Document:

Exhibit
      10.1

     

    

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      Securities Purchase Agreement (this “Agreement”)
      is
      dated as of June 29,
      2007,
      among China Agritech, Inc., a Delaware corporation (the “Company”),
      Chang
      Yu, a citizen of the PRC and the President and CEO of the Company (the
“Make
      Good Pledgor”)
      and the
      investors listed on the Schedule of Buyers attached hereto as Annex
      A
      and
      identified on the signature pages hereto (each, an “Investor”
      and
      collectively, the “Investors”).

     

    WHEREAS,
      subject to the terms and conditions set forth in this Agreement and pursuant
      to
      Section 4(2) of the Securities Act (as defined below) and Rule 506 promulgated
      thereunder, the Company desires to issue and sell to each Investor, and each
      Investor, severally and not jointly, desires to purchase from the Company
      certain securities of the Company, as more fully described in this Agreement;
      and

     

    WHEREAS,
      as an inducement for the Investors to purchase securities of the Company the
      parties are simultaneously entering into the Make Good Escrow Agreement (as
      defined below), which inducement is acknowledged and agreed to be a fundamental
      term of the agreement among the parties.

     

    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, the Make Good Pledgor and the Investors
      agree as follows:

     

    ARTICLE
      1.

    DEFINITIONS

     

    1.1. Definitions.
      In
      addition to the terms defined elsewhere in this Agreement, for all purposes
      of
      this Agreement, the following terms shall have the meanings indicated in this
      Section 1.1:

     

    “2007
      Make Good Shares”
      has the
      meaning given to such term in Section 4.13(a).

     

    “Action”
      means
      any action, suit, inquiry, notice of violation, proceeding (including any
      partial proceeding such as a deposition) or investigation pending or threatened
      in writing against or affecting the Company, any Subsidiary or any of their
      respective properties before or by any court, arbitrator, governmental or
      administrative agency, regulatory authority (federal, state, county, local
      or
      foreign), stock market, stock exchange or trading facility.

     

    “Affiliate”
      means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a
      Person.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Business
      Day”
      means
      any day except Saturday, Sunday and any day which is a federal legal holiday
      or
      a day on which banking institutions in the State of New York or State of
      Delaware are authorized or required by law or other governmental action to
      close.

     

    “Buy-In”
has
      the
      meaning set forth in Section 4.1(c).

     

    “Closing”
      means
      the closing of the purchase and sale of the Shares pursuant to Article
      2.

     

    “Closing
      Date”
      means
      the Business Day on which all of the conditions set forth in Sections 5.1 and
      5.2 hereof are satisfied, or such other date as the parties may
      agree.

     

    "Closing
      Escrow Agreement"
      means
      the Closing Escrow Agreement, dated as of the date hereof, between the Company,
      the Investors and the escrow agent (the “Escrow
      Agent”)
      identified therein, in the form of Exhibit
      B
      hereto.

     

    “Commission”
      means
      the Securities and Exchange Commission.

     

    “Common
      Stock”
      means
      the common stock of the Company, par value $0.001 per share, and any securities
      into which such common stock may hereafter be reclassified.

     

    “Common
      Stock Equivalents”
      means
      any securities of the Company or any Subsidiary which entitle the holder thereof
      to acquire Common Stock at any time, including any debt, preferred stock,
      rights, options, warrants or other instrument that is at any time convertible
      into or exchangeable for, or otherwise entitles the holder thereof to receive,
      Common Stock or other securities that entitle the holder to receive, directly
      or
      indirectly, Common Stock.

     

    “Company
      Counsel”
      means
      Thelen Reid Brown Raysman & Steiner LLP.

     

    “Company
      Deliverables”
      has the
      meaning set forth in Section 2.2(a).

     

    “Disclosure
      Materials”
      has the
      meaning set forth in Section 3.1(h).

     

    “Effective
      Date”
      means
      the date that the initial Registration Statement required by Section 2(a) of
      the
      Registration Rights Agreement is first declared effective by the
      Commission.

     

    “Evaluation
      Date”
      has the
      meaning set forth in Section 3.1(s).

     

    “Exchange
      Act”
      means
      the Securities Exchange Act of 1934, as amended.

     

    “GAAP”
      means
      U.S. generally accepted accounting principles.

     

    “Intellectual
      Property Rights”
      has the
      meaning set forth in Section 3.1(p).

     

    “Investment
      Amount”
      means,
      with respect to each Investor, the Investment Amount indicated on such
      Investor’s signature page to this Agreement.

     

    “Investor
      Deliverables”
      has the
      meaning set forth in Section 2.2(b).

     

    
      
        
        

      

      
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    “Investor
      Party”
      has the
      meaning set forth in Section 4.7.

     

    “Lien”
      means
      any lien, charge, encumbrance, security interest, right of first refusal or
      other restrictions of any kind.

     

    “Make
      Good Escrow Agreement” means
      the Make Good Escrow Agreement, dated as of the date hereof, between the
      Company, the Make Good Pledgor, the Investors and the Escrow Agent identified
      therein, in the form of Exhibit
      C
      hereto.

     

    “Make
      Good Pledgor” means
      Chang Yu.

     

    “Material
      Adverse Effect”
      means
      any of (i) a material and adverse effect on the legality, validity or
      enforceability of any Transaction Document, (ii) a material and adverse effect
      on the results of operations, assets, prospects, business or condition
      (financial or otherwise) of the Company and the Subsidiaries, taken as a whole,
      or (iii) an adverse impairment to the Company’s ability to perform on a timely
      basis its obligations under any Transaction Document.

     

    “New
      York Courts”
      means
      the state and federal courts sitting in the City of New York, Borough of
      Manhattan.

     

    “Outside
      Date”
      means
      the twentieth day following the date of this Agreement.

     

    “Per
      Share Purchase Price”
      equals
      $2.70.

     

    “Person”
      means an
      individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    “PRC”
means
      the People’s Republic of China, not including Taiwan, Hong Kong and
      Macau.

     

    “Proceeding”
      means an
      action, claim, suit, investigation or proceeding (including an investigation
      or
      partial proceeding, such as a deposition), whether commenced or
      threatened.

     

    “Registration
      Rights Agreement”
      means
      the Registration Rights Agreement, dated as of the date of this Agreement,
      among
      the Company and the Investors, in the form of Exhibit
      A
      hereto.

     

    “Registration
      Statement”
      means a
      registration statement meeting the requirements set forth in the Registration
      Rights Agreement and covering the resale by the Investors of the
      Shares.

     

    “Rule
      144”
      means
      Rule 144 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
      Reports”
      has the
      meaning set forth in Section 3.1(h).

     

    
      
        
        

      

      
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    “Securities
      Act”
      means
      the Securities Act of 1933, as amended.

     

    “Share
      Delivery Date”
has
      the
      meaning set forth in Section 4.1(c).

     

    “Shares”
      means
      the shares of Common Stock issued, issuable or transferable to the Investors
      pursuant to this Agreement.

     

    “Short
      Sales”
      include
      all “short sales” as defined in Rule 200 promulgated under Regulation SHO under
      the Exchange Act and all types of direct and indirect stock pledges, forward
      sale contracts, options, puts, calls, swaps and similar arrangements (including
      on a total return basis), and sales and other transactions through non-US broker
      dealers or foreign regulated brokers.

     

    “Subsidiary”
      means
      any “significant subsidiary” as defined in Rule 1-02(w) of the Regulation S-X
      promulgated by the Commission under the Exchange Act.

     

    “Trading
      Day”
      means
      (i) a day on which the Common Stock is traded on a Trading Market (other than
      the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a Trading
      Market (other than the OTC Bulletin Board), a day on which the Common Stock
      is
      traded in the over-the-counter market, as reported by the OTC Bulletin Board,
      or
      (iii) if the Common Stock is not quoted on any Trading Market, a day on which
      the Common Stock is quoted in the over-the-counter market as reported by the
      Pink Sheets LLC (or any similar organization or agency succeeding to its
      functions of reporting prices); provided, that in the event that the Common
      Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then
      Trading Day shall mean a Business Day.

     

    “Trading
      Market”
      means
      whichever of the New York Stock Exchange, the American Stock Exchange, the
      NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market
      or OTC Bulletin Board on which the Common Stock is listed or quoted for trading
      on the date in question.

     

    “Transaction
      Documents”
      means
      this Agreement, the Registration Rights Agreement, the Closing Escrow Agreement,
      Make Good Escrow Agreement and any other documents or agreements executed in
      connection with the transactions contemplated hereunder.

     

    ARTICLE
      2.

    PURCHASE
      AND SALE

     

    2.1. ClosingSubject
      to the terms and conditions set forth in this Agreement, at the Closing the
      Company shall issue and sell to each Investor, and each Investor shall,
      severally and not jointly, purchase from the Company, the Shares representing
      such Investor’s Investment Amount. The Closing shall take place at the offices
      of Bryan Cave LLP, 1290 Avenue of the Americas, New York, NY 10104 on the
      Closing Date or at such other location or time as the parties may
      agree.

     

    2.2. Closing
      Deliveries (a) At the Closing, the Company shall deliver or cause to be
      delivered to each Investor the following (the “Company
      Deliverables”):

     

    
      
        
        

      

      
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    (i) a
      certificate evidencing a number of Shares equal to such Investor’s Investment
      Amount divided by the Per Share Purchase Price, registered in the name of such
      Investor or its nominee;

     

    (ii) the
      legal
      opinion of Company Counsel, in agreed form, addressed to the Investors;

     

    (iii) an
      officer’s certificate, in agreed form, certifying the satisfaction of each of
      the conditions precedent to the Investors’ obligation to purchase
      Shares*

     

    (iv) the
      Registration Rights Agreement, duly executed by the Company; 

     

    (v) the
      Closing Escrow Agreement, duly executed by all parties thereto; and

     

    (vi) the
      Make
      Good Escrow Agreement, duly executed by all parties thereto.

     

    (b) At
      the
      Closing, each Investor shall deliver or cause to be delivered the following
      (the
“Investor
      Deliverables”):

     

    (i) to
      the
      Escrow Agent, for deposit and disbursement in accordance with the Closing Escrow
      Agreement, its Investment Amount, in immediately available funds, by wire
      transfer to an account designated in writing by the Escrow Agent for such
      purpose; and

     

    (ii) to
      the
      Company, the Registration Rights Agreement, Closing Escrow Agreement, and Make
      Good Escrow Agreement, duly executed by such Investor.

     

    ARTICLE
      3.

    REPRESENTATIONS
      AND WARRANTIES

     

    3.1. Representations
      and Warranties of the Company.
      The
      Company hereby makes the following representations and warranties to each
      Investor as of the date hereof and as of the Closing Date:

     

    (a) Subsidiaries.
      The
      Company has no direct or indirect Subsidiaries other than as specified in the
      SEC Reports. Except as disclosed in Schedule 3.1(a), the Company owns, directly
      or indirectly, all of the capital stock of each Subsidiary free and clear of
      any
      and all Liens, and all the issued and outstanding shares of capital stock of
      each Subsidiary are validly issued and are fully paid, non-assessable and free
      of preemptive and similar rights.

     

    (b) Organization
      and Qualification.
      The
      Company and each Subsidiary are duly incorporated or otherwise organized,
      validly existing and in good standing under the laws of the jurisdiction of
      its
      incorporation or organization (as applicable), with the requisite power and
      authority to own and use its properties and assets and to carry on its business
      as currently conducted. Neither the Company nor any Subsidiary is in violation
      of any of the provisions of its respective certificate or articles of
      incorporation, bylaws or other organizational or charter documents. The Company
      and each Subsidiary are duly qualified to conduct its respective businesses
      and
      are in good standing as a foreign corporation or other entity in each
      jurisdiction in which the nature of the business conducted or property owned
      by
      it makes such qualification necessary, except where the failure to be so
      qualified or in good standing, as the case may be, could not, individually
      or in
      the aggregate, have or reasonably be expected to result in a Material Adverse
      Effect.

