THIS
        WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
        NOT
        BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS WARRANT
        AND
        THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD,
        OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
        REGISTRATION STATEMENT UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY
        SATISFACTORY TO AMERICAN DAIRY, INC. THAT SUCH REGISTRATION IS NOT
        REQUIRED.

       

      Right
        to
        Purchase [______] shares of Common Stock

      of
        American Dairy, Inc.

      (subject
        to adjustment as provided herein)

       

      AMENDED
        AND RESTATED

      COMMON
        STOCK PURCHASE WARRANT

       

      
        	
                No.

              	
                Issue
                  Date: November __, 2008

              


      

       

      AMERICAN
        DAIRY, INC., a corporation organized under the laws of the State of Utah
        (the
        "Company"),
        hereby certifies that [_______________], whose address is
        _________________________________________, or its assigns (the "Holder"),
        is
        entitled, subject to the terms set forth below, to purchase from the Company
        at
        any time after October 3, 2006 (the "Issue
        Date"),
        until
        5:00 p.m., E.S.T on October 3, 2012 (the "Expiration Date"), up to [_____]
        fully
        paid and non-assessable shares of common stock of the Company, par value
        $0.001
        per share (the "Common
        Stock"),
        at a
        per share price of $14.50. The aforedescribed price per share, as adjusted
        from
        time to time as herein provided, is referred to herein as the "Exercise
        Price."
        The
        number and character of such shares of Common Stock and the Exercise Price
        are
        subject to adjustment as provided herein. The Company may reduce the Exercise
        Price without the consent of the Holder. Capitalized terms used and not
        otherwise defined herein shall have the meanings set forth in that certain
        Subscription Agreement (the "Subscription
        Agreement"),
        dated
        of October 2, 2006, entered into by the Company and the original holders
        of the
        Warrants. 

       

      This
        Warrant amends and restates it is entirety that certain Warrant (the
“Existing
        Warrant”)
        between the parties dated October 2, 2006 (the “Closing
        Date”),
        it
        being the intention of the parties that all of the terms of the Existing
        Warrant, as amended hereby, are restated in and are replaced by the terms
        of
        this Warrant, but this Warrant shall not be deemed or construed to have been
        issued in payment, satisfaction, cancellation or novation of the Existing
        Warrant.

       

      As
        used
        herein the following terms, unless the context otherwise requires, have the
        following respective meanings:

       

      (a) The
        term
"Company"
        shall
        include American Dairy, Inc. and any corporation which shall succeed or assume
        the obligations of American Dairy, Inc. hereunder.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b) The
        term
        "Common
        Stock"
        includes (i) the Company's Common Stock, $0.001 par value per share, as
        authorized on the date of the Subscription Agreement, and (ii) any other
        securities into which or for which any of the securities described in (i)
        may be
        converted or exchanged pursuant to a plan of recapitalization, reorganization,
        merger, sale of assets or otherwise.

       

      (c) The
        term
        "Other
        Securities"
        refers
        to any stock (other than Common Stock) and other securities of the Company
        or
        any other person (corporate or otherwise) which the holder of the Warrant
        at any
        time shall be entitled to receive, or shall have received, on the exercise
        of
        the Warrant, in lieu of or in addition to Common Stock, or which at any time
        shall be issuable or shall have been issued in exchange for or in replacement
        of
        Common Stock or Other Securities pursuant to Section 2 or
        otherwise.

       

      1. Exercise
        of Warrant.

       

      1.1 Number
        of Shares Issuable upon Exercise.
        From
        and after the Issue Date through and including the Expiration Date, the Holder
        hereof shall be entitled to receive, upon exercise of this Warrant in whole
        in
        accordance with the terms of Sub-section 1.2 or upon exercise of this Warrant
        in
        part in accordance with Sub-section 1.3, the number of shares of Common Stock
        of
        the Company set forth in the first paragraph of this Warrant, subject to
        adjustment pursuant to Section 2. No fractional shares will be issued;
        therefore, in the event that the number of shares of Common Stock due hereunder
        is not a whole number, the Company shall round up to the nearest whole share
        the
        number of such shares due. 

