Document:

Exhibit
        10.1

    

    
      
        

      

    

    

    LOAN
      AGREEMENT

    

    

    

    dated
      as
      of April 19, 2007

    

    

    among

    

    

    Synutra
      International, Inc.

    

    Liang
      Zhang

    

    Xiuqing
      Meng

    

    

    and

    

    

    ABN
      AMRO Bank N.V.,

    Hong
      Kong Branch

     

    
 

    
      
 

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        TABLE
          OF CONTENTS

        

        Page(s)

        

        
          	
                  ARTICLE
                    1

                	
                  DEFINITIONS
                    AND ACCOUNTING TERMS

                	
                  1

                
	 	 	 
	
                  Section
                    1.01.

                	
                  Defined
                    Terms

                	
                  1

                
	
                  Section
                    1.02.

                	
                  With
                    reference to this Agreement and each other Loan Document, unless
                    otherwise
                    specified herein or in such other Loan Document:

                	
                  14

                
	
                  Section
                    1.03.

                	
                  Accounting
                    Terms

                	
                  15

                
	
                  Section
                    1.04.

                	
                  References
                    to Agreements, Laws and Persons

                	
                  15

                
	
                  Section
                    1.05.

                	
                  Times
                    of Day

                	
                  15

                
	 	 	 
	
                  ARTICLE
                    2

                	
                  THE
                    COMMITMENTS AND THE LOANS

                	
                  16

                
	 	 	 
	
                  Section
                    2.01.

                	
                  Loans.

                	
                  16

                
	
                  Section
                    2.02.

                	
                  Prepayments.

                	
                  16

                
	
                  Section
                    2.03.

                	
                  Repayment
                    of Loans

                	
                  17

                
	
                  Section
                    2.04.

                	
                  Interest.

                	
                  17

                
	
                  Section
                    2.05.

                	
                  Computation
                    of Interest

                	
                  17

                
	
                  Section
                    2.06.

                	
                  Evidence
                    of Debt

                	
                  17

                
	
                  Section
                    2.07.

                	
                  Payments
                    Generally.

                	
                  17

                
	
                  Section
                    2.08.

                	
                  Fees
                    and Expenses.

                	
                  18

                
	 	 	 
	
                  ARTICLE
                    3

                	
                  TAXES,
                    YIELD PROTECTION AND ILLEGALITY

                	
                  18

                
	 	 	 
	
                  Section
                    3.01.

                	
                  Taxes.

                	
                  18

                
	
                  Section
                    3.02.

                	
                  Illegality

                	
                  20

                
	
                  Section
                    3.03.

                	
                  Inability
                    to Determine Eurodollar Rate

                	
                  20

                
	
                  Section
                    3.04.

                	
                  Increased
                    Cost and Reduced Return; Capital Adequacy.

                	
                  20

                
	
                  Section
                    3.05.

                	
                  Funding
                    Losses

                	
                  21

                
	
                  Section
                    3.06.

                	
                  Requests
                    for Compensation

                	
                  21

                
	
                  Section
                    3.07.

                	
                  Survival

                	
                  21

                
	 	 	 
	
                  ARTICLE
                    4

                	
                  CONDITIONS
                    PRECEDENT

                	
                  21

                
	 	 	 
	
                  Section
                    4.01.

                	
                  Conditions
                    to All Credit Extensions

                	
                  21

                
	 	 	 
	
                  ARTICLE
                    5

                	
                  REPRESENTATIONS
                    AND WARRANTIES

                	
                  23

                
	 	 	 
	
                  Section
                    5.01.

                	
                  Existence,
                    Qualification and Power; Compliance with Laws

                	
                  23

                
	
                  Section
                    5.02.

                	
                  Authorization;
                    No Contravention

                	
                  23

                
	
                  Section
                    5.03.

                	
                  Governmental
                    Authorization; Other Consents

                	
                  23

                
	
                  Section
                    5.04.

                	
                  Binding
                    Effect

                	
                  24

                
	
                  Section
                    5.05.

                	
                  Disclosure
                    Documents; No Material Adverse Effect.

                	
                  24

                
	
                  Section
                    5.06.

                	
                  Litigation

                	
                  24

                

        

         

        
          
             

          

          
            i

            
              

            

          

          
             

          

          

            TABLE
              OF CONTENTS

            (continued)

             

            Page(s)

          

           

        

        
          	
                  Section
                    5.07.

                	
                  No
                    Default

                	
                  24

                
	
                  Section
                    5.08

                	
                  Ownership
                    of Collateral; Liens

                	
                  24

                
	
                  Section
                    5.09

                	
                  Taxes

                	
                  24

                
	
                  Section
                    5.10

                	
                  Subsidiaries

                	
                  24

                
	
                  Section
                    5.11

                	
                  Investment
                    Company Act

                	
                  25

                
	
                  Section
                    5.12

                	
                  Disclosure

                	
                  25

                
	
                  Section
                    5.13

                	
                  Compliance
                    with Laws

                	
                  25

                
	
                  Section
                    5.14

                	
                  Security
                    Interests

                	
                  25

                
	
                  Section
                    5.15

                	
                  Financial
                    Ratios.

                	
                  25

                
	
                  Section
                    5.16

                	
                  Pari
                    Passu Ranking

                	
                  25

                
	
                  Section
                    5.17

                	
                  Corporate
                    Chart

                	
                  25

                
	
                  Section
                    5.18

                	
                  Residence

                	
                  25

                
	
                  Section
                    5.19

                	
                  Government
                    Approvals

                	
                  26

                
	
                  Section
                    5.20

                	
                  Distributions

                	
                  26

                
	
                  Section
                    5.21

                	
                  Common
                    Stock

                	
                  26

                
	 	 	 
	
                  ARTICLE
                    6

                	
                  AFFIRMATIVE
                    COVENANTS

                	
                  26

                
	 	 	 
	
                  Section
                    6.01

                	
                  Information

                	
                  26

                
	
                  Section
                    6.02

                	
                  Notices

                	
                  26

                
	
                  Section
                    6.03

                	
                  Payment
                    of Obligations

                	
                  26

                
	
                  Section
                    6.04

                	
                  Preservation
                    of Existence, etc

                	
                  27

                
	
                  Section
                    6.05

                	
                  Compliance
                    with Laws

                	
                  27

                
	
                  Section
                    6.06

                	
                  Books
                    and Records

                	
                  27

                
	
                  Section
                    6.07

                	
                  Inspection
                    Rights

                	
                  27

                
	
                  Section
                    6.08

                	
                  Use
                    of Proceeds

                	
                  27

                
	
                  Section
                    6.09

                	
                  Know
                    Your Customer Checks

                	
                  28

                
	
                  Section
                    6.10

                	
                  Pari
                    Passu Ranking

                	
                  28

                
	
                  Section
                    6.11

                	
                  Unlawful
                    Contributions

                	
                  28

                
	
                  Section
                    6.12

                	
                  Distributions

                	
                  28

                
	
                  Section
                    6.13

                	
                  Compliance
                    Certificates.

                	
                  28

                
	 	 	 
	
                  ARTICLE
                    7

                	
                  NEGATIVE
                    COVENANTS

                	
                  29

                
	 	 	 
	
                  Section
                    7.01

                	
                  Liens

                	
                  29

                
	
                  Section
                    7.02

                	
                  Fundamental
                    Changes

                	
                  29

                
	
                  Section
                    7.03

                	
                  Restricted
                    Payments on Stock

                	
                  29

                
	
                  Section
                    7.04

                	
                  Financial
                    Covenants.

                	
                  29

                

        

         

        
          
             

          

          
            ii

            
              

            

          

          
             

          

           

          
            TABLE
              OF CONTENTS

            (continued)

             

            Page(s)

          

        

        
          	 	 	 
	
                  ARTICLE
                    8

                	
                  EVENTS
                    OF DEFAULT AND REMEDIES

                	
                  29

                
	 	 	 
	
                  Section
                    8.01

                	
                  Events
                    of Default

                	
                  29

                
	
                  Section
                    8.02

                	
                  Remedies
                    Upon Event of Default

                	
                  32

                
	
                  Section
                    8.03

                	
                  Application
                    of Funds

                	
                  32

                
	 	 	 
	
                  ARTICLE
                    9

                	
                  MISCELLANEOUS

                	
                  33

                
	 	 	 
	
                  Section
                    9.01

                	
                  Amendments;
                    Etc

                	
                  33

                
	
                  Section
                    9.02

                	
                  Notices
                    and Other Communications; Facsimile Copies.

                	
                  33

                
	
                  Section
                    9.03

                	
                  No
                    Waiver; Cumulative Remedies

                	
                  34

                
	
                  Section
                    9.04

                	
                  Attorney
                    Costs, Expenses and Taxes

                	
                  34

                
	
                  Section
                    9.05

                	
                  Indemnification
                    by Each Obligor

                	
                  34

                
	
                  Section
                    9.06

                	
                  Payments
                    Set Aside

                	
                  35

                
	
                  Section
                    9.07

                	
                  Successors
                    and Assigns; Participations.

                	
                  35

                
	
                  Section
                    9.08

                	
                  Confidentiality

                	
                  36

                
	
                  Section
                    9.09

                	
                  Set-off

                	
                  37

                
	
                  Section
                    9.10

                	
                  Interest
                    Rate Limitation

                	
                  37

                
	
                  Section
                    9.11

                	
                  Counterparts

                	
                  38

                
	
                  Section
                    9.12

                	
                  Integration

                	
                  38

                
	
                  Section
                    9.13

                	
                  Survival
                    of Representations and Warranties

                	
                  38

                
	
                  Section
                    9.14

                	
                  Severability

                	
                  38

                
	
                  Section
                    9.15

                	
                  Governing
                    Law.

                	
                  38

                
	
                  Section
                    9.16

                	
                  Waiver
                    of Right to Trial by Jury

                	
                  39

                
	
                  Section
                    9.17

                	
                  New
                    York Process Agent

                	
                  39

                
	
                  Section
                    9.18

                	
                  Obligation
                    Currency

                	
                  39

                
	 	 	 
	
                  ARTICLE
                    10

                	
                  GUARANTEES

                	
                  40

                
	 	 	 
	
                  Section
                    10.01

                	
                  The
                    Guarantees

                	
                  40

                
	
                  Section
                    10.02

                	
                  Guaranty
                    Unconditional

                	
                  40

                
	
                  Section
                    10.03

                	
                  Discharge
                    Only Upon Payment in Full; Reinstatement in Certain
                    Circumstances

                	
                  41

                
	
                  Section
                    10.04

                	
                  Waiver
                    by the Individual Guarantors

                	
                  41

                
	
                  Section
                    10.05

                	
                  Subrogation

                	
                  41

                
	
                  Section
                    10.06

                	
                  Stay
                    of Acceleration

                	
                  41

                

        

        

        EXHIBITS

        
          	
                  Exhibit
                    A

                	
                  Form
                    of Collateral Agreement

                
	
                  Exhibit
                    B

                	
                  Form
                    of Loan Drawdown Notice

                
	
                  Exhibit
                    C

                	
                  Form
                    of U.S. Counsel Opinion 

                
	
                  Exhibit
                    D

                	
                  Form
                    of PRC Counsel Opinion 

                
	
                  Exhibit
                    E

                	
                  Form
                    of BVI Counsel Opinion 

                

        

        

        
          
             

          

          
            iii

            
              

            

          

          
             

          

        

      

    

    LOAN
      AGREEMENT

    

    This
      LOAN
      AGREEMENT (“Agreement”)
      is
      entered into as of April 19, 2007 by and among Synutra International, Inc.,
      a
      Delaware corporation (the “Borrower”),
      Liang
      Zhang, Xiuqing Meng (“Individual
      Guarantors”)
      and
      ABN AMRO Bank N.V., Hong Kong Branch, as lender (the “Lender”)
      and as
      collateral agent (the “Collateral
      Agent”).

    

    In
      consideration of the mutual covenants and agreements herein contained, the
      parties hereto covenant and agree as follows:

    

    ARTICLE
      1

    DEFINITIONS
      AND ACCOUNTING TERMS

     

    Section
      1.01. Defined
      Terms.
      As used
      in this Agreement, the following terms shall have the meanings set forth
      below:

    

    “ABN
      AMRO”
means
      ABN AMRO Bank N.V., Hong Kong Branch.

    

    “Acquisition
      Recovery”
means
      any claim brought by the Borrower or any of its Subsidiaries in connection
      with
      an asset acquisition against the seller of such assets; provided that the
      aggregate amount received by the Borrower or any Subsidiary of the Borrower
      in
      connection with such claim or series of claims exceeds US$3.0
      million.

    

    “Affiliate”
means,
      with respect to any Person, another Person that directly, or indirectly through
      one or more intermediaries, Controls or is Controlled by or is under common
      Control with the Person specified. “Control”
means
      the possession, directly or indirectly, of the power to direct or cause the
      direction of the management or policies of a Person, whether through the ability
      to exercise voting power, by contract or otherwise. “Controlling”
and
      “Controlled”
have
      meanings correlative thereto. In any event, each Individual Guarantor and its
      Affiliates shall be deemed Affiliates of the Borrower.

    

    “Agreement”
has
      the
      meaning specified in the introductory paragraph hereto.

    

    “Alternate
      Interest Rate”
means
      a
      rate per annum equal to the sum of (i) the Base Rate plus (ii) the Applicable
      Margin.

    

    “Applicable
      Margin”
means
      2.00% per annum.

    

    “Applicable
      Rate”
means
      for any day of the Closing Date 2.50% per annum.

    

    “Asset
      Disposition”
means
      the sale or other Disposition by the Borrower or any of its Subsidiaries (other
      than to the Borrower or another Subsidiary of the Borrower), other than in
      the
      Borrower’s or such Subsidiary’s ordinary course of business, of (a) Capital
      Stock of any Subsidiary of the Borrower or (b) assets of the Borrower and its
      Subsidiaries; provided that the aggregate amount received by the Borrower or
      any
      Subsidiaries in connection with such sales or other Dispositions exceeds US$3.0
      million.

    

    “Assignee”
has
      the
      meaning specified in Section 9.07(a).

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    “Attorney
      Costs”
means
      and includes all reasonable fees, expenses and disbursements of any law firm
      or
      other external counsel.

    

    “Attributable
      Indebtedness”
means,
      on any date, (a) in respect of any Capitalized Lease of any Person, the
      capitalized amount thereof that would appear on a balance sheet of such Person
      prepared as of such date in accordance with GAAP, (b) in respect of any
      Synthetic Lease Obligation, the capitalized amount of the remaining lease or
      similar payments under the relevant lease or other applicable agreement or
      instrument that would appear on a balance sheet of such Person prepared as
      of
      such date in accordance with GAAP if such lease or other agreement or instrument
      were accounted for as a Capitalized Lease and (c) all Synthetic Debt of such
      Person.

    

    “Availability
      Period”
means
      the period from and including the Closing Date to the earliest of (i) the date
      that falls 60 days after the Closing Date and (ii) any date of termination
      of
      the Commitment pursuant to Section 8.02(a);

    

    “Base
      Rate”
means
      for any day a fluctuating rate per annum equal to the rate of interest in effect
      for such day as publicly announced from time to time by ABN AMRO as its “prime
      rate” for US Dollar borrowings. The “prime rate” is a rate set by ABN AMRO based
      upon various factors including its costs and desired return, general economic
      conditions and other factors, and is used as a reference point for pricing
      some
      loans, which may be priced at, above, or below such announced rate. Any change
      in such rate announced by ABN AMRO shall take effect at the opening of business
      on the day specified in the public announcement of such change.

    

    “Beams
      Power”
means
      Beams Power Investment Limited, an International Business Act company
      re-registered as a BVI business company under the laws of the BVI.

    

    “Borrower”
means,
      Synutra International, Inc., a company organized under the laws of the State
      of
      Delaware.

    

    “Business
      Day”
means
      any day other than a Saturday, Sunday or other day on which commercial banks
      are
      authorized to close under the Laws of, or are in fact closed in, the State
      of
      New York or Hong Kong and on which dealings in US Dollar deposits are conducted
      by and between banks in the London interbank eurodollar market.

    

    “BVI”
means
      the British Virgin Islands.

    

    “Capital
      Stock”
means,
      with respect to any Person, any and all shares, interests, participations or
      other equivalents (however designated, whether voting or non-voting) in equity
      of such Person, whether outstanding on the Closing Date or issued thereafter,
      including, without limitation, all common stock and preferred
      stock.

    

    “Capitalized
      Leases”
means
      all leases that have been or should be, in accordance with GAAP, recorded as
      capitalized leases.

