Document:

Wilshire
      Bancorp, Inc.

     

    2008
      Stock Incentive Plan

     

    Notice
      of Stock Option Grant

     

    You
      have
      been granted the following option to purchase shares of the Common Stock of
      Wilshire Bancorp, Inc. (the “Company”):

     

    
      	
              Name
                of Optionee:

            	
              _______________

            
	
              Total
                Number of Shares:

            	
              _______________

            
	
              Type
                of Option:

            	
              _______________

            
	
              Exercise
                Price Per Share:

            	
              _______________

            
	
              Date
                of Grant:

            	
              _______________

            
	
              Vesting
                Commencement

            	
              _______________

            
	
              Date:

            	 

    

    

     

    
      	
              Vesting
                Schedule:

            	
              This
                option becomes exercisable with respect to __________% of the Shares
                on
                the Vesting Commencement Date. Thereafter, this option becomes exercisable
                with respect to an additional ______% of the Shares subject to this
                option
                on each anniversary of the Date of Grant.

            
	
              Expiration
                Date:

            	
              The
                last business day prior to _____________. This option expires earlier
                if
                your Service terminates earlier, as described in the Stock Option
                Agreement.

            

    

     

    You
      and
      the Company agree that this option is granted under and governed by the terms
      and conditions of this Notice of Stock Option Grant (the “Notice”), the 2008
      Stock Incentive Plan (the “Plan”), and the Stock Option Agreement. The Plan and
      Stock Option Agreement are both attached to and made an integral part of this
      Notice.

     

    You
      further agree that the Company may deliver by email all documents relating
      to
      the Plan or this option and all other documents that the Company is required
      to
      deliver to its security holders (including, without limitation, annual reports
      and proxy statements). You also agree that the Company may deliver these
      documents by posting them on a web site maintained by the Company or by a third
      party under contract with the Company. If the Company posts these documents
      on a
      web site, it will notify you by email.

     

    
      	
              Optionee:

            	 	
              Wilshire
                Bancorp, Inc.

            	 
	 
	 	  
	 
	 	 	
              Joanne
                Kim, President & CEO

            	 

 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Wilshire
      Bancorp, Inc.

     

    2008
      Stock Incentive Plan

     

    Stock
      Option Agreement

     

      
        	
                Tax
                  Treatment

              	
                This
                  option is intended to be an incentive stock option under section 422
                  of the Internal Revenue Code or a nonstatutory stock option, as
                  provided
                  in the Notice of Stock Option Grant.

              
	
                Vesting

              	
                This
                  option becomes exercisable in installments, as shown in the Notice
                  of
                  Stock Option Grant. In addition, this option becomes exercisable
                  in full
                  if either of the following events occurs: 

                ·  Your
                  Service terminates because of retirement at or after age 65, total
                  and permanent disability, or death, or

                ·  The
                  Company is subject to a “Change in Control” (as defined in the Plan)
                  before your Service terminates, and you are subject to an “Involuntary
                  Termination” (as defined in the Plan) within 12 months after the Change in
                  Control.

                This
                  option will in no event become exercisable for additional shares
                  after
                  your Service has terminated for any reason.

              
	
                Term

              	
                This
                  option expires in any event at the close of business at Company
                  headquarters on the last business day before the 5th
                  anniversary of the Date of Grant, as shown in the Notice of Stock
                  Option
                  Grant. (It will expire earlier if your Service terminates, as described
                  below.)

              
	
                Regular
                  Termination

              	
                If
                  your Service terminates for any reason except involuntary termination
                  for
                  cause, death or total and permanent disability, then this option
                  will
                  expire at the close of business at Company headquarters on the
                  last
                  business day prior to the date that is three months after your
                  termination
                  date. The Company determines when your Service terminates for this
                  purpose.

              
	
                Involuntary
                  Termination 

                for
                  Cause

              	
                If
                  your Service is involuntary terminated by the Company for cause,
                  then this
                  option will expire immediately. For
                  the purposes of this Agreement, “for cause” shall mean shall mean
                  termination as a result of personal dishonesty, incompetence, willful
                  misconduct, breach of fiduciary duty involving personal profit,
                  intentional failure to perform stated duties, willful violation
                  of any
                  law, rule or regulation (other than traffic violations or similar
                  offenses) or any final cease-and-desist order, or material breach
                  of any
                  provision of your employment agreement (if any).

              
	
                Death

              	
                If
                  you die before your Service terminates, then this option will expire
                  at
                  the close of business at Company headquarters on the last business
                  day
                  prior to the date 12 months after the date of death.

              
	
                Disability

              	
                If
                  your Service terminates because of your total and permanent disability,
                  then this option will expire at the close of business at Company
                  headquarters on the last business date that is prior to the date
                  12 months
                  after your termination date.

              
	 	
                For
                  all purposes under this Agreement, “total and permanent disability” means
                  that you are unable to engage in any substantial gainful activity
                  by
                  reason of any medically determinable physical or mental impairment
                  which
                  can be expected to result in death or which has lasted, or can
                  be expected
                  to last, for a continuous period of not less than one
                  year.

              

      

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

       

      
        	
                Leaves
                  of Absence and 

                Part-Time
                  Work

              	
                For
                  purposes of this option, your Service does not terminate when you
                  go on a
                  military leave, a sick leave or another bona
                  fide
                  leave of absence, if the leave was approved by the Company in writing
                  and
                  if continued crediting of Service is required by the terms of the
                  leave or
                  by applicable law. But your Service terminates when the approved
                  leave
                  ends, unless you immediately return to active work.

              
	 	
                If
                  you go on a leave of absence, then the vesting schedule specified
                  in
                  the Notice of Stock Option Grant
                  may be adjusted in accordance with the
                  Company’s leave of absence policy or the terms of your leave. If
                  you commence working on a part-time basis, then the vesting schedule
                  specified in
                  the Notice of Stock Option Grant
                  may be adjusted in accordance with the Company’s part-time work policy or
                  the terms of an agreement between you and the Company pertaining
                  to your
                  part-time schedule.

              
	
                Restrictions
                  on Exercise

              	
                The
                  Company will not permit you to exercise this option if the issuance
                  of
                  shares at that time would violate any law or regulation. Any exercise
                  of
                  this option in violation of any law or regulation may be deemed
                  invalid or
                  ineffective by the Company, in its sole discretion.