       

      1.2 Full
        Exercise.
        This
        Warrant may be exercised in full by the Holder hereof by delivery of an original
        or facsimile copy of the form of subscription attached as Exhibit
        A hereto
        (the "Subscription
        Form")
        duly
        executed by such Holder and surrender of this Warrant to the Company at its
        principal office or at the office of its Warrant Agent (as provided
        hereinafter), accompanied by (subject to Sub-section 1.7) payment, in cash,
        wire
        transfer or by certified or official bank check payable to the order of the
        Company, in the amount obtained by multiplying the number of shares of Common
        Stock for which this Warrant is then exercisable by the Exercise Price then
        in
        effect.

       

      1.3 Partial
        Exercise.
        This
        Warrant may be exercised in part (but not for a fractional share) by surrender
        of this Warrant in the manner and at the place provided in Sub-section 1.2
        except that the amount payable by the Holder on such partial exercise shall
        be
        the amount obtained by multiplying (a) the number of whole shares of Common
        Stock designated by the Holder in the Subscription Form by (b) the Exercise
        Price then in effect. On any such partial exercise, the Company, at its expense,
        will forthwith issue and deliver to or upon the order of the Holder hereof
        a new
        Warrant of like tenor, in the name of the Holder hereof or as such Holder
        (upon
        payment by such Holder of any applicable transfer taxes) may request, the
        whole
        number of shares of Common Stock remaining for which such Warrant may still
        be
        exercised.

       

      1.4 Company
        Acknowledgment.
        The
        Company will, at the time of the exercise of the Warrant, upon the request
        of
        the Holder hereof, acknowledge in writing its continuing obligation to afford
        to
        such Holder any rights to which such Holder shall continue to be entitled
        after
        such exercise in accordance with the provisions of this Warrant. If the Holder
        shall fail to make any such request, such failure shall not affect the
        continuing obligation of the Company to afford to such Holder any such
        rights.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      1.5 Trustee
        for Warrant Holders.
        In the
        event that a bank or trust company shall have been appointed as trustee for
        the
        Holder of the Warrants pursuant to Sub-section 2.2, such bank or trust company
        shall have all the powers and duties of a warrant agent (as hereinafter
        described) and shall accept, in its own name for the account of the Company
        or
        such successor person as may be entitled thereto, all amounts otherwise payable
        to the Company or such successor, as the case may be, on exercise of this
        Warrant pursuant to this Section 1.

       

      1.6 Delivery
        of Stock Certificates, etc. on Exercise.
        The
        Company agrees that the shares of Common Stock purchased upon exercise of
        this
        Warrant shall be deemed to be issued to the Holder hereof as the record owner
        of
        such shares as of the close of business on the date on which this Warrant
        shall
        have been surrendered and payment made for such shares as provided for in
        Sub-sections 1.2, 1.3 or 1.7. As soon as practicable after the exercise of
        this
        Warrant in full or in part, the Company, at its expense (including the payment
        by it of any applicable issue taxes), will cause to be issued in the name
        of and
        delivered to the Holder hereof, or as such Holder (upon payment by such Holder
        of any applicable transfer taxes) may direct in compliance with applicable
        securities laws, a certificate or certificates for the number of duly and
        validly issued, fully paid and non-assessable shares of Common Stock (or
        Other
        Securities or property) to which such Holder shall be entitled on such
        exercise.

       

      1.7  Cashless
        Exercise.
        

      


      (a) Notwithstanding
        anything to the contrary in this Section 1, in lieu of making the payments
        specified in accordance with Sub-sections 1.2
        and
        1.3 of this Warrant, the Holder may elect, in the Subscription Form, to exercise
        without paying in cash (“Cashless
        Exercise”)
        all or
        part of this Warrant and to receive, a number of shares of Common Stock equal
        to
        the number of shares of Common Stock that the Holder would receive had the
        Holder paid the aggregate Exercise Price reduced by that number of shares
        of
        Common Stock equal to the quotient obtained by dividing (x) the aggregate
        Exercise Price (assuming no Cashless Exercise) to be paid by (y) the Current
        Market Price in effect on such day of election of Cashless Exercise under
        this
        Section 1.7 for one share of Common Stock.