    

    “Change
      of Control”
means
      the occurrence of one or more of the following events: 

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

       

    

    (a) the
      sale
      of all or substantially all the assets of the Borrower to another Person or
      any
      merger, amalgamation or consolidation involving the Borrower in which the
      Borrower shall not be the surviving Person; 

    

    (b) at
      any
      time the Permitted Holders are the beneficial owners and “control”, as
      determined pursuant to Rule 13d-3 under the United States Securities Exchange
      Act of 1934, as amended, less than 67.0% of the total voting power of the Voting
      Stock of the Borrower (or any successor entity); or 

    

    (c) the
      adoption of a plan relating to the liquidation or dissolution of the
      Borrower.

    

    “Closing
      Date”
means
      the date of this Agreement.

    

    “Collateral”
means
      any and all “Collateral” as defined in the Collateral Agreement.

    

    “Collateral
      Agent”
has
      the
      meaning specified in the introductory paragraph hereto.

    

    “Collateral
      Agreement”
means
      the Collateral Agreement dated as of the date hereof (as amended from time
      to
      time) among the Borrower, Beams Power as the Lien Grantor (the “Lien
      Grantor”)
      and
      ABN AMRO as the Lender and Collateral Agent, substantially in the form of
      Exhibit A hereto.

    

    “Collateral
      Permitted Liens”
means
      any Permitted Lien set forth in clause (a) or (b) of the definition of Permitted
      Liens.

    

    “Collateral
      Requirement”
means
      the requirement that:

    

    (a) the
      Lender and Collateral Agent shall have received counterparts of the Collateral
      Agreement duly executed and delivered on behalf of each of Beams Power and
      the
      Borrower, together with certificates for the Pledged Stocks delivered in
      accordance with the Collateral Agreement;

    

    (b) the
      Issuer shall have delivered to the stock transfer agent of the Borrower stop
      transfer instructions and a lien registration notice with respect to the Pledged
      Stock, instructing the stock transfer agent not to effect any transfer of
      Pledged Stock without the consent of the Collateral Agent;

    

    (c) all
      documents and instruments, including Uniform Commercial Code financing
      statements, required by law or reasonably requested by the Lender to be filed,
      registered or recorded to create the Liens intended to be created by the
      Collateral Agreement and perfect or record such Liens to the extent, and with
      the priority, required by the Collateral Agreement, shall have been filed,
      registered or recorded or delivered to the Lender for filing, registration
      or
      recording;

    

    (d) Beams
      Power shall have obtained all consents and approvals required to be obtained
      by
      it in connection with the execution and delivery of the Collateral Agreement
      and
      related documents to which it is a party, the performance of the obligations
      of
      Beams Power thereunder and the granting of the Liens granted by Beams Power
      thereunder; and

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

       

    

    (e) Beams
      Power shall have taken all other action required under the Collateral Agreement
      to perfect, register and/or record the Liens granted by it
      thereunder.

    

    “Commitment”
means
      the Lender’s obligation to make Loans to the Borrower pursuant to Section
      2.01(a) in an initial aggregate principal amount not to exceed US$35.0
      million.

    

    “Consolidated
      EBITDA”
means,
      at any date of determination, an amount equal to Consolidated Net Income of
      the
      Borrower and its Subsidiaries on a consolidated basis for the most recently
      completed Measurement Period plus 

    

    (a) the
      following items, to the extent deducted in calculating such Consolidated Net
      Income: (i) Consolidated Interest Charges, (ii) the provision for Federal,
      state, local and foreign income taxes payable, (iii) depreciation and
      amortization expense, (iv) restructuring expenses incurred during such period,
      (v) non-cash compensation resulting from stock based awards, deferred
      compensation or similar incentive compensation and (vi) other non-recurring
      costs and expenses reducing such Consolidated Net Income which do not represent
      a cash item in such period or any future period (in each case of or by the
      Borrower and its Subsidiaries for such Measurement Period); and minus

    

    (b) the
      following items, to the extent included in calculating such Consolidated Net
      Income: (i) Federal, state, local and foreign income tax credits and (ii) all
      non-cash items increasing Consolidated Net Income (in each case of or by the
      Borrower and its Subsidiaries for such Measurement Period). 

    

    “Consolidated
      Indebtedness”
means,
      as of any date of determination, for the Borrower and its Subsidiaries on a
      consolidated basis, the sum of (a) the outstanding principal amount of all
      obligations, whether current or long-term, for borrowed money (including
      Obligations hereunder) and all obligations evidenced by bonds, debentures,
      notes, loan agreements or other similar instruments, (b) all purchase money
      Indebtedness, (c) all direct obligations arising under letters of credit
      (including standby and commercial), bankers’ acceptances, bank guarantees,
      surety bonds and similar instruments, (d) all obligations in respect of the
      deferred purchase price of property or services (other than trade accounts
      payable in the ordinary course of business), (e) all Attributable Indebtedness,
      (f) without duplication, all Guarantees with respect to outstanding Indebtedness
      of the types specified in clauses (a) through (e) above of Persons other than
      the Borrower or any of its Subsidiaries, and (g) all Indebtedness of the types
      referred to in clauses (a) through (f) above of any partnership or joint venture
      (other than a joint venture that is itself a corporation or limited liability
      company) in which the Borrower or a Subsidiary of the Borrower is a general
      partner or joint venturer, unless such Indebtedness is expressly made
      non-recourse to the Borrower or such Subsidiary.

    

    “Consolidated
      Interest Charges”
means,
      for any Measurement Period, the sum of (a) all interest, premium payments,
      debt
      discount, fees, charges and related expenses in connection with borrowed money
      (including capitalized interest) or in connection with the deferred purchase
      price of assets, in each case to the extent treated as interest in accordance
      with GAAP, (b) all interest paid or payable with respect to discontinued
      operations, (c) the portion of rent expense under Capitalized Leases that is
      treated as interest in accordance with GAAP and (d) any dividends paid on
      preference stock, in each case, of or by the Borrower and its Subsidiaries
      on a
      consolidated basis for the most recently completed Measurement
      Period.

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

       

    

    “Consolidated
      Interest Coverage Ratio”
means,
      as of any date of determination, the ratio of (a) Consolidated EBITDA to (b)
      Consolidated Interest Charges, in each case, of or by the Borrower and its
      Subsidiaries on a consolidated basis for the most recently completed Measurement
      Period. 

    

    “Consolidated
      Leverage Ratio”
means,
      as of any date of determination, the ratio of (a) Consolidated Indebtedness
      as
      of such date to (b) Consolidated EBITDA of the Borrower and its Subsidiaries
      on
      a consolidated basis for the most recently completed Measurement Period.

    

    “Consolidated
      Net Income”
means,
      at any date of determination, the net income (or loss) of the Borrower and
      its
      Subsidiaries on a consolidated basis for the most recently completed Measurement
      Period; provided that Consolidated Net Income shall exclude (a) extraordinary
      gains and extraordinary losses for such Measurement Period, (b) the net income
      of any Subsidiary of the Borrower during such Measurement Period to the extent
      that the declaration or payment of dividends or similar distributions by such
      Subsidiary of such income is not permitted by operation of the terms of its
      Organization Documents or any agreement, instrument or Law applicable to such
      Subsidiary during such Measurement Period, except that the Borrower’s equity in
      any net loss of any such Subsidiary for such Measurement Period shall be
      included in determining Consolidated Net Income, and (c) any income (or loss)
      for such period of any Person if such Person is not a Subsidiary of the
      Borrower, except that the Borrower’s equity in the net income of any such Person
      for such Measurement Period shall be included in Consolidated Net Income up
      to
      the aggregate amount of cash actually distributed by such Person during such
      period to the Borrower or a Subsidiary of the Borrower as a dividend or other
      distribution (and in the case of a dividend or other distribution to a
      Subsidiary of the Borrower, such Subsidiary is not precluded from further
      distributing such amount to the Borrower as described in clause (b) of this
      proviso).

    

    “Contractual
      Obligation”
means,
      as to any Person, any material provision of any debt, equity or hybrid security
      issued by such Person or of any material agreement, instrument or other
      undertaking to which such Person is a party or by which it or any of its
      material properties is bound.

    

    “Control”
has
      the
      meaning specified in the definition of “Affiliate.”

    

    “Credit
      Extension”
means
      any borrowing of Loans pursuant to Section 2.01(a).

    

    “Debtor
      Relief Laws”
means
      the Bankruptcy Code of the United States, and all other liquidation,
      conservatorship, bankruptcy, assignment for the benefit of creditors,
      moratorium, rearrangement, receivership, insolvency, reorganization, or similar
      debtor relief laws of the United States or other applicable jurisdictions from
      time to time in effect and affecting the rights of creditors
      generally.

    

    “Default”
means
      any event or condition that constitutes an Event of Default or that, with the
      giving of any notice, the passage of time, or both, would be an Event of
      Default.

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

       

    

    “Default
      Rate”
means
      an interest rate equal to 2% per annum in excess of the interest rate otherwise
      payable under this Agreement with respect to the applicable Loans (or, in the
      case of any such fees and other amounts, at a rate which is 2% per annum in
      excess of the Alternate Interest Rate).

    

    “Disclosure
      Documents”
means
      the Borrower’s (a) quarterly report filed with the U.S. SEC on Form 10Q/A
      (Amendment No. 1) on March 16, 2007, (b) annual report filed with the U.S.
      SEC
      on Form 10-KSB (Amendment No. 4) on March 16, 2007 and (c) any other document
      filed with the U.S. SEC during the period beginning on April 5, 2007 and ending
      on the day immediately preceding the Closing Date, including any exhibits
      thereto, whether included by incorporation by reference or
      otherwise.

    

    “Disposition”
or
      “Dispose”
means
      the sale, transfer, license, lease or other disposition (including any sale
      and
      leaseback transaction) of any property by any Person, including any sale,
      assignment, transfer or other disposal, with or without recourse, of any notes
      or accounts receivable or any rights and claims associated
      therewith.

    

    “Equity
      Offering”
means
      any sale or series of related sales by the Borrower of Capital Stock of the
      Borrower to any person other than to an Individual Guarantor, any of their
      Affiliates, or any existing holder of Capital Stock of the Borrower; provided
      that the aggregate proceeds received by the Borrower from any such sale or
      series of sales exceeds US$3.0 million; provided that Equity Offering shall
      not
      include any sale or series of related sales by the Borrower of any Capital
      Stock, warrants, or options of the Borrower to directors or employees of
      Borrower and its Subsidiaries.

    

    “ERISA”
means
      the Employee Retirement Income Security Act of 1974, as amended from time to
      time, and any successor thereto.

    

    “Eurodollar
      Rate”
means,
      for each day during any Interest Period, the rate of interest (rounded upwards,
      if necessary to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or
      any
      successor page) as the 1-month London interbank offered rate for deposits in
      US
      Dollars at approximately 11:00 a.m. (London time) on the second Business Day
      preceding the first day of such Interest Period, as adjusted from time to time
      in the Lender’s sole discretion for then-applicable reserve requirements,
      deposit insurance assessment rates and other regulatory costs; if for any reason
      such rate is not available, the “Eurodollar Rate” for such day shall be the rate
      of interest (rounded upwards, if necessary to the nearest 1/100 of 1%) appearing
      on Reuters Screen LIBO Page as the 1-month London interbank offered rate for
      deposits in US Dollars at approximately 11:00 a.m. (London time) on the second
      preceding Business Day, as adjusted from time to time in the Lender’s sole
      discretion for then-applicable reserve requirements, deposit insurance
      assessment rates and other regulatory costs; provided, however, if more than
      one
      rate is specified on Reuters Screen LIBO page, the applicable rate shall be
      the
      arithmetic mean of all such rates.

    

    “Event
      of Default”
has
      the
      meaning specified in Section 8.01.

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

       

    

    “Excluded
      Taxes”
shall
      mean, with respect to any Lender or any other recipient of any payment to be
      made by or on account of any obligation of Borrower hereunder, inclusive in
      each
      case of all interest, additions to Tax, penalties and other liabilities with
      respect thereto, (a) Taxes imposed on or measured by its overall net income
      (however denominated), franchise Taxes imposed on it (in lieu of net income
      Taxes) and branch profits or similar Taxes imposed on it, by a jurisdiction
      (or
      any political subdivision thereof) as a result of the recipient being organized
      or having its principal office or, in the case of any Lender, its applicable
      lending office in such jurisdiction or as a result of a present or former
      connection between the recipient and such jurisdiction (other than any such
      connection arising from such recipient having executed, delivered or performed
      its obligations or received a payment under, or enforced, or otherwise with
      respect to, any of the Loan Documents) and (b) any withholding or backup
      withholding Tax that (i) is imposed under a law in effect at the time a Lender
      who is not party to this Agreement on the Closing Date becomes a party hereto
      or
      otherwise acquires an interest herein (or designates a new lending office),
      except to the extent that such Lender (or its assignor, if any) was entitled,
      at
      the time of designation of a new lending office (or assignment), to receive
      additional amounts from Borrower with respect to such withholding or backup
      withholding Tax pursuant to Section 3.01(a) or (ii) is attributable to such
      Lender’s failure (or unreasonable delay) to comply with Section 3.01(d) or
      Section 3.01(e).

    

    “Foreign
      Lender”
shall
      mean any Lender that is not, for United States federal income tax purposes,
      (i)
      an individual who is a citizen or resident of the United States, (ii) a
      corporation, partnership or other entity treated as a corporation or partnership
      created or organized in or under the laws of the United States, or any political
      subdivision thereof, (iii) an estate whose income is subject to U.S. federal
      income taxation regardless of its source or (iv) a trust if a court within
      the
      United States is able to exercise primary supervision over the administration
      of
      such trust and one or more United States persons have the authority to control
      all substantial decisions of such trust.

    

    “Foreign
      Plan”
means
      any employee benefit plan maintained by Borrower or any of its Subsidiaries
      that
      is mandated or governed by any law, rule or regulation of any Governmental
      Authority other than the United States, any state thereof or any other political
      subdivision thereof.

    

    “GAAP”
means
      generally accepted accounting principles in the United States set forth in
      the
      opinions and pronouncements of the Accounting Principles Board and the American
      Institute of Certified Public Accountants and statements and pronouncements
      of
      the Financial Accounting Standards Board or such other principles as may be
      approved by a significant segment of the accounting profession in the United
      States, that are applicable to the circumstances as of the date of
      determination, consistently applied.

    

    “Governmental
      Authority”
means
      any nation or government, any state or other political subdivision thereof,
      any
      agency, authority, instrumentality, regulatory body, court, administrative
      tribunal, central bank or other entity exercising executive, legislative,
      judicial, taxing, regulatory or administrative powers or functions of or
      pertaining to government.

    

    “Guarantee”
means,
      as to any Person, (a) any obligation, contingent or otherwise, of such Person
      guaranteeing or having the economic effect of guaranteeing any Indebtedness
      or
      other obligation payable or performable by another Person (the “primary
      obligor”)
      in any
      manner, whether directly or indirectly, and including any obligation of such
      Person, direct or indirect, (i) to purchase or pay (or advance or supply funds
      for the purchase or payment of) such Indebtedness or other obligation, (ii)
      to
      purchase or lease property, securities or services for the purpose of assuring
      the obligee in respect of such Indebtedness or other obligation of the payment
      or performance of such Indebtedness or other obligation, (iii) to maintain
      working capital, equity capital or any other financial statement condition
      or
      liquidity or level of income or cash flow of the primary obligor so as to enable
      the primary obligor to pay such Indebtedness or other obligation, or (iv)
      entered into for the purpose of assuring in any other manner the obligee in
      respect of such Indebtedness or other obligation of the payment or performance
      thereof or to protect such obligee against loss in respect thereof (in whole
      or
      in part), or (b) any Lien on any assets of such Person securing any Indebtedness
      or other obligation of any other Person, whether or not such Indebtedness or
      other obligation is assumed by such Person. The amount of any Guarantee shall
      be
      deemed to be an amount equal to the stated or determinable amount of the related
      primary obligation, or portion thereof, in respect of which such Guarantee
      is
      made or, if not stated or determinable, the maximum reasonably anticipated
      liability in respect thereof as determined by the guaranteeing Person in good
      faith. The term “Guarantee” as a verb has a corresponding meaning.

    

    
      
         

      

      
        7

        
          

        

      

      
         

      

       

    

    “Indebtedness”
means,
      as to any Person at a particular time, without duplication, all of the
      following, whether or not included as indebtedness or liabilities in accordance
      with GAAP:

    

    (a) all
      obligations of such Person for borrowed money and all obligations of such Person
      evidenced by bonds, debentures, notes, loan agreements or other similar
      instruments;

    

    (b) all
      direct or contingent obligations of such Person arising under letters of credit
      (including standby and commercial), bankers’ acceptances, bank guaranties,
      surety bonds and similar instruments;

    

    (c) net
      obligations of such Person under any derivative contract (and calculated based
      on termination values as of any relevant date);

    

    (d) all
      obligations of such Person to pay the deferred purchase price of property or
      services (other than trade accounts payable in the ordinary course of
      business);

    

    (e) indebtedness
      (excluding prepaid interest thereon) secured by a Lien on property owned or
      being purchased by such Person (including indebtedness arising under conditional
      sales or other title retention agreements), whether or not such indebtedness
      shall have been assumed by such Person or is limited in recourse;

    

    (f) capital
      leases; and

    

    (g) all
      Guarantees of such Person in respect of any of the foregoing.

