Unassociated Document


     

    
      INVESTOR
RIGHTS AGREEMENT

       

      This
Investor Rights Agreement (this “Agreement”)
is made and entered into as of April 28, 2010, by and among Kun Run
Biotechnology, Inc., a Nevada corporation (the “Company”),
the purchasers signatory hereto (including any successor or assign of any
purchaser signatory hereto, each a “Purchaser”
and, collectively, the “Purchasers”)
and the holders of Capital Stock signatory hereto (each a “Key
Holder” and, collectively, the “Key
Holders”).  Capitalized terms used and not otherwise defined
herein that are defined in the Purchase Agreement shall have the meanings given
such terms in the Purchase Agreement.

       

      This
Agreement is made pursuant to the Securities Purchase Agreement, dated as of the
date hereof between the Company and each Purchaser (the “Purchase
Agreement”).

       

      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 Company and each of the Purchasers agree as
follows:

       

      1. Definitions.  As
used in this Agreement, the following terms shall have the following
meanings:

       

      “Advice”
shall have the meaning set forth in Section 4(b).

       

      “Affiliate”
means, with respect to any Person, any other Person that, directly or indirectly
through one or more intermediaries, Controls, is controlled by or is under
common control with such Person, as such terms are used in and construed under
Rule 144, provided that
for purposes of Section 8(d), “Affiliate”
means, with respect to the Company or any Subsidiary of the Company, (a) each
person that, directly or indirectly, owns or controls 5% or more of the stock or
membership interests having ordinary voting power in the election of directors
or managers of the Company or such Subsidiary, and (b) each person that
controls, is controlled by or is under common control with the Company or such
Subsidiary.  With respect to a Purchaser, any investment fund or
managed account that is managed on a discretionary basis by the same investment
manager as such Purchaser will be deemed to be an Affiliate of such
Purchaser.

       

      “Effective
Date” means the date that a Registration Statement filed pursuant to
Section 2(a) is first declared effective by the Commission.

       

      “Effectiveness
Deadline” means, with respect to each Initial Registration Statement or
New Registration Statement, the earlier of: (i) the 60th
calendar day following the applicable Filing Deadline; provided, that, if the
Commission reviews and has written comments to a filed Registration Statement,
then the Effectiveness Deadline under this clause (i) shall be the 90th
calendar day following the applicable Filing Deadline, and (ii) fifth (5th)
Business Day following the date on which the Company is notified by the
Commission that the applicable Registration Statement will not be reviewed or is
no longer subject to further review and comments and the effectiveness of such
Registration Statement may be accelerated; provided, however, that if
the Effectiveness Deadline falls on a Saturday, Sunday or other day that the
Commission is closed for business, the Effectiveness Deadline shall be extended
to the next Business Day on which the Commission is open for
business.

       

      “Effectiveness
Period” shall have the meaning set forth in Section 2(b).

       

      “Excluded
Securities” means any issuance of (a) securities to employees, officers
or directors of the Company pursuant to any duly-adopted equity incentive or
equity compensation plan, to the extent approved by a majority of the
non-employee members of the Board or a majority of the members of a committee of
non-employee directors established for such purpose, (b) securities upon the
exercise, exchange or conversion of any securities issued or issuable under the
Purchase Agreement and/or other securities exercisable or exchangeable for or
convertible into shares of Common Stock issued and outstanding on the date of
this Agreement, provided that such securities have not been amended since the
date of this Agreement to increase the number of such securities or to decrease
the exercise, exchange or conversion price of such securities, (c) securities
issued pursuant to acquisitions or strategic transactions approved by a majority
of the disinterested directors of the Company, provided that any such issuance
shall only be to a Person which is, itself or through its subsidiaries, an
operating company in a business synergistic with the business of the Company and
in which the Company receives benefits in addition to the investment of funds,
but shall not include any transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities or (d) securities issued in an underwritten
public offering of the Company’s securities.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Filing
Deadline” means, with respect to each of the Registration Statements
required to be filed pursuant to Section 2(a), the 60th
calendar day following the Closing Date; provided, however, that if
the Filing Deadline falls on a Saturday, Sunday or other day that the Commission
is closed for business, the Filing Deadline shall be extended to the next
Business Day on which the Commission is open for business.

       

      “FINRA”
means the Financial Industry Regulatory Authority, Inc. or any successor entity
or entities.

       

      “Holder” or
“Holders”
means the holder or holders, as the case may be, from time to time of
Registrable Securities.

       

      “Indemnified
Party” shall have the meaning set forth in Section 6(c).

       

      “Indemnifying
Party” shall have the meaning set forth in Section 6(c).

       

      “Initial
Registration Statement” shall have the meaning set forth in Section
2(a).

       

      “Issuer
Filing” shall have the meaning set forth in Section 3(p).

       

      “OrbiMed
Designee” shall have the meaning set forth in Section
8(b)(2).

       

      “Losses”
shall have the meaning set forth in Section 6(a).

       

      “New Registration
Statement” shall have the meaning set forth in Section 2(a).

       

      “Observer
Rights” shall have the meaning set forth in Section 8(b)(1).

       

      “OrbiMed”
means Caduceus Asia Partners, LP and its Affiliates.

       

      “Prospectus”
means the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Registration Statement, and
all other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Register,”
“registered”
and “registration”
refer to a registration made by preparing and filing a Registration Statement or
similar document in compliance with the Securities Act and pursuant to Rule 415,
and the declaration or ordering of effectiveness of such Registration Statement
or document.

       

      “Registrable
Securities” means all of (i) the Shares and (ii) any securities issued or
issuable upon any stock split, dividend or other distribution, recapitalization
or similar event with respect to the Shares, provided, that the Shares
shall cease to be Registrable Securities upon the earliest to occur of the
following:  (A) sale pursuant to a Registration Statement or Rule 144
under the Securities Act (in which case, only such security sold shall cease to
be a Registrable Security); or (B) to the extent Shares may be immediately sold
to the public without registration or restriction (including without limitation
as to volume by each holder thereof) under the Securities Act, including
pursuant to Rule 144.

       

      “Registration
Statements” means any one or more registration statements of the Company
filed under the Securities Act that covers the resale of any of the Registrable
Securities pursuant to the provisions of this Agreement (including without
limitation any Initial Registration Statements, New Registration Statements and
Remainder Registration Statements), amendments and supplements to such
Registration Statements, including post-effective amendments, all exhibits and
all material incorporated by reference or deemed to be incorporated by reference
in such Registration Statements.

       

      “Remainder
Registration Statements” shall have the meaning set forth in Section
2(a).

       

      “Rule 415”
means Rule 415 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as such
Rule.

       

      “Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as such
Rule.

       

      “SEC
Guidance” means (i) any publicly-available written or oral guidance,
comments, requirements or requests of the Commission staff and (ii) the
Securities Act.

       

      “Selling
Stockholder Questionnaire” means a questionnaire in the form attached as
Annex A hereto,
or such other form of questionnaire as may reasonably be adopted by the Company
from time to time.

       

      “Special
Registration Statement” shall mean a registration statement relating to
any employee benefit plan under Form S-8 or similar form or with respect to any
corporate reorganization or other transaction under Rule 145 of the
Securities Act.

       

      “Suspension
Certificate” shall have the meaning set forth in Section
4(a).

       

      “Suspension
Period” shall have the meaning set forth in Section 4(a).

       

      “Violations”
shall have the meaning set forth in Section 6(a).