              
	
                Notice
                  of Exercise

              	
                When
                  you wish to exercise this option, you must notify the Company by
                  filing
                  the proper “Notice of Exercise” form at the address given on the form.
                  Your notice must specify how many shares you wish to purchase.
                  Your notice
                  must also specify how your shares should be registered and be accompanied
                  by payment or provision for payment as described below. The notice
                  will be
                  effective when the Company receives it.

              
	 	
                If
                  someone else wants to exercise this option after your death, that
                  person
                  must prove to the Company's satisfaction that he or she is entitled
                  to do
                  so.

              
	
                Form
                  of Payment

              	
                When
                  you submit your notice of exercise, you must include payment of
                  the option
                  exercise price for the shares that you are purchasing. Payment
                  may be made
                  in one (or a combination of two or more) of the following
                  forms:

                ·  Your
                  personal check, a cashier’s check or a money order.

                ·  Certificates
                  for shares of Company stock that you own, along with any forms
                  needed to
                  effect a transfer of those shares to the Company. The value of
                  the shares,
                  determined as of the effective date of the option exercise, will
                  be
                  applied to the option exercise price. Instead of surrendering shares
                  of
                  Company stock, you may attest to the ownership of those shares
                  on a form
                  provided by the Company and have the same number of shares subtracted
                  from
                  the option shares issued to you. However, you may not surrender,
                  or attest
                  to the ownership of, shares of Company stock in payment of the
                  exercise
                  price if your action would cause the Company to recognize compensation
                  expense (or additional compensation expense) with respect to this
                  option
                  for financial reporting purposes.

              
	 	
                ·  Irrevocable
                  directions to a securities broker approved by the Company to sell
                  all or
                  part of your option shares and to deliver to the Company from the
                  sale
                  proceeds an amount sufficient to pay the option exercise price
                  and any
                  withholding taxes. (The balance of the sale proceeds, if any, will
                  be
                  delivered to you.) The directions must be given by signing a special
                  “Notice of Exercise” form provided by the Company.

              
	 	 

      

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      
        	
                Withholding
                  Taxes and Stock 

                Withholding

              	
                You
                  will not be allowed to exercise this option unless you make arrangements
                  acceptable to the Company to pay any withholding taxes that may
                  be due as
                  a result of the option exercise. With the Company’s consent, these
                  arrangements may include withholding shares of Company stock that
                  otherwise would be issued to you when you exercise this
                  option.
                  The value of these shares, determined as of the effective date
                  of the
                  option exercise, will be applied to the withholding
                  taxes.

              
	
                Restrictions
                  on Resale

              	
                You
                  agree not to sell any option shares at a time when applicable laws,
                  Company policies or an agreement between the Company and its underwriters
                  prohibit a sale. This restriction will apply as long as your Service
                  continues and for such period of time after the termination of
                  your
                  Service as the Company may specify.

              
	
                Transfer
                  of Option

              	
                Prior
                  to your death, only you may exercise this option. You cannot transfer
                  or
                  assign this option. For instance, you may not sell this option
                  or use it
                  as security for a loan. If you attempt to do any of these things,
                  this
                  option will immediately become invalid. You may, however, dispose
                  of this
                  option in your will or a beneficiary designation.

              
	 	
                Regardless
                  of any marital property settlement agreement, the Company is not
                  obligated
                  to honor a notice of exercise from your former spouse, nor is the
                  Company
                  obligated to recognize your former spouse’s interest in your option in any
                  other way.

              
	
                Retention
                  Rights

              	
                Your
                  option or this Agreement does not give you the right to be retained
                  by the
                  Company or a subsidiary of the Company in any capacity. The Company
                  and
                  its subsidiaries reserve the right to terminate your Service at
                  any time,
                  with or without cause.

              
	
                Shareholder
                  Rights

              	
                You,
                  or your estate or heirs, have no rights as a shareholder of the
                  Company
                  until you have exercised this option by giving the required notice
                  to the
                  Company and paying the exercise price. No adjustments are made
                  for
                  dividends or other rights if the applicable record date occurs
                  before you
                  exercise this option, except as described in the Plan.

              
	
                Adjustments

              	
                In
                  the event of a stock split, a stock dividend or a similar change
                  in
                  Company stock, the number of shares covered by this option and
                  the
                  exercise price per share may be adjusted pursuant to the
                  Plan.

              
	
                
                  Applicable
                    Law

                

              	
                This
                  Agreement will be interpreted and enforced under the laws of the
                  State of
                  California (without regard to their choice-of-law
                  provisions).

              
	
                The
                  Plan and Other 

                Agreements

              	
                The
                  text of the Plan is incorporated in this Agreement by
                  reference.

                This
                  Agreement, the Notice and the Plan constitute the entire understanding
                  between you and the Company regarding this option. Any prior agreements,
                  commitments or negotiations concerning this option are superseded.
                  This
                  Agreement may be amended only by another written agreement between
                  the
                  parties.

              

      

    

     

    By
      signing the cover sheet of this Agreement, you agree to all of the terms

    and
      conditions described above and in the Plan.

    

    
      
         

      

      
        3FORM
      OF

     

    CERTIFICATE
      OF DESIGNATIONS

     

    of

     

    SERIES
      A CONVERTIBLE PREFERRED STOCK

     

    of

     

    CHINA
      ADVANCED CONSTRUCTION MATERIALS GROUP, INC.

     

    Pursuant
      to Section 151(g) of the

    General
      Corporation Law of the State of Delaware

     

    CHINA
      ADVANCED CONSTRUCTION MATERIALS GROUP, INC., a corporation organized and
      existing under the laws of the State of Delaware (the “Corporation”),
      does
      hereby certify that, pursuant to the authority conferred on the Board of
      Directors of the Corporation by the Certificate of Incorporation, as amended
      and
      restated to date (the “Certificate
      of Incorporation”),
      of
      the Corporation and in accordance with Section 151(g) of the General Corporation
      Law of the State of Delaware, the Board of Directors of the Corporation adopted
      the following resolution establishing a series of 875,000 shares of Preferred
      Stock of the Corporation designated as “Series A Convertible Preferred
      Stock”:

     

    RESOLVED,
      that pursuant to the authority conferred on the Board of Directors of this
      Corporation by the Certificate of Incorporation, a series of Preferred Stock,
      par value $0.001 per share, of the Corporation is hereby established and
      created, and that the designation and number of shares thereof and the voting
      and other powers, preferences and relative, participating, optional or other
      rights of the shares of such series and the qualifications, limitations and
      restrictions thereof are as follows:

     

    1. Designation
      and Amount. The shares of such series created hereby shall be designated as
      Series A Convertible Preferred Stock (the “Series A Preferred Stock”) and
      the authorized number of shares constituting such series shall be 875,000.
      The
      agreed stated value of each of the Series A Preferred Stock shall be $8.00
      per
      share (the “Agreed Stated Value”). The Series A Preferred Stock shall,
      with respect to dividend rights, have the entitlements set forth herein and
      shall, with respect to rights on liquidation, dissolution and winding up of
      the
      affairs of the Corporation, rank senior to all classes of Common Stock of the
      Corporation and, subject to the rights of any series of Preferred Stock that
      may
      from time to time come into existence providing that the Series A Preferred
      Stock shall rank junior or senior thereto, other equity securities of the
      Corporation. Such number of shares may be decreased by resolution of the Board
      of Directors of the Corporation; provided, however, that no decrease shall
      reduce the number of shares of Series A Preferred Stock to less than the number
      of shares then issued and outstanding.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2. Dividends
      and Distributions.

