THIS
        NOTE
        HAS BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY AND MAY NOT BE TRANSFERRED
        UNTIL
        (i) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED
        (THE
“ACT”)
        SHALL
        HAVE BECOME EFFECTIVE WITH RESPECT THERETO OR (ii) RECEIPT BY THE COMPANY
        OF AN
        OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT THAT
        REGISTRATION UNDER THE ACT IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED
        TRANSFER NOR IS IN VIOLATION OF ANY APPLICABLE STATE SECURITIES LAWS. THIS
        LEGEND SHALL BE ENDORSED UPON ANY NOTE ISSUED IN EXCHANGE FOR THIS
        NOTE.

       

      BENDA
        PHARMACEUTICAL, INC.

       

      Convertible
        Promissory Note

       

      
        	US $__________ 	
                 April
                  __, 2007


              


      

            

      FOR
        VALUE
        RECEIVED, Benda Pharmaceutical, Inc., a Delaware corporation (the “Company”)
        with
        its principal executive office at Changjiang Tower, 23rd
        Floor,
        No.1 Minquan Road, Wuhan, Hubei province, People’s Republic of China , promises
        to pay to the order of _________________ (the “Holder”)
        or
        registered assigns, the principal amount of ___________________ ($________)
        (the
“Principal
        Amount”),
        together
        with accrued interest on the unpaid Principal Amount from time to time
        outstanding from the date hereof until the
        earlier of (i) April __, 2009 (the “Maturity
        Date”),
        and
        (ii) the date the Holder elects to exercise its right to convert this Note,
        together with accrued and unpaid interest, and other fees and obligations
        outstanding under this Note (the “Obligations”),
        in
        accordance with the provisions hereof; and (iii) April 15, 2007 if the Sibiono
        Transaction has not closed. This Note may not be prepaid, in whole or in
        part,
        without the prior written consent of the Holder. This
        Note
        is payable in lawful money of the United States of America and in same day
        funds, without abatement, reduction, deduction, counterclaim, recoupment,
        defense or setoff, to Holder at such account as Holder may designate. Interest
        on the outstanding Principal Amount shall accrue at a rate per annum computed
        in
        accordance with Section 1 hereof and shall be payable to the Holder in
        accordance herewith. 

       

      1 Computation
        of Interest.

       

      A. Base
        Interest Rate.
        Subject
        to subsections 1B below, until such time that the Holder elects to exercise
        its
        Conversion Right, the Note shall bear interest at the rate of four percent
        (4%)
        per annum calculated on the basis of the actual number of days elapsed and
        a
        year of 365 days. Interest shall be payable in cash, semi-annually in arrears,
        on the last Business Day of each June and December. 

       

      B. Penalty
        Interest.
        In the
        event the Note is not repaid on the Maturity Date, or upon the occurrence
        of an
        Event of Default (after expiration of any applicable cure periods), the rate
        of
        interest applicable to the unpaid Principal Amount shall be adjusted to fifteen
        percent (15%) per annum (the “Default
        Rate”),
        whether by acceleration or otherwise.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      2 Covenants
        of Company

       

      A. Affirmative
        Covenants.
        The
        Company covenants and agrees that, so long as any portion of the Principal
        Amount, accrued but unpaid interest or other Obligations hereunder remain
        outstanding, it will comply with its covenants and other obligations under
        the
        Investment Agreement and the other Transaction Documents (as defined in the
        Investment Agreement). 

       

      B. Negative
        Covenants.
        The
        Company covenants and agrees that, so long as any portion of the Principal
        Amount, accrued but unpaid interest or other Obligations hereunder remain
        outstanding, it will observe the following negative covenants set forth in
        this
        Section 2B:

       

      (i) Liquidation,
        Dissolution.
        Unless
        it receives the prior written consent of the Holder, the Company will not
        liquidate or dissolve;

       

      (ii) Sales
        of Assets.
        Unless
        it receives the prior written consent of the Holder, the Company will not,
        and
        will not allow any of its Subsidiaries to sell, transfer, lease or otherwise
        dispose of all or substantially all of its properties or assets to any person
        or
        entity; provided that
        this
        clause shall not restrict any disposition made in the ordinary course of
        business and consisting of