       

      2. Registration.

       

      (a) On or
prior to each Filing Deadline, the Company shall prepare and file with the
Commission a “shelf” Registration Statement covering the resale of all of the
then outstanding Registrable Securities or Registrable Securities issuable upon
exercise of then outstanding Warrants not already covered by an existing and
effective Registration Statement for an offering to be made on a continuous
basis pursuant to Rule 415 or, if Rule 415 is not available for offers and sales
of the Registrable Securities, by such other means of distribution of
Registrable Securities as the Holders may reasonably specify (each, an “Initial
Registration Statement”).  Each Initial Registration Statement
shall be on Form S-3 (except if the Company is then ineligible to register for
resale the Registrable Securities on Form S-3, in which case such registration
shall be on Form S-1) subject to the provisions of Section 2(e) and shall
contain (except if otherwise required pursuant to written comments received from
the Commission upon a review of such Registration Statement) the “Plan of
Distribution” section approved by a majority of the
Holders.  Notwithstanding the registration obligations set forth in
this subsection (a) and subsections (b) and (c) of this Section 2, in the event
the Commission informs the Company that all of the Registrable Securities
required to be included in an Initial Registration Statement cannot, as a result
of the application of Rule 415, be registered for resale as a secondary offering
on a single registration statement, the Company agrees to promptly (i) inform
each of the Holders thereof and file amendments to the applicable Initial
Registration Statement as required by the Commission and/or (ii) withdraw such
Initial Registration Statement and file a new registration statement (a “New Registration
Statement”), in either case covering the maximum number of Registrable
Securities required to be included in an Initial Registration Statement and
permitted to be registered by the Commission, on Form S-3 or such other form
available to register for resale the Registrable Securities as a secondary
offering; provided,
however, that prior to filing such amendment or New Registration
Statement, the Company shall be obligated to use its commercially reasonable
efforts to advocate with the Commission for the registration of all of the
Registrable Securities in accordance with SEC Guidance, including without
limitation, the Manual of Publicly Available Telephone Interpretations
D.29.  Notwithstanding any other provision of this Agreement, if any
SEC Guidance sets forth a limitation of the number of Registrable Securities
permitted to be registered on a particular Registration Statement as a secondary
offering (and notwithstanding that the Company used commercially reasonable
efforts to advocate with the Commission for the registration of all or a greater
number of Registrable Securities), unless otherwise directed in writing by a
Holder as to its Registrable Securities, the number of Registrable Securities to
be registered on such Registration Statement will (A) if applicable, first be
reduced by Registrable Securities not acquired pursuant to the Purchase
Agreement (whether pursuant to registration rights or otherwise), and (B) second
by Registrable Securities represented by holders of Shares (applied, in the case
that some Shares may be registered, to the Holders on a pro rata basis based on
the total number of unregistered Shares held by such Holders).  In the
event the Company amends an Initial Registration Statement or files a New
Registration Statement, as the case may be, under clauses (i) or (ii) above, the
Company will file with the Commission, as promptly as allowed by Commission or
SEC Guidance provided to the Company or to registrants of securities in general,
one or more registration statements on Form S-3 or such other form available to
register for resale those Registrable Securities that were not registered for
resale on the Initial Registration Statement, as amended, or the New
Registration Statement (the “Remainder
Registration Statements”).

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (b) The
Company shall use its best efforts to cause each Registration Statement to be
declared effective by the Commission as soon as practicable and, with respect to
each Initial Registration Statement or New Registration Statement, as
applicable, shall use commercially reasonable efforts to cause each Registration
Statement to be declared effective by the Commission no later than the
Effectiveness Deadline (including filing with the Commission a request for
acceleration of effectiveness in accordance with Rule 461 promulgated under the
Securities Act within five (5) Business Days after the date that the Company is
notified (orally or in writing, whichever is earlier) by the Commission that
such Registration Statement will not be “reviewed,” or will not be subject to
further review and that the effectiveness of such Registration Statement may be
accelerated) and shall, subject to Section 3(c) hereof, keep each such
Registration Statement continuously effective under the Securities Act until the
earlier of (i) such time as all of the Shares (including any securities issued
or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing) shall cease to
be Registrable Securities hereunder, (ii) the date on which the Purchasers shall
have sold all of the Registrable Securities covered by such Registration
Statement or (iii) the date four years after the Effective Date (the “Effectiveness
Period”).  The Company shall ensure that each Registration
Statement (including any amendments or supplements thereto and Prospectuses
contained therein) shall not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein, or necessary to
make the statements therein (in the case of Prospectuses, in the light of the
circumstances in which they were made) not misleading.  Each
Registration Statement shall also cover, to the extent allowable under the
Securities Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the Registrable
Securities.  The Company shall promptly notify the Holders via
facsimile or e-mail of the effectiveness of a Registration Statement within two
(2) Business Days of the date on which the Company telephonically confirms
effectiveness with the Commission, which confirmation shall initially be the
date requested for effectiveness of a Registration Statement.  The
Company shall, by 9:30 a.m. New York City Time on the third Business Day after
the Effective Date, file a Rule 424(b) prospectus with the
Commission.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (c) The
Company shall not, prior to the Effective Date of the Registration Statements
covering the resale of the Registrable Securities issued or issuable at, or upon
exercise or conversion of securities issued at, the Closing, prepare and file
with the Commission any registration statement under the Securities Act covering
any of its securities other than a registration statement on Form
S-8.

       

      (d) Each
Holder agrees to furnish to the Company a completed Selling Stockholder
Questionnaire not more than ten (10) Business Days following the date of this
Agreement. Each Holder further agrees that it shall not be entitled to be named
as a selling securityholder in a Registration Statement or use the Prospectus
for offers and resales of Registrable Securities at any time, unless such Holder
has returned to the Company a completed and signed Selling Stockholder
Questionnaire. If a Holder of Registrable Securities returns a Selling
Stockholder Questionnaire after the deadline specified in the previous sentence,
the Company shall take such actions as are required to name such Holder as a
selling security holder in the applicable Registration Statement or any
pre-effective or post-effective amendment thereto and to include (to the extent
not theretofore included) in such Registration Statement the Registrable
Securities identified in such late Selling Stockholder Questionnaire. Each
Holder acknowledges and agrees that the information in the Selling Stockholder
Questionnaire will be used by the Company in the preparation of one or more
Registration Statements covering such Holder’s Registrable Securities and hereby
consents to the inclusion of such information in such Registration
Statements.

       

      (e) In the
event that Form S-3 is not available for the registration of the resale of
Registrable Securities hereunder, the Company shall register
the resale of the Registrable Securities on another appropriate form reasonably
acceptable to the Holders, including a registration statement on Form S-1
and maintain the effectiveness of such Registration Statement that is on a form
other than Form S-3 during the Effectiveness Period.

       

      3. Registration
Procedures

       

      In
connection with the Company’s registration obligations hereunder, the Company
shall:

       

      (a) Not less
than five (5) Business Days prior to the filing of a Registration Statement and
not less than three (3) Business Days prior to the filing of any related
Prospectus or any amendment or supplement thereto (except for annual reports on
Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and
any similar or successor reports), the Company shall furnish to the Holder
copies of such Registration Statement, Prospectus or amendment or supplement
thereto, as proposed to be filed, which documents will be subject to the review
of such Holder (it being acknowledged and agreed that if a Holder does not
object to or comment on the aforementioned documents within such five (5)
Business Day or three (3) Business Day period, as the case may be, then the
Holder shall be deemed to have consented to and approved the use of such
documents).  The Company shall not file any Registration Statement or
amendment or supplement thereto in a form to which a Holder reasonably objects
in good faith, provided that, the Company is notified of such objection in
writing within the five (5) Business Day or three (3) Business Day period
described above, as applicable.  The Company shall permit a single
firm of counsel designated by the Holders to review such Registration Statement
and all amendments and supplements thereto (as well as all requests for
acceleration or effectiveness thereof) and use commercially reasonable efforts
to reflect in such documents any comments as such counsel may reasonably propose
(so long as such comments are provided to the Company at least  three
(3) Business Day prior to the expected filing date) and will not request
acceleration of such Registration Statement without prior notice to such
counsel.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (b) (i)  Prepare
and file with the Commission such amendments (including post-effective
amendments) and supplements to each Registration Statement and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement continuously effective as to the applicable Registrable Securities for
its Effectiveness Period and prepare and file with the Commission such
additional Registration Statements in order to register for resale under the
Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement
(subject to the terms of this Agreement), and, as so supplemented or amended, to
be filed pursuant to Rule 424; (iii) respond as promptly as reasonably
practicable to any comments received from the Commission with respect to each
Registration Statement or any amendment thereto and, as promptly as reasonably
possible, provide the Holders true and complete copies of all correspondence
from and to the Commission relating to such Registration Statement but, except
as agreed by a Holder, not any comments that would result in the disclosure to
the Holders of material and non-public information concerning the Company; and
(iv) comply with the provisions of the Securities Act and the Exchange Act with
respect to the disposition of all Registrable Securities covered by a
Registration Statement until such time as all of such Registrable Securities
shall have been disposed of (subject to the terms of this Agreement) in
accordance with the intended methods of disposition by the Holders thereof as
set forth in such Registration Statement as so amended or in such Prospectus as
so supplemented; provided,
however, that each Purchaser shall be responsible for the delivery of the
Prospectus to the Persons to whom such Purchaser sells any of the Shares
(including in accordance with Rule 172 under the Securities Act), and each
Purchaser agrees to dispose of Registrable Securities in compliance with the
plan of distribution described in the applicable Registration Statement and
otherwise in compliance with applicable federal and state securities laws. In
the case of amendments and supplements to a Registration Statement which are
required to be filed pursuant to this Agreement (including pursuant to this
Section 3(b)) by reason of the Company filing a report on Form 10-K, Form 10-Q
or Form 8-K or any analogous report under the Exchange Act, the Company shall
have incorporated such report by reference into such Registration Statement, if
applicable, or shall file such amendments or supplements with the Commission on
the same day on which the Exchange Act report which created the requirement for
the Company to amend or supplement such Registration Statement was
filed.