    

    For
      all
      purposes hereof, the Indebtedness of any Person shall include the Indebtedness
      of any partnership or joint venture (other than a joint venture that is itself
      a
      corporation or limited liability company) in which such Person is a general
      partner or a joint venturer, unless such Indebtedness is expressly made
      non-recourse to such Person. The amount of any net obligation under any
      derivative contract on any date shall be deemed to be the termination value
      thereof as of such date.

    

    
      
         

      

      
        8

        
          

        

      

      
         

      

       

    

    “Indemnified
      Liabilities”
has
      the
      meaning specified in Section 9.05.

    

    “Indemnified
      Taxes”
shall
      mean all Taxes other than Excluded Taxes.

    

    “Indemnitees”
has
      the
      meaning specified in Section 9.05.

    

    “Individual
      Guarantor”
means
      Liang Zhang, a citizen of the PRC with a PRC passport number G14902730 and
      currently domiciled in #103, Dongluyuan, Tongzhou District, Beijing PRC, and
      Xiuqing Meng, a citizen of Hong Kong Special Administrative Region of the PRC,
      with a Hong Kong Special Administrative Region passport number DA9001206 and
      currently domiciled in Unit D, 10/F, China Overseas Building, 139 Hennessy
      Road,
      Wanchai, Hong Kong, HK, and “Individual
      Guarantors”
means
      both of them.

    

    “Insurance
      Claim”
means
      any claim brought by the Borrower or any of its Subsidiaries against an
      insurance carrier of the Borrower, any Subsidiary of the Borrower or any other
      insurance carrier; provided that the aggregate amount received by the Borrower
      or any of its Subsidiaries in connection with any insured event or series of
      insured events exceeds US$3.0 million.

    

    “Interest
      Payment Date”
means,
      as to any Loan, (x) the last day of the then current Interest Period applicable
      to such Loan and (y) the Maturity Date.

    

    “Interest
      Period”
means,
      as to each Loan, (x) the initial period commencing on the date such Loan is
      disbursed or continued and ending on the date one (1) month thereafter and
      (y)
      each successive one-month period thereafter; provided that:

    

    (a) any
      Interest Period that would otherwise end on a day that is not a Business Day
      shall be extended to the next succeeding Business Day unless such Business
      Day
      falls in another calendar month, in which case such Interest Period shall end
      on
      the next preceding Business Day;

    

    (b) any
      Interest Period that begins on the last Business Day of a calendar month (or
      on
      a day for which there is no numerically corresponding day in the calendar month
      at the end of such Interest Period) shall end on the last Business Day of the
      calendar month at the end of such Interest Period;

    

    (c) no
      Interest Period shall extend beyond the Maturity Date; and 

    

    (d) the
      Interest Period applicable to Loans and other obligations accruing interest
      at
      the Default Rate after the Maturity Date under any Loan Document shall be
      daily.

    

    “Internal
      Revenue Code”
means
      the United States Internal Revenue Code of 1986, as amended.

    

    “Laws”
means,
      collectively, all international, foreign, U.S. federal, state and local
      statutes, treaties, rules, guidelines, regulations, ordinances, codes and
      administrative or judicial precedents or authorities, including the
      interpretation or administration thereof by any Governmental Authority charged
      with the enforcement, interpretation or administration thereof, and all
      applicable administrative orders, directed duties, requests, licenses,
      authorizations and permits of, and agreements with, any Governmental Authority,
      in each case whether or not having the force of law.

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

       

    

    “Lender”
has
      the
      meaning specified in the introductory paragraph hereto or as determined pursuant
      to Section 9.07.

    

    “Lending
      Office”
means
      the office or offices of the Lender described as such on Schedule 9.02, or
      such
      other office or offices as the Lender may from time to time notify the
      Borrower.

    

    “Lien”
means
      any mortgage, pledge, hypothecation, assignment, deposit arrangement,
      encumbrance, lien (statutory or other), charge, or preference, priority or
      other
      security interest or preferential arrangement of any kind or nature whatsoever
      (including any conditional sale or other title retention agreement, and any
      financing lease having substantially the same economic effect as any of the
      foregoing).

    

    “Loan”
has
      the
      meaning specified in Section 2.01(a).

    

    “Loan
      Documents”
means
      this Agreement, the Collateral Agreement or any other Security Documents and
      any
      fee and expense reimbursement letter agreements entered into among the parties
      hereto in connection herewith.

    

    “Loan
      Drawdown Notice”
means
      a
      request for a Loan substantially in the form of Exhibit B hereto.

    

    “Margin
      Stock”
means
      any “margin stock” (as such term is defined in Regulation U of the Board of
      Governors of the Federal Reserve System of the United States).

    

    “Material
      Adverse Effect”
means
      (a) a material adverse change in, or a material adverse effect upon, the
      operations, business, properties, assets, operations, liabilities (actual or
      contingent), condition (financial or otherwise) or prospects of any Obligor;
      (b)
      a material impairment of the ability of any Obligor to perform its obligations
      under any Loan Document to which any Obligor is a party; or (c) a material
      adverse effect upon the Collateral or upon the legality, validity, binding
      effect or enforceability against any Obligor of any Loan Document to which
      it is
      a party.

    

    “Material
      Subsidiary”
means
      any Subsidiary of the Borrower that would be a “significant subsidiary” for
      purposes of the consolidated financial statements of the Borrower, as defined
      in
      Article 1, Rule 1-02 (w)(1) or (2) of Regulation S-X promulgated under the
      United States Securities Act of 1933, as amended, as such regulation is in
      effect from time to time; provided that the term “10 percent” in each of clause
      (1) and (2) of such Rule will be substituted by the term “5 percent” for
      purposes of this determination; provided further that Qingdao ST George Dairy
      Co. Ltd shall at all times be a Material Subsidiary.

    

    “Maturity
      Date”
means
      October 19, 2007 in regard to each Loan, or if such date is not a Business
      Day,
      the next preceding Business Day.

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

       

    

    “Measurement
      Period”
means,
      at any date of determination, the most recently completed four fiscal quarters
      of the Borrower.

    

    “Notice
      No. 75”
has
      the
      meaning specified in Section 5.18.

    

    “Obligation
      Currency”
has
      the
      meaning specified in Section 9.18.

    

    “Obligations”
means
      all advances to, and debts, liabilities, obligations, covenants and duties
      of,
      any Obligor arising under any Loan Document or otherwise with respect to any
      Loan, whether direct or indirect (including those acquired by assumption),
      absolute or contingent, due or to become due, now existing or hereafter arising
      and including interest and fees that accrue after the commencement by or against
      any Obligor or any Affiliate thereof of any proceeding under any Debtor Relief
      Laws naming such Person as the debtor in such proceeding, regardless of whether
      such interest and fees are allowed claims in such proceeding.

    

    “Obligor”
means
      each of the Borrower and the Individual Guarantors; provided that for purposes
      of Article 8 only, the term shall also include the Lien Grantor under the
      Collateral Agreement.

    

    “Organization
      Documents”
means,
      (a) with respect to any corporation, the certificate or articles of
      incorporation and the bylaws (or equivalent or comparable constitutive documents
      with respect to any non-U.S. jurisdiction); (b) with respect to any limited
      liability company, the certificate or articles of formation or organization
      and
      operating agreement; and (c) with respect to any partnership, joint venture,
      trust or other form of business entity, the partnership, joint venture or other
      applicable agreement of formation or organization and any agreement, instrument,
      filing or notice with respect thereto filed in connection with its formation
      or
      organization with the applicable Governmental Authority in the jurisdiction
      of
      its formation or organization and, if applicable, any certificate or articles
      of
      formation or organization of such entity.

    

    “Other
      Taxes”
shall
      mean all present or future stamp or documentary taxes or any other excise or
      property taxes, charges or similar levies arising from any payment made
      hereunder or under any other Loan Document or from the execution, delivery
      or
      enforcement of, or otherwise with respect to, this Agreement or any other Loan
      Document.

    

    “Participant”
has
      the
      meaning specified in Section 9.07(b).

    

    “Permitted
      Holders”
means
      any or all of the following: 

    

    (a) Liang
      Zhang and Xiuqing Meng; and

    

    (b) any
      Person both the Capital Stock and the Voting Stock of which (or in the case
      of a
      trust, the beneficial interests in which) are owned 95% or more by Persons
      specified in clause (a).

    

    “Permitted
      Liens”
means
      the following types of Liens (excluding any such Lien imposed pursuant to
      Section 401(a)(29) or 412(n) of the Internal Revenue Code or by ERISA, any
      such
      Lien imposed by a Governmental Authority in connection with any Foreign Plan,
      any such Lien relating to or imposed in connection with any environmental
      claim):

    

    
      
         

      

      
        11

        
          

        

      

      
         

      

       

    

    (a) Liens
      for
      taxes, assessments or governmental charges or claims the payment of which is
      not, at the time, required by Section 6.03;

    

    (b) Liens
      arising pursuant to any Loan Document;

    

    (c) Liens
      for
      taxes not yet due or which are being contested in good faith and by appropriate
      proceedings diligently conducted, if adequate reserves with respect thereto
      are
      maintained on the books of the applicable Person in accordance with
      GAAP;

    

    (d) the
      existing Liens set forth on Schedule 7.01;

    

    (e) in
      the
      case of the Borrower, other Liens so long as the aggregate fair market value
      of
      all assets of the Borrower which are subject to Liens permitted only by this
      paragraph (e) does not exceed US$1.0 million; 

    

    (f) in
      the
      case of each Individual Guarantor, (i) a Lien on his primary residence securing
      obligations not exceeding the US Dollar equivalent of US$3.0 million and (ii)
      a
      Lien or Liens securing additional obligations not exceeding the US Dollar
      equivalent of US$4.0 million, which Lien(s) may be upon his primary residence
      or
      upon any other assets;

    

    (g) statutory
      Liens of landlords, Liens of collecting banks under the Uniform Commercial
      Code
      on items in the course of collection, statutory Liens and rights of set-off
      of
      banks, statutory Liens of carriers, warehousemen, mechanics, repairmen, workmen
      and materialmen, and other Liens imposed by law, in each case incurred in the
      ordinary course of business (a) for amounts not yet overdue or (b) for amounts
      that are overdue and that (in the case of any such amounts overdue for a period
      in excess of 5 days) are being contested in good faith by appropriate
      proceedings, so long as such reserves or other appropriate provisions, if any,
      as shall be required by GAAP shall have been made for any such contested
      amounts;

    

    (h) deposits
      made in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security, or
      to
      secure the performance of statutory obligations, bids, leases, government
      contracts, trade contracts, and other similar obligations (exclusive of
      obligations for the payment of borrowed money), so long as no foreclosure,
      sale
      or similar proceedings have been commenced with respect to any portion of the
      Collateral on account thereof;

    

    (i) any
      attachment or judgment Lien not constituting an Event of Default under Section
      8.01(j);

    

    (j) licenses
      (with respect to Intellectual Property and other property), leases or subleases
      granted to third parties and not interfering in any material respect with the
      ordinary conduct of the business of Borrower or any of its Subsidiaries or
      resulting in a material diminution in the value of any Collateral as security
      for the Obligations;

    

    
      
         

      

      
        12

        
          

        

      

      
         

      

       

    

    (k) easements,
      right-of-way restrictions, encroachments, and other minor defects or
      irregularities in titles, in each case which do not and will not interfere
      in
      any material respect with the ordinary conduct of the business of Borrower
      or
      any of its Subsidiaries;

    

    (l) any
      (a)
      interest or title of a lessor or sublessor under any lease not prohibited by
      this Agreement, (b) Lien or restriction that the interest or title of such
      lessor or sublessor may be subject to, or (c) subordination of the interest
      of
      the lessee or sublessee under such lease to any Lien or restriction referred
      to
      in the preceding clause (b), so long as the holder of such Lien or restriction
      agrees to recognize the rights of such lessee or sublessee under such
      lease;

    

    (m) Liens
      arising from filing Uniform Commercial Code financing statements relating solely
      to leases not prohibited by this Agreement;

    

    (n) Liens
      in
      favor of customs and revenue authorities arising as a matter of law to secure
      payment of customs duties in connection with the importation of
      goods;

    

    (o) any
      zoning or similar law or right reserved to or vested in any Governmental
      Authority to control or regulate the use of any real property;

    

    (p) Liens
      securing obligations (other than obligations representing Indebtedness for
      borrowed money) under operating, reciprocal easement or similar agreements
      entered into in the ordinary course of business of Borrower and its
      Subsidiaries.

    

    “Person”
means
      any natural person, corporation, limited liability company, trust, joint
      venture, association, company, partnership, Governmental Authority or other
      entity.

    

    “Pledged
      Stock”
means
      any shares of Capital Stock of the Borrower constituting
      Collateral.

    

    “PRC”
means
      the People’s Republic of China.

    

    “Related
      Parties”
means,
      with respect to any Person, such Person’s Affiliates and the partners,
      directors, officers, employees, agents and advisors of such Person and of such
      Person’s Affiliates.

    

    “Responsible
      Officer”
means
      any of the president, chief executive officer and chief financial officer of
      the
      Borrower. Any document delivered hereunder signed by a Responsible Officer
      of
      the Borrower shall be conclusively presumed to have been authorized by all
      necessary action on the part of the Borrower and such Responsible Officer shall
      be conclusively presumed to have acted on behalf of the Borrower.

    

    “Restricted
      Payment”
means
      any dividend or other distribution (whether in cash, securities or other
      property) with respect to any equity interest of the Borrower, or any payment
      (whether in cash, securities or other property), including any sinking fund
      or
      similar deposit, on account of the purchase, redemption, retirement,
      acquisition, cancellation or termination of any such equity interest or of
      any
      option, warrant or other right to acquire any such equity interest.

    

    
      
         

      

      
        13

        
          

        

      

      
         

      

       

    

    “Security
      Documents”
means
      the Collateral Agreement and any additional pledges, security agreements or
      mortgages required to be delivered from time to time pursuant to the Loan
      Agreement or Collateral Agreement, and any instruments of assignment or other
      instruments or agreements executed pursuant to the foregoing.

    

    “Subsidiary”
of
      a
      Person means a corporation, partnership, joint venture, limited liability
      company or other business entity of which a majority of the shares of securities
      or other interests having ordinary voting power for the election of directors
      or
      other governing body (other than securities or interests having such power
      only
      by reason of the happening of a contingency) are at the time beneficially owned,
      or the management of which is otherwise Controlled, directly, or indirectly
      through one or more intermediaries, or both, by such Person.

    

    “Synthetic
      Debt”
means,
      with respect to any Person as of any date of determination thereof, all
      obligations of such Person in respect of transactions entered into by such
      Person that are intended to function primarily as a borrowing of funds
      (including any minority interest transactions that function primarily as a
      borrowing) but are not otherwise included in the definition of “Indebtedness”
or
      as a
      liability on the consolidated balance sheet of such Person and its Subsidiaries
      in accordance with GAAP.

    

    “Synthetic
      Lease Obligation”
means
      the monetary obligation of a Person under (a) a so-called synthetic, off-balance
      sheet or tax retention lease, or (b) an agreement for the use or possession
      of
      property (including sale and leaseback transactions), in each case, creating
      obligations that do not appear on the balance sheet of such Person but which,
      upon the application of any Debtor Relief Laws to such Person, would be
      characterized as the indebtedness of such Person (without regard to accounting
      treatment).

    

    “Taxes”
shall
      mean all present or future taxes, levies, imposts, duties, deductions,
      withholdings, assessments, fees or other charges imposed by any Governmental
      Authority, including any interest, additions to tax or penalties applicable
      thereto.

    

    “United
      States”
and
      “U.S.”
mean
      the United States of America.

    

    “US
      Dollar”
and
      “US$”
mean
      lawful money of the United States.

    

    “U.S.
      SEC”
means
      the United States Securities and Exchange Commission or any successor
      Governmental Authority.

    

    “Voting
      Stock”
means,
      with respect to any Person, Capital Stock of any class or kind ordinarily having
      the power to vote for the election of directors, managers or other voting
      members of the governing body of such Person.

     

    Section
      1.02. With
      reference to this Agreement and each other Loan Document, unless otherwise
      specified herein or in such other Loan Document:

    

    (a) The
      meanings of defined terms are equally applicable to the singular and plural
      forms of the defined terms.