     

    ___________________

    *
      Please
      provide.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    (c) Authorization;
      Enforcement.
      The
      Company has the requisite corporate power and authority to enter into and to
      consummate the transactions contemplated by each of the Transaction Documents
      and otherwise to carry out its obligations thereunder. The execution and
      delivery of each of the Transaction Documents by the Company and the
      consummation by it of the transactions contemplated thereby have been duly
      authorized by all necessary action on the part of the Company and no further
      action is required by the Company in connection therewith. Each Transaction
      Document has been (or upon delivery will have been) duly executed by the Company
      and, when delivered in accordance with the terms hereof, will constitute the
      valid and binding obligation of the Company enforceable against the Company
      in
      accordance with its terms, except as such enforceability may be limited by
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles of general
      application.

     

    (d) No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company
      and the consummation by the Company of the transactions contemplated thereby
      do
      not and will not (i) conflict with or violate any provision of the Company’s
      certificate of incorporation or bylaws, or (ii) conflict with, or constitute
      a
      default (or an event that with notice or lapse of time or both would become
      a
      default) under, or give to others any rights of termination, amendment,
      acceleration or cancellation (with or without notice, lapse of time or both)
      of,
      any agreement, credit facility, debt or other instrument (evidencing a Company
      or Subsidiary debt or otherwise) or other understanding to which the Company
      or
      any Subsidiary is a party or by which any property or asset of the Company
      or
      any Subsidiary is bound or affected, or (iii) result in a violation of any
      U.S.
      law, rule, regulation, order, judgment, injunction, decree or other restriction
      of any court or governmental authority to which the Company or a Subsidiary
      is
      subject (including federal and state securities laws and regulations), or by
      which any property or asset of the Company or a Subsidiary is bound or affected;
      except in the case of each of clauses (ii) and (iii), such as could not,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect.

     

    (e) Filings,
      Consents and Approvals.
      The
      Company is not required to obtain any consent, waiver, authorization or order
      of, give any notice to, or make any filing or registration with, any United
      States or PRC court or other federal, state, local or other governmental
      authority or other Person in connection with the execution, delivery and
      performance by the Company of the Transaction Documents, other than (i) the
      filing with the Commission of one or more Registration Statements in accordance
      with the requirements of the Registration Rights Agreement, (ii) filings
      required by state securities laws, (iii) the filing of a Notice of Sale of
      Securities on Form D with the Commission under Regulation D of the Securities
      Act, (iv) the filings required in accordance with Section 4.5 and (v) those
      that
      have been made or obtained prior to the date of this Agreement.

     

    
      
        
        

      

      
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    (f) Issuance
      of the Shares.
      The
      Shares and the Make Good Shares have been duly authorized and are, or with
      respect to the Shares to be delivered to the Investors on the Closing Date,
      when
      issued and paid for in accordance with the Transaction Documents, will be,
      duly
      and validly issued, fully paid and nonassessable, free and clear of all Liens.
      The Company has reserved from its duly authorized capital stock the shares
      of
      Common Stock issuable pursuant to this Agreement in order to issue the
      Shares.

     

    (g) Capitalization.
      The
      number of shares and type of all authorized, issued and outstanding capital
      stock of the Company, and all shares of Common Stock reserved for issuance
      under
      the Company’s various option and incentive plans, is specified in the SEC
      Reports. Except as specified in the SEC Reports, no securities of the Company
      are entitled to preemptive or similar rights, and no Person has any right of
      first refusal, preemptive right, right of participation, or any similar right
      to
      participate in the transactions contemplated by the Transaction Documents.
      Except as specified in the SEC Reports, there are no outstanding options,
      warrants, scrip rights to subscribe to, calls or commitments of any character
      whatsoever relating to, or securities, rights or obligations convertible into
      or
      exchangeable for, or giving any Person any right to subscribe for or acquire,
      any shares of Common Stock, or contracts, commitments, understandings or
      arrangements by which the Company or any Subsidiary is or may become bound
      to
      issue additional shares of Common Stock, or securities or rights convertible
      or
      exchangeable into shares of Common Stock. Neither the issue and sale of Shares
      contemplated by this Agreement or the transfer of the 2007 Make Good Shares
      to
      the Investors will, immediately or with the passage of time, obligate the
      Company to issue shares of Common Stock or other securities to any Person (other
      than the Investors) or will result in a right of any holder of Company
      securities to adjust the exercise, conversion, exchange or reset price under
      such securities.

     

    (h) SEC
      Reports; Financial Statements.
      The
      Company has filed all reports required to be filed by it under the Securities
      Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
      for the two years preceding the date hereof (or such shorter period as the
      Company was required by law to file such reports) (the foregoing materials
      being
      collectively referred to herein as the “SEC
      Reports”
      and,
      together with the Schedules to this Agreement (if any), the “Disclosure
      Materials”)
      on a
      timely basis or has timely filed a valid extension of such time of filing and
      has filed any such SEC Reports prior to the expiration of any such extension.
      As
      of their respective dates and the dates they were filed, the SEC Reports
      complied in all material respects with the requirements of the Securities Act
      and the Exchange Act and the rules and regulations of the Commission promulgated
      thereunder, and none of the SEC Reports, when filed, contained any untrue
      statement of a material fact or omitted to state a material fact required to
      be
      stated therein or necessary in order to make the statements therein, in light
      of
      the circumstances under which they were made, not misleading. The financial
      statements of the Company included in the SEC Reports comply in all material
      respects with applicable accounting requirements and the rules and regulations
      of the Commission with respect thereto as in effect at the time of filing.
      Such
      financial statements have been prepared in accordance with GAAP applied on
      a
      consistent basis during the periods involved, except as may be otherwise
      specified in such financial statements or the notes thereto, and fairly present
      in all material respects the financial position of the Company and its
      consolidated Subsidiaries as of and for the dates thereof and the results of
      operations and cash flows for the periods then ended, subject, in the case
      of
      unaudited statements, to normal, immaterial, year-end audit
      adjustments.

     

    
      
        
        

      

      
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    (i) Press
      Releases.
      The
      press releases disseminated by the Company during the two years preceding the
      date of this Agreement taken as a whole do not contain any untrue statement
      of a
      material fact or omit to state a material fact required to be stated therein
      or
      necessary in order to make the statements therein, in light of the circumstances
      under which they were made and when made, not misleading.

     

    (j) Material
      Changes.
      Since
      the date of the latest audited financial statements included within the SEC
      Reports, except as specifically disclosed in the SEC Reports, (i) there has
      been
      no event, occurrence or development that has had or that could reasonably be
      expected to result in a Material Adverse Effect, (ii) the Company has not
      incurred any liabilities (contingent or otherwise) other than (A) trade
      payables, accrued expenses and other liabilities incurred in the ordinary course
      of business consistent with past practice and (B) liabilities not required
      to be
      reflected in the Company’s financial statements pursuant to GAAP or required to
      be disclosed in filings made with the Commission, (iii) the Company has not
      altered its method of accounting or the identity of its auditors, (iv) the
      Company has not declared or made any dividend or distribution of cash or other
      property to its stockholders or purchased, redeemed or made any agreements
      to
      purchase or redeem any shares of its capital stock, and (v) the Company has
      not
      issued any equity securities to any officer, director or Affiliate, except
      pursuant to existing Company stock option plans. The Company does not have
      pending before the Commission any request for confidential treatment of
      information.

     

    (k) Litigation.
      There
      is no Action which (i) adversely affects or challenges the legality, validity
      or
      enforceability of any of the Transaction Documents or the Shares or (ii) except
      as specifically disclosed in the SEC Reports, could, if there were an
      unfavorable decision, individually or in the aggregate, have or reasonably
      be
      expected to result in a Material Adverse Effect. Neither the Company nor any
      Subsidiary, nor any director or officer thereof (in his or her capacity as
      such), is or has been the subject of any Action involving a claim of violation
      of or liability under federal or state securities laws or a claim of breach
      of
      fiduciary duty, except as specifically disclosed in the SEC Reports. There
      has
      not been, and to the knowledge of the Company, there is not pending any
      investigation by the Commission involving the Company or any current or former
      director or officer of the Company (in his or her capacity as such). The
      Commission has not issued any stop order or other order suspending the
      effectiveness of any registration statement filed by the Company or any
      Subsidiary under the Exchange Act or the Securities Act.

     

    (l) Labor
      Relations.
      No
      material labor dispute exists or, to the knowledge of the Company, is imminent
      with respect to any of the employees of the Company or any
      Subsidiary.

     

    (m) Compliance.
      Neither
      the Company nor any Subsidiary (i) is in default under or in violation of (and
      no event has occurred that has not been waived that, with notice or lapse of
      time or both, would result in a default by the Company or any Subsidiary under),
      nor has the Company or any Subsidiary received notice of a claim that it is
      in
      default under or that it is in violation of, any indenture, loan or credit
      agreement or any other agreement or instrument to which it is a party or by
      which it or any of its properties is bound (whether or not such default or
      violation has been waived), (ii) is in violation of any order of any court,
      arbitrator or governmental body, or (iii) is or has been in violation of any
      statute, rule or regulation of any governmental authority, including all
      foreign, federal, state and local laws relating to taxes, environmental
      protection, occupational health and safety, product quality and safety and
      employment and labor matters, except in the case of clause (i), such as could
      not, individually or in the aggregate, have or reasonably be expected to result
      in a Material Adverse Effect. The Company is in compliance with all effective
      requirements of the Sarbanes-Oxley Act of 2002, as amended, and the rules and
      regulations thereunder, that are applicable to it. 

     

    
      
        
        

      

      
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    (n) Regulatory
      Permits.
      The
      Company and the Subsidiaries possess all certificates, authorizations and
      permits issued by the appropriate federal, state, local or foreign regulatory
      authorities necessary to conduct their respective businesses as described in
      the
      SEC Reports, except where the failure to possess such permits could not,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect, and neither the Company nor any Subsidiary has received
      any notice of proceedings relating to the revocation or modification of any
      such
      permits.

     

    (o) Title
      to Assets.
      The
      Company and the Subsidiaries have valid land use rights for all real property
      that is material to their respective businesses and good and marketable title
      in
      all personal property owned by them that is material to their respective
      businesses, in each case free and clear of all Liens, except for Liens as do
      not
      materially affect the value of such property and do not materially interfere
      with the use made and proposed to be made of such property by the Company and
      the Subsidiaries. Any real property and facilities held under lease by the
      Company and the Subsidiaries are held by them under valid, subsisting and
      enforceable leases.

     

    (p) Patents
      and Trademarks.
      The
      Company and the Subsidiaries have, or have rights to use, all patents, patent
      applications, trademarks, trademark applications, service marks, trade names,
      copyrights, licenses and other similar rights (collectively, the “Intellectual
      Property Rights”)
      that
      are necessary or material for use in connection with their respective businesses
      as described in the SEC Reports and which the failure to so have could,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect. Neither the Company nor any Subsidiary has received
      a
      written notice that the Intellectual Property Rights used by the Company or
      any
      Subsidiary violates or infringes upon the rights of any Person. Except as set
      forth in the SEC Reports, to the knowledge of the Company, all such Intellectual
      Property Rights are enforceable and there is no existing infringement by another
      Person of any of the Intellectual Property Rights.

     

    (q) Insurance.
      The
      Company and the Subsidiaries are insured by insurers of recognized financial
      responsibility against such losses and risks and in such amounts as are prudent
      and customary in the businesses in which the Company and the Subsidiaries are
      engaged. The Company has no reason to believe that it will not be able to renew
      its and the Subsidiaries’ existing insurance coverage as and when such coverage
      expires or to obtain similar coverage from similar insurers as may be necessary
      to continue its business on terms consistent with market for the Company’s and
      such Subsidiaries’ respective lines of business.

     

    
      (r) Transactions
        With Affiliates and Employees.
        Except
        as set forth in the SEC Reports, none of the officers or directors of the
        Company and, to the knowledge of the Company, none of the employees of the
        Company is presently a party to any transaction with the Company or any
        Subsidiary (other than for services as employees, officers and directors),
        including any contract, agreement or other arrangement providing for the
        furnishing of services to or by, providing for rental of real or personal
        property to or from, or otherwise requiring payments to or from any officer,
        director or such employee or any entity in which any officer, director, or,
        to
        the knowledge of the Company, any such employee has a substantial interest
        or is
        an officer, director, trustee or partner.