       

      (a) capital
        goods which are obsolete or have no remaining useful life; or

       

      (b) finished
        goods inventories;

       

      (iii) Negative
        Pledge.
        Unless
        it receives the prior written consent of the Holder, the Company will not,
        and
        will not allow any Subsidiary to, hereafter create, incur, assume or suffer
        to
        exist any mortgage, pledge, hypothecation, assignment, security interest,
        encumbrance, lien (statutory or other), preference, priority or other security
        agreement or preferential arrangement of any kind or nature whatsoever
        (including any conditional sale or other title retention agreement and any
        financing lease) (each, a “Lien”)
        upon
        any of its property, revenues or assets, whether now owned or hereafter
        acquired, except: 

       

      (a) Liens
        granted to secure indebtedness incurred to finance the acquisition (whether
        by
        purchase or capitalized lease) of tangible assets to be owned by the Company,
        but only on the assets acquired with the proceeds of such
        indebtedness;

       

      (b) Liens
        for
        taxes, assessments or other governmental charges or levies not at the time
        delinquent or thereafter payable without penalty or being contested in good
        faith by appropriate proceedings and for which adequate reserves in accordance
        with GAAP shall have been set aside on its books;

       

      (c) Liens
        of
        carriers, warehousemen, mechanics, materialmen and landlords incurred in
        the
        ordinary course of business for sums not overdue or being contested in good
        faith by appropriate proceedings and for which adequate reserves in accordance
        with GAAP shall have been set aside on its books;

       

      
        
          
          

        

        
          -2-

          
            

          

        

        
          
          

        

      

       

      (d) Liens
        incurred in the ordinary course of business in connection with workers’
compensation, unemployment insurance or other forms of governmental insurance
        or
        benefits, or to secure performance of tenders, statutory obligations, leases
        and
        contracts (other than for borrowed money) entered into in the ordinary course
        of
        business or to secure obligations on surety or appeal bonds; 

       

      (e) judgment
        Liens in existence less than 60 days after the entry thereof or with respect
        to
        which execution has been stayed; and

       

      (f) present
        outstanding loans as follows: (i) $2,000,000 RMB bank loan through the Company’s
        subsidiaries domiciled in the People’s Republic of China (“PRC Subs”); and (ii)
        the Company is presently negotiating a $10,000,000 RMB bank loan with China
        Everbright Bank to support the PRC Subs operations which would require
        securitization of the Company’s and/or PRC Subs assets. 

       

      (iv) Senior
        Indebtedness.
        The
        Company hereby agrees that it will not issue any indebtedness with rights
        that
        are senior to this Note. 

       

      3. Events
        of Default.

       

      A. Within
        five (5) business days of the occurrence of any one or more of the following
        Events of Default (after any applicable cure period), the Company shall give
        written notice to the Holder of the Event of Default (the “Default
        Notice”).
        After
        receipt of the Default Notice, if such Event of Default shall continue, the
        Holder may, by written notice (the “Acceleration
        Notice”)
        to the
        Company, declare all the entire outstanding Principal Amount and accrued
        but
        unpaid interest, to be immediately due and payable within five (5) Business
        Days
        (the “Default
        Notice Period”).
        If
        within the Default Notice Period the Company cures the Event of Default in
        a
        manner acceptable to the Holder, the Acceleration Notice will be deemed
        rescinded and the Event of Default will be deemed to no longer exist and
        any
        rights and remedies of Holder pertaining to such Event of Default will be
        of no
        further force or effect.

       

      B. The
        term
“Event
        of Default”
shall
        mean any of the events set forth in this Section 3B:

       

      (i) Non-Payment
        of Obligations.
        The
        Company shall default in the payment of the outstanding Principal Amount,
        and
        accrued but unpaid interest under this Note as and when the same shall become
        due and payable, whether by acceleration or otherwise, and such default remains
        uncured for a period of ten (10) days following receipt by the Company of
        written notice from Holder demanding payment of such amount. 

