PURCHASE
AGREEMENT

     

    This
Purchase Agreement (this “Agreement”) is made
as of January ___, 2009 by and among Ms. Yan Li (the “Seller”), the
purchasers set forth on the signature pages hereto (each, a “Purchaser” and
collectively, the “Purchasers”) and
China-Biotics, Inc., a Delaware corporation (the “Company”).

     

    WHEREAS,
Seller desires to sell certain of her shares of the Company’s common stock, par
value $0.0001 per share (the “Common Stock”), to
the Purchasers and the Purchasers desire to purchase such shares.

     

    WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to
Sections 4(1) and 4(2) of the Securities Act of 1933, as amended (the “Securities Act”),
Seller desires to sell and transfer to each Purchaser the number of shares of
Common Stock set forth on such Purchaser’s signature page hereto, which such
shares of Common Stock were originally issued to the Seller by the Company (the
“Shares”) and
each Purchaser desires to purchase the Shares from the Seller.

     

    NOW,
THEREFORE, in consideration of the mutual covenants contained in this Agreement
and for other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the Seller, the Company and the Purchasers hereby agree
as follows:

     

    Section
1.           Agreement to
Purchase.  Each Purchaser hereby agrees to purchase, and the
Seller hereby agrees to sell, the Shares set forth on each such Purchaser’s
signature page pursuant to the conditions set forth herein.  The
purchase price per Share being sold to the Purchasers hereunder is $6.60 (the
“Purchase
Price”).

     

    Section
2.            Closing;
Delivery.

     

    a.           The
closing under this Agreement shall occur upon delivery of executed signature
pages to this Agreement and all other documents, instruments and writings
required to be delivered pursuant to this Agreement as provided in Sections 2(b)
and 2(c) to the offices of Winston & Strawn LLP, 200 Park Avenue, New York,
NY 10166 (the “Closing”) at 10:00
a.m. (eastern time) on such date as the Purchasers and Seller may agree upon
(the “Closing
Date”).

     

    b.           Following
the execution of this Agreement, (i) the Seller will deliver, or cause to be
delivered, to the Company’s transfer agent the certificate representing the
Shares together with all executed stock power and assignment documents which may
be relevant in order to effectuate the transfer of the Shares to the Purchasers
and (ii) each Purchaser will deliver to the Seller by wire transfer of
immediately available funds to such account as designated by Seller, a United
States dollar amount equal to the product of the Purchase Price multiplied by
the number of Shares set forth on such Purchaser’s signature page
hereto.

     

    c.           At
the Closing, the Seller will deliver, or cause to be delivered, to each
Purchaser a facsimile copy of the certificate representing the Shares being
purchased by such Purchaser in the name of each such Purchaser.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    Section
3.           Representations and
Warranties of each Purchaser.  Each Purchaser, severally and
not jointly, hereby represents and warrants to the Seller and the Company as
follows:

     

    a.           Intent.  Such
Purchaser is acquiring the Shares as principal for its own account and not with
a current view to or for distributing or reselling such Shares, without
prejudice, however, to such Purchaser’s right, at all times, to sell or
otherwise dispose of all or any part of such Shares pursuant to an effective
registration statement under the Securities Act or under an exemption from such
registration and in compliance with applicable federal and state securities
laws.  Nothing contained herein shall be deemed a representation or
warranty by any Purchaser to hold the Shares for any period of
time.  Such Purchaser is acquiring the Shares hereunder in the
ordinary course of its business and does not have any agreement or
understanding, directly or indirectly, with any person to distribute any of the
Shares.

     

    b.           Organization;
Authority.  Such Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite partnership power and authority to enter into
and to consummate the transactions contemplated hereby and otherwise to carry
out its obligations hereunder. The purchase by each such Purchaser of the Shares
hereunder has been duly authorized by all necessary action on the part of such
Purchaser.  This Agreement has been duly executed by each such
Purchaser, and when delivered by such Purchaser in accordance with the terms
hereof, will constitute the valid and legally binding obligation of such
Purchaser, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors’ rights generally.

     

    c.           Purchaser
Status.  Such Purchaser is an “accredited investor” as defined
in Rule 501(a) under the Securities Act.  Such Purchaser is not a
registered broker-dealer under Section 15 of the Securities Exchange Act of
1934, as amended (the “Exchange
Act”).