    

    
      
        
        

      

      
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    (s) Internal
      Accounting Controls.
      The
      Company has established disclosure controls and procedures (as defined in
      Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such
      disclosure controls and procedures to ensure that material information relating
      to the Company, including its Subsidiaries, is made known to the certifying
      officers by others within those entities, particularly during the period in
      which the Company’s Form 10-K or 10-Q, as the case may be, is being prepared.
      The Company’s certifying officers have evaluated the effectiveness of the
      Company’s controls and procedures in accordance with Item 307 of Regulation S-K
      under the Exchange Act for the Company’s most recently ended fiscal quarter or
      fiscal year-end (such date, the “Evaluation
      Date”).
      The
      Company presented in its most recently filed Form 10-K or Form 10-Q the
      conclusions of the certifying officers about the effectiveness of the disclosure
      controls and procedures based on their evaluations as of the Evaluation Date.
      Since the Evaluation Date, there have been no significant changes in the
      Company’s internal controls (as such term is defined in Rule 13a-15 under the
      Exchange Act) or, to the Company’s knowledge, in other factors that could
      significantly affect the Company’s internal controls.

     

    (t) Solvency.
      Based
      on the financial condition of the Company as of the Closing Date (and assuming
      that the Closing shall have occurred), (i) the Company’s fair saleable value of
      its assets exceeds the amount that will be required to be paid on or in respect
      of the Company’s existing debts and other liabilities (including known
      contingent liabilities) as they mature, (ii) the Company’s assets do not
      constitute unreasonably small capital to carry on its business for the current
      fiscal year as now conducted and as proposed to be conducted including its
      capital needs taking into account the particular capital requirements of the
      business conducted by the Company, and projected capital requirements and
      capital availability thereof, and (iii) the current cash flow of the Company,
      together with the proceeds the Company would receive, were it to liquidate
      all
      of its assets, after taking into account all anticipated uses of the cash,
      would
      be sufficient to pay all amounts on or in respect of its debt when such amounts
      are required to be paid. The Company does not intend to incur debts beyond
      its
      ability to pay such debts as they mature (taking into account the timing and
      amounts of cash to be payable on or in respect of its debt).

     

    (u) Certain
      Fees.
      Except
      as described in Schedule 3.1(u), no brokerage or finder’s fees or commissions
      are or will be payable by the Company to any broker, financial advisor or
      consultant, finder, placement agent, investment banker, bank or other Person
      with respect to the transactions contemplated by this Agreement. The Investors
      shall have no obligation with respect to any fees or with respect to any claims
      (other than such fees or commissions owed by an Investor pursuant to written
      agreements executed by such Investor which fees or commissions shall be the
      sole
      responsibility of such Investor) made by or on behalf of other Persons for
      fees
      of a type contemplated in this Section that may be due in connection with the
      transactions contemplated by this Agreement.

     

    
      
        
        

      

      
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    (v) No
      General Solicitation; Private Placement.
      Neither
      the Company nor any person authorized to act on the Company’s behalf has sold or
      offered to sell or solicited any offer to buy the Shares by means of any form
      of
      general solicitation or advertising. Neither the Company nor any of its
      directors of officers nor any Person authorized to act on the Company’s behalf
      has, directly or indirectly, at any time within the past six months, made any
      offer or sale of any security or solicitation of any offer to buy any security
      under circumstances that would (i) eliminate the availability of the exemption
      from registration under Regulation D under the Securities Act in connection
      with
      the offer and sale by the Company of the Shares as contemplated hereby or (ii)
      cause the offering of the Shares pursuant to this Agreement to be integrated
      with prior offerings by the Company for purposes of any applicable law,
      regulation or stockholder approval provisions, including under the rules and
      regulations of any national securities exchange, market or trading or quotation
      facility on which the Shares are listed or quoted.

     

    (w) Certain
      Registration Matters.
      Assuming the accuracy of the Investors’ representations and warranties set forth
      in Section 3.2(b)-(e), no registration under the Securities Act is required
      for
      the offer and sale of the Shares by the Company to the Investors under the
      Transaction Documents or the transfer of the 2007 Make Good Shares to the
      Investors. The Company is eligible to register its Common Stock for resale
      by
      the Investors under Form S-1 promulgated under the Securities Act. Except as
      specified in Schedule 3.1(w), the Company has not granted or agreed to grant
      to
      any Person any rights (including “piggy-back” registration rights) to have any
      securities of the Company registered with the Commission or any other
      governmental authority that have not been satisfied. The Company withdrew its
      Registration Statement on Form SB-2 (File No. 333-126802) on December 14,
      2006.

     

    (x) Listing
      and Maintenance Requirements.
      Except
      as specified in the SEC Reports, the Company has not, in the two years preceding
      the date hereof, received notice from any Trading Market to the effect that
      the
      Company is not in compliance with the listing or maintenance requirements
      thereof. The Company is, and has no reason to believe that it will not in the
      foreseeable future continue to be, in compliance with the listing and
      maintenance requirements for continued listing of the Common Stock on the
      Trading Market on which the Common Stock is currently listed or quoted. The
      issuance and sale of the Shares under the Transaction Documents and the transfer
      of the 2007 Make Good Shares to the Investors, does not contravene the rules
      and
      regulations of the Trading Market on which the Common Stock is currently listed
      or quoted, and no approval of the shareholders of the Company thereunder is
      required for the Company to issue and deliver to the Investors the Shares
      contemplated by Transaction Documents or the transfer of the 2007 Make Good
      Shares to the Investors.

     

    (y) Investment
      Company.
      The
      Company is not, and is not an Affiliate of, and immediately following the
      Closing will not have become, an “investment company” within the meaning of the
      Investment Company Act of 1940, as amended.

     

    (z) Application
      of Takeover Protections.
      The
      Company has taken all necessary action, if any, in order to render inapplicable
      any control share acquisition, business combination, poison pill (including
      any
      distribution under a rights agreement) or other similar anti-takeover provision
      under the Company’s certificate of incorporation (or similar charter documents)
      or the laws of its state of incorporation that is or could become applicable
      to
      the Investors as a result of the Investors and the Company fulfilling their
      obligations or exercising their rights under the Transaction Documents,
      including the Company’s issuance of and/or delivery of all of the Shares and the
      Investors’ ownership of the Shares.

     

    
      
        
        

      

      
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    (aa) No
      Additional Agreements.
      The
      Company does not have any agreement or understanding with any Investor with
      respect to the transactions contemplated by the Transaction Documents other
      than
      as specified in the Transaction Documents.

     

    (bb) Foreign
      Corrupt Practices Act.
      Neither
      the Company nor any Subsidiary, nor to the knowledge of the Company, any agent
      or other person acting on behalf of any of the Company or any Subsidiary, has,
      directly or indirectly, (i) used any funds, or will use any proceeds from the
      sale of the Shares, for unlawful contributions, gifts, entertainment or other
      unlawful expenses related to foreign or domestic political activity, (ii) made
      any unlawful payment to foreign or domestic government officials or employees
      or
      to any foreign or domestic political parties or campaigns from corporate funds,
      (iii) failed to disclose fully any contribution made by the Company or any
      Subsidiary (or made by any Person acting on their behalf of which the Company
      is
      aware) where such failure to disclose is in violation of law, or (iv) has
      violated in any material respect any provision of the Foreign Corrupt Practices
      Act of 1977, as amended, and the rules and regulations thereunder which was
      applicable to the Company or Subsidiary.

     

    (cc) PFIC.
      Neither
      the Company nor any Subsidiary is or intends to become a “passive foreign
      investment company” within the meaning of Section 1297 of the U.S. Internal
      Revenue Code of 1986, as amended.

     

    (dd) OFAC.
      None of
      the Company, any Subsidiary, director, officer, nor to the knowledge of the
      Company, any agent, employee, Affiliate or Person acting on behalf of the
      Company or any Subsidiary is currently identified on the specially designated
      nationals or other blocked person list administered by the Office of Foreign
      Assets Control of the U.S. Treasury Department (“OFAC”);
      and
      the Company will not directly or indirectly use the proceeds of the sale of
      the
      Shares, or lend, contribute or otherwise make available such proceeds to any
      Subsidiary, joint venture partner or other Person or entity in violation of
      any
      U.S. sanctions administered by OFAC.

     

    (ee) Money
      Laundering Laws.
      The
      operations of each of the Company and any Subsidiary are and have been conducted
      at all times in compliance with any applicable money laundering statutes of
      applicable jurisdictions, the rules and regulations thereunder and any related
      or similar rules, regulations or guidelines, issued, administered or enforced
      by
      any applicable governmental agency (collectively, the “Money
      Laundering Laws”)
      and no
      action, suit or proceeding by or before any court or governmental agency,
      authority or body or any arbitrator involving the Company and/or any Subsidiary
      with respect to the Money Laundering Laws is pending or, to the best knowledge
      of the Company, threatened.

     

    (ff) Additional
      PRC Representations and Warranties.
      

     

    
      (i) All
        material consents, approvals, authorizations or licenses requisite under
        PRC law
        for the due and proper establishment and operation of the Company and the
        Subsidiaries have been duly obtained from the relevant PRC governmental
        authorities and are in full force and effect.

    

    
      
        
        

      

      
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    (ii) All
      filings and registrations with the PRC governmental authorities required in
      respect of the Company and the Subsidiaries and their operations, including
      approval by the Ministry of Commerce and registration with the State
      Administration of Industry and Commerce, the State Administration of Foreign
      Exchange, tax bureau and customs office and other government authorities that
      administer foreign investment enterprises, have been duly completed in
      accordance with the relevant PRC rules and regulations, except where, the
      failure to complete such filings and registrations does not, and would not,
      individually or in the aggregate, have a Material Adverse Effect.

     

    (iii) The
      Company and the Subsidiaries have complied with all relevant PRC laws and
      regulations regarding the contribution and payment of its registered capital,
      the payment schedule of which has been approved by the relevant PRC governmental
      authorities. There are no outstanding rights of, or commitments made by the
      Company or any Subsidiary to sell any of their respective equity
      interests.

     

    (iv) Neither
      the Company nor any Subsidiary is in receipt of any letter or notice from any
      relevant PRC governmental authority notifying it of the revocation, or otherwise
      questioning the validity, of any licenses or qualifications issued to it or
      any
      subsidy granted to it by any PRC governmental authority for non-compliance
      with
      the terms thereof or with applicable PRC laws, or the need for compliance or
      remedial actions in respect of the activities carried out by the Company or
      such
      Subsidiary.

     

    (v) The
      Company and the Subsidiaries have conducted their respective business activities
      within their permitted scope of business or have otherwise operated their
      respective businesses in compliance with all relevant legal requirements and
      with all requisite licenses and approvals granted by competent PRC governmental
      authorities other than such non-compliance that do not, and would not,
      individually or in the aggregate, have a Material Adverse Effect. As to
      licenses, approvals and government grants and concessions requisite or material
      for the conduct of any part of the Company or any Subsidiaries’ business which
      is subject to periodic renewal, neither the Company nor such Subsidiary has
      any
      knowledge of any grounds on which such requisite renewals will not be granted
      by
      the relevant PRC governmental authorities.

     

    (vi) With
      regard to employment and staff or labor, the Company and the Subsidiaries have
      complied with all applicable PRC laws and regulations in all material respects,
      including laws and regulations pertaining to welfare funds, social benefits,
      medical benefits, insurance, retirement benefits, pensions or the
      like.

     

    (gg) Disclosure.
      The
      Company confirms that neither it nor, any of its officers, directors, Affiliates
      or any Person authorized to act on the Company’s behalf, has provided any
      Investor or its respective agents or counsel with any information that the
      Company believes constitutes material, non-public information except insofar
      as
      the existence and terms of the proposed transactions hereunder may constitute
      such information. The Company understands and confirms that the Investors will
      rely on the foregoing representations and covenants in effecting transactions
      in
      securities of the Company. All disclosure provided to the Investors regarding
      the Company, its business and the transactions contemplated hereby, furnished
      by
      or on behalf of the Company (including the Company’s representations and
      warranties set forth in this Agreement) are true and correct and do not contain
      any untrue statement of a material fact or omit to state any material fact
      necessary in order to make the statements made therein, in light of the
      circumstances under which they were made, not misleading.