       

      (ii) Non-Performance
        of Affirmative Covenants.
        The
        Company shall default in the due observance or performance of any covenant
        set
        forth in Section 2A, which default shall continue uncured for a period of
        ten
        (10) days following receipt by the Company of written notice from Holder
        of the
        Company’s failure to perform such covenant.

       

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

       

      (iii) Failure
        to Observe Negative Covenants.
        The
        Company shall default in the due observance of any negative covenant set
        forth
        in Section 2B, which failure can not be cured within ten (10) days following
        receipt by the Company of written notice from Holder of the Company’s failure to
        observe such negative covenant.

       

      (iv) Bankruptcy,
        Insolvency, etc. 

       

      (a) a
        resolution is passed or an order of a court of competent jurisdiction is
        made
        that the Company be wound up or dissolved otherwise than for the purposes
        of, or
        pursuant to and followed by a consolidation, amalgamation, merger or other
        corporate reorganization (a “Corporate Transaction”), the terms of which have
        previously been approved in writing by the Required Holder Majority;


       

      (b) a
        resolution is passed or an order of a court of competent jurisdiction is
        made
        for the winding up or dissolution of any Subsidiary of the Company, except
        (i)
        for the purposes of or pursuant to and followed by a Corporate Transaction
        with
        or into the Company or any other Subsidiary, (ii) for the purposes of or
        pursuant to and followed by a Corporate Transaction (other than as described
        in
        (i) above) the terms of which shall have previously been approved by the
        Required Holder Majority, or (iii) by way of a voluntary winding up or
        dissolution where there are surplus assets in such subsidiary and such surplus
        assets attributable to the Company and/or any other subsidiary are distributed
        to the Company and/or any such other subsidiary; 

       

      (c) a
        trustee, receiver, or other custodian is appointed over the whole or a
        substantial part of the assets or undertaking of the Company or any
        Subsidiary;

       

      (d) a
        distress, execution or seizure order before judgment is levied or enforced
        upon
        or sued out against the whole or a substantial part of the property of the
        Company or any Subsidiary (as the case may be) and is not discharged within
        forty (40) days thereof; 

       

      (e) the
        Company or any Subsidiary is unable to pay its debts as and when they fall
        due,
        or the Company or any Subsidiary shall initiate or consent to proceedings
        relating to itself under any applicable bankruptcy, reorganization or insolvency
        law or make an assignment for the benefit of, or enter into any composition
        with, its creditors; 

       

      (f) proceedings
        shall have been initiated against the Company or any Subsidiary under any
        applicable bankruptcy, reorganization or insolvency law and such proceedings
        shall not have been discharged or stayed within a period of sixty (60) days;
        

       

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

       

      (g) the
        Company shall take any corporate or other action authorizing, or in furtherance
        of, any of the foregoing.

       

      4. Conversion
        of Note.

       

      A. Conversion
        Right; Conversion Price.
        Subject
        to the terms and conditions hereof, at any time prior to the Maturity Date,
        while any portion of the Principal Amount is outstanding under this Note,
        the
        Holder shall have the right, but not the obligation, to convert the outstanding
        Principal Amount, together with all accrued but unpaid interest thereon (the
        “Conversion
        Right”),
        into
        shares of Company Common Stock. The number of shares of Company Common Stock
        the
        Holder shall be entitled to receive upon exercise of a Conversion Right shall
        be
        the quotient determined by dividing (i) the amount of the Note to be converted
        as set forth in the “Conversion Notice” (defined below) divided by (ii) the
“Conversion
        Price”
of
        $0.555 (subject to adjustment as set forth in herein). 