     

    (a) Amount.
      The
      holders of shares of Series A Preferred Stock shall be entitled to receive
      cumulative dividends on each share of Series A Preferred Stock, payable in
      cash,
      out of
      funds legally available therefor at the annual rate of nine percent
      (9.0%) of
      the
      Dividend Base Amount (as defined below), payable quarterly in arrears. Dividends
      on the Series A Preferred Stock shall accrue on a daily basis from the date
      of
      issuance and are cumulative from such date whether or not the Corporation has
      earnings or profits, there are funds legally available for the payment of such
      dividends, the Corporation has sufficient cash, or dividends are
      declared.

     

    (b) Payment.
      The
      first payment of dividends shall commence on the last day of the Calendar
      Quarter in which the initial closing of the issuance of the Series A Preferred
      Stock occurs (the “First
      Payment Date”)
      and
      shall continue on the last day of each subsequent Calendar Quarter following
      the
      First Payment Date (each, a “Dividend
      Payment Date”).
      Each
      distribution shall be made to the holders of shares of Series A Preferred Stock
      of record as they appear on the stock books of the Corporation on such record
      dates, not more than ten (10) days after the related Dividend Payment Date
      (each, a “Payment
      Due Date”).
      For
      purposes of this Certificate
      of Designations, “Calendar
      Quarter” shall mean a period of three (3) consecutive months ending on the last
      day of March, June, September, or December, respectively.

     

    (c) Non-Payment.
      In the
      event that the Corporation fails to pay any distributions within ten (10) days
      of the applicable Payment Due Date, the Per Share Conversion Price (as defined
      in Section 5) shall be reduced by twenty percent (20%) until such time as all
      accrued dividends owing to the holders of Series A Preferred Stock are
      paid-in-full.

     

    (d) Dividends
      Priority.
      Unless
      all dividends shall be declared and paid in full on all outstanding shares
      of
      Series A Preferred Stock, no dividends
      shall be declared or paid on, and no assets shall be distributed or set apart
      for, any shares of Junior Stock (as defined below) other than distributions
      of
      dividends in shares of the same class and series of Junior Stock to the holders
      of Junior Stock in respect of which such distribution is made.

     

    (e) Dividend
      Base Amount.
      The
“Dividend
      Base Amount”
shall
      be $8.00 plus all accrued dividends unpaid thereon, whether or not declared,
      together with any other dividends declared but unpaid thereon (subject to
      appropriate adjustment to reflect any stock split, combination, reclassification
      or reorganization of the Series A Preferred Stock).

     

    (f) Junior
      Stock.
      “Junior
      Stock”
shall
      mean (i) each class of the Corporation’s common stock (“Common
      Stock”),
      and
      (ii) each other class or series
      of
      the Corporation’s capital stock, whether common, preferred or otherwise, the
      terms of which do not provide that shares of such class or series shall rank
      senior to or on a parity with shares of the Series A Preferred Stock as to
      distributions of dividends and distributions upon the liquidation, winding-up
      and dissolution of the Corporation. 

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    3. Liquidation
      Preference.

     

    (a) In
      the
      event of a (i) liquidation, dissolution or winding up of the Corporation,
      whether voluntary or involuntary, (ii) a sale, lease, transfer, exclusive
      license or other disposition, in a single transaction or series of related
      transactions, by the Corporation of all or substantially all the assets of
      the
      Corporation or (iii) voluntary or involuntary bankruptcy of the Corporation
      (subparagraphs (i), (ii) and (iii) being collectively referred to as a
“Liquidation
      Event”),
      after
      payment or provision for payment of debts and other liabilities of the
      Corporation, the holders of the Series A Preferred Stock then outstanding shall
      be entitled to be paid out of the assets of the Corporation available for
      distribution to its stockholders, whether such assets are capital, surplus,
      or
      earnings, before and in preference to any payment or declaration and setting
      apart for payment of any amount shall be made in respect of any Junior Stock,
      an
      amount equal to $8.00 per share plus an amount equal to all accrued dividends
      unpaid thereon, whether or not declared, together with any other dividends
      declared but unpaid thereon. In the case of property or in the event that any
      such securities are restricted, the value of such property or securities shall
      be determined by agreement between the Corporation and the holders of a majority
      of the shares of Series A Preferred Stock then outstanding. If upon any
      Liquidation Event, whether voluntary or involuntary, the assets to be
      distributed to the holders of the Series A Preferred Stock shall be insufficient
      to permit the payment to such stockholders of the full preferential amounts
      aforesaid, then all of the assets of the Corporation to be distributed shall
      be
      so distributed ratably to the holders of the Series A Preferred Stock on the
      basis of the number of shares of Series A Preferred Stock held. A merger or
      other corporate reorganization in which the Corporation’s stockholders shall
      receive cash or securities of another corporation or entity (except in
      connection with a consolidation or merger in which the holders of voting stock
      of the Corporation immediately before the consolidation or merger will in the
      aggregate own more than fifty percent (50%) of the voting shares of the
      continuing or surviving corporation after the consolidation or merger) or any
      transaction in which all or substantially all of the assets of the Corporation
      are sold shall be treated as a Liquidation Event. Holders of the Series A
      Preferred Stock shall receive prior notice of any such transaction in accordance
      with Section 8 hereof and an opportunity to convert their Series A Preferred
      Stock prior to the consummation of such transaction. All shares of Series A
      Preferred Stock shall rank as to payment upon the occurrence of any Liquidation
      Event senior to the Common Stock as provided herein and, unless the terms of
      such other series shall provide otherwise, senior to all other series of the
      Corporation’s preferred stock. 