       

      (c) Notify
the Holders (which notice shall, pursuant to clauses (iii) through (v) hereof,
be accompanied by an instruction to suspend the use of the Prospectus until the
requisite changes have been made) as promptly as reasonably possible (and, in
the case of (i)(A) below, not less than three Business Days prior to such
filing, in the case of (iii) and (iv) below, not more than one Business Day
after such issuance or receipt, and in the case of (v) below, not less than one
Business Day after a determination by the Company that the financial statements
in any Registration Statement have become ineligible for inclusion therein) and
(if requested by any such Person) confirm such notice in writing no later than
one Business Day following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is proposed
to be filed; (B) when the Commission notifies the Company whether there will be
a “review” of such Registration Statement and whenever the Commission comments
in writing on any Registration Statement (in which case the Company shall
provide to each of the Holders true and complete copies of all comments that
pertain to the Holders as a “Selling Stockholder” or to the “Plan of
Distribution” and all written responses thereto, but not information that the
Company believes would constitute material and non-public information); and (C)
with respect to each Registration Statement or any post-effective amendment,
when the same has become effective; (ii) of any request by the Commission or any
other Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information that pertains
to the Holders as “Selling Stockholders” or the “Plan of Distribution”; (iii) of
the issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of a Registration
Statement covering any or all of the Registrable Securities or the initiation of
any Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
(in the case of any Prospectus, form of prospectus or supplement thereto, in
light of the circumstances under which they were made), not misleading; provided that any and all of
such information shall remain confidential to each Holder until such information
otherwise becomes public, unless disclosure by a Holder is required by law;
provided, further, that notwithstanding
each Holder’s agreement to keep such information confidential, the Holders make
no acknowledgement that any such information is material, non-public
information.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (d) Use
commercially reasonable efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, as soon as practicable.

       

      (e) Prior to
any resale of Registrable Securities by a Holder, register or qualify, or
cooperate with the selling Holders in connection with the registration or
qualification, unless an exemption from registration and qualification applies,
the Registrable Securities for offer and sale under the securities or Blue Sky
laws of such jurisdictions within the United States as any Holder reasonably
requests in writing, to keep each such registration or qualification (or
exemption therefrom) effective during any Effectiveness Period and to do any and
all other acts or things reasonably necessary to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statements; provided,
that the Company shall not be required to qualify generally to do
business in any jurisdiction where it is not then so qualified or to take any
action that would subject the Company to general service of process in any
jurisdiction where it is not then so subject or subject the Company to any
material tax in any such jurisdiction where it is not then so
subject.

       

      (f) If
requested by the Holders, cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to any Registration Statement, which
certificates shall be free, to the extent permitted by the Purchase Agreement
and under law, of all restrictive legends, and to enable such Registrable
Securities to be in such denominations and registered in such names as any such
Holders may reasonably request.  In connection therewith, if required
by the Company’s transfer agent, the Company shall promptly after the
effectiveness of the applicable Registration Statement cause an opinion of
counsel as to the effectiveness of such Registration Statement to be delivered
to and maintained with its transfer agent, together with any other
authorizations, certificates and directions required by the transfer agent,
which authorize and direct the transfer agent to issue such Registrable
Securities without legend upon sale by the holder of such shares of Registrable
Securities under such Registration Statement.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (g) Following
the occurrence of any event contemplated by Section 3(c)(iii) through (v), as
promptly as reasonably practicable, prepare a supplement or amendment, including
a post-effective amendment, to the affected Registration Statements or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus, form of prospectus or supplement thereto, in light
of the circumstances under which they were made), not misleading.

       

      (h) In the
time and manner required by the Principal Trading Market, prepare and file with
such Trading Market an additional shares listing application covering all of the
Registrable Securities, (ii) use commercially reasonable efforts to take all
steps necessary to cause such Registrable Securities to be approved for listing
on the Principal Trading Market as soon as possible thereafter, (iii) if
requested by any Holder, provide such Holder evidence of such listing, and (iv)
during each Effectiveness Period, use commercially reasonable efforts to
maintain the listing of such Registrable Securities on the Principal Trading
Market.

       

      (i) In order
to enable the Holders to sell Shares under Rule 144, for a period commencing on
the date hereof until five years of the later of the date hereof, and the
Closing, the Company covenants to timely file (or obtain extensions in respect
thereof and file within the applicable grace period) all reports required to be
filed by the Company after the date hereof pursuant to Section 13(a) or 15(d) of
the Exchange Act. During such period, if the Company is not required to file
reports pursuant to Section 13(a) or 15(d) of the Exchange Act, it will prepare
and furnish to the Holders and make publicly available in accordance with Rule
144(c) promulgated under the Securities Act annual and quarterly financial
statements, together with a discussion and analysis of such financial statements
in form and substance substantially similar to those that would otherwise be
required to be included in reports required by Section 13(a) or 15(d) of the
Exchange Act, as well as any other information required thereby, in the time
period that such filings would have been required to have been made under the
Exchange Act. The Company further covenants that it will take such further
action as any Holder may reasonably request, all to the extent required from
time to time to enable such Person to sell Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
promulgated under the Securities Act.  The Company agrees to furnish
to the Holders so long as the Holders own Registrable Securities, promptly upon
request, (i) a written statement by the Company that it has complied with the
reporting requirements of the Securities Act and the Exchange Act as required
for applicable provisions of Rule 144, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company, and (iii) such other information as may be reasonably requested to
permit the Holders to sell such securities pursuant to Rule 144 without
registration.

       

      (j) The
Company may require each selling Holder to furnish to the Company a certified
statement as to (i) the number of shares of Common Stock beneficially owned by
such Holder and any Affiliate thereof, (ii) any FINRA affiliations, (iii) any
natural persons who have the power to vote or dispose of the Common Stock and
(iv) any other information as may be requested by the Commission, FINRA or any
state securities commission.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (k) The
Company shall hold in confidence and not make any disclosure of information
concerning a Holder provided to the Company unless (i) disclosure of such
information is necessary to comply with federal or state securities laws or the
rules of any securities exchange or trading market on which the Company’s
securities are then listed or traded, (ii) the disclosure of such information is
necessary to avoid or correct a misstatement or omission in any Registration
Statement, (iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this or any other agreement. The
Company agrees that it shall, upon learning that disclosure of such information
concerning a Holder is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to such Holder prior to
making such disclosure, and allow such Holder, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, such information.