      


      (b) For
        purposes of this Section 1.7, the following terms shall have the meaning
        indicated:

       

      (i) “Current
        Market Price”
shall
        mean the average of the daily Closing Sale Prices per share of Common Stock
        for
        the ten (10) consecutive Trading Days ending on the earlier of the Trading
        Day
        immediately preceding the relevant date and the day before the “ex” date. For
        purpose of this paragraph, the term “ex” date, (1) when used with respect to any
        issuance or distribution, means the first date on which the Common Stock
        trades,
        regular way, on the relevant exchange or in the relevant market from which
        the
        Closing Sale Price was obtained without the right to receive such issuance
        or
        distribution, and (2) when used with respect to any subdivision or combination
        of shares of Common Stock, means the first date on which the Common Stock
        trades, regular way, on such
        exchange or in such market after the time at which such subdivision or
        combination becomes effective. If another issuance, distribution, subdivision
        or
        combination to which this Sub-section applies occurs during the period
        applicable for calculating “Current Market Price”, “Current Market Price” shall
        be calculated for such period in a manner determined by the Board of Directors
        to reflect the impact of such issuance, distribution, subdivision or combination
        on the Closing Sale Price of the Common Stock during such period.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (ii) “Closing
        Sale Price”
of
        the
        shares of Common Stock on any date means (i) if the Common Stock is primarily
        traded on a national securities exchange, the last sale price on such national
        securities exchange on the applicable day, or if no sale occurred on such
        day,
        the mean between the closing “bid” and “asked” prices on such day, (ii) if the
        principal market for Common Stock is in the over-the-counter market, the
        closing
        sale price on the applicable day as published by The NASDAQ Stock Market,
        Inc.
        or similar organization, or if such price is not so published on such day,
        the
        mean between the closing “bid” and “asked” priced, if available on such day,
        which prices may be obtained from any reputable pricing service, broker or
        dealer, and (ii) if neither clause (i) nor clause (ii) is applicable, the
        fair
        market value as determined in good faith by the Board of Directors of the
        Company. The Closing Sale Price shall be determined based on regular market
        hours without reference to extended after hours trading or pre-market
        trading.

       

      (iii) “Trading
        Day”
shall
        mean (x) if the applicable security is quoted on NYSE Euronext or another
        national securities exchange, a day on which NYSE Euronext, or other applicable
        national securities exchange is open for business, or (y) if the applicable
        security is not so listed, admitted for trading or quoted, any day other
        than a
        Saturday or Sunday or a day in which banking institutions in the State of
        New
        York are authorized or obligated by law or executive order to
        close.

       

      2. Adjustment
        for Reorganization, Consolidation, Merger, etc.

       

      2.1 Reorganization,
        Consolidation, Merger, etc.
        In case
        at any time or from time to time, the Company shall (a) effect a reorganization,
        (b) consolidate with or merge into any other person or (c) transfer all or
        substantially all of its properties or assets to any other person under any
        plan
        or arrangement contemplating the dissolution of the Company, then, in each
        such
        case, as a condition to the consummation of such a transaction, notice shall
        be
        provided to the Holder of this Warrant as set forth in this Section 2.1 and
        proper and adequate provision shall be made by the Company whereby the Holder
        of
        this Warrant, on the exercise hereof as provided in Section 1, at any time
        after
        the consummation of such reorganization, consolidation or merger or the
        effective date of such dissolution, as the case may be, shall receive, in
        lieu
        of the Common Stock (or Other Securities) issuable on such exercise prior
        to
        such consummation or such effective date, the stock and Other Securities
        and
        property (including cash) to which such Holder would have been entitled upon
        such consummation or in connection with such dissolution, as the case may
        be, if
        such Holder had so exercised this Warrant, immediately prior thereto, all
        subject to further adjustment thereafter as provided in this Section 2. In
        each
        case of (a), (b) or (c) in this Section 2.1, the Company shall provide written
        notice to the Holder in accordance with Section 9 hereof at the earliest
        practicable time (in any event, not less than fifteen (15) days before any
        record date or other date set for definitive action) of the date on which
        the
        books of the Company will close or a record will be taken for determining
        holders of Common Stock entitled to participate in any such reorganization,
        consolidation, merger, sale or dissolution, as the case may be.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      