     

    
      
        
        

      

      
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    3.1A.
       Representations
      and Warranties of the Make Good Pledgor

     

    (a) Authorization;
      Enforcement.
      Chang
      has the requisite capacity and authority to enter into and to consummate the
      transactions contemplated by this Agreement (the “Document”) and otherwise to
      carry out his obligations hereunder. The execution and delivery of the Document
      by Chang and the consummation of the transactions contemplated thereby have
      been
      duly authorized by all necessary action on the part of Chang and third parties
      and no further action is required by Chang or third parties in connection
      therewith. The Document has been duly executed by Chang and constitutes the
      valid and binding obligation of Chang and is enforceable against Chang in
      accordance with its terms, except as such enforceability may be limited by
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles of general
      application.

     

    (b) No
      Conflicts.
      Chang’s
      execution and delivery of the Document, Chang’s performance of his obligations
      under the Document and the consummation of the transactions contemplated thereby
      do not and will not (i) conflict with, or constitute a default (or an event
      that
      with notice or lapse of time or both would become a default) under, or give
      to
      others any rights of termination, amendment, acceleration or cancellation (with
      or without notice, lapse of time or both) of, any agreement, credit facility,
      debt or other instrument or other understanding to which Chang, the Company
      or
      any Subsidiary is a party or by which any property or asset of Chang, the
      Company or any Subsidiary is bound or affected, or (ii) result (with or without
      notice, lapse of time or both) in the creation or imposition of any lien, charge
      or encumbrance upon the Escrow Shares.

     

    (c) Filings,
      Consents and Approvals.
      Except
      for the filing with the PRC State Administration of Foreign Exchange with
      respect to the share structure change in the Company, Chang
      is
      not required to obtain any consent, waiver, authorization or order of, give
      any
      notice to, or make any filing or registration with, any U.S. or PRC court or
      other federal, state, local or other governmental authority or other Person
      in
      connection with the execution, delivery and performance by Chang and Escrow
      Agent of the Transaction Documents to which they are a party or the consummation
      of the transactions contemplated by any of the Transaction
      Documents.

     

    3.2. Representations
      and Warranties of the Investors.
      Each
      Investor hereby, for itself and for no other Investor, represents and warrants
      to the Company as follows:

     

    (a) Organization;
      Authority.
      Such
      Investor is an entity duly organized, validly existing and in good standing
      under the laws of the jurisdiction of its organization with the requisite
      corporate or partnership power and authority to enter into and to consummate
      the
      transactions contemplated by the applicable Transaction Documents and otherwise
      to carry out its obligations thereunder. The execution, delivery and performance
      by such Investor of the transactions contemplated by this Agreement has been
      duly authorized by all necessary corporate or, if such Investor is not a
      corporation, such partnership, limited liability company or other applicable
      like action, on the part of such Investor. Each of this Agreement and the
      Registration Rights Agreement has been duly executed by such Investor, and
      when
      delivered by such Investor in accordance with the terms hereof, will constitute
      the valid and legally binding obligation of such Investor, enforceable against
      it in accordance with its terms, except as such enforceability may be limited
      by
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles of general
      application.

    
      
        
        

      

      
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    (b) Investment
      Intent.
      Such
      Investor is acquiring the Shares as principal for its own account for investment
      purposes only and not with a view towards, or resale in connection with, a
      public sale or distribution of such Shares or any part thereof, without
      prejudice, however, to such Investor’s right at all times to sell or otherwise
      dispose of all or any part of such Shares in compliance with applicable federal
      and state securities laws. Subject to the immediately preceding sentence,
      nothing contained herein shall be deemed a representation or warranty by such
      Investor to hold the Shares for any period of time. Such Investor is acquiring
      the Shares hereunder in the ordinary course of its business. Such Investor
      does
      not have any agreement or understanding, directly or indirectly, with any Person
      to distribute any of the Shares.

     

    (c) Investor
      Status.
      At the
      time such Investor was offered the Shares, it was an “accredited investor” as
      defined in Rule 501(a) under the Securities Act. Such Investor is not a
      registered broker dealer under Section 15 of the Exchange Act.

     

    (d) General
      Solicitation.
      Such
      Investor is not purchasing the Shares as a result of any advertisement, article,
      notice or other communication regarding the Shares published in any newspaper,
      magazine or similar media or broadcast over television or radio.

     

    (e) Access
      to Information.
      Such
      Investor acknowledges that it has reviewed the Disclosure Materials and has
      been
      afforded (i) the opportunity to ask such questions as it has deemed necessary
      of, and to receive answers from, representatives of the Company concerning
      the
      terms and conditions of the offering of the Shares and the merits and risks
      of
      investing in the Shares; (ii) access to information about the Company and the
      Subsidiaries and their respective financial condition, results of operations,
      business, properties, management and prospects sufficient to enable it to
      evaluate its investment; and (iii) the opportunity to obtain such additional
      information that the Company possesses or can acquire without unreasonable
      effort or expense that is necessary to make an informed investment decision
      with
      respect to the investment. Neither such inquiries nor any other investigation
      conducted by or on behalf of such Investor or its representatives or counsel
      shall modify, amend or affect such Investor’s right to rely on the truth,
      accuracy and completeness of the Disclosure Materials and the Company’s
      representations and warranties contained in the Transaction
      Documents.

     

    
      (f) Certain
        Trading Activities.
        Such
        Investor has not directly or indirectly, nor has any Person acting on behalf
        of
        or pursuant to any understanding with such Investor, engaged in any transactions
        in the securities of the Company (including any Short Sales involving the
        Company’s securities) since the time that such Investor was first contacted by
        the Company or Roth Capital Partners, LLC regarding the investment in the
        Company contemplated by this Agreement. Such Investor covenants that neither
        it
        nor any Person acting on its behalf or pursuant to any understanding with
        it
        will engage in any transactions in the securities of the Company (including
        Short Sales) prior to the time that the transactions contemplated by this
        Agreement are publicly disclosed.

    

    
      
        
        

      

      
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    (g) Independent
      Investment Decision.
      Such
      Investor has independently evaluated the merits of its decision to purchase
      Shares pursuant to the Transaction Documents, and such Investor confirms that
      it
      has not relied on the advice of any other Investor’s business and/or legal
      counsel in making such decision. Such Investor has not relied on the business
      or
      legal advice of Roth Capital Partners, LLC or any of its agents, counsel or
      Affiliates in making its investment decision hereunder, and confirms that none
      of such Persons has made any representations or warranties to such Investor
      in
      connection with the transactions contemplated by the Transaction
      Documents.

     

    The
      Company acknowledges and agrees that no Investor has made or makes any
      representations or warranties with respect to the transactions contemplated
      hereby other than those specifically set forth in this Section 3.2.

     

    ARTICLE
      4.

    OTHER
      AGREEMENTS OF THE PARTIES

     

    4.1.
      (a)
Shares
      may only be disposed of in compliance with state and federal securities laws.
      In
      connection with any transfer of the Shares, other than pursuant to an effective
      registration statement, pursuant to Rule 144, or to the Company, to an Affiliate
      of an Investor or in connection with a pledge as contemplated in Section 4.1(b),
      the Company may require the transferor thereof to provide to the Company an
      opinion of counsel selected by the transferor, the form and substance of which
      opinion shall be reasonably satisfactory to the Company, to the effect that
      such
      transfer does not require registration of such transferred Shares under the
      Securities Act. Notwithstanding the foregoing, the Company hereby consents
      to
      and agrees to register on the books of the Company and with its transfer agent,
      without any such legal opinion, any transfer of Shares by an Investor to an
      Affiliate of such Investor, provided that the transferee certifies to the
      Company that it is an “accredited investor” as defined in Rule 501(a) under the
      Securities Act and provided that such Affiliate does not request any removal
      of
      any existing legends on any certificate evidencing the Shares.

     

    (b) Certificates
      evidencing the Shares will contain the following legend, until such time as
      they
      are not required under Section 4.1(c):

     

    THESE
      SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
      OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
      REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
      SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
      TO
      SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
      COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
      ACCOUNT SECURED BY SUCH SECURITIES.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    The
      Company acknowledges and agrees that an Investor may from time to time pledge,
      and/or grant a security interest in some or all of the Shares pursuant to a
      bona
      fide margin agreement in connection with a bona fide margin account and, if
      required under the terms of such agreement or account, such Investor may
      transfer pledged or secured Shares to the pledgees or secured parties. Such
      a
      pledge or transfer would not be subject to approval or consent of the Company
      and no legal opinion of legal counsel to the pledgee, secured party or pledgor
      shall be required in connection with the pledge, but such legal opinion may
      be
      required in connection with a subsequent transfer following default by the
      Investor transferee of the pledge. No notice shall be required of such pledge.
      At the appropriate Investor’s expense, the Company will execute and deliver such
      reasonable documentation as a pledgee or secured party of Shares may reasonably
      request in connection with a pledge or transfer of the Shares including the
      preparation and filing of any required prospectus supplement under Rule
      424(b)(3) of the Securities Act or other applicable provision of the Securities
      Act to appropriately amend the list of Selling Stockholders thereunder. Except
      as otherwise provided in Section 4.1(c), any Shares subject to a pledge or
      security interest as contemplated by this Section 4.1(b) shall continue to
      bear
      the legend set forth in this Section 4.1(b) and be subject to the restrictions
      on transfer set forth in Section 4.1(a).

     

    (c) Certificates
      evidencing Shares shall not contain any legend (including the legend set forth
      in Section 4.1(b)): 

     

    (i) following
      a sale or transfer of such Shares pursuant to an effective registration
      statement (including a Registration Statement), or 

     

    (ii) following
      a sale or transfer of such Shares pursuant to Rule 144 (assuming the transferee
      is not an Affiliate of the Company), or 

     

    (iii) while
      such Shares are eligible for sale under Rule 144(k).

     

    If
      an Investor shall make a sale or transfer of Shares either (x) pursuant to
      Rule
      144 or (y) pursuant to a registration statement and in each case shall have
      delivered to the Company or the Company’s transfer agent the certificate
      representing Shares containing a restrictive legend which are the subject of
      such sale or transfer
      and a representation letter in customary form (the
      date of such sale or transfer and Share delivery being the “Share
      Delivery Date”)
      and (1) the Company shall fail to deliver or cause to be delivered to such
      Investor a certificate representing such Shares that is free from all
      restrictive or other legends by the third Trading Day following the Share
      Delivery Date and (2) following such third Trading Day after the Share Delivery
      Date and prior to the time such Shares are received free from restrictive
      legends, the Investor, or any third party on behalf of such Investor, purchases
      (in an open market transaction or otherwise) shares of Common Stock to deliver
      in satisfaction of a sale by the Investor of such Shares (a "Buy-In"),
      then the Company shall pay in cash to the Investor (for costs incurred either
      directly by such Investor or on behalf of a third party) the amount by which
      the
      total purchase price paid for Common Stock as a result of the Buy-In (including
      brokerage commissions, if any) exceed the proceeds received by such Investor
      as
      a result of the sale to which such Buy-In relates. The Investor shall provide
      the Company written notice indicating the amounts payable to the Investor in
      respect of the Buy-In. Payment by the Company of amounts payable in respect
      of
      the Buy-In are in addition to any other remedies that an Investor may have,
      under the Transaction Documents or otherwise, as a result of the Company’s
      failure to deliver Share certificates free from the restrictive legend as
      provided herein.

     

    
      
        
        

      

      
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    4.2. Furnishing
      of Information.
      As long
      as any Investor owns the Shares, 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
      the Exchange Act. As long as any Investor owns Shares, if the Company is not
      required to file reports pursuant to such laws, it will prepare and furnish
      to
      the Investors and make publicly available in accordance with Rule 144(c) such
      information as is required for the Investors to sell the Shares under Rule
      144.
      The Company further covenants that it will take such further action as any
      holder of Shares may reasonably request, all to the extent required from time
      to
      time to enable such Person to sell the Shares without registration under the
      Securities Act within the limitation of the exemptions provided by Rule
      144.