     

    (b) Upon
      the
      completion of the distribution required by subparagraph (a) of this Section
      3
      and subject to any other distribution that may be required with respect to
      any
      series of Preferred Stock that may from time to time come into existence, the
      remaining assets of the Corporation available for distribution to stockholders
      shall be distributed among the holders of the shares of Series A Preferred
      Stock
      and Common Stock, pro rata based on the number of shares held by each such
      holder, treating for this purpose all such securities as if they had been
      converted to Common Stock pursuant to Section 5 immediately prior to such
      dissolution, liquidation or winding up of the Corporation.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    4. Registration
      Rights.

     

    (a) Initial
      Registration.
      The
      Corporation will, as soon as practicable but not later than sixty (60) days
      following the final closing of the
      offering pursuant to which the Series A Preferred Stock are issued (the sixtieth
      (60th) day following the final closing is referred to as the “Initial
      Filing Date”),
      (1)
      file with the Securities and Exchange Commission (“SEC”)
      a
      registration statement under the Securities Act of 1933, as amended (the
“Act”)
      on the
      appropriate form of registration statement (“Registration
      Statement”)
      as is
      then available to effect a registration for resale of the shares of Common
      Stock
      underlying the Series A Preferred Stock (“Registrable
      Securities”)
      by the
      holders and use its best efforts to have such Registration Statement declared
      effective within 120 days after such final closing (or within 150
      days in
      the event of a full review of the SEC) (the “Effective
      Date”)
      and
      (2) cause such Registration Statement to remain effective (the “Registration
      Period”)
      until
      the earlier of (i) such date as the holders of the Registrable Securities have
      completed the distribution described in such Registration Statement or (ii)
      at
      such time that all such shares have become eligible for sale pursuant to Rule
      144 (or any successor thereto) under the Act. To the extent permissible, such
      Registration Statement also shall cover, to the extent allowable under the
      Act
      and the rules promulgated thereunder (including Rule 416 under the Act), such
      indeterminate number of additional shares of Common Stock resulting from stock
      splits, stock dividends or similar transactions with respect to such Registrable
      Securities. In the event the Registration Statement is not filed with the SEC
      on
      or before the Initial Filing Date or in the event the Registration Statement
      is
      not declared effective by the SEC on or before the Effective Date, the Company
      shall pay to each holder of Series A Preferred Stock, as liquidated damages
      and
      not as a penalty, an amount, for each month (or portion of a month) in which
      such delay shall occur, equal to one and one half percent (1.5%) of the purchase
      price paid by each such holder, until the point in time when the Registration
      Statement is filed with, or declared effective by, the SEC, respectively, which
      amount shall become payable on the first business day after the Initial Filing
      Date and every thirty days thereafter until the Registration Statement is filed
      or declared effective, respectively. The payment of liquidated damages as set
      forth in this clause (a) shall not constitute the holders’ exclusive remedies
      for such events and the holders shall have the remedy of specific performance.
      Notwithstanding the foregoing, the total cash payments payable by the Company
      for not meeting the Initial Filing Date and/or the Effective Date shall not
      exceed six percent (6%) of the purchase price paid by each such
      holder.

     

    (b) Additional
      Registrable Securities.
      In the
      event the Corporation is obligated to issue Additional Shares (defined as (i)
      the shares of common stock underlying the Series A Preferred Stock and (ii)
      any
      additional shares of Common Stock issuable upon adjustment to the conversion
      or
      exercise price of the securities referenced in clause (i) above or as a result
      of the events set forth in Section 5(b) below) the
      Corporation shall use its best efforts to promptly prepare and file with the
      SEC
      one or more Registration Statements, on such form of registration statement
      as
      is then available to effect a registration for resale of such additional shares
      of Common Stock, covering the resale of the Additional Shares, but only to
      the
      extent the Additional Shares are not at the time covered by an effective
      Registration Statement. To the extent permissible, such Registration Statement
      also shall cover, to the extent allowable under the Act and the rules
      promulgated thereunder (including Rule 416 under the Act), such indeterminate
      number of additional shares of Common Stock resulting from stock splits, stock
      dividends or similar transactions with respect to the Additional Shares. A
      Registration Statement covering the Additional Shares shall be filed by the
      Corporation with the SEC as promptly as possible, but in no event more than
      thirty (30) days following the transaction resulting in the adjustment to the
      number of shares of Common Stock issuable pursuant to the Series A Preferred
      Stock (the “Additional
      Filing Deadline”).
      The
      Corporation shall cause such Registration Statement to remain effective for
      the
      Registration Period. 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (c) Cutback.
      In
      connection with filing the Registration Statement, if the SEC limits the amount
      of Registrable Securities to be registered for resale pursuant to Rule 415
      under
      the Securities Act, then the Company shall be entitled to exclude such
      disallowed Registrable Securities on a pro rata basis among the Holders thereof,
      with a first priority given to the shares of Common Stock underlying the
      Preferred Stock. The Company shall prepare, and, as soon as practicable but
      in
      no event later than the six months from the date the Company’s Registration
      Statement was declared effective, file with the SEC an additional Registration
      Statement (“Additional
      Registration Statement”)
      on
      Form S-1 covering the resale of all of the disallowed Registrable Securities
      not
      previously registered on an Additional Registration Statement hereunder. In
      the
      event that Form S-1 is unavailable for such a registration, the Company shall
      use such other form as is available for such a registration on another
      appropriate form. The Company shall use its best efforts to have each Additional
      Registration Statement declared effective by the SEC as soon as practicable,
      but
      in no event later than the ninety (90) days from the filing date of the
      Additional Registration Statement. The Company shall not be subject to
      liquidated damages as set forth in Section 4(a) in connection with the filing
      and effectiveness of the Additional Registration Statement registering the
      disallowed Registrable Securities.

     

    5. Conversion
      Rights.

     

    (a) Conversion,
      Per Share Conversion Price.
      Each
      share of Series A Preferred Stock shall be convertible, at the option of the
      holder thereof upon exercise in accordance with Section 5(b), without the
      payment of additional consideration, into such number of fully paid and
      nonassessable shares of the Corporation’s Common Stock equal to the quotient
      obtained by dividing the Agreed Stated Value plus all accrued dividends unpaid
      thereon, whether or not declared, together with any other dividends declared
      but
      unpaid thereon, by $2.00 (the “Conversion
      Price”)
      (as
      such amount may be adjusted from time to time pursuant to this Certificate
      of
      Designations, the “Per
      Share Conversion Price”).