    

    
      
         

      

      
        14

        
          

        

      

      
         

      

       

    

    (b) (i) The
      words
“herein”,
      “hereto”,
      “hereof”
and
      “hereunder”
and
      words of similar import when used in any Loan Document shall refer to such
      Loan
      Document as a whole and not to any particular provision thereof.

    (ii) Article,
      Section, Exhibit and Appendix references are to the Loan Document in which
      such
      reference appears.

    

    (iii) The
      term
“including”
is
      by
      way of example and not limitation.

    

    (iv) The
      term
“documents”
      includes any and all instruments, documents, agreements, certificates, notices,
      reports, financial statements and other writings, however evidenced, whether
      in
      physical or electronic form.

    

    (c) In
      the
      computation of periods of time from a specified date to a later specified date,
      the word “from”
means
      “from
      and including”;
      the
      words “to”
and
      “until”
each
      mean “to
      but
      excluding”;
      and
      the word “through”
means
      “to
      and
      including”.

    

    (d) Section
      headings herein and in the other Loan Documents are included for convenience
      of
      reference only and shall not affect the interpretation of this Agreement or
      any
      other Loan Document.

    

    (e) References
      to “him”
or
      “he”
or
      “his”
shall
      also refer to the opposite gender.

     

    Section
      1.03. Accounting
      Terms.
      All
      accounting terms not specifically or completely defined herein shall be
      construed in conformity with, and all financial data (including financial ratios
      and other financial calculations) required to be submitted pursuant to this
      Agreement shall be prepared in conformity with, GAAP applied on a consistent
      basis, as in effect from time to time, except as otherwise specifically
      prescribed herein.

     

    Section
      1.04. References
      to Agreements, Laws and Persons.
      Unless
      otherwise expressly provided herein, (a) references to Organization Documents,
      agreements (including the Loan Documents) and other contractual instruments
      shall be deemed to include all subsequent amendments, restatements, extensions,
      supplements and other modifications thereto, but only to the extent that such
      amendments, restatements, extensions, supplements and other modifications are
      not prohibited by any Loan Document; and (b) references to any Law shall include
      all statutory and regulatory provisions consolidating, amending, replacing,
      supplementing or interpreting such Law and (c) references to any Person include
      its successors and permitted assigns.

     

    Section
      1.05. Times
      of Day.
      Unless
      otherwise specified, all references herein to times of day shall be references
      to Hong Kong time.

    

    ARTICLE
      2

    THE
      COMMITMENTS AND THE LOANS

     

    Section
      2.01. Loans. 

    

    
      
         

      

      
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    (a) Subject
      to the terms and conditions set forth herein, the Lender agrees to (i) make
      loans (the “Loans”)
      to the
      Borrower from time to time, on any Business Day during the Availability Period,
      in an aggregate amount not to exceed the Commitment. The Commitment is not
      revolving in nature, and amounts repaid or prepaid may not be
      reborrowed.

    

    (b) Upon
      satisfaction of the conditions set forth in Section 4.01, the Lender shall
      make
      the proceeds of the Loan available to the Borrower by wire transfer of such
      proceeds in accordance with instructions provided to (and reasonably acceptable
      to) the Lender by the Borrower.

    

    (c) The
      Commitment shall terminate at the close of business on the last day of the
      Availability Period whether or not Loans were made.

     

    Section
      2.02. Prepayments. 

    

    (a) Optional.
      The
      Borrower may, upon notice to the Lender, on any Business Day voluntarily prepay
      any Loan in whole or in part without premium or penalty, but subject to Section
      3.05; provided that such notice must be received by the Lender not later than
      1:00 p.m. local time at the Lending Office ten Business Days prior to any date
      of prepayment and (ii) any prepayment of a Loan shall be in a principal amount
      of US$5,000,000 or a multiple of US$1,000,000 in excess thereof or, if less,
      the
      entire principal amount thereof then outstanding under such Loan. Each such
      notice shall specify the date and amount of such prepayment and shall be
      delivered to the Lender appropriately completed and signed by a Responsible
      Officer. If such notice is given by the Borrower, the Borrower shall make such
      prepayment and the payment amount specified in such notice shall be due and
      payable on the date specified therein.

    

    (b) Mandatory.
      

    

    (i) Upon
      the
      occurrence of a Change of Control, but subject to Article 8, (x) the Borrower
      shall, on the first Business Day thereafter, prepay, without premium or penalty,
      but subject to Section 3.05, all and any amounts outstanding under the Loans
      and
      (y) any remaining Commitments shall terminate.

    

    (ii) Upon
      the
      date of receipt of any net proceeds by the Borrower from an (1) Equity Offering,
      (2) Asset Disposition, (3) Insurance Claim or (4) Acquisition Recovery, in
      a
      cumulative aggregate amount in excess of US$3.0 million (since any prior
      prepayment effected hereunder) the Borrower shall prepay, without premium or
      penalty (other than pursuant to Section 3.05), a principal amount of Loans
      equal
      to the aggregate net proceeds so received, rounded down to the nearest multiple
      of US$100,000. Such prepayment shall be applied to prepay the outstanding Loans
      on a pro rata basis. To the extent that the aggregate amount of such net
      proceeds exceeds the aggregate amount of Loans outstanding at such time, the
      Commitment shall be reduced in an amount equal to such excess
      amount.

     

    Section
      2.03. Repayment
      of Loans.
      Subject
      to Section 2.02(b) and Article 8, the Borrower shall repay to the Lender on
      the
      Maturity Date the principal amount of all Loans outstanding on such
      date.

     

    Section
      2.04. Interest. 

    

    
      
         

      

      
        16

        
          

        

      

      
         

      

       

    

    (a) Subject
      to the provisions of subsection (b) below and other relevant provisions hereof,
      each Loan shall bear interest on the outstanding principal amount thereof for
      each Interest Period at a rate per annum equal to the Eurodollar Rate for such
      Interest Period plus the Applicable Rate. Interest on each Loan shall be due
      and
      payable in arrears on each Interest Payment Date applicable thereto and at
      such
      other times as may be specified herein. Interest hereunder shall be due and
      payable in accordance with the terms hereof before and after judgment, and
      before and after the commencement of any proceeding under any Debtor Relief
      Law.

    

    (b) If
      any
      amount payable by any Obligor under any Loan Document is not paid when due
      (without regard to any applicable grace periods), whether at stated maturity,
      by
      acceleration or otherwise, such amount shall thereafter bear interest at an
      interest rate at all times equal to the Default Rate, to the fullest extent
      permitted by applicable Laws. Furthermore, while any Event of Default has
      occurred and is continuing, the Borrower shall pay interest on the principal
      amount of all outstanding Obligations hereunder at an interest rate equal to
      the
      Default Rate, to the fullest extent permitted by applicable Laws. Accrued and
      unpaid interest on past-due amounts (including interest on past-due interest)
      shall be due and payable upon demand.

    

    (c) Interest
      hereunder shall be due and payable in accordance with the terms hereof before
      and after judgment, and before and after the commencement of any proceeding
      under any Debtor Relief Law.

     

    Section
      2.05. Computation
      of Interest.
      All
      computations of interest hereunder shall be made on the basis of a 360-day
      year
      and actual days elapsed (which results in more fees or interest, as applicable,
      being paid than if computed on the basis of a 365-day year); provided that
      Obligations accruing Default Interest shall be calculated on a compounded daily
      basis. Interest shall accrue for the day on which the Loan is made, and shall
      not accrue on the Loan, or any portion thereof, for the day on which the Loan
      or
      such portion is repaid.

     

    Section
      2.06. Evidence
      of Debt.
      Each
      Loan shall be evidenced by one or more accounts or records maintained by the
      Lender in the ordinary course of business. The accounts or records maintained
      by
      the Lender shall be conclusive absent manifest error of the amount of any Loan
      made by the Lender to the Borrower and the interest and payments thereon. Any
      failure to so record or any error in doing so shall not, however, limit or
      otherwise affect the obligation of any Obligor to pay any amount owing with
      respect to the Obligations.

     

    Section
      2.07. Payments
      Generally. 

    

    (a) All
      payments to be made by any Obligor shall be made without condition or deduction
      for any counterclaim, defense, recoupment or setoff. Except as otherwise
      expressly provided herein, all payments by any Obligor hereunder shall be made
      to the Lender at the applicable Lending Office in US Dollars and in immediately
      available funds not later than 1:00 p.m. on the date specified herein. All
      payments received by the Lender after 1:00 p.m. local time at the Lending Office
      shall be deemed received on the next succeeding Business Day and any applicable
      interest or fee shall continue to accrue.

    

    
      
         

      

      
        17

        
          

        

      

      
         

      

       

    

    (b) If
      any
      payment to be made by any Obligor shall come due on a day other than a Business
      Day, payment shall be made on the next following Business Day, and such
      extension of time shall be reflected in computing interest.

    

    (c) Nothing
      herein shall be deemed to obligate the Lender to obtain the funds for any Loan
      in any particular place or manner or to constitute a representation by the
      Lender that it has obtained or will obtain the funds for any Loan in any
      particular place or manner.

     

    Section
      2.08. Fees
      and Expenses. 

    

    (a) Fees
      and Expenses.
      Within
      five Business Days after presentation of the relevant invoices to the Borrower,
      the Borrower shall pay to the Lender the amount of all fees and expenses payable
      by the Borrower pursuant to Section 9.04.

    

    (b) Commitment
      Fees.
      The
      Borrower shall pay to the Lender for the account of the Commitment, a commitment
      fee at a rate per annum equal to 1.00% on the actual daily amount by which
      the
      Commitment exceeds the aggregate outstanding amount under the Loans. The
      commitment fee shall accrue at all times during the relevant Availability
      Period, including at any time during which one or more of the conditions in
      Article 4 is not met, and shall be due and payable on each of May 19, 2007
      and
      June 19, 2007. The commitment fee shall be calculated monthly in
      arrears.

    

    ARTICLE
      3

    TAXES,
      YIELD PROTECTION AND ILLEGALITY

     

    Section
      3.01. Taxes. 

    

    (a) Any
      and
      all payments by any Obligor to or for the account of the Lender under any Loan
      Document to or for the account of the beneficiary thereof shall be made free
      and
      clear of and without deduction for any Indemnified Taxes or Other Taxes. If
      any
      Obligor shall be required by any Laws to deduct any Indemnified Taxes (including
      Other Taxes) from or in respect of any sum payable under any Loan Document
      to
      the Lender, (i) the sum payable shall be increased as necessary so that after
      making all required deductions (including deductions applicable to additional
      sums payable under this Section 3.01), the Lender receives an amount equal
      to
      the sum it would have received had no such deductions been made, (ii) such
      Obligor shall make such deductions, (iii) such Obligor shall pay the full amount
      deducted to the relevant taxation authority or other authority in accordance
      with applicable Laws, and (iv) as promptly as practicable after the date of
      such
      payment, such Obligor shall furnish to the Lender the original or a certified
      copy of a receipt evidencing payment thereof.

    

    (b) Without
      limiting the provisions of paragraph (a) above, the Borrower shall timely pay
      any Other Taxes to the relevant Governmental Authority in accordance with
      applicable Law.

    

    (c) The
      Borrower agrees to indemnify the Lender for (i) the full amount of any
      Indemnified Taxes and Other Taxes (including any Indemnified Taxes or Other
      Taxes imposed or asserted by any jurisdiction on amounts payable under this
      Section) paid by the Lender and (ii) any liability (including additions to
      tax,
      penalties, interest and expenses) arising therefrom or with respect thereto.
      Payment under this subsection (c) shall be made within ten days after the date
      the Lender makes a demand therefor.

    

    
      
         

      

      
        18

        
          

        

      

      
         

      

       

    

    (d) Any
      Foreign Lender shall, to the extent it may lawfully do so, deliver to Borrower
      (in such number of copies as shall be reasonably requested by the recipient)
      on
      or prior to the date on which such Foreign Lender becomes a Lender under this
      Agreement (and from time to time thereafter upon the request of Borrower or
      as
      otherwise prescribed by applicable Law, but only if such Foreign Lender is
      legally entitled to do so), whichever of the following is
      applicable:

    

    (i) duly
      completed copies of Internal Revenue Service Form W-8BEN claiming eligibility
      for benefits of an income tax treaty to which the United States of America
      is a
      party,

    

    (ii) duly
      completed copies of Internal Revenue Service Form W-8ECI,

    

    (iii) in
      the
      case of a Foreign Lender claiming the benefits of the exemption for portfolio
      interest under Section 881(c) of the Internal Revenue Code, (x) a certificate,
      to the effect that such Foreign Lender is not (A) a “bank” within the meaning of
      Section 881(c)(3)(A) of the Internal Revenue Code, (B) a “10 percent
      shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the
      Internal Revenue Code, or (C) a “controlled foreign corporation” described in
      Section 881(c)(3)(C) of the Internal Revenue Code and (y) duly completed copies
      of Internal Revenue Service Form W-8BEN, or

    

    (iv) any
      other
      form prescribed by applicable Law as a basis for claiming exemption from or
      a
      reduction in United States federal withholding tax duly completed together
      with
      such supplementary documentation as may be prescribed by applicable Law to
      permit Borrower to determine the withholding or deduction required to be
      made.

    

    (e) Any
      Lender that is not a Foreign Lender and has not otherwise established to the
      reasonable satisfaction of Borrower that it is an exempt recipient (as defined
      in section 6049(b)(4) of the Internal Revenue Code and the United States
      Treasury Regulations thereunder) shall deliver to Borrower (in such number
      of
      copies as shall be reasonably requested by the recipient) on or prior to the
      date on which such Lender becomes a Lender under this Agreement (and from time
      to time thereafter upon the request of Borrower or as otherwise prescribed
      by
      applicable Law, but only if such Lender is legally entitled to do so), duly
      executed and properly completed copies of Internal Revenue Service Form
      W-9.

    

    (f) If
      a
      Lender determines, in its sole discretion, that it has received a refund of
      any
      Indemnified Taxes or Other Taxes as to which it has been indemnified by Borrower
      or with respect to which Borrower has paid additional amounts pursuant to this
      Section, it shall pay to Borrower an amount equal to such refund (but only
      to
      the extent of indemnity payments made, or additional amounts paid, by Borrower
      under this Section with respect to the Indemnified Taxes or Other Taxes giving
      rise to such refund), net of all out-of-pocket expenses of such Lender and
      without interest (other than any interest paid by the relevant Governmental
      Authority with respect to such refund); provided that Borrower, upon the request
      of such Lender, agrees to repay the amount paid over to Borrower (plus any
      penalties, interest or other charges imposed by the relevant Governmental
      Authority) to such Lender in the event such Lender is required to repay such
      refund to such Governmental Authority. This paragraph shall not be construed
      to
      require any Lender to make available its tax returns (or any other information
      relating to its taxes that it deems confidential) to Borrower or any other
      person.

     

    
      
         

      

      
        19

        
          

        

      

      
         

      

       

    

    Section
      3.02. Illegality.
      If the
      Lender determines that any Law has made it unlawful, or that any Governmental
      Authority has asserted that it is unlawful, for the Lender or its Lending Office
      to make, maintain or fund any Loan, or to determine or charge interest rates
      based upon the Eurodollar Rate, then, on notice thereof by the Lender to the
      Borrower, any obligation of the Lender to make such Loan shall be suspended
      until the Lender notifies the Borrower that the circumstances giving rise to
      such determination no longer exist. Upon receipt of such notice with respect
      to
      any Loan, the Borrower shall, upon demand from the Lender, prepay such Loan.
      Notwithstanding the foregoing, the Borrower may, at its option by notice to
      the
      Lender, in lieu of prepaying a Loan pursuant to this Section 3.02, elect that
      such Loan shall bear interest at the Alternate Interest Rate from the date
      on
      which such prepayment would otherwise have been required until the Lender
      notifies the Borrower that the circumstances giving rise thereto no longer
      exist. The Lender agrees to designate a different Lending Office if such
      designation will avoid the need for such notice and will not, in the good faith
      judgment of the Lender, otherwise be materially disadvantageous to the
      Lender.

     

    Section
      3.03. Inability
      to Determine Eurodollar Rate.
      If the
      Lender determines that for any reason adequate and reasonable means do not
      exist
      for determining the Eurodollar Rate for any day, or that the Eurodollar Rate
      for
      any day does not adequately and fairly reflect the cost to the Lender of funding
      the Loans, the Lender will promptly so notify the Borrower. Thereafter, the
      Loans shall bear interest at the Alternate Interest Rate until the Lender
      revokes such notice.

     

    Section
      3.04. Increased
      Cost and Reduced Return; Capital Adequacy. 

