Document:

EXHIBIT 10.6

                                            April 30, 2005

Chardan China Acquisition Corp. III
625 Broadway
Suite 1111
San Diego, California 92101

EarlyBirdCapital, Inc.
275 Madison Avenue
Suite 1203
New York, New York 10016

            Re: Initial Public Offering
                -----------------------

Gentlemen:

      SUJG, Inc. ("SUJG"),  a stockholder of Chardan China Acquisition Corp. III
("Company"), in consideration of EarlyBirdCapital,  Inc. ("EBC") entering into a
letter of intent  ("Letter of Intent") to underwrite an initial public  offering
of the  securities  of the Company  ("IPO") and  embarking  on the IPO  process,
hereby agrees as follows (certain  capitalized  terms used herein are defined in
paragraph 9 hereof):

      1. If the  Company  solicits  approval of its  stockholders  of a Business
Combination,  SUJG will vote all Insider  Shares owned by it in accordance  with
the majority of the votes cast by the holders of the IPO Shares.

      2.  In  the  event  that  the  Company  fails  to  consummate  a  Business
Combination  within 18 months from the effective date ("Effective  Date") of the
registration statement relating to the IPO (or 24 months under the circumstances
described  in the  prospectus  relating to the IPO),  SUJG will vote all Insider
Shares owned by it in favor of the Company's decision to liquidate. Each of SUJG
and each  officer,  director  or  controlling  person of SUJG  (each a  "Control
Person") hereby waives any and all right,  title,  interest or claim of any kind
in or to any  distribution of the Trust Fund and any remaining net assets of the
Company  as a result of such  liquidation  with  respect to its  Insider  Shares
("Claim")  and hereby waives any Claim either may have in the future as a result
of, or arising out of, any contracts or agreements with the Company and will not
seek recourse against the Trust Fund for any reason whatsoever.

<PAGE>

      3. Neither  SUJG,  any Control  Person,  any family  member of any Control
Person,  nor any  affiliate  ("Affiliate")  of SUJG or any  Control  Person will
submit to the  Company  for  consideration,  or vote for the  approval  of,  any
Business  Combination  which involves a company which is affiliated  with any of
the  Insiders  unless  the  Company  obtains  an  opinion  from  an  independent
investment  banking  firm  reasonably   acceptable  to  EBC  that  the  business
combination is fair to the Company's stockholders from a financial perspective.

      4. Neither  SUJG,  any Control  Person,  any family  member of any Control
Person,  nor any  Affiliate  of SUJG or any  Control  Person will be entitled to
receive  and will not accept  any  compensation  for  services  rendered  to the
Company prior to the  consummation  of the Business  Combination;  provided that
SUJG  (and  each  Control  Person  on  behalf  of  SUJG)  shall be  entitled  to
reimbursement  from the  Company  for its  out-of-pocket  expenses  incurred  in
connection with seeking and consummating a Business Combination.

      5. Neither  SUJG,  any Control  Person,  any family  member of any Control
Person,  nor any  Affiliate  of SUJG or any  Control  Person will be entitled to
receive or accept a finder's  fee or any other  compensation  in the event SUJG,
any Control Person,  any family member of any Control Person or any Affiliate of
SUJG or any Control Person originates a Business Combination.

      6.  SUJG  will  escrow  its  Insider  Shares  for the  three  year  period
commencing  on the  Effective  Date  subject  to the  terms  of a  Stock  Escrow
Agreement  which the  Company  will  enter  into  with SUJG and an escrow  agent
acceptable to the Company.

      7. SUJG's  Questionnaire  furnished  to the Company and EBC and annexed as
Exhibit A hereto is true and  accurate  in all  respects.  SUJG  represents  and
warrants that:

            (a) no Control  Person is subject  to or a  respondent  in any legal
action for, any  injunction,  cease-and-desist  order or order or stipulation to
desist  or  refrain  from  any  act or  practice  relating  to the  offering  of
securities in any jurisdiction;

            (b) no Control  Person has ever been  convicted of or pleaded guilty
to any  crime  (i)  involving  any  fraud  or  (ii)  relating  to any  financial
transaction or handling of funds of another person,  or (iii)  pertaining to any
dealings in any  securities  and he is not  currently  a  defendant  in any such
criminal proceeding; and

            (c) no  Control  Person has ever been  suspended  or  expelled  from
membership in any  securities or  commodities  exchange or  association or had a
securities or commodities license or registration denied, suspended or revoked.