     

    (b) Conversion
      Procedures.
      The
      optional conversion of shares of Series A Preferred Stock in accordance with
      Section 5(a) may be effected by a holder of record thereof by making written
      demand for such conversion (a “Conversion
      Demand”)
      upon
      the Corporation at its principal executive offices setting forth therein: (i)
      the number of shares to be converted; (ii) the certificate or certificates
      representing such shares; and (iii) the proposed date of such conversion, which
      shall be a business day not less than five (5) nor more than thirty (30) days
      after the date of such Conversion Demand (the “Conversion
      Date”).
      Within five days of receipt of the Conversion Demand, the Corporation shall
      give
      written notice (a “Conversion
      Notice”)
      to
      such holder setting forth therein: (i) the address of the place or places at
      which the certificate or certificates representing the shares so to be converted
      are to be surrendered; and (ii) whether the certificate or certificates to
      be
      surrendered are required to be indorsed for transfer or accompanied by a duly
      executed stock power or other appropriate instrument of assignment and, if
      so,
      the form of such endorsement or power or other instrument of assignment. The
      Conversion Notice shall be sent by first class mail, postage prepaid, to such
      holder at such holder’s address as may be set forth in the Conversion Demand. On
      or before the Conversion Date, the holder of Series A Preferred Stock to be
      converted shall surrender the certificate or certificates representing such
      shares, duly indorsed for transferor accompanied by a duly executed stock power
      or other instrument of assignment, if the Conversion Notice so provides, to
      the
      Corporation at any place set forth in such notice or, if no such place is so
      set
      forth, at the principal executive offices of the Corporation. As soon as
      practicable after the Conversion Date and the surrender of the certificate
      or
      certificates representing such shares, the Corporation shall issue and deliver
      to such holder, or its nominee, a certificate or certificates for the number
      of
      whole shares of Common Stock issuable upon such conversion in accordance with
      the provisions hereof. Upon surrender of certificates of Series A Preferred
      Stock to be converted in part, the Corporation shall issue a balance certificate
      representing the number of full shares of Series A Preferred Stock not so
      converted. 

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    (c) Effect
      of Conversion.
      All
      outstanding shares of Series A Preferred Stock to be converted pursuant to
      the
      Conversion Notice shall, on the Conversion Date, be converted into Common Stock
      for all purposes, notwithstanding the failure of the holder thereof to surrender
      any certificate representing such shares on or prior to such date. On and after
      the Conversion Date, (i) no such share of Series A Preferred Stock shall be
      deemed to be outstanding or be transferable on the books of the Corporation
      or
      the stock transfer agent, if any, for the Series A Preferred Stock, and (ii)
      the
      holder of such shares, as such, shall not be entitled to receive any dividends
      or other distributions (other than any accrued dividends unpaid thereon, whether
      or not declared, together with any other dividends declared but unpaid thereon),
      to receive notices or to vote such shares or to exercise or to enjoy any other
      powers, preferences or rights in respect thereof, other than the right, upon
      surrender of the certificate or certificates representing such shares, to
      receive a certificate or certificates for the number of shares of Common Stock
      into which such shares shall have been converted. On the Conversion Date, all
      such shares of Series A Preferred Stock shall be retired and canceled and shall
      not be reissued.

     

    6. Mandatory
      Conversion.

     

    (a) Trigger
      Events.
      Beginning any time after the date thirty (30) trading days after the Effective
      Date, if the closing price of the sale of shares of Common Stock on the
OTC
      Bulletin Board (or the Corporation’s principal securities exchange, if other
      than the OTC Bulletin Board) exceeds $5.00 per share (subject to appropriate
      adjustment in the event of any stock dividend, stock split, combination or
      other
      similar recapitalization with respect to the Common Stock),
      for
any
      twenty (20) of the last thirty (30) consecutive trading days
      and the
      average daily trading volume of the Common Stock is no less than 100,000 shares
      per day during such 30-day period,
      the
      Series A Preferred Stock shall automatically convert to the Series A Preferred
      Stock to Common Stock (the “Mandatory
      Conversion Time”),
      based
      on the Conversion Price. 

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    (b) Procedural
      Requirements.
      At the
      Mandatory Conversion Time, all
      holders of record of shares of Series A Preferred Stock shall be sent written
      notice of the place designated for mandatory conversion of all such shares
      of
      Series A Preferred Stock pursuant to this Section
      5.
      Upon
      receipt of such notice, each holder of shares of Series A Preferred Stock shall
      surrender his, her or its certificate or certificates for all such shares (or,
      if such holder alleges that such certificate has been lost, stolen or destroyed,
      a lost certificate affidavit and agreement reasonably acceptable to the
      Corporation to indemnify the Corporation against any claim that may be made
      against the Corporation on account of the alleged loss, theft or destruction
      of
      such certificate) to the Corporation at the place designated in such notice.
      If
      so required by the Corporation, certificates surrendered for conversion shall
      be
      endorsed or accompanied by written instrument or instruments of transfer, in
      form satisfactory to the Corporation, including medallion seal, duly executed
      by
      the registered holder or by his, her or its attorney duly authorized in writing.
      All rights with respect to the Series A Preferred Stock converted pursuant
      to
      this Section
      6,
      including the rights, if any, to receive notices and vote (other than as a
      holder of Common Stock), will terminate at the Mandatory Conversion Time
      (notwithstanding the failure of the holder or holders thereof to surrender
      the
      certificates at or prior to such time), except only the rights of the holders
      thereof, upon surrender of their certificate or certificates (or lost
      certificate affidavit and agreement) therefor, to receive the items provided
      for
      in the next sentence of this Section
      6(b).
      As soon
      as practicable after the Mandatory Conversion Time and the surrender of the
      certificate or certificates (or lost certificate affidavit and agreement) for
      Series A Preferred Stock, the Corporation shall issue and deliver to such
      holder, or to his, her or its nominees, a certificate or certificates for the
      number of full shares of Common Stock issuable on such conversion in accordance
      with the provisions hereof, together with cash as provided in Section
      14
      in lieu
      of any fraction of a share of Common Stock otherwise issuable upon such
      conversion and the payment of any declared but unpaid dividends on the shares
      of
      Series A Preferred Stock converted. Such converted Series A Preferred Stock
      shall be retired and cancelled and may not be reissued as shares of such series,
      and the Corporation may thereafter take such appropriate action (without the
      need for stockholder action) as may be necessary to reduce the authorized number
      of shares of Series A Preferred Stock accordingly.