      2.2 Dissolution.
        In the
        event of any dissolution of the Company following the transfer of all or
        substantially all of its properties or assets, the Company, prior to such
        dissolution, shall at its expense deliver or cause to be delivered the stock
        and
        Other Securities and property (including cash, where applicable) receivable
        by
        the Holder of this Warrant upon exercise of this Warrant after the effective
        date of such dissolution pursuant to this Section 2, to a bank or trust company
        (a "Trustee")
        having
        its principal office in New York, NY, as trustee for the Holder of the
        Warrants.

       

      2.3 Continuation
        of Terms.
        Upon
        any reorganization, consolidation, merger or transfer (and any dissolution
        following any transfer) referred to in this Section 2, this Warrant shall
        continue in full force and effect and the terms hereof shall be applicable
        to
        the Other Securities and property receivable on the exercise of this Warrant
        after the consummation of such reorganization, consolidation or merger or
        the
        effective date of dissolution following any such transfer, as the case may
        be,
        and shall be binding upon the issuer of any Other Securities, including,
        in the
        case of any such transfer, the person acquiring all or substantially all
        of the
        properties or assets of the Company, whether or not such person shall have
        expressly assumed the terms of this Warrant as provided in this Section 2.
        In
        the event this Warrant does not continue in full force and effect after the
        consummation of the transaction described in this Section 2, then only in
        such
        event will the Company's securities and property (including cash, where
        applicable) receivable by the Holder of the Warrants be delivered to the
        Trustee
        as contemplated by Sub-section 2.2.

       

      2.4 Extraordinary
        Events Regarding Common Stock.
        (a) In
        the event that the Company shall (i) issue additional shares of the Common
        Stock
        as a dividend or other distribution on outstanding Common Stock, (ii) subdivide
        its outstanding shares of Common Stock, or (iii) combine its outstanding
        shares
        of the Common Stock into a smaller number of shares of the Common Stock,
        then,
        in each such event, the Exercise Price shall, simultaneously with the happening
        of such event, be adjusted by multiplying the then Exercise Price by a fraction,
        the numerator of which shall be the number of shares of Common Stock outstanding
        immediately prior to such event and the denominator of which shall be the
        number
        of shares of Common Stock outstanding immediately after such event, and the
        product so obtained shall thereafter be the Exercise Price then in effect.
        The
        Exercise Price, as so adjusted, shall be readjusted in the same manner upon
        the
        happening of any successive event or events described herein in this Sub-section
        2.4. 

       

      (b) In
        case
        the Company shall issue rights or warrants to all holders of its outstanding
        shares of Common Stock entitling them (for a period expiring within forty-five
        (45) days after the date fixed for determination of shareholders entitled
        to
        receive such rights or warrants) to subscribe for or purchase shares of Common
        Stock at a price per share less than the Exercise Price immediately preceding
        the date such distribution is first publicly announced by the Company, the
        Exercise Price shall be adjusted so that the same shall equal the rate
        determined by multiplying the Exercise Price in effect immediately prior
        to the
        date fixed for determination of shareholders entitled to receive such rights
        or
        warrants by a fraction,

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      (i) the
        numerator of which shall be the sum of the number of shares of Common Stock
        outstanding at the close of business on the date fixed for determination
        of
        shareholders entitled to receive such rights or warrants plus the number
        of
        shares that the aggregate offering price of the total number of shares so
        offered would purchase at a price equal to the Exercise Price immediately
        preceding the date such distribution is first publicly announced by the Company,
        and