    

    (a) If
      the
      Lender determines that as a result of the introduction of or any change in
      or in
      the interpretation of any Law, or the Lender’s compliance therewith, there shall
      be any increase in the cost to the Lender of agreeing to make or making, funding
      or maintaining Loans, or a reduction in the amount received or receivable by
      the
      Lender in connection with any of the foregoing (excluding for purposes of this
      subsection (a) any such increased costs or reduction in amount resulting from
      (i) Taxes or Other Taxes (as to which Section 3.01 shall govern), (ii) changes
      in the basis of taxation of overall net income or overall gross income by the
      United States, Hong Kong or any other foreign jurisdiction or any political
      subdivision of either thereof under the Laws of which the Lender is organized
      or
      has its Lending Office; and it being understood that, to the extent duplicative
      of the provisions of Section 3.01, this Section 3.04 shall not apply to Taxes),
      or (iii) regulatory costs (whether or not reflected in an adjustment by the
      Lender to the Eurodollar Rate), then from time to time upon demand of the
      Lender, the Borrower shall pay to the Lender such additional amounts as will
      compensate the Lender for such increased cost or reduction.

    

    (b) If
      the
      Lender determines that the introduction of any Law regarding capital adequacy
      or
      any change therein or in the interpretation thereof, or compliance by the Lender
      (or its Lending Office) therewith, has the effect of reducing the rate of return
      on the capital of the Lender or any corporation controlling the Lender as a
      consequence of the Lender’s obligations hereunder (taking into consideration its
      policies with respect to capital adequacy and the Lender’s desired return on
      capital), then from time to time upon demand of the Lender, the Borrower shall
      pay to the Lender such additional amounts as will compensate the Lender for
      such
      reduction.

     

    
      
         

      

      
        20

        
          

        

      

      
         

      

       

    

    Section
      3.05. Funding
      Losses.
      Upon
      demand of the Lender from time to time, the Borrower shall promptly compensate
      the Lender for and hold the Lender harmless from any loss, cost or expense
      incurred by it as a result of (a) any failure by the Borrower (for a reason
      other than the failure of the Lender to make a Loan) to prepay or borrow a
      Loan
      on the date or in the amount notified by the Borrower in accordance with this
      Agreement, or (b) the prepayment of any principal of any Loan other than on
      the
      last day of an Interest Period applicable thereto (including as a result of
      an
      Event of Default), including any loss of anticipated profits and any loss or
      expense arising from the liquidation or reemployment of funds obtained by it
      to
      maintain such Loan or from fees payable to terminate the deposits from which
      such funds were obtained. The Borrower shall also pay any customary
      administrative fees charged by the Lender in connection with the
      foregoing.

     

    Section
      3.06. Requests
      for Compensation.
      A
      certificate of the Lender claiming compensation under this Article 3 and setting
      forth the additional amount or amounts to be paid to it hereunder shall be
      conclusive in the absence of manifest error. In determining such amount, the
      Lender may use any reasonable averaging and attribution methods.

     

    Section
      3.07. Survival.
      All of
      the Borrower’s obligations under this Article 3 shall survive termination of the
      Commitment and repayment of all other Obligations hereunder.

    

    ARTICLE
      4

    CONDITIONS
      PRECEDENT

     

    Section
      4.01. Conditions
      to All Credit Extensions.
      The
      obligation of the Lender to make any Credit Extension hereunder is subject
      to
      satisfaction of the following conditions precedent; provided that the Lender
      may
      waive any such condition in its sole discretion:

    

    (a) The
      Lender’s receipt of the following, each of which shall be originals or
      facsimiles (followed promptly by originals) unless otherwise specified, each
      properly executed, each dated the Closing Date (or, in the case of certificates
      of governmental officials, a recent date before the Closing Date) and each
      in
      form and substance satisfactory to the Lender and its legal
      counsel:

    

    (i) counterparts
      of this Agreement, duly executed by each Obligor;

    

    (ii) counterparts
      of the Collateral Agreement, duly executed by each party thereto;

    

    (iii) such
      certificates of resolutions or other action, incumbency certificates and/or
      other certificates of Responsible Officers of the Borrower as the Lender may
      require evidencing the identity, authority and capacity of any such Responsible
      Officer authorized to so act in connection with this Agreement and the other
      Loan Documents to which the Borrower is a party;

    

    
      
         

      

      
        21

        
          

        

      

      
         

      

       

    

    (iv) such
      documents and certifications as the Lender may reasonably require to evidence
      (x) that the Borrower and the Lien Grantor are duly organized or formed, validly
      existing and in good standing and (y) have taken all necessary or appropriate
      corporate or other actions to authorize and enter into the Loan
      Documents;

    

    (v) a
      favorable opinion of O’Melveny & Myers LLP, United States counsel to the
      Obligors, addressed to the Lender, substantially in the form set forth in
      Exhibit C hereto and such other matters concerning the Obligors, the Lien
      Grantor and the Loan Documents as the Lender may reasonably request in form
      and
      substance satisfactory to the Lender;

    

    (vi) a
      favorable opinion of DeHeng Law Office, PRC counsel to the Obligors, addressed
      to the Lender, substantially in the form set forth in Exhibit D hereto and
      such
      other matters concerning the Obligors, the Lien Grantor and the Loan Documents
      as the Lender may reasonably request in form and substance satisfactory to
      the
      Lender;

    

    (vii) a
      favorable opinion of Conyers Dill & Pearman, BVI counsel to the Obligors,
      addressed to the Lender, substantially in the form set forth in Exhibit E hereto
      and such other matters concerning the Obligors, the Lien Grantor and the Loan
      Documents as the Lender may reasonably request in form and substance
      satisfactory to the Lender;

    

    (viii) a
      certificate signed by each Obligor certifying (A) that the conditions specified
      in Sections 4.01(c) and (d) have been satisfied, and (B) that since the
      respective dates of which information is set forth in the Disclosure Documents,
      there has been no event or circumstance, either individually or in the
      aggregate, that has had or would be reasonably expected to have a Material
      Adverse Effect; and

    

    (ix) such
      other assurances, certificates, documents, consents or opinions as the Lender
      reasonably may require.

    

    (b) The
      Collateral Requirement shall have been satisfied.

    

    (c) The
      representations and warranties of the Obligors and the Lien Grantor contained
      in
      Article 5 of this Agreement or in any other Loan Document, or which are
      contained in any document furnished at any time under or in connection herewith
      or therewith, shall be true and correct on and as of Article 1 the Closing
      Date
      and Article 2 immediately prior to and after giving effect to the relevant
      Credit Extension; provided
      that,
      with
      respect to Schedules 5.10 and 5.17, the Borrower may, in connection with any
      Credit Extension, update such schedules, solely to reflect any additional
      Subsidiaries the Borrower may have formed or acquired.

    

    (d) No
      Default shall exist, or would result from the relevant Credit Extension and
      all
      of the Loan Documents shall be in full force and effect.

    

    (e) All
      fees
      and reasonable expense reimbursements arising under or in connection with a
      Loan
      Document and payable to the Lender or the Collateral Agent by the Borrower,
      the
      Lien Grantor or the Individual Guarantors shall either (x) have been paid and
      satisfied or (y) arrangements satisfactory to the Lender, in its reasonable
      discretion, regarding the concurrent or expected future payment of such fees
      and
      expenses in a timely manner shall have been established.

    

    
      
         

      

      
        22

        
          

        

      

      
         

      

       

    

    (f) The
      Availability Period is continuing.

    

    (g) The
      Commitment has not been terminated.

    

    (h) The
      Lender’s receipt of a Loan Drawdown Notice at least two Business Days prior to
      the date of the respective Credit Extension.

    

    ARTICLE
      5

    REPRESENTATIONS
      AND WARRANTIES

    

    Each
      Obligor represents and warrants to the Lender that:

     

    Section
      5.01. Existence,
      Qualification and Power; Compliance with Laws.
      The
      Borrower and each Material Subsidiary (a) in the case of the Borrower, is duly
      organized or formed, validly existing and in good standing under the Laws of
      the
      State of Delaware, and in the case of a Material Subsidiary, is duly organized
      or formed, validly existing and in good standing under the laws of the
      jurisdiction where it was organized or formed, (b) has all requisite power
      and
      authority and all requisite governmental licenses, authorizations, consents
      and
      approvals to (i) own its assets and carry on its business and (ii) execute,
      deliver and perform its obligations under the Loan Documents to which it is
      a
      party, (c) is duly qualified and is licensed and in good standing under the
      Laws
      of each jurisdiction where its ownership, lease or operation of properties
      or
      the conduct of its business requires such qualification or license, and (d)
      is
      in compliance with all Laws; except in each case referred to in clause (b)(i),
      (c) or (d), to the extent that failure to do so would not reasonably be expected
      to have a Material Adverse Effect.

     

    Section
      5.02. Authorization;
      No Contravention.
      The
      execution, delivery and performance by the Borrower of each Loan Document to
      which it is party, have been duly authorized by all necessary corporate action,
      and do not and will not contravene the terms of any of its Organization
      Documents. The execution, delivery and performance by each Obligor of each
      Loan
      Document to which he or it is a party do not and will not (e) conflict with
      or
      result in any breach or contravention of, or the creation of any Lien (other
      than the Liens created by the Collateral Agreements) under, (i) any Contractual
      Obligation to which any Obligor or any Affiliate of any Obligor is a party
      or
      (ii) any order, injunction, writ or decree of any Governmental Authority or
      any
      arbitral award to which any Obligor or any Affiliate of any Obligor or his
      or
      its property is subject; or (iii) violate any Law.

     

    Section
      5.03. Governmental
      Authorization; Other Consents.
      No
      approval, consent, exemption, authorization, or other action by, or notice
      to,
      or filing with, any Governmental Authority or any other Person is necessary
      or
      required in connection with the execution, delivery or performance by, or
      enforcement against, any Obligor of this Agreement or any other Loan
      Document.

     

    Section
      5.04. Binding
      Effect.
      This
      Agreement has been, and each other Loan Document to which any Obligor is a
      party, when delivered hereunder, will have been duly executed and delivered
      by
      such Obligor. This Agreement constitutes, and each such other Loan Document
      when
      so delivered will constitute, a legal, valid and binding obligation of each
      Obligor party thereto, enforceable against such Obligor in accordance with
      its
      terms, except as enforceability may be limited by bankruptcy, insolvency and
      other laws affecting creditors’ rights generally and by general principles of
      equity.

     

    
      
         

      

      
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    Section
      5.05. Disclosure
      Documents; No Material Adverse Effect. 

    

    (a) The
      Disclosure Documents do not contain any untrue statement of material fact or
      omit to state a material fact necessary in order to make the statements
      contained therein, in light of the circumstances under which they were made,
      not
      misleading.

    

    (b) Since
      the
      respective dates as of which information is set forth in the Disclosure
      Documents, there has been no event or circumstance, either individually or
      in
      the aggregate, that has had or would reasonably be expected to have a Material
      Adverse Effect.

     

    Section
      5.06. Litigation.
      There
      are no actions, suits, proceedings, claims or disputes pending or, to the
      knowledge of Obligors after due and diligent investigation, threatened or
      contemplated, at law, in equity, in arbitration or before any Governmental
      Authority, by or against any Obligor or any Affiliate of any Obligor or against
      any of its or their properties or revenues that (a) purport to affect or pertain
      to this Agreement or any other Loan Document, or any of the transactions
      contemplated hereby, or (b) either individually or in the aggregate, if
      determined adversely, would reasonably be expected to have a Material Adverse
      Effect.

     

    Section
      5.07. No
      Default.
      Neither
      any Obligor nor any Affiliate of any Obligor is in default under or with respect
      to any Contractual Obligation that would, either individually or in the
      aggregate, reasonably be expected to have a Material Adverse Effect. No Default
      has occurred and is continuing or would result from the consummation of the
      transactions contemplated by this Agreement or any other Loan
      Document.

     

    Section
      5.08. Ownership
      of Collateral; Liens.
      Beams
      Power has good title to the Collateral and the Capital Stock of the Borrower
      constituting the pledged Collateral has been duly and validly issued, and is
      outstanding and non-assessable and is registered in the name of Beams Power
      on
      the stock transfer records of the Borrower. The Collateral is also not subject
      to any Liens other than those permitted by Section 7.01.

     

    Section
      5.09. Taxes.
      Each
      Obligor and each Material Subsidiary has filed all material tax returns and
      reports required to be filed, and has paid all material taxes, assessments,
      fees
      and other governmental charges levied or imposed upon him or it or his or its
      properties, income or assets otherwise due and payable, except those which
      are
      being contested in good faith by appropriate proceedings diligently conducted
      and for which adequate reserves have been provided in accordance with GAAP.
      There is no proposed tax assessment against any Obligor or any Affiliate of
      any
      Obligor that would, if made, have a Material Adverse Effect.

     

    Section
      5.10. Subsidiaries.
      Except
      for the information set forth on Schedule 5.10 hereto with respect to identity
      and percentage ownership, the Obligors have no Subsidiaries.

     

    Section
      5.11. Investment
      Company Act.
      Neither
      the Borrower nor any Person Controlling the Borrower is or is required to be
      registered as an “investment company” under the United States Investment Company
      Act of 1940, as amended.

     

    
      
         

      

      
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    Section
      5.12. Disclosure.
      The
      Obligors have disclosed to the Lender all agreements, instruments and corporate
      or other restrictions to which he or it or any Affiliate of any Obligor is
      subject, and all other matters known to him or it, that, individually or in
      the
      aggregate, could reasonably be expected to result in a Material Adverse Effect.
      No report, financial statement, certificate or other information furnished
      (whether in writing or orally) by or on behalf of the Obligors to the Lender
      in
      connection with the transactions contemplated hereby and the negotiation of
      this
      Agreement or delivered hereunder (as modified or supplemented by other
      information so furnished) contains any material misstatement of fact or omits
      to
      state any material fact necessary to make the statements therein, in the light
      of the circumstances under which they were made, not misleading.

     

    Section
      5.13. Compliance
      with Laws.
      Each
      Obligor and each Affiliate of any Obligor is in compliance in all material
      respects with the requirements of all Laws and all orders, writs, injunctions
      and decrees applicable to him or it or to its properties, except in such
      instances in which (a) such requirement of Law or order, writ, injunction or
      decree is being contested in good faith by appropriate proceedings diligently
      conducted or (b) the failure to comply therewith, either individually or in
      the
      aggregate, would not reasonably be expected to have a Material Adverse
      Effect.

     

    Section
      5.14. Security
      Interests.
      Each of
      the representations and warranties of Beams Power contained in the Collateral
      Agreement is true and correct. The Borrower has delivered to the stock transfer
      agent of the Borrower a stop transfer instruction and a lien registration notice
      with respect to the Pledged Stock, instructing the stock transfer agent not
      to
      effect any transfer of Pledged Stock without the consent of the Collateral
      Agent.

     

    Section
      5.15. Financial
      Ratios. 

    

    (a) The
      Consolidated Interest Coverage Ratio as of the end of the most recent completed
      fiscal quarter of the Borrower was higher than 4.00.

    

    (b) The
      Consolidated Leverage Ratio of the Borrower is lower than 4.25.

     

    Section
      5.16. Pari
      Passu Ranking.
      The
      payment Obligations of each Obligor under the Loan Documents rank at least
      pari
      passu with the claims of all of his (or her) or its other unsecured and
      unsubordinated creditors, except for obligations mandatorily preferred by law
      applying to such Obligor generally.

     

    Section
      5.17. Corporate
      Chart.
      The
      corporate chart attached as Schedule 5.17 hereto sets out the corporate and
      shareholding structure of the Borrower and its Subsidiaries and such corporate
      chart and the information contained therein is true, complete and
      accurate.

     

    Section
      5.18. Residence.
      Xiuqing
      Meng is a resident of the Hong Kong Special Administrative Region of the PRC
      and
      is not a resident of the PRC as defined in Article 1 of the Notice (Hui Fa
      2005
      No. 75) issued by the State Administration of Foreign Exchange of the PRC (the
      “Notice
      No. 75”).

     

    Section
      5.19. Government
      Approvals.
      Each
      Individual Guarantor has obtained all applicable governmental licenses,
      registrations, authorizations, consents and approvals for their respective
      direct or indirect investments in the Borrower, including any registration
      pursuant to Article 1 of the Notice No. 75 and has delivered all applicable
      notices to Governmental Authorities in connection therewith.

     

    
      
         

      

      
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    Section
      5.20. Distributions.
      Each
      Subsidiary of the Borrower has obtained or completed (a) all approvals,
      consents, exemptions, authorizations or other actions by or notices to, or
      filings with any Governmental Authority or any person and (b) any corporate
      or
      shareholder approval necessary or required in order to permit such Subsidiary
      to
      pay dividends or make any other distributions on its Capital Stock.

     

    Section
      5.21. Common
      Stock.
      As of
      the date hereof, the aggregate number of outstanding shares of common stock
      of
      the Borrower is 50,000,713.