       

      B. Mechanics
        of Conversion.
        In
        order to exercise its Conversion Right, the Holder shall deliver written
        notice,
        in the form attached hereto as Exhibit
        A
        (the
        "Conversion
        Notice"),
        of
        the Holder's election to convert this Note and surrender the Note to the
        Company. If the Note is converted in part only, the Company shall execute
        and
        deliver to the Holder, at the expense of the Company, a new Note in Principal
        Amount equal to the unconverted portion of the Principal Amount. On or before
        the first (1st)
        Business Day following the date on which the Company has received each of
        the
        Conversion Notice, the Company shall transmit by facsimile an acknowledgment
        of
        confirmation of receipt of the Conversion Notice to the Holder and the Company's
        transfer agent (the "Transfer
        Agent").
        On or
        before the third (3rd)
        Business Day following the date on which the Company has received the Conversion
        Notice (the "Share
        Delivery Date"),
        the
        Company shall (X) provided that the Transfer Agent is participating in The
        Depository Trust Company ("DTC")
        Fast
        Automated Securities Transfer Program, upon the request of the Holder, credit
        such aggregate number of Note Shares to which the Holder is entitled pursuant
        to
        such exercise to the Holder's or its designee's balance account with DTC
        through
        its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer Agent
        is
        not participating in the DTC Fast Automated Securities Transfer Program,
        issue
        and dispatch by overnight courier to the address as specified in the Conversion
        Notice, a certificate, registered in the Company's share register in the
        name of
        the Holder or its designee, for the number of shares of Common Stock to which
        the Holder is entitled pursuant to such conversion. In addition, if the Note
        shall have been converted prior to the effective date of an adjustment to
        the
        Conversion Price in accordance herewith, then on or before the third
        (3rd)
        Business Day following the effective date of such adjustment the Company
        shall
        issue irrevocable instructions to its transfer agent to issue certificates
        or
        credit shares to the applicable balance accounts at DTC, registered in the
        name
        of Holder or its respective nominee(s) in accordance with the preceding
        sentence, for a number of Note Shares equal to the difference between the
        number
        of Note Shares that would have been issued based on the EPS Adjusted Conversion
        Price, and the number of Conversion Shares issued upon earlier Conversion.
        Upon
        delivery of the Conversion Notice, the Holder shall be deemed for all corporate
        purposes to have become the holder of record of the Note Shares with respect
        to
        which this Note has been converted, irrespective of the date such Note Shares
        are credited to the Holder's DTC account or the date of delivery of the
        certificates evidencing such Note Shares, as the case may be. No fractional
        shares of Common Stock are to be issued upon the conversion of this Note,
        but
        rather the number of Note Shares to be issued shall be rounded up to the
        nearest
        whole number. The Company shall pay any and all taxes which may be payable
        with
        respect to the issuance and delivery of Note Shares upon any conversion of
        this
        Note. 

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

       

      C. Company's
        Failure to Timely Deliver Securities.
        If the
        Company shall fail for any reason or for no reason to issue to the Holder
        within
        the three (3) Business Day time periods set forth in Section 4B above, a
        certificate for the number of Note Shares to which the Holder is entitled
        and
        register such Note Shares on the Company's share register or to credit the
        Holder's balance account with DTC for such number of Note Shares to which
        the
        Holder is entitled, then, in addition to all other remedies available to
        the
        Holder, the Company shall pay in cash to the Holder on each day after such
        third Business
        Day that the issuance of such Note Shares is not timely effected an amount
        equal
        to 2.0% of the product of (A) the sum of the number of Note Shares not issued
        to
        the Holder on a timely basis and to which the Holder is entitled and (B)
        the
        Closing Sale Price of the shares of Common Stock on the Trading Day immediately
        preceding the last possible date which the Company could have issued such
        shares
        of Common Stock to the Holder without violating Section 1(a). In addition
        to the
        foregoing, if within three (3) Trading Days after the Company's receipt of
        the
        facsimile copy of a Conversion Notice the Company shall fail to issue and
        deliver a certificate to the Holder and register such Note Shares on the
        Company's share register or credit the Holder's balance account with DTC
        for the
        number of Note Shares to which the Holder is entitled upon the Holder's
        conversion hereunder, and if on or after such Trading Day the Holder purchases
        (in an open market transaction or otherwise) shares of Common Stock to deliver
        in satisfaction of a sale by the Holder of shares of Common Stock issuable
        upon
        such exercise that the Holder anticipated receiving from the Company (a
"Buy-In"),
        then
        the Company shall, within three (3) Business Days after the Holder's request
        and
        in the Holder's discretion, either (i) pay cash to the Holder in an amount
        equal
        to the Holder's total purchase price (including brokerage commissions, if
        any)
        for the shares of Common Stock so purchased (the "Buy-In
        Price"),
        at
        which point the Company's obligation to deliver such certificate (and to
        issue
        such Note Shares) shall terminate, or (ii) promptly honor its obligation
        to
        deliver to the Holder a certificate or certificates representing such Note
        Shares and pay cash to the Holder in an amount equal to the excess (if any)
        of
        the Buy-In Price over the product of (A) such number of shares of Common
        Stock,
        times (B) the Closing Bid Price on the date of exercise.

