby. 
 e. In the event of a violation of any of the restrictive covenants set forth in paragraphs 12(a), (b) and (c) of this Agreement, if the Executive is prevented by a court or arbitrator from committing any
further violation, whether by a temporary restraining order, injunction or otherwise, the time periods set forth in paragraphs 12(a), (b) and (c) of this Agreement shall be computed by commencing the periods on the date of the applicable
court or arbitrators’ order and continuing them from that date for the full period provided. 
 f. The Executive shall have the right to
request a waiver of all or part of the restrictive covenants contained in paragraphs 12(a), (b) and (c) of this Agreement by providing the Company with a written request for such a waiver that contains all relevant details. The Company
may, in its sole discretion, waive all or part of the restrictive covenants contained in paragraphs 12(a), (b) and (c) of this Agreement on such terms and conditions, and to such extent, as it, in its sole discretion, deems appropriate.
Such waiver must be in writing. 
 g. The parties acknowledge that this Agreement would not have been entered into, that the benefits
described in paragraphs 5, 6 and 7 would not have been promised to the Executive by the Company, in the absence of the Executive’s covenants and promises set forth in paragraphs 12(a), (b) and (c) of this Agreement. 
 13. DISPUTE RESOLUTION. The Executive and the Company agree that any dispute or claim, whether based on contract, tort, discrimination, retaliation, or
otherwise, relating to, arising from, or connected in any manner with this Agreement or with the Executive’s employment with Company shall be resolved exclusively through final and binding arbitration under the auspices of the Hong Kong Chamber
of Commerce (“HKCC”) in accordance with the commercial arbitration rules and supplementary procedures for international commercial arbitration of the HKCC. The arbitration shall be held in Hong Kong. There shall be three arbitrators: one
arbitrator shall be chosen by each party to the dispute and those two arbitrators shall choose the third arbitrator. Each party shall cooperate with the other in making full disclosure of and providing complete access to all information and
documents requested by the other party in connection with the arbitration proceedings. Arbitration shall be the sole, binding, exclusive and final remedy for resolving any dispute between the parties. The arbitrators shall have jurisdiction to
determine any claim, including the arbitrability of any claim, submitted to them. The arbitrators may grant any relief authorized by law for any properly established claim. The interpretation and enforceability of this paragraph of this Agreement
shall be governed and construed in accordance with the United 








 
States Federal Arbitration Act, 9. U.S.C. ss.1, ET SEQ. More specifically, the parties agree to submit to binding arbitration any claims for unpaid wages or
benefits, or for alleged discrimination, harassment, or retaliation, arising under Title VII of the Civil Rights Act of 1964, the Equal Pay Act, the National Labor Relations Act, the Age Discrimination in Employment Act, the Americans With
Disabilities Act, the Executive Retirement Income Security Act, the Civil Rights of 1991, the Family and Medical Leave Act, the Fair Labor Standards Act, Sections 1981 through 1988 of Title 42 of the United States Code, COBRA, and any other federal,
state, or local law, regulation, or ordinance, and any common law claims, claims for breach of contract, or claims for declaratory relief. The Executive acknowledges that the purpose and effect of this paragraph is solely to elect private
arbitration in lieu of any judicial proceeding she might otherwise have available to her in the event of an employment-related dispute between her and the Company. Therefore, the Executive hereby waives her right to have any such employment-related
dispute heard by a court or jury, as the case may be, and agrees that her exclusive procedure to redress any employment-related claims will be arbitration. 
 14. MISCELLANEOUS. 
 a. Telephones, stationery, postage, e-mail, the internet and other resources made
available to the Executive by the Company, are solely for the furtherance of the Company’s business. 
 b. All issues concerning,
relating to or arising out of this Agreement and from the Executive’s employment by the Company, including, without limitation, the construction and interpretation of this Agreement, shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to that State’s principles of conflicts of law. 
 c. The Executive and
the Company agree that any provision of this Agreement deemed unenforceable or invalid may be reformed to permit enforcement of the objectionable provision to the fullest permissible extent. Any provision of this Agreement deemed unenforceable after
modification shall be deemed stricken from this Agreement, with the remainder of the Agreement being given its full force and effect. 
 d.
The Company shall be entitled to equitable relief, including injunctive relief and specific performance as against the Executive, for the Executive’s threatened or actual breach of paragraphs 10, 11 or 12 of this Agreement, as money damages for
a breach thereof would be incapable of precise estimation, uncertain, and an insufficient remedy for an actual or threatened breach of paragraphs 10, 11 or 12 of this Agreement. The Executive and the Company agree that any pursuit of equitable
relief in respect of paragraphs 10, 11 or 12 of this Agreement shall have no effect whatsoever regarding the continued viability and enforceability of paragraph 13 of this Agreement. 
 e. Any waiver or inaction by the Company for any breach of this Agreement shall not be deemed a waiver of any subsequent breach of this Agreement.