     

    d.           Experience of such
Purchaser.  Such Purchaser, either alone or together with its
representatives, has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
the prospective investment in the Shares, and has so evaluated the merits and
risks of such investment.  Such Purchaser is able to bear the economic
risk of an investment in the Shares and, at the present time, is able to afford
a complete loss of such investment.

     

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

     

    f.           Independent Investment
Decision.  Such Purchaser has independently evaluated the
merits of its decision to purchase the Shares pursuant to this Agreement, and
such Purchaser confirms that it has not relied on the advice of any other
Purchaser’s business and/or legal counsel in making such
decision.  Such Purchaser has not relied on the business or legal
advice of Roth Capital Partners, LLC or any of its agents, counsel or affiliates
in making its investment decision hereunder, and confirms that none of such
persons has made any representations or warranties to Purchaser in connection
with the transactions contemplated by this Agreement.  Such Purchaser
has had the opportunity to conduct its own due diligence and have its questions
regarding the Company and the Shares answered to its
satisfaction.


    
      
         


      

      
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    g.           Non-Public
Information.  Such Purchaser acknowledges that the Seller may
be an "affiliate" of the Company as such term is defined in the Securities Act
and the rules and regulations promulgated thereunder, and that the Seller may
have non-public information (which may or may not be relevant to such
Purchaser’s consideration of an investment in the Shares) with respect to the
Company which each Purchaser agrees need not be provided to him or
her.

     

    h.           Restricted
Securities.  Such Purchaser acknowledges that the Shares are
“restricted securities” as defined in Rule 144 under the Securities
Act.

     

    Section
4.             Representations and
Warranties of the Company.  The Company hereby represents and
warrants to each Purchaser as follows:

     

    a.           Authority.  This
Agreement has been duly executed by the Company, and when delivered by the
Company in accordance with the terms hereof, will constitute the valid and
legally binding obligation of the Company, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors’ rights generally.

     

    Section
5.            Representations and
Warranties of the Seller.  The Seller hereby represents and
warrants to each Purchaser and the Company as follows:

     

    a.           Power and
Authority.  Such Seller has full authority and power to execute
and deliver this Agreement and subject in part to the truthfulness of
Purchasers’ representations herein, to sell and transfer the Shares to the
Purchasers as provided herein.  This Agreement has been duly executed
and delivered by such Seller and constitutes the valid and binding obligation of
such Seller enforceable against such Seller in accordance with its respective
terms, subject to applicable bankruptcy, reorganization, insolvency, moratorium
or similar laws affecting creditors’ rights generally.

     

    b.           Ownership.  Seller
is the sole and exclusive owner, beneficially and of record, of the Shares, free
and clear of any lien, encumbrance or pledge and, except for restrictions on
transfer imposed by applicable securities laws, has the unconditional right to
sell the Shares as contemplated by this Agreement.  At the Closing,
upon payment of the Purchase Price, the Purchasers will acquire all right, title
and interest in the Shares, free and clear of any lien, encumbrance or pledge
other than restrictions on transfer in accordance with applicable securities
laws.  Such Seller is not aware of any third party claims with respect
to the Shares.

     

    c.           Solicitation.  At
no time did such Seller present or solicit, by means of any publicly issued or
circulated newspaper, mail, radio, television or other form of general
advertising or solicitation, in connection with the offer, sale and purchase of
the Shares.


    
      
         


      

      
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    d.           No
Conflicts.  The execution and delivery of this Agreement and
the performance of its respective terms will not, with or without the giving of
notice or the passage of time, conflict with, constitute a violation or breach
of or result in a default under, result in the acceleration of, create in any
party the right to accelerate, terminate, modify, or cancel or require any
notice or consent under (a) any contract, security interest, or other
arrangement to which such Seller is a party or by which such Seller or its
property is bound or to which any of such Seller’s assets are subject, (b) any
order, writ, injunction, award, decree, decision or ruling of any court,
arbitrator or governmental or regulatory body against or binding such Seller or
its property, or (c) any statute, law, rule or regulation of any jurisdiction to
which Seller or its property may be subject.