       

      (l) The
Company shall cooperate with each Holder who holds Registrable Securities being
offered and the managing underwriter or underwriters as reasonably requested by
them with respect to an applicable Registration Statement, if any, to facilitate
the timely preparation and delivery of certificates (not bearing any restrictive
legends) representing Registrable Securities to be offered pursuant to such
Registration Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the managing underwriter or underwriters, if
any, or a Holder may reasonably request and registered in such names as the
managing underwriter or underwriters, if any, or a Holder may request, and,
within three (3) Business Days after a Registration Statement which includes
Registrable Securities is ordered effective by the Commission, the Company shall
deliver, and shall cause legal counsel selected by the Company to deliver, to
the transfer agent for the Registrable Securities (with copies to each Holder)
an appropriate instruction and an opinion of such counsel in the form required
by the transfer agent in order to issue such Registrable Securities free of
restrictive legends upon the resale of such Registrable Securities pursuant to
such Registration Statement.

       

      (m) At the
reasonable request of a Holder, the Company shall prepare and file with the
Commission such amendments (including post-effective amendments) and supplements
to a Registration Statement and any prospectus used in connection with the
Registration Statement as may be necessary in order to change the plan of
distribution set forth in such Registration Statement.  The Company
shall take all other reasonable actions necessary to expedite and facilitate
disposition by the Holders of Registrable Securities pursuant to a Registration
Statement.

       

      (n) The
Company shall use commercially reasonable efforts to comply with all applicable
laws related to a Registration Statement and offering and sale of securities and
all applicable rules and regulations of governmental authorities in connection
therewith (including without limitation the Securities Act and the Exchange Act
and the rules and regulations promulgated by the Commission).

       

      (o) If
required by the FINRA Corporate Financing Department or any similar entity, the
Purchasers shall promptly effect a filing with FINRA pursuant to FINRA Rule 2710
with respect to the public offering contemplated by resales of securities under
the Registration Statement (an “Issuer
Filing”), and the Company shall pay the filing fee required by such
Issuer Filing. The Purchasers shall use commercially reasonable efforts to
pursue the Issuer Filing until FINRA issues a letter confirming that it does not
object to the terms of the offering contemplated by the Registration
Statement.

       

      4. Holder
Covenants.

       

      (a) Suspension of
Trading. At any time after the Registrable Securities are covered by an
effective Registration Statement, the Company may deliver to the Holders of such
Registrable Securities a certificate (the “Suspension
Certificate”) approved by the Chief Executive Officer or Chief Financial
Officer of the Company and signed by an officer of the Company stating that the
effectiveness of and sales of Registrable Securities under the applicable
Registration Statement would:

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      1. materially
interfere with any transaction that would require the Company to prepare
financial statements under the Securities Act that the Company would otherwise
not be required to prepare in order to comply with its obligations under the
Exchange Act, or

       

      2. require
public disclosure of a material transaction or event prior to the time such
disclosure might otherwise be required.

       

      Upon
receipt of a Suspension Certificate by Holders of Registrable Securities, such
Holders of Registrable Securities shall refrain from selling or otherwise
transferring or disposing of any Registrable Securities then held by such
Holders for a specified period of time (a “Suspension
Period”) that is customary under the circumstances (not to exceed ten
(10) Trading Days). Notwithstanding the foregoing sentence, the Company shall be
permitted to cause Holders of Registrable Securities to so refrain from selling
or otherwise transferring or disposing of any Registrable Securities on only one
(1) occasion during each six (6) consecutive month period that such Registration
Statement remains effective. The Company may impose stop transfer instructions
to enforce any required agreement of the Holders under this Section
4(a).

       

      (b) Discontinued
Disposition.  Each Holder agrees by its acquisition of
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(c)(iii)-(v), such
Holder will forthwith discontinue disposition of such Registrable Securities
under the applicable Registration Statement until it is advised in writing (the
“Advice”)
by the Company that the use of the applicable Prospectus (as it may have been
supplemented or amended) may be resumed.  The Company may provide
appropriate stop orders to enforce the provisions of this Section
4(b).

       

      5. Registration
Expenses.  All fees and expenses incident to the Company’s
performance of or compliance with its obligations under this Agreement shall be
borne by the Company whether or not any Registrable Securities are sold pursuant
to a Registration Statement.  The fees and expenses to be borne by the
Company referred to in the foregoing sentence shall include, without limitation,
(i) all registration and filing fees (including, without limitation, fees and
expenses (A) with respect to filings required to be made with any Trading Market
on which the Common Stock of the Company is then listed for trading, (B) with
respect to compliance with applicable state securities or Blue Sky laws
(including, without limitation, fees and disbursements of counsel for the
Company in connection with Blue Sky qualifications or exemptions of the
Registrable Securities and determination of the eligibility of the Registrable
Securities for investment under the laws of such jurisdictions as requested by
the Holders) and (C) with respect to any filing that may be required to be made
by any broker through which a Holder intends to make sales of Registrable
Securities with FINRA pursuant to FINRA Rule 2710 or similar rules, (ii)
printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities and of printing prospectuses if the
printing of prospectuses is reasonably requested by the Holders of a majority of
the Registrable Securities included in the applicable Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance, if the Company
so desires such insurance, and (vi) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In no event shall the Company be responsible for
any underwriting, broker or similar fees or commissions of any Holder or, except
to the extent provided above or otherwise in any Transaction Document, any legal
fees or other costs of the Holders.

       

      6. Indemnification.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (a) Indemnification by the
Company.  The Company shall, notwithstanding any termination of
this Agreement, indemnify, defend and hold harmless each Holder, the officers,
directors, agents, partners, members, managers, stockholders, Affiliates and
employees of each of them, each Person who controls any such Holder (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act)
and the officers, directors, partners, members, managers, stockholders, agents
and employees of each such controlling Person, to the fullest extent permitted
by applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable costs of
preparation and investigation and reasonable attorneys’ fees) and expenses
(collectively, “Losses”),
as incurred, that arise out of or are based upon: (i) any untrue statement or
alleged untrue statement of a material fact in a Registration Statement or the
omission or alleged omission to state therein a material fact required to be
stated or necessary to make the statements therein not misleading; (ii) any
untrue statement or alleged untrue statement of a material fact contained in any
preliminary Prospectus if used prior to the effective date of such Registration
Statement, or contained in the final Prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the
Commission) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the
circumstances under which the statements therein were made, not misleading; or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act, any state securities law, any “blue sky” laws of any
jurisdiction in which Registrable Securities are offered, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities (the matters in the foregoing clauses (i) through (iii) being,
collectively, “Violations”),
except to the extent, but only to the extent, that (A) such untrue statements,
alleged untrue statements, omissions or alleged omissions are based upon
information regarding such Holder furnished in writing to the Company by such
Holder expressly for use therein, or to the extent that such information relates
to such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was consented to and approved by such Holder for use in the
applicable Registration Statement, such Prospectus or such form of Prospectus or
in any amendment or supplement thereto, or (B) in the case of an occurrence of
an event of the type specified in Section 3(c)(iii)-(v), related to the use by a
Holder of an outdated or defective Prospectus after the Company has notified
such Holder in writing that the Prospectus is outdated or defective and prior to
the receipt by such Holder of the Advice, but only if and to the extent that
following the receipt of the Advice the misstatement or omission giving rise to
such Loss would have been corrected.  The Company shall notify the
Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware.  Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
an Indemnified Party (as defined in Section 6(c)) and shall survive the transfer
of the Registrable Securities by the Holders.