     

    4.3. Integration.
      The
      Company shall not, and shall use its best efforts to ensure that no Affiliate
      of
      the Company shall, sell, offer for sale or solicit offers to buy or otherwise
      negotiate in respect of any security (as defined in Section 2 of the Securities
      Act) that would be integrated with the offer or sale of the Shares in a manner
      that would require the registration under the Securities Act of the sale of
      the
      Shares to the Investors, or that would be integrated with the offer or sale
      of
      the Shares for purposes of the rules and regulations of any Trading Market
      in a
      manner that would require stockholder approval of the sale of the securities
      to
      the Investors.

     

    4.4. Subsequent
      Registrations.
      The
      Company may not file any registration statement (other than on Form S-8) with
      the Commission with respect to any securities of the Company (other than a
      Registration Statement filed in accordance with the Registration Rights
      Agreement which may include previously issued shares of the Company’s common
      stock), prior to the first date on which all Shares have been included in and
      may be sold pursuant to an effective Registration Statement; provided, however,
      if any Investor objects to the inclusion of their Shares in any registration
      statement that would otherwise cover their Shares, the Company shall be deemed
      to have complied with this provision. For the avoidance of doubt, securities
      of
      the Company issued after the date of this Agreement may not be registered
      through a registration statement (other than a Form S-8) with the Commission
      until all Shares have been included in and may be sold pursuant to an effective
      Registration Statement; provided, however, if any Investor objects to the
      inclusion of their Shares in any registration statement that would otherwise
      cover their Shares, the Company shall be deemed to have complied with this
      provision.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    4.5. Securities
      Laws Disclosure; Publicity.
      By
      9:00
      a.m. (New York time) on the Trading Day following the execution of this
      Agreement, and by 9:00 a.m. (New York time) on the Trading Day following the
      Closing Date, the Company shall issue press releases disclosing the transactions
      contemplated hereby and the Closing. Within two (2) Trading Days following
      the
      execution of this Agreement the Company will file a Current Report on Form
      8-K
      disclosing the material terms of the Transaction Documents (and attach as
      exhibits thereto the Transaction Documents), and on the Trading Day following
      the Closing Date the Company will file an additional Current Report on Form
      8-K
      to disclose the Closing; it being understood and agreed that if the Closing
      occurs contemporaneously with the execution of the Agreement, the Company may,
      at its option, file a single Form 8-K disclosing such facts. In addition, the
      Company will make such other filings and notices in the manner and time required
      by the Commission and the Trading Market on which the Common Stock is listed.
      Notwithstanding the foregoing, the Company shall not publicly disclose the
      name
      of any Investor, or include the name of any Investor in any filing with the
      Commission (other than the Registration Statement and any exhibits to filings
      made in respect of this transaction in accordance with periodic filing
      requirements under the Exchange Act) or any regulatory agency or Trading Market,
      without the prior written consent of such Investor, except to the extent such
      disclosure is required by law or Trading Market regulations.

     

    4.6. Limitation
      on Issuance of Future Priced Securities.
      During
      the six months following the Closing Date, the Company shall not issue any
      “Future Priced Securities” as such term is described by NASD
      IM-4350-1.

     

    4.7. Indemnification
      of Investors.
      In
      addition to the indemnity provided in the Registration Rights Agreement, the
      Company will indemnify and hold the Investors and their directors, officers,
      shareholders, partners, employees and agents (each, an “Investor
      Party”)
      harmless from any and all losses, liabilities, obligations, claims,
      contingencies, damages, costs and expenses, including all judgments, amounts
      paid in settlements, court costs and reasonable attorneys’ fees and costs of
      investigation (collectively, “Losses”)
      that
      any such Investor Party may suffer or incur as a result of or relating to any
      misrepresentation, breach or inaccuracy of any representation, warranty,
      covenant or agreement made by the Company in any Transaction Document. In
      addition to the indemnity contained herein, the Company will reimburse each
      Investor Party for its reasonable legal and other expenses (including the cost
      of any investigation, preparation and travel in connection therewith) incurred
      in connection therewith, as such expenses are incurred. Except as otherwise
      set
      forth herein, the mechanics and procedures with respect to the rights and
      obligations under this Section 4.7 shall be the same as those set forth in
      Section 5 of the Registration Rights Agreement.

    
       

      4.8. Non-Public
        Information.
        The
        Company covenants and agrees that neither it nor any other Person acting
        on its
        behalf will provide any Investor or its agents or counsel with any information
        that the Company believes constitutes material non-public information, unless
        prior thereto such Investor shall have executed a written agreement regarding
        the confidentiality and use of such information. The Company understands
        and
        confirms that each Investor shall be relying on the foregoing representations
        in
        effecting transactions in securities of the Company.

       

    

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    4.9. Listing
      of Shares.
      The
      Company agrees, (i) if the Company applies to have the Common Stock traded
      on
      any other Trading Market, it will include in such application the Shares, and
      will take such other action as is necessary or desirable to cause the Shares
      to
      be listed on such other Trading Market as promptly as possible, and (ii) it
      will
      take all action reasonably necessary to continue the listing and trading of
      its
      Common Stock on a Trading Market and will comply in all material respects with
      the Company’s reporting, filing and other obligations under the bylaws or rules
      of the Trading Market. The Company shall use its best efforts to have its Common
      Stock listed on a NASDAQ Trading Market within one (1) year of the Effective
      Date.

     

    4.10. Use
      of
      Proceeds.
      The
      Company will use the net proceeds from the sale of the Shares hereunder for
      working capital purposes and/or capital expenditures, but not for the
      satisfaction of any portion of the Company’s debt (other than payment of trade
      payables and accrued expenses in the ordinary course of the Company’s business
      and consistent with prior practices), or to redeem any Common Stock or Common
      Stock Equivalents.

     

    4.11. Chief
      Financial Officer.
      No
      later than six (6) months following the Closing Date, the Company will hire
      a
      chief financial officer who is an expert in (i) United States generally accepted
      accounting principles and (ii) auditing procedures and compliance for United
      States public companies. The
      Company shall enter into an employment agreement with the CFO for a term of
      no
      less than two years; provided,
      however, that such employment agreement may contain provisions allowing the
      Company to terminate the CFO for reasonable cause at the Company’s discretion at
      any time and without penalty or the obligation to make severance payments,
      even
      prior to the expiration of the two year term set forth in this sentence. Should
      the CFO be dismissed pursuant to the preceding sentence at any time prior to
      two
      years from the Closing Date, the Company shall replace the CFO with a Chief
      Financial Officer who fits the criteria set forth herein as soon as practicable.
      By
      9:00
      a.m. (New York time) on the second Trading Day following the hiring of such
      chief financial officer, the Company will file a Current Report on Form 8-K
      disclosing the information required by Item 5.02 of Form 8-K. 

     

    4.12. Audit
      Preparation Assistance.
      Within
      sixty (60) days following the Closing Date, the Company will use best efforts
      to
      hire SEC Audit Prep, Inc. to assist the Company with its accounting and record
      keeping on an ongoing basis.

     

    4.13. Make
      Good Obligation.

     

    (a) Make
      Good
      Pledgor agrees to sign a Make Good Escrow Agreement that provides that if the
      After-Tax Net Income for the fiscal year ended December 31, 2007 reported in
      the
      Company’s Annual Report on Form 10-K for the fiscal year ending December 31,
      2007, as filed with the Commission (the “2007
      Annual Report”)
      is
      $8,350,000 or less (the “2007
      Guaranteed ATNI”),
      Make
      Good Pledgor will transfer to each Investor on a pro rata basis (based upon
      such
      Investor’s Investment Amount relative to the aggregate Investment Amount of all
      Investors hereunder) for no additional consideration, 1,124,564 shares of Common
      Stock (the “2007
      Make Good Shares”).
      If the
      Company’s audited consolidated financial statements for the fiscal year ended
      December 31, 2007 specify that the 2007 Guaranteed ATNI has been exceeded,
      no
      transfer of the 2007 Make Good Shares shall be required by this Section and
      all
      2007 Make Good Shares deposited with the Make Good Escrow Agent (as defined
      in
      the Make Good Escrow Agreement) shall be returned to the Make Good Pledgor
      within ten Business Days after the date which the 2007 Annual Report is filed
      with the Commission and otherwise in accordance with the Make Good Escrow
      Agreement. Transfers of 2007 Make Good Shares required under this Section shall
      be made to Investors within ten Business Days after the date which the 2007
      Annual Report is filed with the Commission and otherwise in accordance with
      the
      Make Good Escrow Agreement. Notwithstanding anything to the contrary
      contained herein, in the event that the release of any of the 2007
      Make Good Shares to the Investors or the Make Good Pledgor is deemed to be
      an
      expense or deduction from revenues/income of the Company for the applicable
      year, as required under GAAP, then such expense or deduction shall be
      excluded for purposes of determining whether or not the 2007 Guaranteed
      ATNI has been achieved by the Company.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    
    

    (b) In
      connection with the foregoing, Make Good Pledgor agrees that within one Trading
      Day following execution of this Agreement, Make Good Pledgor will deposit all
      2007 Make Good Shares into escrow in accordance with the Make Good Escrow
      Agreement along with bank medallion guaranteed stock powers endorsed in blank,
      and the handling and disposition of the 2007 Make Good Shares shall be governed
      by this Section 4.13 and such Make Good Escrow Agreement. The parties hereby
      agree that the Make Good Pledgor’s obligation to transfer shares of Common Stock
      to Investors pursuant to this Section shall continue to run to the benefit
      of an
      Investor who shall have transferred or sold all or any portion of its Shares,
      and that Investors shall have the right to assign its rights to receive all
      or
      any such shares of Common Stock to other Persons without the consent of any
      other party to this Agreement.

     

    (c) The
      Company covenants and agrees that upon any transfer under this Section of 2007
      Make Good Shares to the Investors in accordance with Section 4 of the Make
      Good
      Escrow Agreement, the Company shall promptly work with its transfer agent to
      reissue such 2007 Make Good Shares in the applicable Investor’s name and deliver
      the same as directed by such Investor.

     

    4.14. Independent
      Public Auditors.
      The
      Company shall use its best efforts to hire as its independent public auditor
      one
      of the internationally recognized public accounting firms listed on Schedule
      4.14 by the earlier of (a) December 31, 2007 and (b) such earlier date as is
      necessary to permit the newly hired auditor to conduct and complete the audit
      of
      the Company's fiscal year 2007 and to permit the Company to include that
      audit
      and related financial statements in the Company's Form 10-K, filed in a timely
      manner.

     

    4.15. Board
      of Directors.
      The
      Company covenants and agrees that no later than six months following the Closing
      Date, the Board of Directors of the Company shall be comprised of a majority
      of
“independent directors” as such term is defined in NASDAQ Marketplace Rule
      4200(a)(15).

     

    4.16. Delivery
      of 2007 Make Good Shares.
      The
      Make Good Pledgor shall deliver all of the 2007 Make Good Shares into escrow
      in
      accordance with the Make Good Escrow Agreement along with bank medallion
      guaranteed stock powers endorsed in blank and satisfactory evidence of such
      delivery shall have been provided to each Investor within 5 business days of
      the
      Closing.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      5.