     

    Section
6.            Certain Obligations of the
Parties.  The Seller covenants and agrees to provide to the
Purchasers and the Company any and all documents which may be reasonably
required in order to effectuate the transactions contemplated by this Agreement,
including, without limitation, the opinion of counsel referenced in Section 2
above.  The Company will use its reasonable best efforts to prepare
and file with the Securities and Exchange Commission a registration statement,
including the prospectus, for an offering to be made on a continuous basis
pursuant to Rule 415 of the Securities Act, on Form S-1 (or on such other form
appropriate for such purpose) (collectively, the “Registration
Statement”) by the 30th day
following the Closing Date covering the resale by the Purchasers of the Shares
and naming the Purchasers as Selling Stockholders therein.  Each
Purchaser shall cooperate with the Company in providing any required or
advisable information regarding such Purchaser for inclusion in the Registration
Statement and shall be solely responsible for all such information provided by
it for inclusion (and, pursuant to Section 9c. hereof, shall indemnify, defend
and hold harmless the Company, its officers, directors employees, agents,
affiliates and advisors from and against any and all costs and liabilities
incurred by any of them arising from or relating to any untrue statement or
omission of material facts relating to such Purchaser provided by or omitted by
such Purchaser).  The Company will use its reasonable best efforts to
cause the Registration Statement be declared effective under the Securities Act
as soon as possible but, in any event, no later than the 120th day
following the Closing Date, and shall use its reasonable best efforts to keep
the Registration Statement continuously effective during the entire
Effectiveness Period.  For purposes hereof, “Effectiveness Period”
shall mean the period commencing on the date on which the Registration Statement
is first declared effective by the Securities and Exchange Commission (the
“Effective
Date”) and ending on the earliest to occur of (a) the second anniversary
of such Effective Date, (b) such time as all of the Shares covered by the
Registration Statement have been publicly sold by the Purchasers pursuant to the
Registration Statement, or (c) such time as all of the Shares covered by the
Registration Statement may be sold by the Purchasers without volume restrictions
pursuant to Rule 144 of the Securities Act, in each case as determined by the
counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company's transfer agent and the affected
Purchasers.  Each Purchaser covenants and agrees that it will comply
with the prospectus delivery requirements of the Securities Act as applicable to
it in connection with sales of Shares pursuant to the Registration
Statement.  Each Purchaser covenants and agrees that it will comply
with federal and state securities laws applicable to it in connection with sales
of Shares pursuant to the Registration Statement.

     

    Section
7.            Conditions Precedent to the
Obligation of the Seller to Sell the Shares on the Closing
Date.  The obligation hereunder of the Seller to sell the
Shares to the Purchasers is subject to the satisfaction or waiver, on or before
the Closing, of each of the conditions set forth below.


    
      
         


      

      
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    a.           This
Agreement shall have been executed by the Purchasers and the Company and
delivered to the Seller;

     

    b.           The
representations and warranties of each Purchaser shall be true and correct in
all material respects as of the date when made and as of the Closing Date;
and

     

    c.           No
statute, 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.

     

    Section
8.           Conditions Precedent to the
Obligation of each Purchaser to Purchase the Shares on the Closing
Date.  The obligation hereunder of each Purchaser to purchase
the Shares from the Seller is subject to the satisfaction or waiver, on or
before the Closing, of each of the conditions set forth below.

     

    a.           This
Agreement shall have been executed by the Seller and the Company and delivered
to each Purchaser;

     

    b.           The
representations and warranties of the Seller and the Company shall be true and
correct in all material respects as of the date when made and as of the Closing
Date;

     

    c.           No
statute, 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; and

     

    d.           The
Seller shall have performed, satisfied and complied in all material respects
with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by it at or prior to the
Closing.

     

    Section
9.            Indemnification.

     

    a.           The
Seller hereby agrees to indemnify and hold harmless each Purchaser and its
respective officers, directors, shareholders, employees, agents and attorneys
against any and all losses, claims, damages, liabilities and expenses incurred
by each such person insofar as such losses, claims, demands, liabilities and
expenses arise out of or are based upon any breach of any representation,
warranty or agreement made by the Seller in this Agreement; provided, however, in no event
shall the maximum aggregate liability of the Seller to each Purchaser pursuant
to this Section 9 be in excess of the product of the Purchase Price multiplied
by the aggregate number of Shares purchased by such Purchaser
hereunder.