     

    7. Adjustment
      of Per Share Conversion Price. 

     

    (a) Stock
      Dividends and Splits.
      If the
      Corporation, at any time while the Series A Preferred Stock is outstanding:
      (i)
      pays a stock dividend or otherwise make a distribution or distributions on
      shares of its Common Stock or any other equity or equity equivalent securities
      payable in shares of Common Stock (which, for avoidance of doubt, shall not
      include any shares of Common Stock issued by the Corporation upon conversion
      of
      any Preferred Stock) (“Common
      Stock Equivalents”),
      (ii)
      subdivides outstanding shares of Common Stock into a larger number of shares,
      (iii) combines (including by way of reverse stock split) outstanding shares
      of
      Common Stock into a smaller number of shares, or (iv) issues by reclassification
      of shares of the Common Stock any shares of capital stock of the Corporation,
      then in each case the Conversion Price shall be multiplied by a fraction the
      numerator of which shall be the number of shares of Common Stock (excluding
      treasury shares, if any) outstanding immediately before such event and the
      denominator of which shall be the number of shares of Common Stock outstanding
      immediately after such event. Any adjustment made pursuant to this Section
      7(a)
      shall
      become effective at the close of business on the record date for the
      determination of stockholders entitled to receive such dividend or distribution
      and shall become effective at the close of business on the effective date in
      the
      case of a subdivision, combination or re-classification.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    (b) Subsequent
      Equity Sales.
      If the
      Corporation, at any time while the Series A Preferred Stock is outstanding,
      shall sell or grant any option to purchase or sell or grant any right to reprice
      its securities, or otherwise dispose of or issue (or announce any offer, sale,
      grant or any option to purchase or other disposition) any Common Stock or Common
      Stock Equivalents entitling any Person to acquire shares of Common Stock, at
      an
      effective price per share less than the Conversion Price (such lower price,
      the
“Base
      Share Price”
and
      such issuances collectively, a “Dilutive
      Issuance”)
      (if
      the holder of the Common Stock or Common Stock Equivalents so issued shall
      at
      any time, whether by operation of purchase price adjustments, reset provisions,
      floating conversion, exercise or exchange prices or otherwise, or due to
      warrants, options or rights per share which are issued in connection with such
      issuance, be entitled to receive shares of Common Stock at an effective price
      per share which is less than the Conversion Price, such issuance shall be deemed
      to have occurred for less than the Conversion Price on such date of the Dilutive
      Issuance), then the Conversion Price shall be reduced and only reduced to equal
      the Base Share Price (the “Adjusted
      Conversion Price”).
      Such
      adjustment shall be made whenever such Common Stock or Common Stock Equivalents
      are issued. Notwithstanding the foregoing, no adjustments shall be made, paid
      or
      issued under this Section
      7(b)
      in
      respect of an Exempt Issuance. The Corporation shall notify the Holder in
      writing, no later than five (5) trading days following the issuance of any
      Common Stock or Common Stock Equivalents subject to this Section
      7(b),
      indicating therein the applicable issuance price, or applicable reset price,
      exchange price, conversion price and other pricing terms in accordance with
      Section
      7(e)
      below
      (such notice the “Dilutive
      Issuance Notice”).
      For
      purposes of clarification, whether or not the Corporation provides a Dilutive
      Issuance Notice pursuant to this Section
      7(b),
      upon
      the occurrence of any Dilutive Issuance, after the date of such Dilutive
      Issuance each share of Series A Preferred Stock shall be convertible into such
      number of shares of Common Stock based on the Adjusted Conversion Price,
      regardless of whether the holder accurately refers to the Adjusted Conversion
      Price in the Demand Notice. As used herein, the term “Exempt
      Issuance”
shall
      mean (i) any issuance, sale, grant or award of any Common Stock, option or
      right
      to purchase Common Stock, or any security convertible into or exchangeable
      for
      Common Stock issued or issuable to any officer, director, employee, consultant
      or advisor of the Corporation pursuant to a bona fide option or equity incentive
      plan or other agreement or arrangement duly adopted by the Corporation, in
      consideration for services rendered or to be rendered to the Corporation by
      such
      officer, director, employee, consultant or advisor and (ii) any issuance of
      the
      Common Stock underlying the Series A Preferred Stock.

     

    (c) Mergers,
      Etc.
      In case
      of any capital reorganization or reclassification, or any consolidation or
      merger to which the Corporation is a party other than a merger or consolidation
      in which the Corporation is the continuing corporation, or in case of any sale
      or conveyance to another entity of all or substantially all of the assets of
      the
      Corporation, or in the case of any statutory exchange of securities with another
      corporation (including any exchange effected in connection with a merger of
      a
      third corporation into the Corporation but excluding any exchange of securities
      or merger with another corporation in which the Corporation is a continuing
      corporation and that does not result in any reclassification of or similar
      change in the Common Stock), each holder of Series A Preferred Stock shall
      have
      the right thereafter to receive on the conversion of the Series A Preferred
      Stock the kind and amount of securities, cash or other property which the holder
      would have owned or have been entitled to receive immediately after such
      reorganization, reclassification, consolidation, merger, statutory exchange,
      sale or conveyance had the Series A Preferred Stock been converted immediately
      prior to the effective date of such reorganization, reclassification,
      consolidation, merger, statutory exchange, sale or conveyance and in any such
      case, if necessary, appropriate adjustment shall be made in the application
      of
      the provisions set forth in this Section
      7
      with
      respect to the rights and interests thereafter of the holder of the Series A
      Preferred Stock to the end that the provisions set forth in this Section
      7
      shall
      thereafter correspondingly be made applicable, as nearly as may reasonably
      be,
      in relation to any shares of stock or other securities or property thereafter
      deliverable on the conversion of the Series A Preferred Stock. The above
      provisions of this Section
      7(c)
      shall
      similarly apply to successive reorganizations, reclassifications,
      consolidations, mergers, statutory exchanges, sales or conveyances. The
      Corporation shall require the issuer of any shares of stock or other securities
      or property thereafter deliverable on the conversion of the Series A Preferred
      Stock to be responsible for all of the agreements and obligations of the
      Corporation hereunder. Notice of any such reorganization, reclassification,
      consolidation, merger, statutory exchange, sale or conveyance and of said
      provisions so proposed to be made, shall be mailed to the holders of the Series
      A Preferred Stock not less than ten (10) days prior to such event. 