       

      (ii) the
        denominator of which shall be the number of shares of Common Stock outstanding
        on the date fixed for determination of shareholders entitled to receive such
        rights or warrants plus the total number of additional shares of Common Stock
        offered for subscription or purchase,

       

      such
        adjustment shall be successively made whenever any such rights or warrants
        are
        issued, and shall become effective immediately after the opening of business
        on
        the day following the date fixed for determination of shareholders entitled
        to
        receive such rights or warrants. If such rights or warrants are not so issued,
        the Exercise Price shall again be adjusted to be the Exercise Price that
        would
        then be in effect if such date fixed for the determination of shareholders
        entitled to receive such rights or warrants had not been fixed. In determining
        whether any rights or warrants entitle the holders to subscribe for or purchase
        shares of Common Stock at a price less than the Exercise Price immediately
        preceding the date such distribution is first publicly announced by the Company,
        and in determining the aggregate offering price of such shares of Common
        Stock,
        there shall be taken into account any consideration received by the Company
        for
        such rights or warrants and any amount payable on exercise or conversion
        thereof, the value of such consideration, if other than cash, to be determined
        by the Board of Directors of the Company.

       

      Rights
        or
        warrants distributed by the Company to all holders of Common Stock entitling
        the
        holders thereof to subscribe for or purchase shares of the Company’s capital
        stock (either initially or under certain circumstances), which rights or
        warrants, until the occurrence of a specified event or events (“Trigger
        Event”):
        (i)
        are deemed to be transferred with such shares of Common Stock; (ii) are not
        exercisable; and (iii) are also issued in respect of future issuances of
        Common
        Stock, shall be deemed not to have been distributed for purposes of this
        Sub-section (and no adjustment to the Exercise Price under this Sub-section
        will
        be required) until the occurrence of the earliest Trigger Event, whereupon
        such
        rights and warrants shall be deemed to have been distributed and an appropriate
        adjustment (if any is required) to the Exercise Price shall be made under
        this
        Sub-section 2.4(b). If any such rights or warrants, including any such existing
        rights or warrants distributed prior to the date of this Warrant, are subject
        to
        events, upon the occurrence of which such rights or warrants become exercisable
        to purchase different securities, evidences of indebtedness or other assets,
        then the date of the occurrence of any and each such event shall be deemed
        to be
        the date of distribution and record date with respect to new rights or warrants
        with such rights (and a termination or expiration of the existing rights
        or
        warrants without exercise by any of the holders thereof). In addition, in
        the
        event of any distribution (or deemed distribution) of rights or warrants,
        or any
        Trigger Event or other event (of the type described in the preceding sentence)
        with respect thereto that was counted for purposes of calculating a distribution
        amount for which an adjustment to the Exercise Price under this Sub-section
        was
        made, (1) in the case of any such rights or warrants that shall all have
        been
        redeemed or repurchased without exercise by any holders thereof, the Exercise
        Price shall be readjusted upon such final redemption or repurchase to give
        effect to such distribution or Trigger Event, as the case may be, as though
        it
        were a cash distribution, equal to the per share redemption or repurchase
        price
        received by a holder or holders of Common Stock with respect to such rights
        or
        warrants (assuming such holder had retained such rights or warrants), made
        to
        all holders of Common Stock as of the date of such redemption or repurchase,
        and
        (2) in the case of such rights or warrants that shall have expired or been
        terminated without exercise by any holders thereof, the Exercise Price shall
        be
        readjusted as if such rights and warrants had not been issued.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      No
        adjustment of the Exercise Price shall be made pursuant to this Sub-section
        2.4(b) in respect of rights or warrants distributed or deemed distributed
        on any
        Trigger Event to the extent that such rights or warrants are actually
        distributed, or reserved by the Company for distribution to holders of the
        Company’s 7.75% Convertible Notes (the “Notes”)
        upon
        conversion by such holders of Notes to Common Stock.