     

    b.           The
Seller hereby agrees to indemnify and hold harmless the Company and its
respective officers, directors, shareholders, employees, agents and attorneys
against any and all losses, claims, damages, liabilities and expenses incurred
by each such person insofar as such losses, claims, demands, liabilities and
expenses arise out of or are based upon (i) any breach of any representation,
warranty or agreement made by the Seller in this Agreement; (ii) any violation
or alleged violation by the Seller of the Securities Act, Exchange Act or any
state securities law or any rule or regulation thereunder, in connection with
the performance of her obligations under this Agreement; or (iii) any untrue or
alleged untrue statement of a material fact made by the Seller in the
Registration Statement or in any amendment or supplement thereto, or arising out
of or relating to any of the Seller’s omission or alleged omission to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, in no event
shall the maximum aggregate liability of the Seller to the Company pursuant to
this Section 9 be in excess of the funds received by Seller in connection with
the sale of Shares pursuant to this Agreement.


    
      
         


      

      
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    c.           Each
Purchaser, severally and not jointly, hereby agrees to indemnify and hold
harmless the Seller and the Company and each of their directors, officers,
agents, advisors and affiliates against any and all losses, claims, damages,
liabilities and expenses incurred by each such person insofar as such losses,
claims, demands, liabilities and expenses arise out of or are based upon any
breach of any representation, warranty or agreement made by such Purchaser in
this Agreement; provided, however, in no event
shall the maximum aggregate liability of such Purchaser to the Seller pursuant
to this Section 9 be in excess of the product of the Purchase Price multiplied
by the aggregate number of Shares purchased by such Purchaser
hereunder.

     

    Section
10.         Entire
Agreement.  This Agreement contains the entire understanding of
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, oral or written, with respect to such
matters.  This Agreement may not be amended or any provision hereof
waived in whole or in part, except by a written instrument signed by the parties
hereto.

     

    Section
11.         Governing
Law.  This Agreement shall be governed and interpreted in
accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof.  Each party agrees that
all legal proceedings concerning the interpretations, enforcement and defense of
the transactions contemplated by this Agreement (each, a “Proceeding”) shall be
commenced exclusively in the state and federal courts sitting in the City of New
York, Borough of Manhattan (the “New York
Courts”).  Each party hereby irrevocably submits to the
exclusive jurisdiction of the New York Courts for the adjudication of all
Proceedings, and hereby irrevocably waives, and agrees not to assert in any
Proceeding, any claim that it is not personally subject to the jurisdiction of
any New York Court, or that any such New York Court is an inconvenient or
improper forum for such Proceeding.  Each party hereby irrevocably
waives personal service of process and consents to process being served in any
Proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address set
forth on the signature page hereto and agrees that such service shall constitute
good and sufficient service of process and notice thereof.  Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.  Each party hereby irrevocably waives,
to the fullest extent permitted by applicable law, any and all right to trial by
jury in any Proceeding. If there shall be commenced a Proceeding, then the
prevailing party in such Proceeding shall be reimbursed by the adverse party or
parties for its reasonable attorneys fees and other expenses incurred in
connection therewith.


    
      
         


      

      
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    Section
12.          Execution.  This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the
other parties, 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 and 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
page were an original thereof.

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
PAGE TO FOLLOW]


    
      
         


      

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

     

    
      
        
          
            
              	
                      SELLER

                    
	 
      
	   
      
	
                       Ms. Yan
      Li

                    
	 
      
	
                      Address:

                    
	 
      
	
                      Facsimile:

                    
	 
      
	
                      PURCHASER

                    
	 
      
	   
      


            

          

        

      

    

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	
                                    By:

                                  	   
      
	 
      	
                                    Name:

                                  
	 
      	
                                    Title:

                                  
	 	 
	
                                    Address:

                                  
	 
      	 
      
	
                                    Facsimile:

                                  
	
                                    Attn:

                                  


                          

                        

                      

                    

                     

                    
                      
                        
                          
                            
                              	
                                      Number of Shares being purchased:

                                    	 


                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  CHINA-BIOTICS,
      INC. (FOR THE PURPOSE OF
      SECTIONS 3, 4, 5, 6, 9(b), 9(c), 10, 11 and 12 ONLY)

                                
	 
      	 
      
	
                                  By:

                                	   
      
	 
      	
                                  Name:

                                
	 
      	
                                  Title:

                                
	 	 
	
                                  Address:

                                
	 
      	 
      
	
                                  Facsimile:

                                
	
                                  Attn:
      Chief Executive
Officer