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (d) No
      adjustment in the Conversion Price shall be required unless such adjustment
      would require an increase or decrease of at least $0.01 per share of Common
      Stock; provided,
      however,
      that
      any adjustments which by reason of this Section
      7(d)
      are not
      required to be made shall be carried forward and taken into account in any
      subsequent adjustment; provided,
      further,
      however, that adjustments shall be required and made in accordance with the
      provisions of this Section
      7
      (other
      than this Section
      7(d))
      not
      later than such time as may be required in order to preserve the tax-free nature
      of a distribution, if any, to the holders of the Series A Preferred Stock or
      Common Stock issuable upon the conversion thereof. All calculations under this
      Section
      7
      shall be
      made to the nearest cent or to the nearest 1/100th of a share, as the case
      may
      be. Anything in this Section
      7
      to the
      contrary notwithstanding, the Corporation shall be entitled to make such
      reductions in the Conversion Price, in addition to those required by this
Section
      7,
      as it
      in its discretion shall deem to be advisable in order that any stock dividend,
      subdivision of shares or distribution of rights to purchase stock or securities
      convertible or exchangeable for stock hereafter made by the Corporation to
      its
      stockholders shall not be taxable.

     

    (e) Whenever
      the Conversion Price is adjusted as provided in this Section
      7
      and upon
      any modification of the rights of the holders of Series A Preferred Stock in
      accordance with this Section
      7,
      the
      Corporation shall promptly prepare a brief statement of the facts requiring
      such
      adjustment or modification and the manner of computing the same and cause copies
      of such certificate to be mailed to each holder of Series A Preferred
      Stock

     

    (f) Upon
      the
      expiration of any rights, options, warrants or conversion privileges with
      respect to the issuance of which an adjustment to the Conversion Price had
      been
      made, if such option, right, warrant or conversion shall not have been
      exercised, the number of shares of Common Stock issuable upon conversion of
      the
      Series A Preferred Stock, to the extent the Series A Preferred Stock has not
      then been converted, shall, upon such expiration, be readjusted and shall
      thereafter be such as they would have been had they been originally adjusted
      (or
      had the original adjustment not been required, as the case may be) on the basis
      of (A) the fact that Common Stock, if any, actually issued or sold upon the
      exercise of such rights, options, warrants or conversion privileges, and (B)
      the
      fact that such shares of Common Stock, if any, were issued or sold for the
      consideration actually received by the Corporation upon such exercise plus
      the
      consideration, if any, actually received by the Corporation for the issuance,
      sale or grant of all such rights, options, warrants or conversion privileges
      whether or not exercised; provided,
      however,
      that no
      such readjustment shall have the effect of decreasing the number of shares
      of
      Common Stock issuable upon conversion of the Series A Preferred Stock by an
      amount in excess of the amount of the adjustment initially made in respect
      of
      the issuance, sale or grant of such rights, options, warrants or conversion
      privileges.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    8. Notices
      of Corporate Action. In the event of:

     

    (i) any
      taking by the Corporation of a record of the holders of any class of securities
      for the purpose of determining the holders thereof who
      are
      entitled to receive any dividend or other distribution, or any right to
      subscribe for, purchase or otherwise acquire any shares of stock of any class
      or
      any other securities or property, or to receive any other right; or

     

    (ii) any
      capital reorganization of the Corporation, any reclassification or
      recapitalization of the capital stock of the Corporation, any
      consolidation or merger involving the Corporation and any other person or any
      transfer of all or substantially all the assets of the Corporation to any other
      person; or

     

    (iii) any
      voluntary or involuntary dissolution, liquidation or winding-up of the
      Corporation; or

     

    (iv) any
      plan
      or proposal by the Corporation to register shares of the Common Stock with
      the
      SEC; the Corporation will deliver to the holder a notice specifying (x) the
      date
      or expected date on which any such record is to be taken for the purpose of
      such
      dividend, distribution or right, and the amount and character of such dividend,
      distribution or right, (y) the date or expected date on which any such
      reorganization, reclassification, recapitalization, consolidation, merger,
      transfer, dissolution, liquidation or winding-up is to take place and the time,
      if any such time is to be fixed, as of which the holders of record of Common
      Stock (or other securities) shall be entitled to exchange their shares of Common
      Stock (or other securities) for the securities or other property deliverable
      upon such reorganization, reclassification, recapitalization, consolidation,
      merger, transfer, dissolution, liquidation or winding-up or (z) the date or
      expected date of the filing of the initial registration statement with respect
      to such shares of Common Stock. Such notice shall be furnished at least thirty
      (30) days prior to the date therein specified; provided, however, if such date
      is prior to a public announcement relating to the events set forth and on such
      date the Corporation is either bound by an agreement with a third party of
      confidentiality with respect to the corporate action the subject of this Section
      7, or the Corporation’s securities are traded or quoted on any recognized
      national securities exchange or quotation system, then such notice shall be
      provided to each holder of a share of Series A Preferred Stock simultaneously
      with
      the
      notice provided to the Corporation’s stockholders.

     

    9. Mandatory
      Redemption.

     

    (a) The
      Corporation shall, upon the second (2nd) anniversary of the original issuance
      date of the Series A Preferred Stock, redeem all of the outstanding shares
      of
      Series A Preferred Stock at an amount equal to 100% of the Agreed Stated Value,
      plus all accrued dividends unpaid thereon, whether or not declared, together
      with any other dividends declared but unpaid thereon (collectively, the
“Redemption
      Price”);
      provided, however, if the shares of common stock underlying the Series A
      Preferred Stock are not available for resale pursuant to an effective
      registration statement or pursuant to Rule 144 of the Securities Act, each
      holder of the Series A Preferred Stock shall have the option of retaining its
      shares of Series A Preferred Stock. Any holder exercising such right to retain
      its shares of Series A Preferred Stock must notify the Company not later than
      the close of business on the Redemption Date (as defined below).

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    (b) Written
      notice of any redemption of shares of Series A Preferred Stock (a “Notice
      of Redemption”),
      specifying the time and place of redemption, shall be mailed by certified mail,
      return receipt requested, at least thirty (30), and not more than forty-five
      (45), days prior to the date specified for redemption (the “Redemption
      Date”),
      to
      each registered holder of the shares to be redeemed at the holder’s last address
      as it appears on the Corporation’s books. On or after the Redemption Date, each
      holder of shares of Series A Preferred Stock called for redemption shall
      surrender his certificates for the shares to the Corporation at the place
      specified in the notice and then the Corporation shall pay the holder (or shall
      cause such holder to be paid) the Redemption Price in cash. 