    

    ARTICLE
      6

    AFFIRMATIVE
      COVENANTS

    

    So
      long
      as any Commitment shall be in effect or any Loan or any other Obligation
      hereunder shall remain unpaid or unsatisfied:

    Section
      6.01. Information.
      Each
      Obligor will deliver promptly to the Lender, in form and detail reasonably
      satisfactory to the Lender, such information regarding the business, assets
      or
      affairs of the Obligors, the Collateral or compliance with the terms of the
      Loan
      Documents, as the Lender may from time to time reasonably request.

     

    Section
      6.02. Notices.
      Each
      Obligor will promptly notify the Lender:

    

    (a) of
      the
      occurrence of any Default; and

    

    (b) of
      any
      matter that has resulted or could reasonably be expected to result in a Material
      Adverse Effect, including (i) a breach or non-performance of, or any default
      under, a Contractual Obligation of any Obligor; (ii) any dispute, litigation,
      investigation, proceeding or suspension between any Obligor and any Governmental
      Authority; or (iii) the commencement of, or any material development in, any
      litigation or proceeding affecting any Obligor.

    

    Each
      notice pursuant to this Section 6.02 shall be accompanied by a statement, which,
      in the case of the Borrower, shall be a statement of a Responsible Officer,
      setting forth details of the occurrence referred to therein and stating what
      action the Obligors have taken and propose to take with respect thereto. Each
      notice pursuant to Section 6.02(a) shall describe with particularity any and
      all
      provisions of this Agreement and any other Loan Document that have been
      breached.

     

    Section
      6.03. Payment
      of Obligations.
      Each
      Obligor will pay and discharge as the same shall become due and payable, all
      obligations and liabilities, including (a) all tax liabilities, assessments
      and
      governmental charges or levies upon any Obligor or its properties or assets,
      unless the same are being contested in good faith by appropriate proceedings
      diligently conducted and adequate reserves in accordance with GAAP are being
      maintained by such Obligor; (b) all material lawful claims which, if unpaid,
      would by law become a Lien upon his (or her) or its property; and (c) all
      Indebtedness, as and when due and payable, but subject to any subordination
      provisions contained in any instrument or agreement evidencing such
      Indebtedness.

     

    
      
         

      

      
        26

        
          

        

      

      
         

      

       

    

    Section
      6.04. Preservation
      of Existence, etc.
      The
      Borrower will, and will procure that each Material Subsidiary will, Article
      3
      preserve, renew and maintain in full force and effect its legal existence and
      good standing under the Laws of the respective jurisdiction of its organization;
      and Article 4 take all reasonable action to maintain all rights, privileges,
      permits, licenses and franchises necessary or desirable in the normal conduct
      of
      its business, except to the extent that failure to do so would not reasonably
      be
      expected to have a Material Adverse Effect.

     

    Section
      6.05. Compliance
      with Laws.
      The
      Borrower will, and will procure that each Material Subsidiary will comply with
      the requirements of all Laws and all orders, writs, injunctions and decrees
      applicable to it or to its business or property, except in such instances in
      which (a) such requirement of Law or order, writ, injunction or decree is being
      contested in good faith by appropriate proceedings diligently conducted; or
      (b)
      the failure to comply therewith would not reasonably be expected to have a
      Material Adverse Effect.

     

    Section
      6.06. Books
      and Records.
      Each
      Obligor will maintain proper books of record and account, in which full, true
      and correct entries in conformity with GAAP consistently applied shall be made
      of all financial transactions and matters involving the assets and business
      of
      such Obligor.

     

    Section
      6.07. Inspection
      Rights.
      Each
      Obligor will permit representatives and independent contractors of the Lender
      to
      examine his (or her) or its corporate, financial and operating records
      (including any documents relating to the Collateral), and make copies thereof
      or
      abstracts therefrom, and to discuss his (or her) or its affairs, finances and
      accounts with his (or her) or its directors, officers, and independent public
      accountants, all at such reasonable times during normal business hours and
      as
      often as may be reasonably desired, upon reasonable advance notice; provided,
      however,
      that
      when an Event of Default exists the Lender (or any of its representatives or
      independent contractors) may do any of the foregoing at the expense of the
      Obligors at any time during normal business hours and without advance
      notice.

     

    Section
      6.08. Use
      of
      Proceeds.
      The
      Borrower will use the proceeds of any Loans made to it 

    

    (a) (i) to
      make
      investments in Heilongjiang Baoquanling Sheng Yuan Dairy and to fund the
      construction of new production facilities with an aggregate capacity to produce
      no less than 11,000 tonnes of milk powder per year, (ii) to establish a joint
      venture for the production of Chondroitin, (iii) to purchase fixed assets for
      the production of nutritional food bars and (iv) to establish a joint venture
      that will offer genetic blood testing services,

    

    (b) not
      in
      contravention of any Law or any Loan Document; and

    

    (c) not,
      directly or indirectly, for the purpose, whether immediate, incidental or
      ultimate, of buying or carrying Margin Stock;

    

    provided
      that, in
      any event, the proceeds will not be applied to any business activities of the
      Borrower or any of its Subsidiaries or Affiliates or, to the knowledge of the
      Borrower, the business activities of the Borrower’s or any of its Subsidiaries’
or Affiliates’ customers, in or related to Iran, Sudan or Myanmar or other
      restricted jurisdictions, or with or related to any restricted person, for
      so
      long as the United States, the European Union or any member country of the
      European Union, or the United Nations Security Council maintain mandatory
      economic sanctions against the relevant jurisdiction or person.

     

    
      
         

      

      
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    Section
      6.09. Know
      Your Customer Checks.
      Each
      Obligor will promptly upon the request of the Lender supply, or procure the
      supply of, such documentation and other evidence as is reasonably requested
      by
      the Lender (for itself or on behalf of any Participant) in order for the Lender
      or any Participant or Assignee to conduct any “know your customer” or other
      similar procedures under applicable laws and regulations.

     

    Section
      6.10. Pari
      Passu Ranking.
      Each
      Obligor will ensure that its payment Obligations under the Loan Documents rank
      and continue to rank at least pari passu with the claims of all of its other
      unsecured and unsubordinated creditors, except for obligations mandatorily
      preferred by law applying to such Obligor generally.

     

    Section
      6.11. Unlawful
      Contributions.
      Each
      Obligor will not, and, as applicable, will not permit any of its Subsidiaries
      or
      any director, officer, agent, employee or other person acting with specific
      instruction from such Obligor or, as applicable, any of its Subsidiaries, to
      (a)
      use any corporate funds for any unlawful contribution, gift, entertainment
      or
      other unlawful expense relating to political activity, (b) make any direct
      or
      indirect unlawful payment to any foreign or domestic government official or
      employee from corporate funds or (c) make any bribe or other unlawful
      payment.

     

    Section
      6.12. Distributions.
      Each
      Obligor will procure that each Subsidiary of the Borrower has, at all times,
      obtained or completed (a) all approvals, consents, exemptions, authorizations
      or
      other actions by or notices to, or filings with any Governmental Authority
      or
      any person and (b) any corporate or shareholder approval necessary or required
      in order to permit such Subsidiary to pay dividends or make any other
      distributions on its Capital Stock.

     

    Section
      6.13. Compliance
      Certificates. 

    

    The
      Borrower will deliver to the Lender (a) within 60 days after the end of any
      fiscal quarter of the Borrower, a certificate of a Responsible Officer of the
      Borrower stating the Consolidated Interest Coverage Ratio and the Consolidated
      Leverage Ratio, each as of the end of the most recent fiscal quarter of the
      Borrower and showing in reasonable detail the calculation of the Consolidated
      Interest Coverage Ratio and the Consolidated Leverage Ratio, including the
      arithmetic computations of each component of these ratios, and (b) as soon
      as
      possible and in any event within 5 Business Days after the Borrower becomes
      aware or should reasonably become aware of the occurrence of a Default, a
      certificate of a Responsible Officer of the Borrower, setting forth the details
      of the Default, and the action which the Borrower proposes to take with respect
      thereto.

    

    ARTICLE
      7

    NEGATIVE
      COVENANTS

    

    So
      long
      as the Commitment shall be in effect or the Loan or any other Obligation
      hereunder shall remain unpaid or unsatisfied, no Obligor shall, directly or
      indirectly:

     

    
      
         

      

      
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    Section
      7.01. Liens.
      Create,
      incur, assume or suffer to exist any Lien upon any of his or its assets, whether
      now owned or hereafter acquired, other than Permitted Liens; provided that,
      in
      any event, at no time shall any Liens other than Collateral Permitted Liens
      exist with respect to the Collateral.

     

    Section
      7.02. Fundamental
      Changes.
      In the
      case of the Borrower, merge, dissolve, liquidate, consolidate with or into
      another Person, or Dispose of (whether in one transaction or in a series of
      transactions) all or substantially all of its assets (whether now owned or
      hereafter acquired) to or in favor of any other Person.

     

    Section
      7.03. Restricted
      Payments on Stock.
      In the
      case of the Borrower, declare or make, directly or indirectly, any Restricted
      Payment in an aggregate amount in excess of US$3.0 million during the term
      of
      this Agreement.

     

    Section
      7.04. Financial
      Covenants.

    

    (a) Permit
      the Consolidated Interest Coverage Ratio as of the end of any fiscal quarter
      of
      the Borrower to be lower than 4.00.

    

    (b) Permit
      the Consolidated Leverage Ratio as of the end of any fiscal quarter of the
      Borrower to be higher than 4.25.

    

    ARTICLE
      8

    EVENTS
      OF DEFAULT AND REMEDIES

     

    Section
      8.01. Events
      of Default.
      Any of
      the following shall constitute an Event of Default:

    

    (a) Non-Payment.
      Any
      Obligor fails to pay when due any amount of principal of any Loan, or any
      Obligor fails to pay any interest on any Loan, any fee due hereunder, or any
      other amount payable hereunder or under any other Loan Document on or within
      five days after the due date thereof; or

    

    (b) Specific
      Covenants.
      Any
      Obligor fails to perform or observe any term, covenant or agreement contained
      in
      any of Section 6.02, 6.04, 6.08, 6.10 or 6.11 or Article 7, as applicable;
      or

    

    (c) Other
      Defaults.
      Any
      Obligor fails to perform or observe any other covenant or agreement (not
      specified in subsection (a) or (b) above) contained in any Loan Document on
      its
      part to be performed or observed and such failure continues for 30 days;
      or

    

    (d) Representations
      and Warranties.
      Any
      representation, warranty, certification or statement of fact made or deemed
      made
      by or on behalf of any Obligor herein, in any other Loan Document, or in any
      document delivered in connection herewith or therewith shall be incorrect or
      misleading in any material respect when made or deemed made; or

    

    
      
         

      

      
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    (e) Cross-Default.
      Any
      Obligor or any Material Subsidiary Article 6 fails to make any payment when
      due
      (whether by scheduled maturity, required prepayment, acceleration, demand,
      or
      otherwise) in respect of any Indebtedness or Guarantee, (other than Indebtedness
      hereunder) in a principal amount in excess of US$1,000,000, or Article 7 fails
      to observe or perform any other agreement or condition relating to any
      Indebtedness or Guarantee, or contained in any instrument or agreement
      evidencing, securing or relating thereto, or any other event occurs, the effect
      of which default or other event is to cause, or to permit the holder or holders
      of such Indebtedness or the beneficiary or beneficiaries of such Guarantee
      (or a
      trustee or agent on behalf of such holder or holders or beneficiary or
      beneficiaries) to cause, with the giving of notice if required, such
      Indebtedness to be demanded or to become due or to be repurchased, prepaid,
      defeased or redeemed (automatically or otherwise), or an offer to repurchase,
      prepay, defease or redeem such Indebtedness to be made, prior to its stated
      maturity, or such Guarantee to become payable or cash collateral in respect
      thereof to be demanded; or

    

    (f) Insolvency
      Proceedings, Etc.
      Any
      Obligor or any Material Subsidiary institutes or consents to the institution
      of
      any proceeding under any Debtor Relief Law, or makes an assignment for the
      benefit of creditors; or applies for or consents to the appointment of any
      receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
      officer for him or it or for all or any material part of his or its property;
      or
      any receiver, trustee, custodian, conservator, liquidator, rehabilitator or
      similar officer is appointed without the application or consent of such Obligor
      or such Material Subsidiary and the appointment continues undischarged or
      unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law
      relating to any Obligor or any Material Subsidiary or to all or any material
      part of its property is instituted without the consent of such Obligor or such
      Material Subsidiary and continues undismissed or unstayed for 60 calendar days,
      or an order for relief is entered in any such proceeding; or

    

    (g) Inability
      to Pay Debts; Attachment.
      (i) Any
      Obligor or any Material Subsidiary becomes unable or admits in writing his
      or
      its inability or fails generally to pay his or its debts as they become due,
      or
      (ii) any writ or warrant of attachment or execution or similar process is issued
      or levied against all or any material part of the property of any Obligor or
      any
      Material Subsidiary and is not released, vacated or fully bonded within 30
      days
      after its issue or levy; or

    

    (h) Reduction
      or Loss of Capital.
      A
      meeting is convened by the Borrower for the purpose of passing any resolution
      to
      purchase, reduce or redeem any of its share capital; or

    

    (i) Composition.
      Any
      steps are taken, or negotiations commenced, by any Obligor or any Material
      Subsidiary or by any of their respective creditors with a view to proposing
      any
      kind of composition, compromise or arrangement involving such company or, as
      the
      case may be, such Person and any of its creditors; or

    

    (j) Analogous
      Proceedings.
      There
      occurs, in relation to any Obligor or any Material Subsidiary in any country
      or
      territory in which any of them carries on business or to the jurisdiction of
      whose courts any part of their respective assets is subject, any event which,
      in
      the reasonable opinion of the Lender, appears in that country or territory
      to
      correspond with, or have an effect equivalent or similar to, any of those
      mentioned in Sections 8.01(f) through (i) (inclusive) or any Obligor or any
      Material Subsidiary otherwise becomes subject, in any such country or territory,
      to the operation of any law relating to insolvency, bankruptcy or liquidation;
      or

    

    
      
         

      

      
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    (k) Judgments.
      There
      is entered against any Obligor or any Material Subsidiary Article 8 a final
      judgment or order for the payment of money in an aggregate amount exceeding
      US$1,000,000 (to the extent not covered by independent third-party insurance
      as
      to which the insurer does not dispute coverage), or Article 9 any one or more
      non-monetary final judgments that have, or could reasonably be expected to
      have,
      individually or in the aggregate, a Material Adverse Effect and, in either
      case,
      (A) enforcement proceedings are commenced by any creditor upon such judgment
      or
      order, or (B) there is a period of 30 consecutive days during which a stay
      of
      enforcement of such judgment, by reason of a pending appeal or otherwise, is
      not
      in effect; or

    

    (l) Cessation
      of Business.
      The
      Borrower or any Material Subsidiary suspends or ceases or threatens to suspend
      or cease to carry on its businesses; or

    

    (m) Seizure.
      All or
      a material part of the undertakings, assets, rights or revenues of, or shares
      or
      other ownership interests in, any Obligor or any Material Subsidiary are seized,
      nationalised, expropriated or compulsorily acquired by or under the authority
      of
      any government; or

    

    (n) Invalidity
      of Loan Documents.
      Any
      Loan Document, at any time after its execution and delivery and for any reason
      other than as expressly permitted hereunder or satisfaction in full of all
      the
      Obligations, ceases to be in full force and effect; or any Obligor or any other
      Person contests in any manner the validity or enforceability of any Loan
      Document; or any Obligor denies that it has any or further liability or
      obligation under any Loan Document, or purports to revoke, terminate or rescind
      any Loan Document; or

    

    (o) Lien
      Defects.
      Any
      Lien created by any of the Collateral Agreements shall at any time fail to
      constitute a valid and perfected Lien on all of the Collateral purported to
      be
      subject thereto, securing the obligations purported to be secured thereby,
      with
      the priority required by the Loan Documents, or any Obligor (or Beams Power
      in
      respect of the Collateral Agreement) shall so assert in writing; or

    

    (p) Material
      Adverse Change, etc.
      Any
      event shall occur which has had or is reasonably likely to have a Material
      Adverse Effect; or

    

    (q) Change
      of Management, etc.
      Any
      claim, demand or the commencement of any proceeding shall have been made or
      threatened to be made against any Obligor, or any of their respective Affiliates
      or employees (not limited to the filing of a lawsuit against any Affiliate
      or
      employee) which alleges any impropriety, illegality, negligence or contractual
      or fiduciary breach related to the performance of services by such Person that,
      if successful, could reasonably be expected to materially and adversely affect
      such Obligor or any Material Subsidiary; or

    

    (r) Judgment
      or Order.
      Any
      judgment or order shall be entered in any investigative, administrative or
      judicial proceeding involving a determination that an Obligor (or an Affiliate
      of an Obligor) shall have violated in any material respect any civil or criminal
      law or regulation applicable to him or it.