      8. SUJG has full right and power, without violating any agreement by which
he is bound, to enter into this letter agreement.

<PAGE>

      9. As used herein, (i) a "Business  Combination" shall mean an acquisition
by merger, capital stock exchange, asset or stock acquisition, reorganization or
otherwise,  of an operating  business;  (ii) "Insiders" shall mean all officers,
directors and  stockholders of the Company  immediately  prior to the IPO; (iii)
"Insider  Shares"  shall mean all of the shares of Common  Stock of the  Company
owned by an  Insider  prior to the IPO;  and (iv) "IPO  Shares"  shall  mean the
shares of Common Stock issued in the Company's IPO.

                                            SUJG, INC.
                                            ----------
                                            Print Name of Insider

                                            By: /s/
                                                ------------------
                                                Name:
                                                Title:INVESTMENT MANAGEMENT TRUST AGREEMENT
                      -------------------------------------

      This Agreement is made as of  _____________,  2005 by and between  Chardan
China  Acquisition  Corp. III (the "Company") and  Continental  Stock Transfer &
Trust Company ("Trustee").

      WHEREAS, the Company's registration statement on Form S-1, No. 333-_______
("Registration  Statement"),  for its  initial  public  offering  of  securities
("IPO") has been declared  effective as of the date hereof by the Securities and
Exchange Commission ("Effective Date"); and

      WHEREAS, EarlyBirdCapital, Inc. ("EBC") is acting as the representative of
the underwriters in the IPO; and

      WHEREAS,  as described in the  Registration  Statement,  and in accordance
with the  Company's  Certificate  of  Incorporation,  $20,640,000  of the  gross
proceeds of the IPO  ($23,736,000 if the underwriters  over-allotment  option is
exercised in full) will be delivered to the Trustee to be deposited  and held in
a trust  account for the benefit of the Company and the holders of the Company's
common  stock,  par value  $.0001  per share,  issued in the IPO as  hereinafter
provided  and in the event the Units are  registered  in  Colorado,  pursuant to
Section  11-51-302(6) of the Colorado Revised  Statutes.  A copy of the Colorado
Statute is attached hereto and made a part hereof (the amount to be delivered to
the Trustee will be referred to herein as the "Property";  the  stockholders for
whose  benefit the Trustee  shall hold the  Property  will be referred to as the
"Public  Stockholders,"  and the Public  Stockholders  and the  Company  will be
referred to together as the "Beneficiaries"); and

      WHEREAS,  the Company and the Trustee  desire to enter into this Agreement
to set forth the terms and  conditions  pursuant to which the Trustee shall hold
the Property;

      IT IS AGREED:

1. Agreements and Covenants of Trustee.  The Trustee hereby agrees and covenants
to:

            (a) Hold the Property in trust for the  Beneficiaries  in accordance
with the terms of this Agreement, including the terms of Section 11-51-302(6) of
the  Colorado   Statute,   in  a  segregated  trust  account  ("Trust  Account")
established by the Trustee at a branch of JPMorgan Chase NY Bank selected by the
Trustee;

            (b) Manage,  supervise and administer  the Trust Account  subject to
the terms and conditions set forth herein;

            (c) In a timely  manner,  upon the  instruction  of the Company,  to
invest and reinvest the Property in any  "Government  Security." As used herein,
Government Security means any Treasury Bill issued by the United States,  having
a maturity of one hundred and eighty days or less;

            (d) Collect and receive,  when due, all principal and income arising
from the Property,  which shall become part of the  "Property,"  as such term is
used herein;

<PAGE>

            (e) Notify the  Company of all  communications  received  by it with
respect to any Property requiring action by the Company;

            (f)  Supply  any  necessary  information  or  documents  as  may  be
requested by the Company in connection with the Company's preparation of the tax
returns for the Trust Account;

            (g)  Participate  in  any  plan  or  proceeding  for  protecting  or
enforcing  any  right or  interest  arising  from the  Property  if, as and when
instructed by the Company to do so;