    CONDITIONS
      PRECEDENT TO CLOSING

     

    5.1. Conditions
      Precedent to the Obligations of the Investors to Purchase Shares.
      The
      obligation of each Investor to acquire Shares at the Closing is subject to
      the
      satisfaction or waiver by such Investor, at or before the Closing, of each
      of
      the following conditions:

     

    (a) Representations
      and Warranties.
      The
      representations and warranties of the Company contained herein shall be true
      and
      correct in all material respects as of the date when made and as of the Closing
      as though made on and as of such date;

     

    (b) Performance.
      The
      Company shall have performed, satisfied and complied in all material respects
      with all covenants, agreements and conditions required by the Transaction
      Documents to be performed, satisfied or complied with by it at or prior to
      the
      Closing;

     

    (c) No
      Injunction.
      No
      statute, rule, regulation, executive order, decree, ruling or injunction shall
      have been enacted, entered, promulgated or endorsed by any court or governmental
      authority of competent jurisdiction that prohibits the consummation of any
      of
      the transactions contemplated by the Transaction Documents;

     

    (d) Adverse
      Changes.
      Since
      the date of execution of this Agreement, no event or series of events shall
      have
      occurred that reasonably could have or result in a Material Adverse
      Effect;

     

    (e) No
      Suspensions of Trading in Common Stock; Listing.
      Trading
      in the Common Stock shall not have been suspended by the Commission or any
      Trading Market (except for any suspensions of trading of not more than one
      Trading Day solely to permit dissemination of material information regarding
      the
      Company) at any time since the date of execution of this Agreement, and the
      Common Stock shall have been at all times since such date listed for trading
      on
      a Trading Market; 

     

    (f) License
      Agreement.
      The
      term of the license agreement between Chang Yu and Pacific
      Dragon Fertilizers Co. Ltd. (a subsidiary of the Company), that authorizes
      Pacific Dragon Fertilizers Co. Ltd. to use the know-how in manufacturing organic
      liquid compound fertilizer owned by Chang Yu for free, shall have been extended
      until December 31, 2011 and satisfactory evidence of such extension shall have
      been provided to each Investor;

     

    (g) Company
      Deliverables.
      The
      Company shall have delivered the Company Deliverables in accordance with Section
      2.2(a); 

     

    (h) Aggregate
      Investment Amount.
      The
      aggregate Investment Amount actually received by the Company at Closing from
      the
      Investors shall equal or exceed $10,000,000; and

     

    (i) Termination.
      This
      Agreement shall not have been terminated as to such Investor in accordance
      with
      Section 6.5.

     

    5.2. Conditions
      Precedent to the Obligations of the Company to sell Shares.
      The
      obligation of the Company to sell Shares at the Closing is subject to the
      satisfaction or waiver by the Company, at or before the Closing, of each of
      the
      following conditions:

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    (a) Representations
      and Warranties.
      The
      representations and warranties of each Investor contained herein shall be true
      and correct in all material respects as of the date when made and as of the
      Closing Date as though made on and as of such date;

     

    (b) Performance.
      Each
      Investor shall have performed, satisfied and complied in all material respects
      with all covenants, agreements and conditions required by the Transaction
      Documents to be performed, satisfied or complied with by such Investor at or
      prior to the Closing;

     

    (c) No
      Injunction.
      No
      statute, rule, regulation, executive order, decree, ruling or injunction shall
      have been enacted, entered, promulgated or endorsed by any court or governmental
      authority of competent jurisdiction that prohibits the consummation of any
      of
      the transactions contemplated by the Transaction Documents; 

     

    (d) Investors
      Deliverables.
      Each
      Investor shall have delivered its Investors Deliverables in accordance with
      Section 2.2(b); and

     

    (e) Termination.
      This
      Agreement shall not have been terminated as to such Investor in accordance
      with
      Section 6.5.

     

    ARTICLE
      6.

    MISCELLANEOUS

     

    6.1. Fees
      and Expenses.
      Each
      party shall pay the fees and expenses of its advisers, counsel, accountants
      and
      other experts, if any, and all other expenses incurred by such party incident
      to
      the negotiation, preparation, execution, delivery and performance of the
      Transaction Documents. The Company shall pay all stamp and other taxes and
      duties levied in connection with the issuance and/or transfer of the Shares
      as
      contemplated by the Transfer Documents.

     

    6.2. Entire
      Agreement.
      The
      Transaction Documents, together with the Exhibits and Schedules thereto, contain
      the entire understanding of the parties with respect to the subject matter
      hereof and supersede all prior agreements, understandings, discussions and
      representations, oral or written, with respect to such matters, which the
      parties acknowledge have been merged into such documents, exhibits and
      schedules.

     

    6.3. Notices.
      Any and
      all notices or other communications or deliveries required or permitted to
      be
      provided hereunder shall be in writing and shall be deemed given and effective
      on the earliest of (a) the date of transmission, if such notice or communication
      is delivered via facsimile (provided the sender receives a machine-generated
      confirmation of successful transmission) at the facsimile number specified
      in
      this Section prior to 5:30 p.m. (New York City time) on a Trading Day, (b)
      the
      next Trading Day after the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile number specified in this Section
      on
      a day that is not a Trading Day or later than 5:30 p.m. (New York City time)
      on
      any Trading Day, (c) the Trading Day following the date of mailing, if sent
      by
      U.S. nationally recognized overnight courier service, or (d) upon actual receipt
      by the party to whom such notice is required to be given. The address for such
      notices and communications shall be as follows:

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    If
      to the
      Company:   China
      Agritech, Inc.

    A#
      Room
      0706-0707, The Spaces International Center 

    No.
      8,
      Dongdaqiao Road 

    Chaoyang
      District, Beijing 100020 

    People's
      Republic of China

    Facsimile:
      86 10 5870 2108

    Attention:
      President

    

    With
      a
      copy to:        Thelen
      Reid Brown Raysman & Steiner LLP

    701
      8th
      Street
      NW

    Washington,
      D.C. 20001

    Facsimile:
      (202) 508-4321

    Attn.:
      Joseph R. Tiano, Jr., Esq.

    

    If
      to an
      Investor: To
      the
      address set forth under such Investor’s name on the signature pages
      hereof;

     

    or
      such
      other address as may be designated in writing hereafter, in the same manner,
      by
      such Person.

     

    6.4. Amendments;
      Waivers; No Additional Consideration.
      No
      provision of this Agreement may be waived or amended except in a written
      instrument signed by the Company and the Investors holding a majority of the
      Shares held by Investors (excluding any Investors that are Affiliates of the
      Company). No waiver of any default with respect to any provision, condition
      or
      requirement of this Agreement shall be deemed to be a continuing waiver in
      the
      future or a waiver of any subsequent default or a waiver of any other provision,
      condition or requirement hereof, nor shall any delay or omission of either
      party
      to exercise any right hereunder in any manner impair the exercise of any such
      right. No consideration shall be offered or paid to any Investor to amend or
      consent to a waiver or modification of any provision of any Transaction Document
      unless the same consideration is also offered to all Investors who then hold
      Shares.

     

    6.5. Termination.
      This
      Agreement may be terminated prior to Closing:

     

    (a) by
      written agreement of the Investors and the Company; and

     

    (b) by
      the
      Company or an Investor (as to itself but no other Investor) upon written notice
      to the other, if the Closing shall not have taken place by 6:30 p.m. Eastern
      time on the Outside Date; provided, that the right to terminate this Agreement
      under this Section 6.5(b) shall not be available to any Person whose
      failure to comply with its obligations under this Agreement has been the cause
      of or resulted in the failure of the Closing to occur on or before such
      time.

     

    In
      the
      event of a termination pursuant to this Section, the Company shall promptly
      notify all non-terminating Investors. Upon a termination in accordance with
      this
      Section 6.5, the Company and the terminating Investor(s) shall not have any
      further obligation or liability (including as arising from such termination)
      to
      the other and no Investor will have any liability to any other Investor under
      the Transaction Documents as a result therefrom. 

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    6.6. Construction;
      Interpretation.
      The
      headings herein are for convenience only, do not constitute a part of this
      Agreement and shall not be deemed to limit or affect any of the provisions
      hereof. The language used in this Agreement will be deemed to be the language
      chosen by the parties to express their mutual intent, and no rules of strict
      construction will be applied against any party. This Agreement shall be
      construed as if drafted jointly by the parties, and no presumption or burden
      of
      proof shall arise favoring or disfavoring any party by virtue of the authorship
      of any provisions of this Agreement or any of the Transaction Documents. The
      words “including,” “include” and other words of similar import shall be deemed
      to be followed by the words “without limitation.”

     

    6.7. Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties and
      their successors and permitted assigns. The Company may not assign this
      Agreement or any rights or obligations hereunder without the prior written
      consent of the Investors. Any Investor may assign any or all of its rights
      under
      this Agreement to any Person to whom such Investor assigns or transfers any
      Shares, provided such transferee agrees in writing to be bound, with respect
      to
      the transferred Shares, by the provisions hereof that apply to the
      Investors.

     

    6.8. No
      Third-Party Beneficiaries.
      This
      Agreement is intended for the benefit of the parties hereto and their respective
      successors and permitted assigns and is not for the benefit of, nor may any
      provision hereof be enforced by, any other Person, except as otherwise set
      forth
      in Section 4.7 (as to each Investor Party).

     

    6.9. Governing
      Law.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Agreement shall be governed by and construed and enforced in accordance
      with the internal laws of the State of New York, without regard to the
      principles of conflicts of law thereof. Each party agrees that all Proceedings
      concerning the interpretations, enforcement and defense of the transactions
      contemplated by this Agreement and any other Transaction Documents (whether
      brought against a party hereto or its respective Affiliates, employees or
      agents) shall be commenced exclusively in the New York Courts. Each party hereto
      hereby irrevocably submits to the exclusive jurisdiction of the New York Courts
      for the adjudication of any dispute hereunder or in connection herewith or
      with
      any transaction contemplated hereby or discussed herein (including with respect
      to the enforcement of the any of the Transaction Documents), and hereby
      irrevocably waives, and agrees not to assert in any Proceeding, any claim that
      it is not personally subject to the jurisdiction of any such New York Court,
      or
      that such Proceeding has been commenced in an improper or inconvenient forum.
      Each party hereto hereby irrevocably waives personal service of process and
      consents to process being served in any such Proceeding by mailing a copy
      thereof via registered or certified mail or overnight delivery (with evidence
      of
      delivery) to such party at the address in effect for notices to it under this
      Agreement and agrees that such service shall constitute good and sufficient
      service of process and notice thereof. Nothing contained herein shall be deemed
      to limit in any way any right to serve process in any manner permitted by law.
      Each party hereto hereby irrevocably waives, to the fullest extent permitted
      by
      applicable law, any and all right to trial by jury in any legal proceeding
      arising out of or relating to this Agreement or the transactions contemplated
      hereby. If either party shall commence a Proceeding to enforce any provisions
      of
      a Transaction Document, then the prevailing party in such Proceeding shall
      be
      reimbursed by the other party for its reasonable attorneys’ fees and other costs
      and expenses incurred with the investigation, preparation and prosecution of
      such Proceeding.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    6.10. Survival.
      The
      representations, warranties, agreements and covenants contained herein shall
      survive the Closing and the delivery of the Shares.

     

    6.11. Execution.
      This
      Agreement may be executed in two or more counterparts, all of which when taken
      together shall be considered one and the same agreement and shall become
      effective when counterparts have been signed by each party and delivered to
      the
      other party, it being understood that both parties need not sign the same
      counterpart. In the event that any signature is delivered by facsimile
      transmission, such signature shall create a valid and binding obligation of
      the
      party executing (or on whose behalf such signature is executed) with the same
      force and effect as if such facsimile signature page were an original
      thereof.

     

    6.12. Severability.
      If any
      provision of this Agreement is held to be invalid or unenforceable in any
      respect, the validity and enforceability of the remaining terms and provisions
      of this Agreement shall not in any way be affected or impaired thereby and
      the
      parties will attempt to agree upon a valid and enforceable provision that is
      a
      reasonable substitute therefor, and upon so agreeing, shall incorporate such
      substitute provision in this Agreement.

     

    6.13. Rescission
      and Withdrawal Right.
      Notwithstanding anything to the contrary contained in (and without limiting
      any
      similar provisions of) the Transaction Documents, whenever any Investor
      exercises a right, election, demand or option under a Transaction Document
      and
      the Company does not timely perform its related obligations within the periods
      therein provided, then such Investor may rescind or withdraw, in its sole
      discretion from time to time upon written notice to the Company, any relevant
      notice, demand or election in whole or in part without prejudice to its future
      actions and rights.