       

      (b) Indemnification by
Holders. Each Holder shall, notwithstanding any termination of this
Agreement, severally and not jointly, indemnify and hold harmless the Company,
its directors, officers, agents and employees, each Person who controls the
Company (within the meaning of Section 15 of the Securities Act and Section 20
of the Exchange Act), and the directors, officers, agents or employees of such
controlling Persons, to the fullest extent permitted by applicable law, from and
against all Losses, as incurred, arising out of or are based upon any untrue or
alleged untrue statement of a material fact contained in any Registration
Statement, any Prospectus, or any form of prospectus, or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
Prospectus, or any form of prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading (i) to the extent, but
only to the extent that, such untrue statements or omissions are based solely
upon information regarding such Holder furnished in writing to the Company by
such Holder expressly for use therein, (ii) to the extent that such information
relates to such Holder or such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and approved by such Holder expressly
for use in the applicable Registration Statement, such Prospectus or such form
of Prospectus or in any amendment or supplement thereto or (iii) in the case of
an occurrence of an event of the type specified in Section 3(c)(iii)-(v), to the
extent related to the use by such Holder of an outdated or defective Prospectus
after the Company has notified such Holder in writing that the Prospectus is
outdated or defective and prior to the receipt by such Holder of the
Advice.  In no event shall the liability of any selling Holder
hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (c) Conduct of Indemnification
Proceedings. If any Proceeding shall be brought or asserted against any
Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from
whom indemnity is sought (the “Indemnifying
Party”) in writing, and the Indemnifying Party shall have the right to
assume the defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all reasonable fees and
expenses incurred in connection with defense thereof; provided, that the failure of
any Indemnified Party to give such notice shall not relieve the Indemnifying
Party of its obligations or liabilities pursuant to this Agreement, except (and
only) to the extent that such failure shall have materially and adversely
prejudiced the Indemnifying Party.

       

      An
Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless:  (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall have been advised by counsel that a conflict of interest exists or may
arise if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the Indemnifying Party); provided, that the Indemnifying Party shall not be
liable for the fees and expenses of more than one separate firm of attorneys at
any time for all Indemnified Parties except to the extent that an Indemnified
Party shall have been advised by counsel that a conflict of interest exists or
may arise if the same counsel were to represent such Indemnified Party and
another Indemnified Party.  The Indemnifying Party shall not be liable
for any settlement of any such Proceeding effected without its written consent,
which consent shall not be unreasonably withheld, delayed or
conditioned.  No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on claims that are the subject matter of such Proceeding.

       

      Subject
to the terms of this Agreement, all fees and expenses of the Indemnified Party
(including reasonable fees and expenses to the extent incurred in connection
with investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party, as
incurred, within twenty Business Days of written notice thereof to the
Indemnifying Party; provided, that the
Indemnified Party shall promptly reimburse the Indemnifying Party for that
portion of such fees and expenses applicable to such actions for which such
Indemnified Party is finally judicially determined to not be entitled to
indemnification hereunder). The failure to deliver written notice to the
Indemnifying Party within a reasonable time of the commencement of any such
action shall not relieve such Indemnifying Party of any liability to the
Indemnified Party under this Section 6, except to the extent that the
Indemnifying Party is prejudiced in its ability to defend such
action.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (d) Contribution.  If
a claim for indemnification under Section 6(a) or 6(b) is unavailable to an
Indemnified Party (by reason of public policy or otherwise), then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations.  The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information supplied by,
such Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission.  The amount paid or payable by a party
as a result of any Losses shall be deemed to include, subject to the limitations
set forth in this Agreement, any reasonable attorneys’ or other reasonable fees
or expenses incurred by such party in connection with any Proceeding to the
extent such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such party in
accordance with its terms.

       

      The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 6(d) were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding
paragraph.  Notwithstanding the provisions of this Section 6(d), (A)
no Holder shall be required to contribute, in the aggregate, any amount in
excess of the amount by which the net proceeds actually received by such Holder
from the sale of the Registrable Securities subject to the Proceeding exceeds
the amount of any damages that such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission and (B) no contribution will be made under circumstances where the
maker of such contribution would not have been required to indemnify the
Indemnified Party under the fault standards set forth in this Section
6.  No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.

       

      The
indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified
Parties and are not in diminution or limitation of the indemnification
provisions under the Purchase Agreement.

       

      7. Piggy-Back
Registrations.

       

      (a) If at any
time after the date hereof there is not one or more effective Registration
Statements covering all of the Registrable Securities then outstanding or
Registrable Securities issuable upon exercise of then outstanding Warrants, the
Company shall notify all Holders in writing at least five (5) Business Days
prior to the filing of any registration statement under the Securities Act for
purposes of a public offering of securities of the Company (including, but not
limited to, registration statements relating to secondary offerings of
securities of the Company, but excluding Special Registration Statements) and
will, subject to Section 7(b) hereof, afford each such Holder an opportunity to
include in such registration statement all or part of such Registrable
Securities held by such Holder.  Each Holder desiring to include in
any such registration statement all or any part of the Registrable Securities
held by it shall, within five (5) Business Days after the above-described notice
from the Company, so notify the Company in writing. Such notice shall state the
intended method of disposition of the Registrable Securities by such
Holder.  If a Holder decides not to include all of its Registrable
Securities in any registration statement thereafter filed by the Company, such
Holder shall nevertheless continue to have the right to include any Registrable
Securities in any subsequent registration statement or registration statements
as may be filed by the Company with respect to offerings of its securities, all
upon the terms and conditions set forth herein.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (b) Underwriting. If the registration
statement under which the Company gives notice under this Section 7 is for an
underwritten offering, the Company shall so advise the Holders.  In
such event, the right of any such Holder to be included in a registration
pursuant to this Section 7 shall be conditioned upon such Holder’s participation
in such underwriting and the inclusion of such Holder’s Registrable Securities
in the underwriting to the extent provided herein. All Holders proposing to
distribute their Registrable Securities through such underwriting shall enter
into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by the Company (or, in the case of a
registration statement initiated by stockholders of the Company, the underwriter
selected by such stockholders that is reasonably acceptable to the
Company).  Notwithstanding any other provision of the Agreement, if
the underwriter determines in good faith that marketing factors require a
limitation of the number of shares to be underwritten, the number of shares that
may be included in the underwriting shall be allocated (i) in the case of a
registration statement initiated by the Company for any offering of shares by
the Company, first, to the Company; second, to the Holders, together with any
other stockholders of the Company  on a pro rata basis and
(ii) in the case of a registration statement initiated by stockholders of
the Company  the Holders and any other participating stockholders of
the Company on a pro rata basis. If any Holder disapproves of the terms of any
such underwriting, such Holder may elect to withdraw therefrom by written notice
to the Company and the underwriter, delivered at least ten (10) Business
Days prior to the effective date of the applicable registration
statement.  Any Registrable Securities excluded or withdrawn from such
underwriting shall be excluded and withdrawn from the registration.

       

      (c) Right to Terminate
Registration. The Company shall have the right to terminate or withdraw
any registration initiated by it under this Section 7 prior to the effectiveness
of such registration whether or not any Holder has elected to include securities
in such registration, and shall promptly notify any Holder that has elected to
include Registrable Securities in such registration of such termination or
withdrawal. The expenses of such withdrawn registration shall be borne by the
Company in accordance with this Agreement.

       

      8. Other
Agreements.

       

      (a) Preemptive
Rights.

       

      1. So long
as a Purchaser owns not less than fifty percent (50%) of the Unit Shares (or
shares of Common Stock issued or issuable upon conversion of such Unit Shares)
purchased under the Purchase Agreement by such Purchaser as of the time of a
determination under this Section, and subject to applicable securities laws,
each Purchaser shall have a right of first refusal to purchase its pro rata share of all Common
Stock Equivalents that the Company may, from time to time, propose to sell and
issue, other than Excluded Securities.  Each Purchaser’s pro rata share is equal to
the ratio of (A) the number of outstanding Unit Shares (including all
shares of Common Stock issuable or issued upon conversion of such Unit Shares)
of which such Purchaser is deemed to be a holder immediately prior to the
issuance of such Common Stock Equivalents to (B) the total number of
outstanding shares of Common Stock of the Company on an as-converted basis
immediately prior to the issuance of the Common Stock Equivalents; provided, however, that such
Purchaser shall not have right of first refusal to purchase more than twenty
five percent (25%) of each offering of such Common Stock
Equivalents.