       

      D. Disputes.
        In the
        case of a dispute as to the determination of the Conversion Price, the Company
        shall promptly issue to the Holder the number of Note Shares that are not
        disputed and resolve such dispute in accordance with Section 14.

       

      E. Insufficient
        Authorized Shares.
        If at
        any time while any of the Notes remain outstanding the Company does not have
        a
        sufficient number of authorized and unreserved shares of Common Stock to
        satisfy
        its obligation to reserve for issuance upon conversion of the Notes at least
        a
        number of shares of Common Stock equal to 150% (the "Required
        Reserve Amount")
        of the
        number of shares of Common Stock as shall from time to time be necessary
        to
        effect the conversion of all of the Notes then outstanding (an "Authorized
        Share Failure"),
        then
        the Company shall immediately take all action necessary to increase the
        Company's authorized shares of Common Stock to an amount sufficient to allow
        the
        Company to reserve the Required Reserve Amount for the Notes then outstanding.
        Without limiting the generality of the foregoing sentence, as soon as
        practicable after the date of the occurrence of an Authorized Share Failure,
        but
        in no event later than sixty (60) days after the occurrence of such Authorized
        Share Failure, the Company shall hold a meeting of its stockholders for the
        approval of an increase in the number of authorized shares of Common Stock.
        In
        connection with such meeting, the Company shall provide each stockholder
        with a
        proxy statement and shall use its best efforts to solicit its stockholders'
        approval of such increase in authorized shares of Common Stock and to cause
        its
        board of directors to recommend to the stockholders that they approve such
        proposal.

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

       

      F. Adjustment
        of Conversion Price.
        

       

      (i) Performance
        Threshold Adjustments.
        Pursuant to the Make-Good Agreement (as defined in the Investment Agreement),
        the Company made covenants with the Buyers (as defined in the Investment
        Agreement) that Net Income (as defined in the Make Good Agreement) for the
        fiscal year ending December 31, 2007 ("FY07
        Net Income")
        of the
        Company would be greater than or equal to $10.0 million (the "Make
        Good Performance
        Threshold"),
        as
        set forth in the FY07 Financial Statements (as defined in the Make Good
        Agreement). For purposes of this Note, the Company covenants with Holder
        that
        the FY07 Net Income will be greater than or equal to $10 million (the
“Note
        Performance Threshold”).
        If
        and to the extent the Note Performance Threshold is not met, then the Conversion
        Price shall be reduced based on the proportionate increase in the number
        of
        shares of Common Stock issued or to be issuable to the Buyers (without taking
        into account any limitations or qualifications) in satisfaction of the
        provisions of the Make-Good Agreement. 

       

      (ii) Adjustments
        Identical to Adjustments to Exercise Price in Warrant.
        If and
        whenever on or after the date hereof while the Note is outstanding any action
        is
        taken that would effect an adjustment to the exercise price or number of
        shares
        issuable upon exercise of the Warrant, a similar adjustment shall be made
        to the
        Conversion Price as of the same effective date.

       

      5. Rights
        Upon Distribution of Assets.
        If the
        Company shall declare or make any Distribution
        (as
        defined in the Warrant), at any time after the issuance of this Note, then
        the
        provisions of the Warrant with respect to such Distributions shall likewise
        apply to this Note, incuding without limitation, an adjustment to the Conversion
        Price.