       

      (c)
        If
        the
        Company shall issue or sell its Common Stock at a price per share less than
        the
        Exercise Price then in effect, or shall issue or sell any securities
        convertible, exchangeable, or exercisable into Common Stock at a price per
        share
        less than the Exercise Price then
        in
        effect, the Exercise Price shall be decreased such that the Exercise Price
        is
        equal to the lowest price or per share at which the Company has issued or
        sold
        its Common Stock after October 1, 2008 such adjustment to take effect as
        of the
        date of the issuance or sale of such Common Stock; provided, however, that
        no
        adjustment shall he made to the Exercise Price for (i) the issuance of Common
        Stock pursuant to the conversion or exercise of convertible or exercisable
        securities issued or outstanding on or prior to October 1, 2008 or the Notes,
        (ii) the issuance of Common Stock or any other securities exercisable into
        shares of Common Stock pursuant to exercise of stock options granted or reserved
        under the Company’s employee stock options existing on October 1, 2008 or
        adopted thereafter, or (iii) the issuance, after October 1, 2008, of Common
        Stock or any other securities exercisable into shares of Common Stock issued
        or
        granted to third-party consultants or employees of the Company and its
        subsidiaries under the Company’s employee stock options or pursuant to written
        contractual arrangements relating to the compensation for the services rendered
        to the Company or its subsidiaries by such consultants or employees, to the
        extent that all such shares or securities issued under subclauses (ii) or
        (iii)
        in this paragraph, in the aggregate, on a cumulative basis and without double
        counting, do not exceed five percent (5%) of the Common Stock of the Company
        issued and outstanding immediately prior to such issuance.

       

      (d) The
        Company may make such increases in the Exercise Price, in addition to those
        required by Sub-section 2.4 as the Board of Directors considers to be advisable
        to avoid or diminish any income tax to holders of Common Stock or rights
        to
        purchase Common Stock resulting from any dividend or distribution of stock
        (or
        rights to acquire stock) or from any event treated as such for income tax
        purposes.

      


      (e)
        The
        Exercise Price, as so adjusted pursuant to Sub-section 2.4, shall be readjusted
        in the same manner upon the happening of any successive event or events
        described herein in this Sub-section 2.4. The number of shares of Common
        Stock
        that the Holder of this Warrant shall thereafter, on the exercise hereof
        as
        provided in Section 1, be entitled to receive shall be adjusted to a number
        determined by multiplying the number of shares of Common Stock that would
        otherwise (but for the provisions of this Sub-section 2.4) be issuable on
        such
        exercise by a fraction of which (a) the numerator is the Exercise Price that
        would otherwise (but for the provisions of this Sub-section 2.4) be in effect,
        and (b) the denominator is the Exercise Price in effect on the date of such
        exercise.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      (f) No
        adjustment in the Exercise Price shall be required unless such adjustment
        would
        require an increase or decrease of at least one percent (1%) in such rate;
        provided that any adjustments that by reason of this Sub-section 2.4 are
        not
        required to be made shall be carried forward and taken into account in any
        subsequent adjustment. All calculations under this Sub-section 2.4 shall
        be made
        by the Company and shall be made to the nearest cent or to the nearest one-ten
        thousandth (1/10,000) of a share, as the case may be. No adjustment need
        be made
        for rights to purchase Common Stock pursuant to a Company plan for reinvestment
        of dividends or interest.

       

      (g) Whenever
        the Exercise Price is adjusted as herein provided, the Company shall follow
        the
        procedures for the issuance of a Certificate of Adjustments as set forth
        below
        in Sub-section 2.5. 

       

      (h) For
        purposes of this Section, the number of shares of Common Stock at any time
        outstanding shall not include shares held in the treasury of the Company
        but
        shall include shares issuable in respect of scrip certificates issued in
        lieu of
        fractions of shares of Common Stock. The Company will not pay any dividend
        or
        make any distribution on shares of Common Stock held in the treasury of the
        Company.