       

      2. If the
Company proposes to issue any Common Stock Equivalents, it shall give each
Purchaser written
notice of its intention, describing the Common Stock Equivalents, the price and
the terms and conditions upon which the Company proposes to issue the
same.  Each Purchaser shall have ten (10)
Business Days from the receipt of such notice to agree to purchase its pro rata share of the Common
Stock Equivalents (except as provided above) for the price and upon the terms
and conditions specified in the notice by giving written notice to the Company
and stating therein the quantity of Common Stock Equivalents to be
purchased.  Notwithstanding the foregoing, the Company shall not be
required to offer or sell such Common Stock Equivalents to any Purchaser who would cause the
Company to be in violation of applicable federal securities laws by virtue of
such offer or sale.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      3. If not
all of the Purchasers elect to purchase their pro rata share of the
available Common Stock Equivalents, then the Company shall promptly notify in
writing the Purchasers who do so elect and shall offer such Purchasers the right
to acquire such unsubscribed shares on a pro rata basis among such
participating Purchasers.  The Purchasers shall have five (5) days
after receipt of such notice to notify the Company of its election to purchase
all or a portion thereof of the unsubscribed shares.  The Company
shall have ninety (90) days thereafter to sell the Common Stock Equivalents in
respect of which the Purchasers’ rights were not exercised, at a price not lower
and upon terms and conditions not more favorable, or in preference to the rights
granted, to the purchasers thereof than specified in the Company’s notice to the
Purchasers pursuant to Section 8(a)(2) hereof.  If the Company has not
sold such Common Stock Equivalents within such ninety (90) day period, the
Company shall not thereafter issue or sell any Common Stock Equivalents, without
first offering such securities to the Purchasers in the manner provided
above.

       

      (b) Board of
Directors.

       

      1.  From
and after the Closing, the Company shall take all appropriate action and each
Key Holder hereby agrees to vote with respect to all Capital Stock held by such
Key Holder to establish the initial size of the Board at three (3) members, (i)
one (1) of which shall be the Company’s Chairman (ii) one (1) of which shall be
designated in writing by OrbiMed to be nominated by the Company to serve as a
member of the Board (the “OrbiMed
Designee”), so long as OrbiMed  (together with any Affiliates)
beneficially owns at least 5% of the outstanding shares of Common Stock of the
Company on an as-converted basis and (iii) one (1) of which shall be an
individual with no prior affiliation with the Company or the Company’s existing
stockholders as of the Closing, which individual will be acceptable to OrbiMed
(the “Independent
Designee”).  The OrbiMed Designee may, from time to time, name
an associate or advisor who shall be entitled to accompany the OrbiMed Designee
to all meetings of the Board and committees of the Board, or, in the absence of
the OrbiMed Designee, to attend such meetings as an observer, provided, that the Company
reserves the right to exclude such associate or advisor from access to any
material or meeting or portion thereof if the Company believes upon advice of
counsel that such exclusion is reasonably necessary to preserve the
attorney-client privilege.

       

      2. The
Company (including any appropriate committee thereof) shall nominate the OrbiMed
Designee and the Independent Designee for election (in case of the initial
election of the OrbiMed Designee and the Independent Designee) or re-election
(including, in the case of the end of the term of the OrbiMed Designee and the
Independent Designee), as applicable, as a director of the Company as part of
the slate proposed by the Company that is included in the proxy statement (or
consent solicitation or similar document) of the Company relating to the
election of its directors, and shall use its best efforts to have the OrbiMed
Designee and the Independent Designee elected and provide the same level of
support for each of the OrbiMed Designee and the Independent Designee as it
provides to other members of the Board or other persons standing for election as
a director of the Company as part of a slate proposed by the Company, so long as
OrbiMed (together with any Affiliates) beneficially owns at least 5% of the
outstanding shares of on an as-converted basis of the Company on an as-converted
basis.  In the event that a vacancy is created on the Board at any
time by the resignation, death or disability of the OrbiMed Designee, so long as
OrbiMed (together with any Affiliates) beneficially owns at least 5% of the
outstanding shares of Common Stock of the Company on an as-converted basis,
OrbiMed may designate another person as the OrbiMed Designee to fill the vacancy
created thereby, and the Company hereby agrees to take, at any time and from
time to time, all actions necessary to fill the vacancy as provided in the
foregoing.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      3. The
Company shall provide each of the OrbiMed Designee and the Independent Designee
with all notices, minutes, consents and other materials, financial or otherwise,
which the Company provides to the other members of the Board and committees
thereof in their capacity as such.

       

      4. The
Company shall reimburse each of the OrbiMed Designee and the Independent
Designee for his or her out-of-pocket expenses incurred in connection with his
or her participation as a member of the Board, in a manner consistent with the
Company’s policies for reimbursing such expenses of the members of the Board. In
addition, the Company shall pay each of the OrbiMed Designee and the Independent
Designee, in his or her capacity as a non-employee member of the Board, the same
compensation as to which all non-employee members of the Board are entitled, in
their capacity as such, subject to compliance with applicable law. The Company
shall indemnify each of the OrbiMed Designee and the Independent Designee to the
same extent it indemnifies its other directors pursuant to its organizational
documents and applicable law.

       

      (c) Qualified
Auditor.  The Company hereby agrees that so long as OrbiMed or
any of its affiliates holds any Capital Stock of the Company, the Company shall
continue to engage a Qualified Auditor to perform audit services.

       

      (d) Transactions with
Affiliates.  The Company shall not, without the prior written
consent of OrbiMed, enter into, renew, extend or be a party to, or permit any of
its Subsidiaries to enter into, renew, extend or be a party to, any transaction
or series of related transactions (including the purchase, sale, lease, transfer
or exchange of property or assets of any kind or the rendering of services of
any kind) with any Affiliate, director, officer or employee except (i) in the
ordinary course of business in a manner and to an extent consistent with past
practice and necessary or desirable for the prudent operation of its business,
for fair consideration and on terms no less favorable to it or its Subsidiaries
than would be obtainable in a comparable arm’s length transaction with a Person
that is not an Affiliate thereof, (ii) reasonable and customary director,
officer and employee compensation (including bonuses) and other benefits
(including retirement, health, stock option, and other benefit plans) and, in
the case of senior officers or director, indemnification arrangements, in each
case approved in good faith by the board of directors of the Company, and (iii)
transactions related to any tax sharing agreement between the Company and any
other Person with which the Company files a consolidated tax return or with
which the Company is part of a consolidated group for tax purposes.

       

      (e) D&O Insurance.
The Company shall use reasonable efforts to obtain and maintain directors’ and
officers’ liability insurance in an amount reasonably acceptable to the Board
and consistent with industry practice.

       

      9. Miscellaneous.

       

      (a) Remedies.  In
the event of a breach by the Company or by a Holder of any of their obligations
under this Agreement, each Holder or the Company, as the case may be, in
addition to being entitled to exercise all rights granted by law and under this
Agreement, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement.  The Company and each
Holder agree that monetary damages would not provide adequate compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (b) No Senior Registration
Rights.  Until such time as all Registrable Securities have
been registered on a Registration Statement that has been declared effective by
the Commission, neither the Company nor any of its security holders (other than
the Holders in such capacity pursuant hereto) may include securities of the
Company in a Registration Statement other than the Registrable Securities, and
the Company shall not enter into any agreement providing any such right to any
of its security holders or prospective security holders that are senior to the
rights of the Holders without the written consent of Holders of at least a
majority of the Registrable Securities.

       

      (c) Entire
Agreement.  This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein.  This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter, except for, and as provided in the Transaction
Documents.

       

      (d) Amendments and
Waivers.  The provisions of Sections 2 through 7 and 9 of this
Agreement, including definitions in Section 1 with respect to such sections, may
not be amended, modified, supplemented or waived unless the same shall be in
writing and signed by the Company and Holders holding at least a majority of the
then outstanding Registrable Securities.  The provisions of Section 8
of this Agreement, including the definitions in Section 1 and the provisions of
this sentence with respect to such section, may not be amended, modified,
supplemented or waived unless the same shall be in writing and signed by the
Company (i) each Purchaser to which such amendment, modification, supplement or
waiver relates with respect to Section 8(a) and (ii)
OrbiMed.  Notwithstanding the foregoing, a waiver or consent to depart
from the provisions hereof with respect to a matter that relates exclusively to
the rights of Holders and that does not directly or indirectly affect the rights
of other Holders may be given by Holders of all of the Registrable Securities to
which such waiver or consent relates; provided, however, that the provisions
of this sentence may not be amended, modified or supplemented except in
accordance with the provisions of the immediately preceding
sentence.