            (h) Render to the  Company and to EBC,  and to such other  person as
the Company may instruct,  monthly  written  statements of the activities of and
amounts in the Trust Account  reflecting all receipts and  disbursements  of the
Trust Account; and

            (i) Commence  liquidation of the Trust Account only after receipt of
and only in accordance with the terms of a letter ("Termination  Letter"),  in a
form  substantially  similar  to that  attached  hereto as  either  Exhibit A or
Exhibit B, signed on behalf of the Company by its  President  or Chairman of the
Board and Secretary or Assistant Secretary,  and complete the liquidation of the
Trust Account and  distribute the Property in the Trust Account only as directed
in the Termination Letter and the other documents referred to therein.

2.  Agreements  and  Covenants of the  Company.  The Company  hereby  agrees and
covenants to:

      (a) Give all instructions to the Trustee  hereunder in writing,  signed by
the  Company's  President  or Chairman of the Board.  In  addition,  except with
respect to its duties under paragraph 1(i) above,  the Trustee shall be entitled
to rely on,  and shall be  protected  in relying  on,  any verbal or  telephonic
advice or instruction  which it in good faith believes to be given by any one of
the persons  authorized  above to give written  instructions,  provided that the
Company shall promptly confirm such instructions in writing;

      (b) Hold the Trustee  harmless and indemnify the Trustee from and against,
any and all expenses,  including  reasonable counsel fees and disbursements,  or
loss  suffered  by the  Trustee in  connection  with any  action,  suit or other
proceeding  brought  against the Trustee  involving any claim,  or in connection
with any claim or  demand  which in any way  arises  out of or  relates  to this
Agreement,  the services of the Trustee hereunder, or the Property or any income
earned from investment of the Property, except for expenses and losses resulting
from the Trustee's gross  negligence or willful  misconduct.  Promptly after the
receipt by the Trustee of notice of demand or claim or the  commencement  of any
action,  suit or  proceeding,  pursuant  to which the  Trustee  intends  to seek
indemnification under this paragraph,  it shall notify the Company in writing of
such claim  (hereinafter  referred to as the "Indemnified  Claim").  The Trustee
shall have the right to conduct and manage the defense against such  Indemnified
Claim,  provided,  that the Trustee shall obtain the consent of the Company with
respect to the selection of counsel,  which  consent  shall not be  unreasonably
withheld.  The Trustee may not agree to settle any Indemnified Claim without the
prior written consent of the Company. The Company may participate in such action
with its own counsel; and

                                       2
<PAGE>

      (c) Pay the Trustee an initial  acceptance fee of $1,000 and an annual fee
of $3,000 (it being expressly  understood that the Property shall not be used to
pay such fee). The Company shall pay the Trustee the initial  acceptance fee and
first  year's  fee  at  the  consummation  of  the  IPO  and  thereafter  on the
anniversary  of the Effective  Date. The Trustee shall refund to the Company the
fee (on a pro rata basis) with  respect to any period after the  liquidation  of
the Trust  Fund.  The  Company  shall not be  responsible  for any other fees or
charges of the Trustee  except as may be provided in  paragraph  2(b) hereof (it
being  expressly  understood  that the  Property  shall  not be used to make any
payments to the Trustee under such paragraph).

3.  Limitations  of  Liability.  The  Trustee  shall have no  responsibility  or
liability to:

      (a) Take any action with respect to the  Property,  other than as directed
in  paragraph  1 hereof and the  Trustee  shall have no  liability  to any party
except  for  liability  arising  out of its  own  gross  negligence  or  willful
misconduct;

      (b)  Institute  any  proceeding  for the  collection  of any principal and
income  arising from, or  institute,  appear in or defend any  proceeding of any
kind with  respect  to,  any of the  Property  unless  and  until it shall  have
received instructions from the Company given as provided herein to do so and the
Company  shall have  advanced or  guaranteed  to it funds  sufficient to pay any
expenses incident thereto;

      (c) Change the investment of any Property,  other than in compliance  with
paragraph 1(c);

      (d) Refund any depreciation in principal of any Property;