     

    (c) Receipt
      of a Notice of Redemption shall not prevent a holder from exercising the
      conversion rights granted pursuant to Section 5 or the right to retain the
      Series A Preferred Stock granted pursuant to Section 9(a). Notwithstanding
      the
      foregoing and any notice provisions contained in Section 5(b), any holder
      exercising such conversion rights must make a Conversion Demand (as defined
      in
      Section 5(b)) not later than the close of business on the Redemption Date.
      

     

    (d) Unless
      the Corporation defaults in the payment in full of the Redemption Price,
      dividends on the shares called for redemption shall cease to accumulate on
      the
      Redemption Date, and all rights of the holders of the shares by reason of their
      ownership of the shares shall cease on the Redemption Date, except the right
      to
      receive the Redemption Price on surrender to the Corporation of the certificates
      representing the shares. After the Redemption Date, the shares shall not be
      deemed to be outstanding and shall not be transferable on the books of the
      Corporation, except to the Corporation. 

     

    (e) Any
      shares of Series A Preferred Stock redeemed or purchased by the Corporation
      shall be canceled and shall have the status of authorized and unissued shares
      of
      preferred stock, without designation as to series. 

     

    10. Voting
      Rights. Holders of shares of Series A Preferred Stock shall not be entitled
      to vote as a separate class on any matter, except as otherwise required by
      law
      or as expressly provided in this Certificate of Designations or the Certificate
      of Incorporation. With respect to any matter on which the holders of shares
      of
      Common Stock shall be entitled to vote, the holders of the shares of Series
      A
      Preferred Stock will vote together with the holders of the Common Stock, and
      each share of Series A Preferred Stock shall have a number of votes equal to
      the
      number of shares of Common Stock then issuable upon conversion. 

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    11. Consents
      Required of Holders of Series A Preferred Stock. In addition to the voting
      rights described in Section 10, for so long as any shares of Series A Preferred
      Stock remain outstanding, consent of the holders of at least sixty percent
      (60%)
      of the then outstanding shares of the Series A Preferred Stock voting together
      as a class shall be required for: (i) any action that creates any new class
      or
      series of equity securities or any other security convertible into equity
      securities having rights, preferences or privileges senior to or on parity
      with
      the Series A Preferred Stock, or increase the authorized number of shares of
      Series A Preferred Stock, (ii) the amendment, alteration or repeal of any
      provision of the Certificate of Incorporation or the Bylaws of the Corporation
      so as adversely to affect the relative rights, preferences, qualifications,
      limitations or restrictions of the Series A Preferred Stock, (iii) the
      declaration or payment of any dividend or distribution on any securities of
      the
      Corporation other than the Series A Preferred Stock pursuant to and in
      accordance with the provisions of this Certificate of Designation for the Series
      A Preferred Stock, or the authorization of the repurchase of any securities
      of
      the Corporation and (iv) the approval of any Liquidation Event, (v) any action
      that creates or authorizes the creation of any debt security; provided, however,
      such consent shall not be required if (1) the Corporation’s aggregate
      indebtedness would not exceed $8,000,000 and (2) the Corporation’s total assets
      to total liabilities ratio remains greater than or equal to 1.5:1 (as adjusted
      for any warrant and/or offering liabilities incurred by the Corporation).
      Notwithstanding anything to the contrary contained in this certificate, the
      Board from time to time without a vote of the holders of the shares of Series
      A
      Preferred Stock, may increase/decrease the number of shares of Common Stock
      outstanding pursuant to stock splits or combinations affecting all then
      outstanding shares of Common Stock, subject to shareholder approval of the
      holders of the Common Stock, if required under applicable law. 

     

    12. Restrictions
      on Transfer. Each certificate representing shares of Series A Preferred
      Stock and each certificate representing shares of Common Stock issuable upon
      conversion of any shares of Series A Preferred Stock shall be stamped or
      otherwise imprinted with a legend in substantially the following
      form:

     

    “THE
      SHARES REPRESENTED BY THIS CERTIFICATE AND ANY SHARES ACQUIRED UPON THE
      CONVERSION OF THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
      THE
      SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED IN THE ABSENCE OF SUCH
      REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT, EXCEPT UNDER
      CIRCUMSTANCES WHERE NEITHER SUCH REGISTRATION NOR SUCH AN EXEMPTION IS REQUIRED
      BY LAW.”

     

    13. Reservation
      of Shares; Transfer Taxes; Etc. The Corporation shall at all times reserve
      and keep available, out of its authorized and unissued shares of Common Stock,
      solely for the purpose of effecting the conversion of the Series A Preferred
      Stock, including shares of Series A Preferred Stock issued as payment of
      dividends, such number of shares of its Common Stock as shall be sufficient
      to
      effect the conversion of all shares of Series A Preferred Stock from time to
      time outstanding. 

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

     

    14. Fractional
      Shares. No fractional shares of Common Stock shall be issued upon conversion
      of the Series A Preferred Stock. In lieu of any fractional shares to which
      the
      holder would otherwise be entitled, the Corporation shall pay cash equal to
      such
      fraction multiplied by the fair market value of a share of Common Stock as
      determined in good faith by the Board of Directors of the Corporation, or it
      may
      round up to the nearest number of whole shares, in the Board’s sole discretion.
      Whether or not fractional shares would be issuable upon such conversion shall
      be
      determined on the basis of the total number of shares of Series A Preferred
      Stock the holder is at the time converting into Common Stock and the aggregate
      number of shares of Common Stock issuable upon such conversion.

     

    15. Severability
      of Provisions. Whenever possible, each provision hereof shall be interpreted
      in a manner as to be effective and valid under applicable law, but if any
      provision hereof is held to be prohibited by or invalid under applicable law,
      such provision shall be ineffective only to the extent of such prohibition
      or
      invalidity, without invalidating or otherwise adversely affecting the remaining
      provisions hereof. If a court of competent jurisdiction should determine that
      a
      provision hereof would be valid or enforceable if a period of time were extended
      or shortened or a particular percentage were increased or decreased, then such
      court may make such change as shall be necessary to render the provision in
      question effective and valid under applicable law. 

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, China Advanced Construction Materials Group, Inc. has caused
      this Certificate to be signed on its behalf by its Chief Executive Officer,
      this
      9th
      day of
      June, 2008.

    

      
        	 	
                CHINA
                  ADVANCED CONSTRUCTION 

                MATERIALS
                  GROUP, INC.

              
	 	 
	 	 
	 	
                By:

              	
                /s/
                  Xianfu Han

              
	 	
                Name:
                  Xianfu Han

              
	 	
                Title:
                  Chief Executive Officer

              

      

    

     

    ATTEST:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}]]