       

      (e) Term.  The
registration rights provided to the Holders of Registrable Securities hereunder,
and the Company’s obligation to keep the Registration Statements effective,
shall terminate at such time as there are no Registrable
Securities.  Notwithstanding the foregoing, Section 5, Section 6 and
Section 9 shall survive the termination of this Agreement.

       

      (f) Notices.  Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be delivered as set forth in the Purchase
Agreement.

       

      (g) Successors and
Assigns.  This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of each of the parties and
shall inure to the benefit of each Holder.  Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.  The Company may not assign its
rights or obligations (i) under Sections 2 through 7 hereof without the prior
written consent of Holders holding at least a majority of the then outstanding
Registrable Securities, (ii) under Section 8(a) hereof without the prior written
consent of each Purchaser to which such assignment relates or (iii) under
Section 8(b) hereof without the prior written consent of OrbiMed (other than by
merger or consolidation or to an entity which acquires the Company, including by
way of acquiring all or substantially all of the Company’s
assets).  The rights of the Holders hereunder, including the right to
have the Company register Registrable Securities pursuant to this Agreement, may
be assigned by each Holder to transferees or assignees of all or any portion of
the Registrable Securities, but only if (i) the Holder agrees in writing with
the transferee or assignee to assign such rights and related obligations under
this Agreement, and for the transferee or assignee to assume such obligations,
and a copy of such agreement is furnished to the Company within a reasonable
time after such assignment, (ii) the Company is, within a reasonable time after
such transfer or assignment, furnished with written notice of the name and
address of such transferee or assignee and the securities with respect to which
such registration rights are being transferred or assigned, (iii) at or before
the time the Company received the written notice contemplated by clause (ii) of
this sentence, the transferee or assignee agrees in writing with the Company to
be bound by all of the provisions contained herein and (iv) the transferee is an
“accredited investor,” as that term is defined in Rule 501 of Regulation
D.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

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

       

      (i) Governing
Law.  All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be determined in
accordance with the provisions of the Purchase Agreement.

       

      (j) Cumulative
Remedies.  The remedies provided herein are cumulative and not
exclusive of any remedies provided by law.

       

      (k) Severability. If any
term, provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction.  It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such that may be hereafter
declared invalid, illegal, void or unenforceable.

       

      (l) Headings.  The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof.

       

      (m) Currency.  Unless
otherwise indicated, all dollar amounts referred to in this Agreement are in
United States Dollars.  All amounts owing under this Agreement are in
United States Dollars.  All amounts denominated in other currencies
shall be converted in the United States Dollar equivalent amount in accordance
with the applicable exchange rate in effect on the date of
calculation.

       

      (n) Further
Assurances.  The parties shall execute and deliver all such
further instruments and documents and take all such other actions as may
reasonably be required to carry out the transactions contemplated hereby and to
evidence the fulfillment of the agreements herein contained.

       

      [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK,

      SIGNATURE
PAGES TO FOLLOW]


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      IN
WITNESS WHEREOF, the parties have executed this Investor Rights Agreement as of
the date first written above.

       

       

      
        
          	 	KUN
      RUN BIOTECHNOLOGY, INC.	 
	 	 	 	 
	
                   

                	
                  By:
      

                	/s/ Xiaoqun
      Ye	 
	 	 	Name: 
      Xiaoqun Ye 	 
	 	 	Title:   
      Chief Executive Officer 	 
	 	 	 	 


        

      

       

       

      [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK,

      SIGNATURE
PAGES OF HOLDERS TO FOLLOW]

       

      
        
           


        

        
           


          
            

          

        

        
           


        

      


      IN WITNESS WHEREOF, the parties have
executed this Investor Rights Agreement as of the date first written
above.

       

      


      NAME OF PURCHASER

      


      


      Caduceus Asia Partners,
LP

      


      By: /s/ Nancy
Chang

      Name:
 Nancy
Chang

      Title: Chairman and Senior Managing
Director

      


       

      


      ADDRESS FOR NOTICE

      


      c/o:                                                                               


      


      Street:                                                                           

      


      City/State/Zip:                                                            

      


      Country:                                                                       

      


      Attention:                                                                     

      


      Tel:                                                                                


      


      Fax:                                                                                


      


      Email:                                                                             


      


      

        
          
             


          

          
             


            
              

            

          

          
             


          

        



      IN WITNESS WHEREOF, the parties have
executed this Investor Rights Agreement as of the date first written
above.

       

      


      NAME OF KEY HOLDER

      


      /s/ Xueyun
Cui                                                                           

      


      


      AUTHORIZED SIGNATORY

      


      By:
_________________________________

      Name:

      Title:

      


      


      

        ADDRESS
FOR NOTICE

        


        c/o:                                                                               


        


        Street:                                                                           

        


        City/State/Zip:                                                            

        


        Country:                                                                       

        


        Attention:                                                                     

        


        Tel:                                                                                


        


        Fax:
                                                                               


        


        Email:                                                                             


      

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      

      


      Annex A

       

      SELLING
STOCKHOLDER NOTICE AND QUESTIONNAIRE

      


      The
undersigned holder of shares of and warrants to purchase shares of the Series A
Preferred Stock, par value $0.001 per share, of Kun Run Biotechnology, Inc., a
Nevada corporation (the “Company”),
issued pursuant to that certain Securities Purchase Agreement by and among the
Company and the Purchasers named therein, dated as of April 17, 2010 (the “Purchase
Agreement”), understands that the Company intends to file with the
Commission a registration statement on Form S-3 (except if the Company is
ineligible to register for resale the Registrable Securities on Form S-3, in
which case such registration shall be on a registration statement on Form S-1)
(the “Resale
Registration Statement”) for the registration and the resale under Rule
415 of the Securities Act of Registrable Securities in accordance with the terms
of that certain Investor Rights Agreement, dated as of the date of the Purchase
Agreement, by and among the Company and the Purchasers as defined therein, to
which this Notice and Questionnaire is attached as Annex A (the “Agreement”).
All capitalized terms not otherwise defined herein shall have the meanings
ascribed thereto in the Agreement.

      


      In order
to sell or otherwise dispose of any Registrable Securities pursuant to the
Resale Registration Statement, a holder of Registrable Securities generally will
be required to be named as a selling stockholder in the related prospectus or a
supplement thereto (as so supplemented, the “Prospectus”),
deliver such Prospectus to purchasers of Registrable Securities (including
pursuant to Rule 172 under the Securities Act) and be bound by the provisions of
the Agreement (including certain indemnification provisions, as described
below). Holders must complete and deliver this Notice and Questionnaire in order
to be named as selling stockholders in the Prospectus. Holders of Registrable Securities who
do not complete, execute and return this Notice and Questionnaire within ten
(10) Business Days following the date of the Agreement shall not be entitled to
(1) be named as a selling stockholder in the Resale Registration Statement or
the Prospectus or (2) use such Prospectus for offers and resales of Registrable
Securities at any time.

      


      Certain
legal consequences arise from being named as a selling stockholder in the Resale
Registration Statement and the Prospectus. Holders of Registrable Securities are
advised to consult their own securities law counsel regarding the consequences
of being named or not named as a selling stockholder in the Resale Registration
Statement and the Prospectus.

      


      NOTICE

       

      The
undersigned holder (the “Selling
Stockholder”) of Registrable Securities hereby gives notice to the
Company of its intention to sell or otherwise dispose of Registrable Securities
owned by it and listed below in Item (3), unless otherwise specified in Item
(3), pursuant to the Resale Registration Statement. The undersigned, by signing
and returning this Notice and Questionnaire, understands and agrees that it will
be bound by the terms and conditions of this Notice and Questionnaire and the
Agreement.