    

    
      
         

      

      
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    (s) Individual
      Guarantor.
      Any
      Individual Guarantor dies or by reason of illness or incapacity becomes
      incapable of managing his/her own affairs or becomes a patient under any mental
      health legislation.

    

    (t) Permitted
      Holders.
      The
      Permitted Holders are the beneficial owners and “control”, as determined
      pursuant to Rule 13d-3 under the United States Securities Exchange Act of 1934,
      as amended, of less than 50% plus one vote of the total voting power of the
      Voting Stock of the Borrower (or any successor entity).

    

    (u) Pledged
      Stock.
      The
      Pledged Stock constitutes less than 34.0% of the total voting power of the
      Voting Stock of the Borrower (or any successor entity).

    Section
      8.02. Remedies
      Upon Event of Default.
      If any
      Event of Default occurs and is continuing, the Lender may take any or all of
      the
      following actions:

    

    (a) declare
      any Commitment to be terminated, whereupon such Commitment shall be
      terminated;

    

    (b) declare
      the unpaid principal amount of any Loan, all interest accrued and unpaid
      thereon, and all other amounts owing or payable hereunder or under any other
      Loan Document to be immediately due and payable, without presentment, demand,
      protest or other notice of any kind, all of which are hereby expressly waived
      by
      each Obligor; 

    

    (c) give
      instructions to the Collateral Agent to foreclose on the Collateral in
      accordance with the Collateral Agreement and with any other Security Documents
      then in existence; and

    

    (d) exercise
      all rights and remedies available to it under the Loan Documents or applicable
      law;

    

    provided,
      however,
      that
      upon the occurrence of an actual or deemed entry of an order for relief with
      respect to any Obligor under the Bankruptcy Code of the United States, the
      Commitments shall automatically terminate, and the unpaid principal amount
      of
      the Loans and all interest and other amounts as aforesaid shall automatically
      become due and payable, in each case without further act of the
      Lender.

    Section
      8.03. Application
      of Funds.
      After
      the exercise of remedies provided for in Section 8.02 (or after the Loans have
      automatically become immediately due and payable as set forth in the proviso
      to
      Section 8.02), subject to Article 3 and Article 9, any amounts received on
      account of the Obligations shall be applied by the Lender in such order as
      it
      elects in its sole discretion.

    

    ARTICLE
      9

    MISCELLANEOUS

     

    Section
      9.01. Amendments;
      Etc.
      No
      amendment or waiver of any provision of this Agreement or any other Loan
      Document, and no consent to any departure by any Obligor therefrom, shall be
      effective unless in writing signed by the Lender and each Obligor to be bound
      thereby, and each such waiver or consent shall be effective only in the specific
      instance and for the specific purpose for which given.

     

    
      
         

      

      
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    Section
      9.02. Notices
      and Other Communications; Facsimile Copies. 

    

    (a) General.
      Unless
      otherwise expressly provided herein, all notices and other communications
      provided for hereunder shall be in writing (including by facsimile
      transmission). All such written notices shall be mailed, faxed or delivered
      to
      the address, facsimile number or (subject to subsection (c) below) electronic
      mail address specified for notices to the applicable party on Schedule 9.02;
      or
      to such other address, facsimile number or electronic mail address as shall
      be
      designated by such party in a notice to the other party. All notices and other
      communications expressly permitted hereunder to be given by telephone shall
      be
      made to the telephone number specified for notices to the applicable party
      on
      Schedule 9.02, or to such other telephone number as shall be designated by
      such
      party in a notice to the other party. All such notices and other communications
      shall be deemed to be given or made upon the earlier to occur of (i) actual
      receipt by the relevant party hereto and (ii) (A) if delivered by hand or by
      courier, when signed for by or on behalf of the relevant party hereto; (B)
      if
      delivered by mail, four Business Days after deposit in the mails, postage
      prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed
      by telephone; and (D) if delivered by electronic mail (which form of delivery
      is
      subject to the provisions of subsection (c) below), when delivered; provided,
      however, that notices and other communications to the Lender pursuant to Article
      2 shall not be effective until actually received by the Lender. In no event
      shall a voicemail message be effective as a notice, communication or
      confirmation hereunder.

    

    (b) Effectiveness
      of Facsimile Documents and Signatures.
      Loan
      Documents may be transmitted and/or signed by facsimile. The effectiveness
      of
      any such documents and signatures shall, subject to applicable Law, have the
      same force and effect as manually-signed originals and shall be binding on
      each
      Obligor and the Lender. The Lender may also require that any such documents
      and
      signatures be confirmed by a manually-signed original thereof; provided,
      however, that the failure to request or deliver the same shall not limit the
      effectiveness of any facsimile document or signature.

    

    (c) Limited
      Use of Electronic Mail.
      Electronic mail and Internet and intranet websites may be used only to
      distribute routine communications, such as financial statements and other
      information as provided in Section 6.01, and to distribute Loan Documents for
      negotiation and execution by the parties thereto, and may not be used for any
      other purpose.

    

    (d) Reliance
      by Lender.
      The
      Lender shall be entitled to rely and act upon any notices reasonably believed
      by
      the Lender to be given by or on behalf of any Obligor even if (i) such notices
      were not made in a manner specified herein, were incomplete or were not preceded
      or followed by any other form of notice specified herein, or (ii) the terms
      thereof, as understood by the recipient, varied from any confirmation thereof.
      Each Obligor shall indemnify the Lender, its Affiliates, and their respective
      officers, directors, employees, agents and attorneys-in-fact from all losses,
      costs, expenses and liabilities resulting from the reliance by such Person
      on
      each notice purportedly given by or on behalf of such Obligor. All telephonic
      notices to and other communications with the Lender may be recorded by the
      Lender, and each Obligor hereby consents to such recording.

     

    
      
         

      

      
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    Section
      9.03. No
      Waiver; Cumulative Remedies.
      No
      failure by the Lender to exercise, and no delay by the Lender in exercising,
      any
      right, remedy, power or privilege hereunder shall operate as a waiver thereof;
      nor shall any single or partial exercise of any right, remedy, power or
      privilege hereunder preclude any other or further exercise thereof or the
      exercise of any other right, remedy, power or privilege. The rights, remedies,
      powers and privileges herein provided are cumulative and not exclusive of any
      rights, remedies, powers and privileges provided by law.

     

    Section
      9.04. Attorney
      Costs, Expenses and Taxes.
      Each
      Obligor agrees to pay or reimburse the Lender for all reasonable out-of-pocket
      costs and expenses incurred in connection with the preparation, drafting,
      execution (including notary or other attestation fees) or delivery of any Loan
      Document and the enforcement, attempted enforcement, or preservation of any
      rights or remedies under this Agreement or the other Loan Documents (including
      all such costs and expenses incurred during any “workout” or restructuring in
      respect of the Obligations and during any legal proceeding, including any
      proceeding under any Debtor Relief Law), including all Attorney Costs, any
      documentary or stamp taxes and notary fees. The foregoing costs and expenses
      shall include all search, filing, recording, title insurance and appraisal
      charges and fees and taxes related thereto, and other out-of-pocket expenses
      reasonably incurred by the Lender and the cost of independent public accountants
      and other outside experts retained by the Lender. All amounts due under this
      Section 9.04 shall be payable within two Business Days after written demand
      therefor. The agreements in this Section shall survive the termination of the
      Commitment and repayment, satisfaction or discharge of all other
      Obligations.

     

    Section
      9.05. Indemnification
      by Each Obligor.
      Whether
      or not the transactions contemplated hereby are consummated, but subject to
      the
      provisions of Sections 3.01, 3.04 and 3.05 (which shall provide the only source
      of indemnification for the matters covered therein), each Obligor shall
      indemnify and hold harmless the Lender and its Affiliates, and their respective
      directors, officers, employees, counsel, agents and attorneys-in-fact
      (collectively the “Indemnitees”)
      from
      and against any and all liabilities, obligations, losses, damages, penalties,
      claims, demands, actions, judgments, suits, costs, expenses and disbursements
      (including Attorney Costs) of any kind or nature whatsoever which may at any
      time be imposed on, incurred by or asserted against any such Indemnitee in
      any
      way relating to or arising out of or in connection with (a) the execution,
      delivery, enforcement, performance or administration of any Loan Document or
      any
      other agreement, letter or instrument delivered in connection with the
      transactions contemplated thereby or the consummation of the transactions
      contemplated thereby, (b) the Commitment, the Loan or the use or proposed use
      of
      the proceeds therefrom or (c) any actual or prospective claim, litigation,
      investigation or proceeding relating to any of the foregoing, whether based
      on
      contract, tort or any other theory (including any investigation of, preparation
      for, or defense of any pending or threatened claim, investigation, litigation
      or
      proceeding) and regardless of whether any Indemnitee is a party thereto (all
      the
      foregoing, collectively, the “Indemnified
      Liabilities”),
      in
      all cases, whether or not caused by or arising, in whole or in part, out of
      the
      negligence of the Indemnitee; provided that such indemnity shall not, as to
      any
      Indemnitee, be available to the extent that such liabilities, obligations,
      losses, damages, penalties, claims, demands, actions, judgments, suits, costs,
      expenses or disbursements are determined by a court of competent jurisdiction
      by
      final and nonappealable judgment to have resulted from the gross negligence
      or
      willful misconduct of such Indemnitee. No Indemnitee shall have any liability
      for any indirect or consequential damages relating to this Agreement or any
      other Loan Document or arising out of its activities in connection herewith
      or
      therewith (whether before or after the Closing Date). All amounts due under
      this
      Section 9.05 shall be payable within five Business Days after demand therefor.
      The agreements in this Section 9.05 shall survive the termination of the
      Commitment and the repayment, satisfaction or discharge of all the other
      Obligations.

     

    
      
         

      

      
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    Section
      9.06. Payments
      Set Aside.
      To the
      extent that any payment by or on behalf of any Obligor is made to the Lender,
      or
      the Lender exercises its right of set-off, and such payment or the proceeds
      of
      such set-off or any part thereof is subsequently invalidated, declared to be
      fraudulent or preferential, set aside or required (including pursuant to any
      settlement entered into by the Lender in its discretion) to be repaid to a
      trustee, receiver or any other party, in connection with any proceeding under
      any Debtor Relief Law or otherwise, then, to the extent of such recovery, the
      obligation or part thereof originally intended to be satisfied shall be revived
      and continued in full force and effect as if such payment had not been made
      or
      such set-off had not occurred.

     

    Section
      9.07. Successors
      and Assigns; Participations. 

    

    (a) The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the parties hereto and their respective successors and assigns permitted hereby,
      except that no Obligor may assign or otherwise transfer any of his (or her)
      or
      its rights or obligations hereunder without the prior written consent of the
      Lender. The Lender may assign and transfer all or any part of its rights and/or
      obligations under this Agreement to any one or more persons (an “Assignee”)
      and
      after any such assignment/transfer the expression the “Lender”
shall
      be deemed to include such assignees/transferees to the extent or their
      respective interests; provided that any transfer of all or part of the Lender’s
      obligations may only be effected if the transferee shall undertake to become
      bound by the terms of this Agreement and thereafter that transferee alone shall
      be obliged to perform that portion of the Lender’s obligations which corresponds
      to its interest; provided further that ABN AMRO shall at all times hold not
      less
      than 50% of the aggregate principal amount of the Loans. Upon request, the
      Borrower shall execute and deliver any documents reasonably necessary or
      appropriate to give effect to such assignment and to provide for the
      administration of this Agreement after giving effect thereto. Nothing in this
      Agreement, expressed or implied, shall be construed to confer upon any Person
      (other than the parties hereto, their respective successors and assigns
      permitted hereby, Participants to the extent provided in Section 9.07(b) and,
      to
      the extent expressly contemplated hereby, the Indemnitees) any legal or
      equitable right, remedy or claim under or by reason of this Agreement.
      Subsequent to any assignment by the Lender to an Assignee, the Lender will
      notify the Borrower of such assignment.

    

    (b) The
      Lender may at any time, without acknowledgement by, or notice to, any Obligor,
      sell participations to any Person (other than any Obligor or any of the
      Obligor’s Affiliates or Subsidiaries) (each, a “Participant”)
      in all
      or a portion of the Lender’s rights and/or obligations under this Agreement
      (including all or a portion of its Commitment and/or the Loans); provided that
      (i) the Lender’s and each Obligor’s obligations under this Agreement shall
      remain unchanged, (ii) the Lender shall remain solely responsible to the
      Borrower for the performance of such obligations and (iii) each Obligor shall
      continue to deal solely and directly with the Lender in connection with the
      Lender’s rights and obligations under this Agreement. Any agreement or
      instrument pursuant to which the Lender sells such a participation shall provide
      that the Lender shall retain the sole right to enforce this Agreement and to
      approve any amendment, modification or waiver of any provision of this
      Agreement; provided
      that
      such agreement or instrument may provide that the Lender will not, without
      an
      acknowledgement by the Participant, agree to any amendment, waiver or other
      modification that would (i) postpone any date upon which any payment of money
      is
      scheduled to be made to such Participant, (ii) reduce the principal, interest,
      fees or other amounts payable to such Participant (provided, however, that
      the
      Lender may, without an acknowledgement by the Participant, waive the right
      to be
      paid interest at the Default Rate) or (iii) release all or substantially all
      of
      the Collateral. Subject to Section 9.07(c), each Obligor agrees that each
      Participant shall be entitled to the benefits of Section 3.01, 3.04 and 3.05
      to
      the same extent as if it were the Lender and had acquired its interest by
      assignment. To the extent permitted by law, each Participant also shall be
      entitled to the benefits of Section 9.09 as though it were the
      Lender.

    

    
      
         

      

      
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    (c) A
      Participant shall not be entitled to receive any greater payment under Section
      3.01, 3.04 or 3.05 than the Lender would have been entitled to receive with
      respect to the participation sold to such Participant, unless the sale of the
      participation to such Participant is acknowledged by the Borrower in writing.
      

    

    (d) The
      Lender may at any time pledge or assign a security interest in all or any
      portion of its rights under this Agreement to secure obligations of the Lender;
      provided
      that no
      such pledge or assignment shall release the Lender from any of its obligations
      hereunder or substitute any such pledgee or assignee for the Lender as a party
      hereto.

    

    (e) The
      Borrower and its Related Parties shall use their respective reasonable best
      efforts to facilitate any selling of any participation pursuant to Section
      9.07(b), including by promptly providing any information requested by the Lender
      for the benefit of any potential Participant.

     

    Section
      9.08. Confidentiality.
      The
      Lender agrees to maintain the confidentiality of the Information (as defined
      below), except that Information may be disclosed Article 10 to its and its
      Affiliates’ directors, officers, employees and agents, including accountants,
      legal counsel and other advisors (it being understood that the Persons to whom
      such disclosure is made will be informed of the confidential nature of such
      Information and instructed to keep such Information confidential); Article
      11 to
      the extent requested by any regulatory authority; Article 12 to the extent
      required by applicable laws or regulations or by any subpoena or similar legal
      process; Article 13 to any other party to this Agreement; Article 14 in
      connection with the exercise of any remedies hereunder or any suit, action
      or
      proceeding relating to this Agreement or the enforcement of rights hereunder;
      Article 15 subject to an agreement containing provisions substantially the
      same
      as those of this Section 9.08 (i) any Assignee of or Participant in, or any
      prospective Assignee of or Participant in, any of its rights or obligations
      under this Agreement or (ii) any direct or indirect contractual counterparty
      or
      prospective counterparty (or such contractual counterparty’s or prospective
      counterparty’s professional advisor) to any credit derivative transaction
      relating to obligations of any Obligor; Article 16 with the consent of each
      Obligor; or Article 17 to the extent such Information (i) becomes publicly
      available other than as a result of a breach of this Section 9.08 or (ii)
      becomes available to the Lender on a nonconfidential basis from a source other
      than any Obligor. In addition, the Lender may disclose the existence of this
      Agreement and information about this Agreement to market data collectors,
      similar service providers to the lending industry, and service providers to
      the
      Lender in connection with the administration and management of this Agreement,
      the other Loan Documents, the Commitment and the Loans.

    

    
      
         

      

      
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    For
      the
      purposes of this Section 9.08, “Information”
means
      all information received from any Obligor relating to such Obligor or its
      business, other than any such information that is available to the Lender on
      a
      nonconfidential basis prior to disclosure by such Obligor; provided that in
      the
      case of information received from any Obligor after the date hereof, such
      information is clearly identified in writing at the time of delivery as
      confidential. Any Person required to maintain the confidentiality of Information
      as provided in this Section 9.08 shall be considered to have complied with
      its
      obligation to do so if such Person has exercised the same degree of care to
      maintain the confidentiality of such Information as such Person would accord
      to
      its own confidential information.