       

      2.5 Certificate
        as to Adjustments.
        In each
        case of any adjustment or readjustment in the shares of Common Stock (or
        Other
        Securities) issuable on the exercise of the Warrants, the Company at its
        expense
        will promptly cause its Chief Executive Officer or other appropriate designee
        to
        compute such adjustment or readjustment in accordance with the terms of the
        Warrant and prepare a certificate setting forth such adjustment or readjustment
        and showing in detail the facts upon which such adjustment or readjustment
        is
        based, including a statement of (a) the consideration received or receivable
        by
        the Company for any additional shares of Common Stock (or Other Securities)
        issued or sold or deemed to have been issued or sold, (b) the number of shares
        of Common Stock (or Other Securities) outstanding or deemed to be outstanding,
        and (c) the Exercise Price and the number of shares of Common Stock to be
        received upon exercise of this Warrant, in effect immediately prior to such
        adjustment or readjustment and as adjusted or readjusted as provided in this
        Warrant. The Company will forthwith mail a copy of each such certificate
        to the
        Holder of the Warrant and any Warrant Agent of the Company (appointed pursuant
        to Section 8 hereof).

       

      3. Reservation
        of Stock, etc. Issuable on Exercise of Warrant; Financial
        Statements.
        The
        Company will at all times reserve and keep available, solely for issuance
        and
        delivery on the exercise of the Warrants, all shares of Common Stock (or
        Other
        Securities) from time to time issuable on the exercise of the Warrant. This
        Warrant entitles the Holder hereof to receive copies of all financial and
        other
        information distributed or required to be distributed to the holders of the
        Company's Common Stock.

       

      4. Assignment;
        Exchange of Warrant.
        Subject
        to compliance with applicable securities laws, this Warrant, and the rights
        evidenced hereby, may be transferred by any registered holder hereof (a
        "Transferor").
        On
        the surrender for exchange of this Warrant, with the Transferor's endorsement
        in
        the form of Exhibit
        B
        attached
        hereto (the "Transferor
        Endorsement Form"),
        the
        Company at its expense, but with payment by the Transferor of any applicable
        transfer taxes, will issue and deliver to or on the order of the Transferor
        thereof a new Warrant or Warrants of like tenor, in the name of the Transferor
        and/or the transferee(s) specified in such Transferor Endorsement Form (each
        a
        "Transferee"),
        calling in the aggregate on the face or faces thereof for the number of shares
        of Common Stock called for on the face or faces of the Warrant so surrendered
        by
        the Transferor. No such transfers shall result in a public distribution of
        the
        Warrant.

       

      
        
          
          

        

        
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      5. Replacement
        of Warrant.
        On
        receipt of evidence reasonably satisfactory to the Company of the loss, theft,
        destruction or mutilation of this Warrant and, in the case of any such loss,
        theft or destruction of this Warrant, on delivery of an indemnity agreement
        or
        security reasonably satisfactory in form and amount to the Company or, in
        the
        case of any such mutilation, on surrender and cancellation of this Warrant,
        the
        Company at its expense, will execute and deliver, in lieu thereof, a new
        Warrant
        of like tenor.

       

      6. Registration
        Rights.
        The
        Holder of this Warrant has been granted certain registration rights by the
        Company. These registration rights are set forth in the Subscription Agreement
        and the Registration Rights Agreement. The terms of the Subscription Agreement
        and the Registration Rights Agreement are incorporated herein by this
        reference.

       

      7. Warrant
        Agent.
        The
        Company may, by written notice to the Holder of the Warrant, appoint an agent
        (a
“Warrant
        Agent”)
        for
        the purpose of issuing Common Stock (or other Securities) on the exercise
        of
        this Warrant pursuant to Section 1, exchanging this Warrant pursuant to Section
        4, and replacing this Warrant pursuant to Section 5, or any of the foregoing,
        and thereafter any such issuance, exchange or replacement, as the case may
        be,
        shall be made at such office by such Warrant Agent.