      (e) Assume that the  authority of any person  designated by the Company to
give instructions hereunder shall not be continuing unless provided otherwise in
such  designation,  or  unless  the  Company  shall  have  delivered  a  written
revocation of such authority to the Trustee;

      (f) The other  parties  hereto or to anyone  else 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,  except  for its  gross
negligence or willful misconduct. The Trustee may rely conclusively and shall be
protected  in acting upon any order,  notice,  demand,  certificate,  opinion or
advice  of  counsel  (including  counsel  chosen  by  the  Trustee),  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 believed by the
Trustee,  in good  faith,  to be genuine  and to be signed or  presented  by the
proper  person or  persons.  The  Trustee  shall  not be bound by any  notice or
demand, or any waiver, modification, termination or rescission of this agreement
or any of the terms hereof,  unless evidenced by a written instrument  delivered
to the  Trustee  signed by the  proper  party or parties  and,  if the duties or
rights of the  Trustee  are  affected,  unless it shall  give its prior  written
consent thereto;

                                       3
<PAGE>

      (g)  Verify  the   correctness  of  the   information  set  forth  in  the
Registration  Statement or to confirm or assure that any acquisition made by the
Company or any other action taken by it is as contemplated  by the  Registration
Statement; and

      (h) Pay any  taxes on  behalf of the  Trust  Account  (it being  expressly
understood  that the  Property  shall not be used to pay any such taxes and that
such  taxes,  if any,  shall be paid by the  Company  from funds not held in the
Trust Account).

4. Termination. This Agreement shall terminate as follows:

      (a) If the Trustee gives written  notice to the Company that it desires to
resign under this  Agreement,  the Company shall use its  reasonable  efforts to
locate a successor  trustee.  At such time that the Company notifies the Trustee
that a  successor  trustee has been  appointed  by the Company and has agreed to
become  subject to the terms of this  Agreement,  the Trustee shall transfer the
management  of the Trust  Account to the  successor  trustee,  including but not
limited to the transfer of copies of the reports and statements  relating to the
Trust Account,  whereupon this Agreement  shall  terminate;  provided,  however,
that, in the event that the Company does not locate a successor  trustee  within
ninety days of receipt of the resignation  notice from the Trustee,  the Trustee
may submit an application to have the Property  deposited with the United States
District Court for the Southern District of New York and upon such deposit,  the
Trustee shall be immune from any liability whatsoever;

      (b) At such time that the Trustee has  completed  the  liquidation  of the
Trust Account in accordance  with the provisions of paragraph  1(i) hereof,  and
distributed  the Property in accordance  with the provisions of the  Termination
Letter, this Agreement shall terminate except with respect to Paragraph 2(b); or

      (c) On such date after  _____________,  2007 when the Trustee deposits the
Property with the United States District Court for the Southern  District of New
York in the event  that,  prior to such date,  the  Trustee  has not  received a
Termination Letter from the Company pursuant to paragraph 1(i).

5. Miscellaneous.

      (a) The Company and the Trustee  each  acknowledge  that the Trustee  will
follow the security procedures set forth below with respect to funds transferred
from the Trust Account. Upon receipt of written  instructions,  the Trustee will
confirm  such  instructions  with  an  Authorized  Individual  at an  Authorized
Telephone  Number listed on the attached  Exhibit C. The Company and the Trustee
will each restrict access to confidential  information relating to such security
procedures  to  authorized  persons.  Each  party must  notify  the other  party
immediately if it has reason to believe  unauthorized  persons may have obtained
access to such  information,  or of any change in its authorized  personnel.  In
executing funds  transfers,  the Trustee will rely upon account numbers or other
identifying  numbers of a beneficiary,  beneficiary's bank or intermediary bank,
rather than names.  The Trustee  shall not be liable for any loss,  liability or
expense  resulting  from any error in an  account  number  or other  identifying
number, provided it has accurately transmitted the numbers provided.

                                       4
<PAGE>

      (b) This  Agreement  shall be governed by and  construed  and  enforced in
accordance  with the laws of the State of New  York,  without  giving  effect to
conflicts  of  law  principles  that  would  result  in the  application  of the
substantive  laws  of  another  jurisdiction.  It may  be  executed  in  several
counterparts, each one of which shall constitute an original, and together shall
constitute but one instrument.