     

    6.14. Replacement
      of Shares.
      If any
      certificate or instrument evidencing any Shares is mutilated, lost, stolen
      or
      destroyed, the Company shall issue or cause to be issued in exchange and
      substitution for and upon cancellation thereof, or in lieu of and substitution
      therefor, a new certificate or instrument, but only upon receipt of evidence
      reasonably satisfactory to the Company of such loss, theft or destruction and
      customary and reasonable indemnity, if requested. The applicants for a new
      certificate or instrument under such circumstances shall also pay any reasonable
      third-party costs associated with the issuance of such replacement Shares.
      If a
      replacement certificate or instrument evidencing any Shares is requested due
      to
      a mutilation thereof, the Company may require delivery of such mutilated
      certificate or instrument as a condition precedent to any issuance of a
      replacement.

     

    6.15. Remedies.
      In
      addition to being entitled to exercise all rights provided herein or granted
      by
      law, including recovery of damages, each of the Investors and the Company will
      be entitled to specific performance under the Transaction Documents. The parties
      agree that monetary damages may not be adequate compensation for any loss
      incurred by reason of any breach of obligations described in the foregoing
      sentence and hereby agrees to waive in any action for specific performance
      of
      any such obligation the defense that a remedy at law would be
      adequate.

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    6.16. Payment
      Set Aside.
      To the
      extent that the Company makes a payment or payments to any Investor pursuant
      to
      any Transaction Document or an Investor enforces or exercises its rights
      thereunder, and such payment or payments or the proceeds of such enforcement
      or
      exercise or any part thereof are subsequently invalidated, declared to be
      fraudulent or preferential, set aside, recovered from, disgorged by or are
      required to be refunded, repaid or otherwise restored to the Company, a trustee,
      receiver or any other person under any law (including any bankruptcy law, state
      or federal law, common law or equitable cause of action), then to the extent
      of
      any such restoration the obligation or part thereof originally intended to
      be
      satisfied shall be revived and continued in full force and effect as if such
      payment had not been made or such enforcement or setoff had not
      occurred.

     

    6.17. Independent
      Nature of Investors’ Obligations and Rights.
      The
      obligations of each Investor under any Transaction Document are several and
      not
      joint with the obligations of any other Investor, and no Investor shall be
      responsible in any way for the performance of the obligations of any other
      Investor under any Transaction Document. The decision of each Investor to
      purchase Shares pursuant to the Transaction Documents has been made by such
      Investor independently of any other Investor. Nothing contained herein or in
      any
      Transaction Document, and no action taken by any Investor pursuant thereto,
      shall be deemed to constitute the Investors as a partnership, an association,
      a
      joint venture or any other kind of entity, or create a presumption that the
      Investors are in any way acting in concert or as a group with respect to such
      obligations or the transactions contemplated by the Transaction Documents.
      Each
      Investor acknowledges that no other Investor has acted as agent for such
      Investor in connection with making its investment hereunder and that no Investor
      will be acting as agent of such Investor in connection with monitoring its
      investment in the Shares or enforcing its rights under the Transaction
      Documents. Each Investor shall be entitled to independently protect and enforce
      its rights, including the rights arising out of this Agreement or out of the
      other Transaction Documents, and it shall not be necessary for any other
      Investor to be joined as an additional party in any proceeding for such purpose.
      The Company acknowledges that each of the Investors has been provided with
      the
      same Transaction Documents for the purpose of closing a transaction with
      multiple Investors and not because it was required or requested to do so by
      any
      Investor.

    
       

      6.18. Limitation
        of Liability.
        Notwithstanding anything herein to the contrary, the Company acknowledges
        and
        agrees that the liability of an Investor arising directly or indirectly,
        under
        any Transaction Document of any and every nature whatsoever shall be satisfied
        solely out of the assets of such Investor, and that no trustee, officer,
        other
        investment vehicle or any other Affiliate of such Investor or any investor,
        shareholder or holder of shares of beneficial interest of such a Investor
        shall
        be personally liable for any liabilities of such Investor.

       

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        27

        
          

        

      

      
        
        

      

    

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

     

    CHINA
      AGRITECH, INC.

     

    By:
      ___________________________

    Name:
      Yu
      Chang 

    Title:
      Chief Executive Officer

     

     

    __________________________

    Yu
      Chang

    

    

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      PAGES FOR INVESTORS FOLLOW]

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

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

     

    NAME
      OF INVESTOR

     

    _________________________________________

     

    By:
      ______________________________________

    Name:

    Title:

     

    Investment
      Amount: $________________________

     

    Tax
      ID
      No.:________________________________

     

    ADDRESS
      FOR NOTICE

     

    c/o:______________________________________

     

    Street:
      ____________________________________

     

    City/State/Zip:______________________________

     

    Attention:_________________________________

     

    Tel:______________________________________

     

    Fax:______________________________________

     

    DELIVERY
      INSTRUCTIONS

    (if
      different from above)

    
       

      c/o:______________________________________

       

      Street:
        ____________________________________

       

      City/State/Zip:______________________________

       

      Attention:_________________________________

       

      Tel:______________________________________

    

     

    

    
      
        
        

      

      
        29Exhibit
      10.2

     

    ESCROW
      AGREEMENT

     

    This
      Escrow Agreement (this “Agreement”), dated as of June ____, 2007, is entered
      into by and among China Agritech, Inc., a Delaware corporation (the “Company”),
      each of the parties listed below who were Investors to the private offering
      of
      securities of the Company, Chang Yu, in his individual capacity (“Chang”), and
      Securities Transfer Corporation (hereinafter referred to as “Escrow
      Agent”).

     

    WHEREAS,
      each of the Investors has entered into a Securities Purchase Agreement, dated
      as
      of the date hereof (the “SPA”) evidencing their participation in the Company’s
      private offering (the “Offering”) of securities. As an inducement to the
      Investors to participate in the Offering and as set forth in the SPA, Chang
      agreed to place the “Escrow Shares” (as hereinafter defined) into escrow for the
      benefit of the Investors in the event the Company failed to satisfy the
“Performance Thresholds” (as hereinafter defined);

     

    WHEREAS,
      pursuant to the requirements of the SPA, the Company, Chang and the Investors
      have agreed to establish an escrow on the terms and conditions set forth in
      this
      Agreement;

     

    WHEREAS,
      Escrow Agent has agreed to act as escrow agent pursuant to the terms and
      conditions of this Agreement; and

     

    WHEREAS,
      all capitalized terms used but not defined herein shall have the meanings
      assigned them in the SPA.

     

    NOW,
      THEREFORE, in consideration of the mutual promises of the parties and the terms
      and conditions hereof, the parties hereby agree as follows:

     

    1. Appointment
      of Escrow Agent.
      The
      Investors, Chang and the Company hereby appoint Securities Transfer Corporation
      as Escrow Agent to act in accordance with the terms and conditions set forth
      in
      this Agreement, and Escrow Agent hereby accepts such appointment and agrees
      to
      act in accordance with such terms and conditions.

     

    2. Establishment
      of Escrow Upon
      the
      execution of this Agreement, Chang shall deliver to Escrow Agent a stock
      certificate evidencing 1,124,564 shares (the “Escrow Shares”) of the Company’s
      common stock, par value $0.001 per share (the “Common Stock”) along with a Stock
      Power executed in blank. As used in this Agreement, “Transfer Agent” means
      Securities Transfer Corporation, or such other entity hereafter retained by
      the
      Company as its stock transfer agent as specified in a writing from the Company
      to Escrow Agent.

     

    3. Representations
      and Covenants of the Company and Chang Each
      of
      the Company and Chang hereby individually and not severally represent and
      warrant to the Investors as follows:

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (i) Authorization;
      Enforcement. Chang has the requisite capacity and authority to enter into and
      to
      consummate the transactions contemplated by each of this Agreement and the
      Stock
      Power (the “Documents”) and otherwise to carry out his obligations thereunder.
      The execution and delivery of each of the Documents by Chang and the
      consummation of the transactions contemplated thereby have been duly authorized
      by all necessary action on the part of Chang and third parties and no further
      action is required by Chang or third parties in connection therewith. Each
      of
      the Documents has been duly executed by Chang and constitutes the valid and
      binding obligation of Chang and is enforceable against Chang in accordance
      with
      its terms, except as such enforceability may be limited by applicable
      bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
      laws
      relating to, or affecting generally the enforcement of, creditors’ rights and
      remedies or by other equitable principles of general application. 

     

    (ii) Escrow
      Shares. The Escrow Shares are validly issued, fully paid and nonassessable
      shares of the Company, and free and clear of all pledges, liens and
      encumbrances. 

     

    (iii) Title
      to
      Escrow Shares. Chang has, and will provide to the Escrow Agent, good and valid
      title to the Escrow Shares to be transferred and delivered on behalf of Chang
      to
      the Investors hereunder, free and clear of all liens, encumbrances, equities
      or
      claims.

     

    (iv) No
      Conflicts. Chang’s execution and delivery of the Documents, Chang’s performance
      of his obligations under the Documents and the consummation of the transactions
      contemplated thereby do not and will not (i) conflict with, or constitute a
      default (or an event that with notice or lapse of time or both would become
      a
      default) under, or give to others any rights of termination, amendment,
      acceleration or cancellation (with or without notice, lapse of time or both)
      of,
      any agreement, credit facility, debt or other instrument or other understanding
      to which Chang, the Company or any Subsidiary is a party or by which any
      property or asset of Chang, the Company or any Subsidiary is bound or affected,
      or (ii) result (with or without notice, lapse of time or both) in the creation
      or imposition of any lien, charge or encumbrance upon the Escrow
      Shares.

     

    (v) Filings,
      Consents and Approvals. Except
      for the filing with the PRC State Administration of Foreign Exchange with
      respect to the change of share structure in the Company, neither
      Chang nor the Company is required to obtain any consent, waiver, authorization
      or order of, give any notice to, or make any filing or registration with, any
      U.S. or PRC court or other federal, state, local or other governmental authority
      or other Person in connection with the execution, delivery and performance
      by
      Chang and Escrow Agent of the Transaction Documents to which they are a party
      or
      the consummation of the transactions contemplated by any of the Transaction
      Documents.

     

    (vi) No
      Impairment of Investor Rights. Neither Chang nor the Company shall take any
      action which could impair Investors’ rights in the Escrow
      Shares.

    (vii) No
      Sale
      of Shares. Chang shall not sell, transfer, assign or otherwise dispose of (by
      operation of law or otherwise) or grant any option with respect to any Escrow
      Shares prior to the termination of this Agreement. For so long as this Agreement
      is in effect, the Company shall cause the Transfer Agent to maintain stop
      transfer instructions on its records with respect to all transfers of the Escrow
      Shares, except for the transfer and delivery to the Investors contemplated
      hereby.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (viii) Attorney-in-Fact.
      Escrow Agent is hereby appointed the attorney-in-fact of Chang for the purpose
      of carrying out the provisions of this Agreement and taking any action and
      executing any instrument that Escrow Agent reasonably may deem necessary or
      advisable to accomplish the purposes hereof, which appointment as
      attorney-in-fact is irrevocable and coupled with an interest. Without limiting
      the generality of the foregoing, Escrow Agent has full power and authority
      to
      effect any transfer of the Escrow Shares permitted under the terms of this
      Agreement.

     

    4. Disbursement
      of Escrow Shares Chang
      hereby agrees with and for the benefit of the Investors that if the After-Tax
      Net Income for the fiscal year ended December 31, 2007 reported in the Company’s
      Annual Report on Form 10-K for the fiscal year ending December 31, 2007, as
      filed with the Commission (the “2007
      Annual Report”)
      is
      $8,350,000 or less (the “2007
      Guaranteed ATNI”),
      Escrow
      Agent shall, on behalf of Chang, transfer to each Investor on a pro rata basis
      (based upon such Investor’s Investment Amount relative to the aggregate
      Investment Amount of all Investors) for no additional consideration, the Escrow
      Shares. If the 2007 Annual Report reflects After-Tax Net Income equal to or
      less
      than the 2007 Guaranteed ATNI, then the Company shall provide written
      instruction to Escrow Agent instructing Escrow Agent to issue and deliver
      certificates evidencing a certain number of Escrow Shares, as applicable, in
      accordance with Exhibit
      A,
      to each
      Investor, within ten (10) Business Days of the date the audit report for the
      fiscal year ending December 31, 2007 is filed with the Commission. Escrow Agent
      shall rely only on the letter of instruction from the Company in this regard.
      If
      the 2007 Annual Reports reflect After-Tax Net Income of greater than the 2007
      Guaranteed ATNI for the fiscal year ending December 31, 2007, the Company shall
      provide written instruction to Escrow Agent for the release of the Escrow Shares
      to Chang. Notwithstanding anything to the contrary contained
      herein, in the event that the release of the Escrow Shares to the
      Investors or Chang is deemed to be an expense or deduction from revenues/income
      of the Company for the applicable year, as required under U.S. generally
      accepted accounting principles, then such expense or deduction shall be
      excluded for purposes of determining whether or not the 2007 Guaranteed
      ATNI has been achieved by the Company.