      


      The
undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate and
complete:

      



      
        
           


        

        
           


          
            

          

        

        
           


        

      


      
        QUESTIONNAIRE

      

       

      
        1.  Name.

      

       

      
        
          	
                   
      

                	
                  (a)

                	
                  Full
      Legal Name of Selling Stockholder:

                
	 	 	 
	 	 	 


        

      

       

       

      
        
          	
                   
      

                	
                  (b)

                	
                  Full
      Legal Name of Registered Holder (if not the same as (a) above) through
      which Registrable Securities Listed in Item 3 below are
    held:

                
	 	 	 
	 	 	 


        

      

       

       

      
        
          	
                   
      

                	
                  (c)

                	
                  Full
      Legal Name of Natural Control Person (which means a natural person who
      directly or indirectly alone or with others has power to vote or dispose
      of the securities covered by this Notice and
    Questionnaire):

                
	 	 	 
	 	 	 
      


        

      

       

       

      
        2.  Address
for Notices to Selling Stockholder:

      

       

      
        
          
            
              
                
                  
                    
                      
                        	 
      
	 
      
	 
      
	      
                                Telephone:
      

                              	
                                 

                              
	      
                                Fax:

                              	
                                 

                              
	      
                                Contact
      Person:

                              	
                                 

                              
	      
                                E-mail
      Address of Contact Person:

                              	
                                 

                              


                      

                    

                  

                

              

            

          

        

      

      


      
        3.  Beneficial
Ownership of Registrable Securities Issuable Pursuant to the Purchase
Agreement:

      

       

      
        
          	
                   
      

                	
                  (a)

                	
                  Type
      and Number of Registrable Securities beneficially owned and issued
      pursuant to the Purchase Agreement:

                
	 	 	 
	 	 	 
      
	 	 	 
      
	 	 	 
      
	 	 	 


        

      

       

      
        
          	
                   
      

                	
                  (b)

                	
                  Number
      of shares of common stock to be registered pursuant to this Notice and
      Questionnaire for resale:

                
	 	 	 
	 	 	 
	 	 	 
	 	 	 


        

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        4.  Broker-Dealer
Status:

      

       

      
        	
                 
      

              	
                (a)

              	
                Are
      you a broker-dealer?

              


      

       

      Yes                         No   

       

      
        	
                (b)

              	
                If
      “yes” to Section 4(a), did you receive your Registrable Securities as
      compensation for

              	
                investment
      banking services to the Company?

              


      

      
         

        Yes                         No   

         

      

      
        	
                Note:

              	
                If
      no, the Commission’s staff has indicated that you should be identified as
      an underwriter in the Registration
Statement.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                Are
      you an affiliate of a
broker-dealer?

              


      

       

      Yes                         No   

       

      
        
          	
                  Note:

                	
                  If
      yes, provide a narrative explanation below:

                
	 	 
	 	 
	 	 


        

      

       

       

      
        	
                 
      

              	
                (c)

              	
                If
      you are an affiliate of a broker-dealer, do you certify that you bought
      the Registrable Securities in the ordinary course of business, and at the
      time of the purchase of the Registrable Securities to be resold, you had
      no agreements or understandings, directly or indirectly, with any person
      to distribute the Registrable
Securities?

              


      

       

      Yes                         No   

       

      
        	
                Note:

              	
                If
      no, the Commission’s staff has indicated that you should be identified as
      an underwriter in the Registration
Statement.

              


      

       

      
        5.  Beneficial
Ownership of Other Securities of the Company Owned by the Selling
Stockholder.

      

       

      Except
as set forth below in this Item 5, the undersigned is not the beneficial or
registered owner of any securities of the Company other than the Registrable
Securities listed above in Item 3.

       

      
        
          	
                   
      

                	
                  (a)

                	
                  Type
      and amount of other securities beneficially owned:

                
	 	 	 
	 	 	 
	 	 	 
	 	 	 


        

      

       

       

      6.  Relationships
with the Company:

       

      Except
as set forth below, neither the undersigned nor any of its affiliates, officers,
directors or principal equity holders (owners of 5% of more of the equity
securities of the undersigned) has held any position or office or has had any
other material relationship with the Company (or its predecessors or affiliates)
during the past three years.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        
          	
                   
      

                	
                  State
      any exceptions here:

                
	 	 
	 	 
	 	 


        

      

       

       

      
        7.  Plan
of Distribution:

      

       

      The
undersigned has reviewed the form of Plan of Distribution provided by the
Company, and hereby confirms that, except as set forth below, the information
contained therein regarding the undersigned and its plan of distribution is
correct and complete.

       

      
        
          	
                   
      

                	
                  State
      any exceptions here:

                
	 	 
	 	 
	 	 


        

      

       

       

      
        ***********

      

       

      The
undersigned agrees to promptly notify the Company of any inaccuracies or changes
in the information provided herein that may occur subsequent to the date hereof
and prior to the effective date of any applicable Resale Registration Statement.
All notices hereunder shall be made as provided in the Agreement. In the absence
of any such notification, the Company shall be entitled to continue to rely on
the accuracy of the information in this Notice and Questionnaire.

       

      By
signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items (1) through (7) above and the inclusion
of such information in the Resale Registration Statement and the Prospectus. The
undersigned understands that such information will be relied upon by the Company
in connection with the preparation or amendment of any such Registration
Statement and the Prospectus.

       

      By
signing below, the undersigned acknowledges that it understands its obligation
to comply, and agrees that it will comply, with the provisions of the Exchange
Act and the rules and regulations thereunder, particularly Regulation M in
connection with any offering of Registrable Securities pursuant to the Resale
Registration Statement. The undersigned also acknowledges that it understands
that the answers to this Notice and Questionnaire are furnished for use in
connection with Registration Statements filed pursuant to the Investor Rights
Agreement and any amendments or supplements thereto filed with the Commission
pursuant to the Securities Act.

       

      The
undersigned hereby acknowledges and is advised of the following Interpretation
A.65 of the July 1997 SEC Manual of Publicly Available Telephone Interpretations
regarding short selling:

       

      “An
Issuer filed a Form S-3 registration statement for a secondary offering of
common stock which is not yet effective.  One of the selling
stockholders wanted to do a short sale of common stock “against the box” and
cover the short sale with registered shares after the effective
date.  The issuer was advised that the short sale could not be made
before the registration statement becomes effective, because the shares
underlying the short sale are deemed to be sold at the time such sale is
made.  There would, therefore, be a violation of Section 5 if the
shares were effectively sold prior to the effective date.”

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      By
returning this Notice and Questionnaire, the undersigned will be deemed to be
aware of the foregoing interpretation.

       

      I confirm
that, to the best of my knowledge and belief, the foregoing statements
(including without limitation the answers to this Notice and Questionnaire) are
correct.

       

      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

      


      IN
WITNESS WHEREOF the undersigned, by authority duly given, has caused this
Questionnaire to be executed and delivered either in person or by its duly
authorized agent.

       

      
        
          
            
              
                
                  
                    
                      
                        	 	 	 	 	 
	
                                Dated: 

                              	 	 	
                                Beneficial
      Owner:

                              	 
	 	 	 	 	 
	
                                 

                              	 	 	
                                By:

                              	 
	
                                 

                              	 	 	
                                 

                              	      
                                Name: 

                              
	 	 	 	      
                                 

                              	      
                                Title:

                              


                      

                    

                  

                

              

            

          

        

      

      
        


      PLEASE
FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN
THE ORIGINAL BY OVERNIGHT MAIL, TO:

      


      Free
Trade Zone

      168
Nanhai Avenue, Haikou City

      Hainan
Province, China 570216

      Telephone No.:
86-898-6680-2207

       Facsimile
No.:

      Attention:  President

      


      With a
copy to:

      


      Cadwalader,
Wickersham & Taft LLP

      2301
China Central Place, Tower 2,

      No. 79
Jianguo Road

      Beijing,
China 100025

      Telephone
No.:  86-10-6599-7200

      Facsimile
No.:  86-10-6599-7300

      Attention:  Jiannan
Zhang, Esq.