       

      6. Purchase
        Rights; Fundamental Transactions.
        If the
        Company shall grant Purchase Rights (as defined in the Warrant) or enters
        into a
        Fundamental Transaction (as defined in the Warrant), the provisions of the
        Warrant with respect to Purchase Rights and Fundamental Transactions shall
        likewise apply to this Note.

       

      7. Noncircumvention.
        The
        noncircumvention provisions of the Warrant shall likewise apply to this
        Note.

       

      8. 
        Holder not deemed a Stockholder.
        Except
        as otherwise specifically provided herein, the Holder, solely in such Person's
        capacity as a holder of this Note, shall not be entitled to vote or receive
        dividends or be deemed the holder of share capital of the Company for any
        purpose, nor shall anything contained in this Note be construed to confer
        upon
        the Holder, solely in such Person's capacity as the Holder of this Note,
        any of
        the rights of a shareholder of the Company or any right to vote, give or
        withhold consent to any corporate action (whether any reorganization, issue
        of
        stock, reclassification of stock, consolidation, merger, conveyance or
        otherwise), receive notice of meetings, receive dividends or subscription
        rights, or otherwise, prior to the issuance to the Holder of the Note Shares
        which such Person is then entitled to receive upon the due conversion of
        this
        Note. In addition, nothing contained in this Note shall be construed as imposing
        any liabilities on the Holder to purchase any securities (upon conversion
        of
        this Note or otherwise) or as a shareholder of the Company, whether such
        liabilities are asserted by the Company or by creditors of the Company.
        Notwithstanding this Section 8, the Company shall provide the Holder with
        copies
        of the same notices and other information given to the shareholders of the
        Company generally, contemporaneously with the giving thereof to the
        shareholders.

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

       

      9. Reissuance
        of Notes.

       

      A Transfer
        of Note.
        If this
        Note is to be transferred, the Holder shall surrender this Note to the Company,
        whereupon the Company will forthwith issue and deliver upon the order of
        the
        Holder a new Note, registered as the Holder may request, representing the
        right
        to the Note being transferred by the Holder and, if less then the entire
        Note is
        being transferred, a new Note to the Holder representing the portion of the
        Note
        not being transferred.

       

      B Lost,
        Stolen or Mutilated Note.
        Upon
        receipt by the Company of evidence reasonably satisfactory to the Company
        of the
        loss, theft, destruction or mutilation of this Note, and, in the case of
        loss,
        theft or destruction, of any indemnification undertaking by the Holder to
        the
        Company in customary form and, in the case of mutilation, upon surrender
        and
        cancellation of this Note, the Company shall execute and deliver to the Holder
        a
        new Note in substitution the Note so lost, stolen or mutilated.

       

      C Issuance
        of New Note.
        Whenever the Company is required to issue a new Note pursuant to the terms
        of
        this Note, such new Note (i) shall be of like tenor with this Note, (ii)
        shall
        represent, as indicated on the face of such new Note, the Principal Amount
        of
        the old Note (or in the case of a new Note being issued pursuant to Section
        9(i), the portion of the Principal Amount designated by the Holder which,
        when
        added to the Principal Amount the other new Notes issued in connection with
        such
        issuance, does not exceed the aggregate Principal Amount of this Note), (iii)
        shall have an issuance date, as indicated on the face of such new Note, which
        is
        the same as the date hereof, and (iv) shall have the same rights and conditions
        as this Note.