     

    5. Duration
      This
      Agreement shall terminate upon the distribution of all the Escrow Shares. The
      Company agrees to promptly provide the Escrow Agent written notice of the filing
      with the Commission of any financial statements or reports referenced
      herein.

    6. Escrow
      Shares.  If
      the
      Escrow Shares are deliverable to the Investors pursuant to in accordance with
      this Agreement, and as required by the SPA, Chang, the Company and Escrow Agent
      covenant and agree to cooperate with the Transfer Agent so that the Transfer
      Agent promptly reissues such Escrow Shares in the applicable Investor’s name and
      delivers the same as directed by such Investor. Until such time as the Escrow
      Shares are required to be delivered pursuant to the SPA and in accordance with
      this Agreement, any dividends payable in respect of the Escrow Shares and all
      voting rights applicable to the Escrow Shares shall be retained by Chang. Should
      Escrow Agent receive dividends or voting materials, such items shall not be
      held
      by Escrow Agent, but shall be passed immediately on to Chang and shall not
      be
      invested or held for any time longer than is needed to effectively re-route
      such
      items to Chang. In the event that Escrow Agent receives a communication
      requiring the conversion of the Escrow Shares to cash or the exchange
      of the Escrow Shares for that of an acquiring company, the Escrow Agent shall
      solicit and follow the written instructions of Chang; provided,
      that
      the cash or exchanged shares are instructed to be redeposited into the Escrow
      Account. Chang shall be responsible for all taxes resulting from any such
      conversion or exchange.

    

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

     

    Assuming
      Chang provides good and valid title to the Escrow Shares to be transferred
      and
      delivered on behalf of Chang to the Investors hereunder, free and clear of
      all
      liens, encumbrances, equities or claims, the Escrow Agent will ensure that
      upon
      delivery of the Escrow Shares, good and valid title to the Escrow Shares, free
      and clear of all liens, encumbrances, equities or claims will pass to the
      Investors.  The
      Escrow Agent shall not take any action which could impair Investors’ rights in
      the Escrow Shares. The Escrow Agent shall not sell, transfer, assign or
      otherwise dispose of (by operation of law or otherwise) or grant any option
      with
      respect to any Escrow Shares prior to the termination of this
      Agreement.

     

    7. Interpleader
      Should
      any controversy arise among the parties hereto with respect to this Agreement
      or
      with respect to the right to receive the Escrow Shares, Escrow Agent shall
      have
      the right to consult counsel and/or to institute an appropriate interpleader
      action to determine the rights of the parties. Escrow Agent is also hereby
      authorized to institute an appropriate interpleader action upon receipt of
      a
      written letter of direction executed by the parties so directing Escrow Agent.
      If Escrow Agent is directed to institute an appropriate interpleader action,
      it
      shall institute such action not prior to thirty (30) days after receipt of
      such
      letter of direction and not later than sixty (60) days after such date. Any
      interpleader action instituted in accordance with this Section 6 shall be filed
      in any court of competent jurisdiction in the State of New York, and the Escrow
      Shares in dispute shall be deposited with the court and in such event Escrow
      Agent shall be relieved of and discharged from any and all obligations and
      liabilities under and pursuant to this Agreement with respect to the Escrow
      Shares.

     

    8. Exculpation
      and Indemnification of Escrow Agent (a)
      Escrow
      Agent is not a party to, and is not bound by or charged with notice of any
      agreement out of which this escrow may arise. Escrow Agent acts under this
      Agreement as a depositary only and is not responsible or liable in any manner
      whatsoever for the sufficiency, correctness, genuineness or validity of the
      subject matter of the escrow, or any part thereof, or for the form or execution
      of any notice given by any other party hereunder, or for the identity or
      authority of any person executing any such notice. Escrow Agent will have no
      duties or responsibilities other than those expressly set forth herein. Escrow
      Agent will be under no liability to anyone by reason of any failure on the
      part
      of any party hereto (other than Escrow Agent) or any maker, endorser or other
      signatory of any document to perform such person’s or entity’s obligations
      hereunder or under any such document. Except for this Agreement and instructions
      to Escrow Agent pursuant to the terms of this Agreement, Escrow Agent will
      not
      be obligated to recognize any agreement between or among any or all of the
      persons or entities referred to herein, notwithstanding its knowledge
      thereof.

     

    
      (b) Escrow
        Agent will not be liable for any action taken or omitted by it, or any action
        suffered by it to be taken or omitted, in good faith and in the exercise
        of its
        own best judgment, and may rely conclusively on, and will be protected in
        acting
        upon, any order, notice, demand, certificate, or opinion or advice of counsel
        (including counsel chosen by Escrow Agent), statement, instrument, report
        or
        other paper or document (not only as to its due execution and the validity
        and
        effectiveness of its provisions, but also as to the truth and acceptability
        of
        any information therein contained) which is reasonably believed by Escrow
        Agent
        to be genuine and to be signed or presented by the proper person or persons.
        The
        duties and responsibilities of Escrow Agent hereunder shall be determined
        solely
        by the express provisions of this Agreement and no other or further duties
        or
        responsibilities shall be implied, including, but not limited to, any obligation
        under or imposed by any laws of the State of New York upon
        fiduciaries.

    

    
 

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (c) Escrow
      Agent will be indemnified and held harmless, jointly and severally, by the
      Company and Chang from and against any expenses, including reasonable attorneys’
fees and disbursements, damages or losses suffered by Escrow Agent in connection
      with any claim or demand, which, in any way, directly or indirectly, arises
      out
      of or relates to this Agreement or the services of Escrow Agent hereunder;
      except, that if Escrow Agent is guilty of willful misconduct, fraud or gross
      negligence under this Agreement, then Escrow Agent will bear all losses, damages
      and expenses arising as a result of such willful misconduct, fraud or gross
      negligence. Promptly after the receipt by Escrow Agent of notice of any such
      demand or claim or the commencement of any action, suit or proceeding relating
      to such demand or claim, Escrow Agent will notify the other parties hereto
      in
      writing. For the purposes hereof, the terms “expense” and “loss” will include
      all amounts paid or payable to satisfy any such claim or demand, or in
      settlement of any such claim, demand, action, suit or proceeding settled with
      the express written consent of the parties hereto, and all costs and expenses,
      including, but not limited to, reasonable attorneys’ fees and disbursements,
      paid or incurred in investigating or defending against any such claim, demand,
      action, suit or proceeding. The provisions of this Section 7 shall survive
      the
      termination of this Agreement.

     

    9. Compensation
      of Escrow Agent. The
      Company will pay Escrow Agent $3,000 for all services rendered by Escrow Agent
      hereunder.

     

    10. Resignation
      of Escrow Agent At
      any
      time, upon ten (10) days’ written notice to the Company, Escrow Agent may resign
      and be discharged from its duties as Escrow Agent hereunder. As soon as
      practicable after its resignation, Escrow Agent will promptly turn over to
      a
      successor escrow agent appointed by the Company the Escrow Shares held hereunder
      upon presentation of a document appointing the new escrow agent and evidencing
      its acceptance thereof. If, by the end of the 10-day period following the giving
      of notice of resignation by Escrow Agent, the Company shall have failed to
      appoint a successor escrow agent, Escrow Agent may interplead the Escrow Shares
      into the registry of any court having jurisdiction.

    11. Records
      Escrow
      Agent shall maintain accurate records of all transactions hereunder. Promptly
      after the termination of this Agreement or as may reasonably be requested by
      the
      parties hereto from time to time before such termination, Escrow Agent shall
      provide the parties hereto, as the case may be, with a complete copy of such
      records, certified by Escrow Agent to be a complete and accurate account of
      all
      such transactions. The authorized representatives of each of the parties hereto
      shall have access to such books and records at all reasonable times during
      normal business hours upon reasonable notice to Escrow Agent.

     

    12. Notice
      All
      notices, communications and instructions required or desired to be given under
      this Agreement must be in writing and shall be deemed to be duly given if sent
      by registered or certified mail, return receipt requested, or overnight courier,
      to the address listed on the signature pages hereto.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    13. Execution
      in Counterparts This
      Agreement may be executed in counterparts, each of which shall be deemed an
      original, but all of which together shall constitute one and the same
      instrument.

     

    14. Assignment
      and Modification This
      Agreement and the rights and obligations hereunder of any of the parties hereto
      may not be assigned without the prior written consent of the other parties
      hereto, except that any Investor shall have the right to assign its rights
      to
      receive all or any portion of the Escrow Shares deliverable to such Investor
      without the consent of any other party to this Agreement. Subject to the
      foregoing, this Agreement will be binding upon and inure to the benefit of
      each
      of the parties hereto and their respective successors and permitted assigns.
      No
      other person will acquire or have any rights under, or by virtue of, this
      Agreement. No portion of the Escrow Shares shall be subject to interference
      or
      control by any creditor of any party hereto, or be subject to being taken or
      reached by any legal or equitable process in satisfaction of any debt or other
      liability of any such party hereto prior to the disbursement thereof to such
      party hereto in accordance with the provisions of this Agreement. This Agreement
      may be changed or modified only in writing signed by all of the parties
      hereto.

     

    15. General. 
      

     

    This
      Agreement and the performance hereunder shall be governed by the laws of the
      State of New York. Chang consents to jurisdiction and venue for any litigation
      arising out of this Agreement of the United States District Court for the
      Southern District of New York and of the Supreme Court of the State of New
      York,
      New York County.

    16. Headings
      The
      headings contained in this Agreement are for convenience of reference only
      and
      shall not affect the construction of this Agreement.

     

    17. Attorneys’
      Fees If
      any
      action at law or in equity, including an action for declaratory relief, is
      brought to enforce or interpret the provisions of this Agreement, the prevailing
      party shall be entitled to recover reasonable attorneys’ fees from the other
      party (unless such other party is the escrow agent), which fees may be set
      by
      the court in the trial of such action or may be enforced in a separate action
      brought for that purpose, and which fees shall be in addition to any other
      relief that may be awarded.

     

    18. Merger
      or Consolidation. 

     

    Any
      corporation or association into which Escrow Agent may be converted or merged,
      or with which it may be consolidated, or to which it may sell or transfer all
      or
      substantially all of its corporate trust business and assets as a whole or
      substantially as a whole, or any corporation or association resulting from
      any
      such conversion, sale, merger, consolidation or transfer to which Escrow Agent
      is a party, shall be and become the successor escrow agent under this Agreement
      and shall have and succeed to the rights, powers, duties, immunities and
      privileges as its predecessor, without the execution or filing of any instrument
      or paper or the performance of any further act.

     

    

     

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        6

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
      set forth opposite their respective names.

      

       

      CHINA
        AGRITECH, INC.

       

       

      By:
        ___________________________

      Name:
        Yu
        Chang

      Title:
        Chief Executive Officer

       

      Address
        for Notice:

       

       

      ______________________________

      Yu
        Chang

       

      Address
        for Notice:

       

       

      SECURITIES
        TRANSFER CORPORATION

       

       

      By:
        ___________________________

      Name:

      Title:

       

      Address
        for Notice:

       

       

      INVESTORS
        ____________________

       

       

      By:
        ___________________________

      Name:
        

      Title:

       

      Address
        for Notice:

       

      
        
           

        

        
          7

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