       

      8. Transfer
        on the Company's Books.
        Until
        this Warrant is transferred on the books of the Company, the Company may
        treat
        the registered holder hereof as the absolute owner hereof for all purposes,
        notwithstanding any notice to the contrary.

       

      9. Notices.
        All
        notices, demands, requests, consents, approvals, and other communications
        required or permitted hereunder shall be in writing and, unless otherwise
        specified herein, shall be (i) personally served or hand delivered, (ii)
        deposited in the mail, registered or certified, return receipt requested,
        postage prepaid, (iii) delivered by express courier service with charges
        prepaid, or (iv) transmitted by facsimile, addressed as set forth below or
        to
        such other address as such party shall have specified most recently by written
        notice. Any notice or other communication required or permitted to be given
        hereunder shall be deemed effective (i) if personally served, when served,
        or
        upon hand delivery, (ii) if mailed, on the third business day after deposit
        in
        first class mail with postage prepaid and properly addressed, (iii) if by
        express courier service, when received, and (iv) if by facsimile, with accurate
        confirmation generated by the transmitting facsimile machine, at the address
        or
        number designated below, on the day transmitted (if delivered on a business
        day
        during normal business hours where such notice is to be received), or the
        first
        business day following such transmittal (if delivered other than on a business
        day during normal business hours where such notice is to be received). The
        addresses for such communications shall be: (i) if to the Company, to: American
        Dairy, Inc., Star City International Building, 10, Jiuxianqiuo Road,
        C-16th
        Floor,
        Chaoyang, Beijing, People's Republic of China, Attn: Jonathan Chou, Chief
        Financial Officer, facsimile number: 86 10 6435 4831, with a copy by facsimile
        only to: Mark L. Hanson, Esq., Jones Day, 1420 Peachtree Street, N.E., Suite
        800, Atlanta, Georgia 30309, facsimile number: (404) 581-8330, or to such
        other
        address as may be hereafter notified in accordance with this Section 9 by
        the
        Company to the Holder; and (ii) if to the Holder, to the address and facsimile
        number indicated
        in the first paragraph of this Warrant, or to such other address as may be
        hereafter notified in accordance with this Section 9 by the Holder to the
        Company.

       

      
        
          
          

        

        
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      10. Miscellaneous.
        This
        Warrant and any term hereof may be changed, waived, discharged or terminated
        only by an instrument in writing signed by the party against which enforcement
        of such change, waiver, discharge or termination is sought. This Warrant
        shall
        be construed and enforced in accordance with and governed by the laws of
        New
        York. Each party hereto: (a) submits for itself and its property in any legal
        action or proceeding relating to this Agreement, or for recognition and
        enforcement of any judgment in respect thereof, to the non-exclusive
        jurisdiction of the courts of the State of New York in New York County, City
        of
        New York, the courts of the United States of America for the Southern District
        of New York, and appellate courts from any thereof; (b) consents that any
        such
        action or proceeding may be brought in such courts and waives any objection
        that
        it may now or hereafter have to the venue of any such action or proceeding
        in
        any such court and agrees not to plead or claim the same; and (c) agrees
        that
        nothing herein shall affect the right to effect service of process in any
        manner
        permitted by law or shall limit the right to sue in any other jurisdiction.
        The
        headings in this Warrant are for purposes of reference only, and shall not
        limit
        or otherwise affect any of the terms hereof. The invalidity or unenforceability
        of any provision hereof shall in no way affect the validity or enforceability
        of
        any other provision. 

       

      


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      IN
        WITNESS WHEREOF, the Company has executed this Warrant as of the date first
        written above.

       

      
        	 Witness: 	 	AMERICAN DAIRY,
                INC.
	 	 	 	 	 
	 	 	By:  	 
	 	 	 	 Name:
	 
	 	 	 	 Title:
	 
	 	 	 	 	 


      

       

      
        
          
          

        

        
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