       

      10. Notices.
        Whenever notice is required to be given under this Note, unless otherwise
        provided herein, such notice shall be given in accordance with Section 9(f)of
        the Investment Agreement. The Company shall provide the Holder with prompt
        written notice of all actions taken pursuant to this Note, including in
        reasonable detail a description of such action and the reason therefore.
        Without
        limiting the generality of the foregoing, the Company will give written notice
        to the Holder (i) immediately upon any adjustment of the Conversion Price,
        setting forth in reasonable detail, and certifying, the calculation of such
        adjustment and (ii) at least fifteen days prior to the date on which the
        Company
        closes its books or takes a record (A) with respect to any dividend or
        distribution upon the shares of Common Stock, (B) with respect to any grants,
        issuances or sales of any Options, Convertible Securities or rights to purchase
        stock, warrants, securities or other property to holders of shares of Common
        Stock or (C) for determining rights to vote with respect to any Fundamental
        Transaction, dissolution or liquidation, provided in each case that such
        information shall be made known to the public prior to or in conjunction
        with
        such notice being provided to the Holder.

       

      
        
          
          

        

        
          -8-

          
            

          

        

        
          
          

        

      

       

      11. Amendment
        and Waiver.
        Except
        as otherwise provided herein, the provisions of this Note may be amended
        and the
        Company may take any action herein prohibited, or omit to perform any act
        herein
        required to be performed by it, only if the Company has obtained the written
        consent of the Required Holder Majority; provided that no such action may
        increase the Conversion Price, require a conversion, reduce the time period
        in
        which the Note may be converted, or grant prepayment rights to the Company,
        in
        any case without the written consent of the Holder. No such amendment shall
        be
        effective to the extent that it applies to less than all of the holders of
        the
        Notes then outstanding.

       

      12. Governing
        Law.
        This
        Note shall be governed by and construed and enforced in accordance with,
        and all
        questions concerning the construction, validity, interpretation and performance
        of this Note shall be governed by, the internal laws of the State of New
        York,
        without giving effect to any choice of law or conflict of law provision or
        rule
        (whether of the State of New York or any other jurisdictions) that would
        cause
        the application of the laws of any jurisdictions other than the State of
        New
        York.

       

      13. Construction;
        Headings.
        This
        Note shall be deemed to be jointly drafted by the Company and the Holder
        and
        shall not be construed against any person as the drafter hereof. The headings
        of
        this Note are for convenience of reference and shall not form part of, or
        affect
        the interpretation of, this Note.

       

      14. Dispute
        Resolution.
        In the
        case of a dispute as to the determination of the Conversion Price or the
        arithmetic calculation of the Note Shares, the Company shall submit the disputed
        determinations or arithmetic calculations via facsimile within two Business
        Days
        of receipt of the Conversion Notice giving rise to such dispute, as the case
        may
        be, to the Holder. If the Holder and the Company are unable to agree upon
        such
        determination or calculation of the Conversion Price or the Note Shares within
        three Business Days of such disputed determination or arithmetic calculation
        being submitted to the Holder, then the Company shall, within two Business
        Days
        submit via facsimile (a) the disputed determination of the Conversion Price
        to
        an independent, reputable investment bank selected by the Company and approved
        by the Required Holder Majority or (b) the disputed arithmetic calculation
        of
        the Note Shares to the Company's independent, outside accountant. The Company
        shall cause at its expense the investment bank or the accountant, as the
        case
        may be, to perform the determinations or calculations and notify the Company
        and
        the Holder of the results no later than ten (10) Business Days from the time
        it
        receives the disputed determinations or calculations. Such investment bank's
        or
        accountant's determination or calculation, as the case may be, shall be binding
        upon all parties absent demonstrable error.

       

      15. Remedies,
        Other Obligations, Breaches and Injunctive Relief.
        The
        remedies provided in this Note shall be cumulative and in addition to all
        other
        remedies available under this Note and the other Transaction Documents, at
        law
        or in equity (including a decree of specific performance and/or other injunctive
        relief), and nothing herein shall limit the right of the Holder right to
        pursue
        actual damages for any failure by the Company to comply with the terms of
        this
        Note. The Company acknowledges that a breach by it of its obligations hereunder
        will cause irreparable harm to the Holder and that the remedy at law for
        any
        such breach may be inadequate. The Company therefore agrees that, in the
        event
        of any such breach or threatened breach, the holder of this Note shall be
        entitled, in addition to all other available remedies, to an injunction
        restraining any breach, without the necessity of showing economic loss and
        without any bond or other security being required.