 f. The Executive and the Company independently have made all inquiries regarding the qualifications and business affairs of the 








 
other which either party deems necessary. The Executive affirms that he fully understands this Agreement’s meaning and legally binding effect. Each
party has participated fully and equally in the negotiation and drafting of this Agreement. Each party assumes the risk of any misrepresentation or mistaken understanding or belief relied upon by her or it in entering into this Agreement.

 g. The Company and the Executive agree that the Executive’s obligations to the Company during the Executive’s employment with
the Company, as well as any other obligation of the Executive under this Agreement, may be assigned to any successor in interest to the Company or any division or affiliate of the Company in its sole discretion and without additional consideration
or prior notice to the Executive, but that nothing requires the Company to do so. The Executive’s obligations under this Agreement are personal in nature and may not be assigned by the Executive to any other person or entity. 
 h. The Company and the Executive acknowledge and agree that future alterations to the Executive’s work hours, working title, management or
supervisory responsibilities, number of subordinate employees, sales or promotional budgets, reporting relationships within the Company or with businesses affiliated with the Company, management responsibilities or duties, or similar changes or
alterations may occur periodically during the Executive’s employment with the Company. The Company and the Executive agree that the Company, in its sole discretion, may implement such alterations or adjustments for any or no reason and that any
such action shall not constitute a breach of this Agreement so long as the Company continues to perform its remaining obligations as provided by this Agreement. 
 i. This instrument constitutes the entire Agreement between the parties regarding its subject matter. When signed by all parties, this Agreement supersedes and nullifies all prior or contemporaneous conversations,
negotiations, or agreements, oral and written, regarding the subject matter of this Agreement. In any future construction of this Agreement, this Agreement should be given its plain meaning. This Agreement may only be amended only by a writing
signed by the Company and the Executive. 
 j. Notwithstanding the termination of this Agreement and of the Executive’s employment with
the Company for any reason, paragraphs 10, 11 and 12 of this Agreement shall continue in full force and effect in accordance with their terms following such termination. 
 k. This Agreement may be executed in counterparts, a counterpart transmitted via facsimile, and all executed counterparts, when taken together, shall constitute sufficient proof of the parties’ entry into this
Agreement. The parties agree to execute any further or future documents which may be necessary to allow the full performance of this Agreement. This Agreement contains headings for ease of reference. The headings have no independent meaning.

 THE EXECUTIVE STATES THAT SHE HAS FREELY AND VOLUNTARILY ENTERED INTO THIS AGREEMENT AND THAT SHE HAS READ AND UNDERSTOOD EACH AND EVERY PROVISION
THEREOF. THIS AGREEMENT IS EFFECTIVE UPON THE EXECUTION OF THIS AGREEMENT BY BOTH PARTIES. 
 UNDERSTOOD, AGREED, AND ACCEPTED: 
  

							
	YANCHUN LI	 	AMERICAN ORIENTAL BIOENGINEERING, INC.
				
	Name:	 	 /s/ Yanchun Li
	 	By:	 	 /s/ Tony Liu

		 		 	Name:	 	Tony Liu
		 		 	Title:	 	Chairman and Chief Executive Officer
		
	Date: August 3, 2007	 	Date: August 3, 2007