      (c) This Agreement  contains the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof.  This Agreement or any
provision hereof may only be changed, amended or modified by a writing signed by
each of the parties hereto; provided, however, that no such change, amendment or
modification  may be made  without the prior  written  consent of EBC. As to any
claim,  cross-claim or counterclaim in any way relating to this Agreement,  each
party waives the right to trial by jury.

      (d) The parties hereto consent to the  jurisdiction and venue of any state
or federal  court  located in the City of New York,  Borough of  Manhattan,  for
purposes of resolving any disputes hereunder.

      (e) Any notice,  consent or request to be given in connection  with any of
the terms or provisions of this Agreement  shall be in writing and shall be sent
by express mail or similar  private courier  service,  by certified mail (return
receipt requested), by hand delivery or by facsimile transmission:

                  if to the Trustee, to:

                           Continental Stock Transfer
                             & Trust Company
                           17 Battery Place
                           New York, New York 10004
                           Attn:    Steven G. Nelson
                           Fax No.:  (212) 509-5150

                  if to the Company, to:

                           Chardan China Acquisition Corp. III
                           625 Broadway
                           Suite 1111
                           San Diego, California 92101
                           Attn:    Jiangnan Huang, Chairman
                           Fax No.:  (858) 847-9090

                                       5
<PAGE>

                  in either case with a copy to:

                           EarlyBirdCapital, Inc.
                           275 Madison Avenue, Suite 1203
                           New York, New York 10016
                           Attn:    David M. Nussbaum, Chairman
                           Fax No.:  (212) 269-3796

      (f) This  Agreement  may not be assigned by the Trustee  without the prior
consent of the Company.

      (g) Each of the Trustee and the Company hereby  represents that it has the
full right and power and has been duly  authorized to enter into this  Agreement
and to perform its respective obligations as contemplated hereunder. The Trustee
acknowledges and agrees that it shall not make any claims or proceed against the
Trust  Account,  including  by way of set-off,  and shall not be entitled to any
funds in the Trust Account under any circumstance.

      (h) Each of the Company and the Trustee hereby  acknowledge  that EBC is a
third party beneficiary of this Agreement.

                                       6
<PAGE>

            IN WITNESS  WHEREOF,  the parties have duly executed this Investment
Management Trust Agreement as of the date first written above.

                                            CONTINENTAL STOCK TRANSFER & TRUST
                                            COMPANY, as Trustee

                                            By: ____________________________
                                                 Name:
                                                 Title:

                                            CHARDAN CHINA ACQUISITION CORP. III

                                            By: ____________________________
                                            Name: Jiangnan Huang
                                                 Title: Chairman

                                       7
<PAGE>

                                                                       EXHIBIT A

                             [LETTERHEAD OF COMPANY]

                                  [INSERT DATE]

Continental Stock Transfer
  & Trust Company
17 Battery Place
New York, New York 10004
Attn:  Steven Nelson

      Re: Trust Account No. 530-_____________________Termination Letter

Gentlemen:

      Pursuant to paragraph 1(i) of the Investment  Management  Trust  Agreement
between Chardan China  Acquisition  Corp. III ("Company") and Continental  Stock
Transfer & Trust  Company  ("Trustee"),  dated as of  __________,  2005  ("Trust
Agreement"),  this is to  advise  you  that  the  Company  has  entered  into an
agreement ("Business Agreement") with __________________  ("Target Business") to
consummate a business combination with Target Business ("Business  Combination")
on or about  [INSERT  DATE].  The Company  shall notify you at least 48 hours in
advance of the  actual  date of the  consummation  of the  Business  Combination
("Consummation Date").

      In accordance with the terms of the Trust  Agreement,  we hereby authorize
you to commence  liquidation  of the Trust  Account to the effect  that,  on the
Consummation  Date,  all of funds held in the Trust Account will be  immediately
available  for transfer to the account or accounts that the Company shall direct
on the Consummation Date.