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

       

      16. Transfer.
        This
        Note may be offered for sale, sold, transferred or assigned without the consent
        of the Company.

       

      17. Miscellaneous.

       

      A. Parties
        in Interest.
        All
        covenants, agreements and undertakings in this Note binding upon the Company
        or
        the Holder shall bind and inure to the benefit of the successors and permitted
        assigns of the Company and the Holder, respectively, whether so expressed
        or
        not.

       

      B. Costs
        and Expenses.
        Company
        agrees to pay on demand all costs and expenses, if any, including counsel
        fees
        and expenses, in connection with the enforcement (whether through negotiations,
        legal proceedings or otherwise) of this Note. 

       

      C. Waiver.
        Except
        as otherwise provided for in this Note, and to the fullest extent permitted
        by
        applicable law, Company waives: (a) presentment, notice, demand and protest,
        and
        notice of presentment, dishonor, intent to accelerate, acceleration, protest,
        default, nonpayment, maturity, release, compromise, settlement, extension
        or
        renewal of this Note at any time held by Holder on which Company may in any
        way
        be liable, and hereby ratifies and confirms whatever Holder may do in this
        regard; (b) all rights to notice and a hearing prior to Holder’s taking
        possession or control of, or to Holder’s replevy, attachment or levy upon, any
        property, real or personal, tangible or intangible of Company or any bond
        or
        security which might be required by any court prior to allowing Holder to
        exercise any of its remedies; and (c) the benefit of all valuation, appraisal
        and exemption laws.

       

      D. Maximum
        Payments.
        Nothing
        contained herein shall be deemed to establish or require the payment of a
        rate
        of interest or other charges in excess of the maximum permitted by applicable
        law. In the event that the rate of interest required to be paid or other
        charges
        hereunder exceed the maximum permitted by such law, any payments in excess
        of
        such maximum shall be credited against amounts owed by the Borrower to the
        Holder and the remainder, if any, refunded to the Borrower.

       

      [Signature
        Page Follows]

      


      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      


      IN
        WITNESS WHEREOF,
        the
        Company has caused this Note to be duly executed as of the date set out
        above.

       

      
        	 	 	 
	 	BENDA
                PHARMACEUTICAL,
                INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
                
                  

                

                Name: Yiqing Wan

                Title: Chief Executive Officer 

              


      

       

      EXHIBIT
        A

      


      CONVERSION
        NOTICE

       

      TO
        BE EXECUTED BY THE REGISTERED HOLDER TO CONVERT THIS

      NOTE
        INTO COMMON STOCK

       

      BENDA
        PHARMACEUTICAL, INC.

       

      The
        undersigned holder hereby exercises the right to convert _____________________of
        the Note into shares of Common Stock ("Note
        Shares")
        of
        Benda Pharmaceutical, Inc., a Delaware corporation (the "Company"),
        evidenced by the attached Note (the "Note").
        Capitalized terms used herein and not otherwise defined shall have the
        respective meanings set forth in the Note.

      


      1.
        Delivery of Note Shares. The Company shall deliver to the holder __________
        Note
        Shares in accordance with the terms of the Note.

      


      Date:
        _______________ __, ______

      
        	 	 	 	 
	 	 	 	 
	
                
Name
                of Holder	 	 	
              


      

       

      
        	 	 	 	 
	By: 
                	 	 	 
	
                
                  

                

                Name:

                Title:

              	 	 	
              


      

       

      
        
          
          

        

        
          -11-

          
            

          

        

         

      


      ACKNOWLEDGMENT


      


      The
        Company hereby acknowledges this Conversion Notice and hereby directs
        Computershare Trust Company, Inc. to issue the above indicated number of
        shares
        of Common Stock in accordance with the Transfer Agent Instructions dated
        _____________from the Company and acknowledged and agreed to by Computershare
        Trust Company, Inc.

      
        	 	 	 
	 	BENDA
                PHARMACEUTICAL, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
                

                Name:

                Title:

              


      

       

      
        
          
          

        

        
          -12-