      On the Consummation  Date (i) counsel for the Company shall deliver to you
written  notification that (a) the Business Combination has been consummated and
(b) the  provisions  of Section  11-51-302(6)  and Rule  51-3.4 of the  Colorado
Statute  have  been met,  and (ii) the  Company  shall  deliver  to you  written
instructions with respect to the transfer of the funds held in the Trust Account
("Instruction  Letter").  You are hereby directed and authorized to transfer the
funds held in the Trust Account  immediately  upon your receipt of the counsel's
letter  and  the  Instruction  Letter,  in  accordance  with  the  terms  of the
Instruction Letter. In the event that certain deposits held in the Trust Account
may not be liquidated by the Consummation Date without penalty,  you will notify
the  Company of the same and the  Company  shall  direct you as to whether  such
funds should remain in the Trust Account and distributed  after the Consummation
Date to the Company. Upon the distribution of all the funds in the Trust Account
pursuant to the terms hereof, the Trust Agreement shall be terminated.

                                       8
<PAGE>

      In the event  that the  Business  Combination  is not  consummated  on the
Consummation  Date  described in the notice thereof and we have not notified you
on or before the original Consummation Date of a new Consummation Date, then the
funds held in the Trust  Account  shall be  reinvested  as provided in the Trust
Agreement on the business day immediately following the Consummation Date as set
forth in the notice.

                                            Very truly yours,

                                            CHARDAN CHINA ACQUISITION CORP. III

                                            By:________________________________
                                                 Jiangnan Huang, Chairman

                                            By:________________________________
                                                 Kerry Propper, Secretary
cc: EarlyBirdCapital, Inc.

                                       9
<PAGE>

                                                                       EXHIBIT B

                             [LETTERHEAD OF COMPANY]

                                  [INSERT DATE]

Continental Stock Transfer
  & Trust Company
17 Battery Place
New York, New York 10004
Attn:

      Re: Trust Account No. 530-__________________Termination Letter

Gentlemen:

      Pursuant to paragraph 1(i) of the Investment  Management  Trust  Agreement
between Chardan China  Acquisition  Corp. III ("Company") and Continental  Stock
Transfer & Trust  Company  ("Trustee"),  dated as of  ___________,  2005 ("Trust
Agreement"),  this is to advise you that the Company has been unable to effect a
Business  Combination  with a Target Company within the time frame  specified in
the Company's prospectus relating to its IPO.

      In accordance with the terms of the Trust Agreement, we hereby (a) certify
to you that the  provisions  of  Section  11-51-302(6)  and Rule  51-3.4  of the
Colorado Statute have been met and (b) authorize you, to commence liquidation of
the Trust  Account.  You will  notify the  Company  and  JPMorgan  Chase NY Bank
("Designated  Paying Agent") in writing as to when all of the funds in the Trust
Account  will  be  available  for  immediate  transfer  ("Transfer  Date").  The
Designated  Paying  Agent  shall  thereafter  notify  you as to the  account  or
accounts  of the  Designated  Paying  Agent that the funds in the Trust  Account
should be  transferred  to on the Transfer  Date so that the  Designated  Paying
Agent may commence  distribution  of such funds in accordance with the Company's
instructions.  You shall have no  obligation  to oversee the  Designated  Paying
Agent's  distribution  of the funds.  Upon the payment to the Designated  Paying
Agent of all the  funds in the  Trust  Account,  the  Trust  Agreement  shall be
terminated.

                                            Very truly yours,

                                            CHARDAN CHINA ACQUISITION CORP. III

                                            By:________________________________
                                                 Jiangnan Huang, Chairman

                                            By:________________________________
                                                 Kerry Propper, Secretary
cc: EarlyBirdCapital, Inc.

                                       10
<PAGE>

                                    EXHIBIT C

AUTHORIZED INDIVIDUAL(S)                                        AUTHORIZED
FOR TELEPHONE CALL BACK                                      TELEPHONE NUMBER(S)
-----------------------                                      -------------------

COMPANY:

Chardan China Acquisition Corp. III
625 Broadway
Suite 1111
San Diego, California 92101
Attn:  Jiangnan Huang, Chairman                               (858) 847-9000

TRUSTEE:

Continental Stock Transfer
  & Trust Company
17 Battery Place
New York, New York 10004
Attn:  Steven G. Nelson, Chairman                             (212) 845-3200

                                       11

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