     

    Section
      9.09. Set-off.
      In
      addition to any rights and remedies of the Lender provided by law, upon the
      occurrence and during the continuance of any Event of Default, but subject
      to
      Article 3 and Article 9, the Lender is authorized at any time and from time
      to
      time, without prior notice to any Obligor, any such notice being waived by
      each
      Obligor to the fullest extent permitted by law, to set off and apply any and
      all
      deposits (general or special, time or demand, provisional or final) at any
      time
      held by, and other indebtedness at any time owing by, the Lender to or for
      the
      credit or the account of any Obligor against any and all Obligations owing
      to
      the Lender hereunder or under any other Loan Document, now or hereafter
      existing, irrespective of whether or not the Lender shall have made demand
      under
      this Agreement or any other Loan Document and although such Obligations may
      be
      contingent or unmatured or denominated in a currency different from that of
      the
      applicable deposit or indebtedness. The Lender agrees promptly to notify each
      Obligor after any such set-off and application; provided, however, that the
      failure to give such notice shall not affect the validity of such set-off and
      application.

     

    Section
      9.10. Interest
      Rate Limitation.
      Notwithstanding anything to the contrary contained in any Loan Document, the
      interest paid or agreed to be paid under the Loan Documents shall not exceed
      the
      maximum rate of non-usurious interest permitted by applicable Law (the
“Maximum
      Rate”).
      If
      the Lender shall receive interest in an amount that exceeds the Maximum Rate,
      the excess interest shall be applied to the principal of the Loans or, if it
      exceeds such unpaid principal, refunded to the Borrower. In determining whether
      the interest contracted for, charged, or received by the Lender exceeds the
      Maximum Rate, the Lender may, to the extent permitted by applicable Law, (a)
      characterize any payment that is not principal as an expense, fee, or premium
      rather than interest, (b) exclude voluntary prepayments and the effects thereof,
      and (c) amortize, prorate, allocate, and spread in equal or unequal parts the
      total amount of interest throughout the contemplated term of the Obligations
      hereunder.

     

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

     

    Section
      9.12. Integration.
      This
      Agreement, together with the other Loan Documents, comprises the complete and
      integrated agreement of the parties on the subject matter hereof and thereof
      and
      supersedes all prior agreements, written or oral, on such subject matter. In
      the
      event of any conflict between the provisions of this Agreement and those of
      any
      other Loan Document, the provisions of this Agreement shall control; provided
      that the inclusion of supplemental rights or remedies in favor of the Lender
      in
      any other Loan Document shall not be deemed a conflict with this Agreement.
      Each
      Loan Document was drafted with the joint participation of the respective parties
      thereto and shall be construed neither against nor in favor of any party, but
      rather in accordance with the fair meaning thereof.

     

    
      
         

      

      
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    Section
      9.13. Survival
      of Representations and Warranties.
      All
      representations and warranties made hereunder and in any other Loan Document
      or
      other document delivered pursuant hereto or thereto or in connection herewith
      or
      therewith shall survive the execution and delivery hereof and thereof. Such
      representations and warranties have been or will be relied upon by the Lender,
      regardless of any investigation made by the Lender or on its behalf and
      notwithstanding that the Lender may have had notice or knowledge of any Default
      at the time of any Loan, and shall continue in full force and effect as long
      as
      any Loan or any other Obligation hereunder shall remain unpaid or
      unsatisfied.

     

    Section
      9.14. Severability.
      If any
      provision of this Agreement or the other Loan Documents is held to be illegal,
      invalid or unenforceable, (a) the legality, validity and enforceability of
      the
      remaining provisions of this Agreement and the other Loan Documents shall not
      be
      affected or impaired thereby and (b) the parties shall endeavor in good faith
      negotiations to replace the illegal, invalid or unenforceable provisions with
      valid provisions the economic effect of which comes as close as possible to
      that
      of the illegal, invalid or unenforceable provisions. The invalidity of a
      provision in a particular jurisdiction shall not invalidate or render
      unenforceable such provision in any other jurisdiction.

     

    Section
      9.15. Governing
      Law. 

    

    (a) THIS
      AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
      THE
      STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
      WITHIN SUCH STATE; PROVIDED THAT THE LENDER SHALL RETAIN ALL RIGHTS ARISING
      UNDER FEDERAL LAW.

    

    (b) ANY
      LEGAL
      ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
      MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH
      OF
      MANHATTAN, NEW YORK CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT
      OF
      SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OBLIGOR AND
      THE LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
      NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OBLIGOR AND THE LENDER
      IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
      VENUE
      OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
      HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
      OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. EACH OBLIGOR AND THE
      LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
      WHICH
      MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. EACH OBLIGOR
      AGREES THAT A FINAL JUDGMENT IN ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
      IN
      SUCH A COURT SHALL BE CONCLUSIVE AND BINDING UPON IT AND WILL BE GIVEN EFFECT
      IN
      ANY OTHER JURISDICTION TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW AND
      MAY
      BE ENFORCED IN ANY COURT TO THE JURISDICTION OF WHICH SUCH OBLIGOR IS OR MAY
      BE
      SUBJECT BY A SUIT UPON SUCH JUDGMENT; PROVIDED THAT SERVICE OF PROCESS IS
      EFFECTED UPON IT IN ONE OF THE MANNERS SPECIFIED HEREIN OR AS OTHERWISE
      PERMITTED BY LAW.

     

    
      
         

      

      
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    Section
      9.16. Waiver
      of Right to Trial by Jury.
      EACH
      PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
      OF
      ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
      OR
      IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
      PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
      TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
      ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
      HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
      ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
      THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
      ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
      WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

     

    Section
      9.17. New
      York Process Agent.
      Without
      prejudice to any other mode of service allowed under any relevant Law each
      Obligor:

    

    (a) irrevocably
      appoints CT Corporation System, located at 111 Eighth Avenue, New York, NY
      10011
      as its agent for service of process in relation to any proceedings before the
      courts of the State of New York sitting in the Borough of Manhattan, New York
      City or of the United States for the Southern District of such State in
      connection with this Agreement; and

    

    (b) agrees
      that failure by a process agent to notify the relevant Obligor of the process
      will not invalidate the proceedings concerned.

     

    Section
      9.18. Obligation
      Currency.
      The
      obligation of the Obligors to make payments pursuant to this Agreement is in
      US
      Dollars (the “Obligation
      Currency”)
      and
      such obligation shall not be discharged or satisfied by any tender or recovery
      pursuant to any judgment expressed in any currency other than the Obligation
      Currency or any other realization in such other currency, whether as proceeds
      of
      set-off, security, guarantee, distributions, or otherwise, except to the extent
      to which such tender, recovery or realization shall result in the receipt by
      the
      party which is to receive such payment of the full amount of the Obligation
      Currency expressed to be payable hereunder. The Obligor liable to make such
      payment agrees to indemnify the party which is to receive such payment for
      the
      amount (if any) by which such receipt shall fall short of the full amount of
      the
      Obligation Currency expressed to be payable hereunder and the party which is
      to
      receive such payment agrees to pay to the party liable to make such payment
      the
      amount (if any) by which such receipt shall exceed the full amount of the
      Obligation Currency, and, in each case, such obligation shall not be affected
      by
      judgment being obtained for any other sums due under this Agreement. The parties
      agree that the rate of exchange which shall be used to determine if such tender,
      recovery or realization shall result in the receipt by the party which is to
      receive such payment of the full amount of the Obligation Currency expressed
      to
      be payable hereunder shall be the noon buying rate in New York City for cable
      transfers in foreign currencies as certified for customs purposes by the Federal
      Reserve Bank of New York for the business day (being a day (excluding Saturdays
      and Sundays) on which banks are generally open in New York) preceding that
      on
      which the judgment becomes a final judgment.

    

    
      
         

      

      
        39

        
          

        

      

      
         

      

       

    

    ARTICLE
      10

    GUARANTEES

     

    Section
      10.01. The
      Guarantees.
      Each
      Individual Guarantor hereby, jointly and severally, unconditionally and
      absolutely guarantees the full and punctual payment (whether at stated maturity,
      upon acceleration or otherwise) of the principal of and interest on the Loan
      made to the Borrower pursuant to this Agreement, and the full and punctual
      payment of all other amounts payable by the Borrower under the Loan Documents.
      Upon failure by the Borrower to pay punctually any such amount, each Individual
      Guarantor shall forthwith on demand pay the amount not so paid at the place
      and
      in the manner specified in this Agreement.

     

    Section
      10.02. Guaranty
      Unconditional.
      The
      obligations of each Individual Guarantor hereunder shall be unconditional and
      absolute and, without limiting the generality of the foregoing, shall not be
      released, discharged or otherwise affected by:

    

    (a) any
      extension, renewal, settlement, compromise, waiver or release in respect of
      any
      obligation of any other Obligor under any Loan Document, by operation of law
      or
      otherwise;

    

    (b) any
      modification or amendment of or supplement to any Loan Document;

    

    (c) any
      release, impairment, non-perfection or invalidity of any direct or indirect
      security for any obligation of any other Obligor under any Loan
      Document;

    

    (d) any
      change in the corporate existence, structure or ownership of any other Obligor,
      or any insolvency, bankruptcy, reorganization or other similar proceeding
      affecting any other Obligor or its assets or any resulting release or discharge
      of any obligation of any other Obligor contained in any Loan
      Document;

    

    (e) the
      existence of any claim, set-off or other rights which such Individual Guarantor
      may have at any time against any other Obligor, the Lender or any other Person,
      whether in connection herewith or any unrelated transactions; provided that
      nothing herein shall prevent the assertion of any such claim by separate suit
      or
      compulsory counterclaim;

    

    (f) any
      invalidity or unenforceability relating to or against any other Obligor for
      any
      reason of any Loan Document, or any provision of applicable law or regulation
      purporting to prohibit the payment by any other Obligor of the principal of
      or
      interest on the Loan or any other amount payable by it under any Loan Document;
      or

    

    
      
         

      

      
        40

        
          

        

      

      
         

      

       

    

    (g) any
      other
      act or omission to act or delay of any kind by any other Obligor, any Lender
      or
      any other Person or any other circumstance whatsoever which might, but for
      the
      provisions of this paragraph, constitute a legal or equitable discharge of
      such
      Individual Guarantor’s obligations hereunder. 

    

    Each
      Individual Guarantor agrees, jointly and severally, as a primary obligation
      to
      indemnify the Lender from time to time on demand from and against any loss
      incurred by the Lender as a result of any such obligation or liability of any
      Individual Guarantor set forth in the preceding sentence being or becoming
      void,
      voidable, unenforceable or ineffective or being or becoming suspended (whether
      pursuant to any rehabilitation, reorganization or moratorium proceedings or
      otherwise) as against such Individual Guarantor for any reason whatsoever,
      whether or not known to the Lender, the amount of such loss being the amount
      which the Lender would otherwise have been entitled to recover from such
      Individual Guarantor.

     

    Section
      10.03. Discharge
      Only Upon Payment in Full; Reinstatement in Certain
      Circumstances.
      Each
      Individual Guarantor’s obligations hereunder shall remain in full force and
      effect until the Commitment shall have terminated and the principal of and
      interest on any Loan and all other amounts payable by the Borrower under the
      Loan Documents shall have been paid in full. If at any time any payment of
      the
      principal of or interest on any Loan or any other amount payable by the Borrower
      under the Loan Documents is rescinded or must be otherwise restored or returned
      upon the insolvency, bankruptcy or reorganization of any Obligor or otherwise,
      each Individual Guarantor’s obligations hereunder with respect to such payment
      shall be reinstated at such time as though such payment had been due but not
      made at such time.

     

    Section
      10.04. Waiver
      by the Individual Guarantors.
      Each
      Individual Guarantor irrevocably waives acceptance hereof, presentment, demand,
      protest and any notice not provided for herein, as well as any requirement
      that
      at any time any action be taken by any Person against any other Obligor or
      any
      other Person.

     

    Section
      10.05. Subrogation.
      Upon
      making any payment with respect to the Borrower hereunder, each Individual
      Guarantor shall be subrogated to the rights of the payee against such Borrower
      with respect to such payment; provided that no Individual Guarantor shall
      enforce any payment by way of subrogation unless all amounts of principal of
      and
      interest on any Loan and all other amounts payable under the Loan Documents
      have
      been paid in full.

     

    Section
      10.06. Stay
      of Acceleration.
      If
      acceleration of the time for payment of any amount payable by the Borrower
      under
      the Loan Documents is stayed upon insolvency, bankruptcy or reorganization
      of
      the Borrower, all such amounts otherwise subject to acceleration under the
      terms
      of this Agreement shall nonetheless be payable by each Individual Guarantor
      hereunder forthwith on demand by the Lender.

    

    
      
         

      

      
        41

        
          

        

      

      
         

      

       

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
      executed as of the date first above written.

     

    
      	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            

    

    

    
      
         

      

      
        42

        
          

        

      

      
         

      

    

    

    
      	 	
              LIANG
                ZHANG

               

               

              _______________________________________

            
	 	
              Name
                in Chinese: 张亮

              PRC
                passport number: G14902730

               

               

               

            
	 	
              in
                the presence of

               

               

              _______________________________________

            
	 	
              Witness

              Name:

            

    

    

    
      
         

      

      
        43

        
          

        

      

      
         

      

    

    

    
      	 	
              XIUQING
                MENG

               

               

              _______________________________________

            
	 	
              Name
                in Chinese: 孟秀清

              Hong
                Kong Special Administrative Region passport number: DA9001206

               

               

               

            
	 	
              in
                the presence of

               

               

              _______________________________________

            
	 	
              Witness

              Name:

            

    

    

    
      
         

      

      
        44

        
          

        

      

      
         

      

    

    

    
      	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Lender

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            
	 	 
	 	 
	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Collateral
                Agent

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            

    

    

    
      
         

      

      
        45

        
          

        

      

      
         

      

    

    Schedule
      5.10

    

    SUBSIDIARIES
      OF THE BORROWER

     

    
      	
              No

            	 	
              Name
                of the Subsidiaries

            	 	
              Place
                of Incorporation

            	 	
              Shareholder
                Structure

            
	
              1.

            	 	
              Synutra,
                Inc. 

            	 	
              Illinois,
                U.S.A.

            	 	
              100%
                owned by Synutra International, Inc.

            
	
              2.

            	 	
              Hunan
                Synutra Dairy Co., Ltd.1 

            	 	
              PRC

            	 	
              70%
                owned by Qingdao ST George Dairy Co., Ltd; 30% owned by Synutra
                International, Inc. 

            
	
              3.

            	 	
              Inner
                Mongolia Sheng Yuan Food Co., Ltd. 

            	 	
              PRC

            	 	
              100%
                owned by Synutra International, Inc.

            
	
              4.

            	 	
              Mei
                Tai Technology (Qingdao) Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra International, Inc. 

            
	
              5.

            	 	
              Qingdao
                ST George Dairy Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra, Inc. 

            
	
              6.

            	 	
              Qingdao
                Sheng Yuan Dairy Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra, Inc.

            
	
              7.

            	 	
              Luobei
                Sheng Yuan Dairy Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra, Inc.

            
	
              8.

            	 	
              Beian
                Yi Pin Dairy Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra, Inc.

            
	
              9.

            	 	
              Zhangjiakou
                Sheng Yuan Dairy Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Synutra, Inc.

            
	
              10.

            	 	
              Inner
                Mongolia Meng Yuan Food Co., Ltd.

            	 	
              PRC

            	 	
              100%
                owned by Zhangjiakou Sheng Yuan Dairy Co.,
                Ltd.

            

    

     

     

      
        

      

    

    1 Hunan
      Synutra is now in the process of liquidation. 

    
      
         

      

      
        S-1

        
          

        

      

      
         

      

    

    CORPORATE
      CHART OF THE BORROWER

    

    

    

    *Hunan
      Synutra is now in the process of liquidation

    
       

      
         

      

      
        S-2

        
          

        

      

      
         

      

    

    

    EXISTING
      LIENS

    

    SYNUTRA
      INTERNATIONAL, INC.:

    

    None

    

    SUBSIDIARIES:

    

    
      	(A)	
              Qingdao
                ST George Dairy Co. Ltd. 

            

    

    

    1. With
      respect to the loan of RMB40,000,000 extended by China Construction Bank Economy
      and Development Zone Branch, Qingdao City on November 16, 2006 to the entity,
      the entity has mortgaged its land use right and its building located on the
      relevant land for a loan of RMB40,000,000. The land in relation to the land
      use
      right is located in Road West, No 18, South to Century Avenue, Jiaonan City,
      Shandong Province. Certificate of the land use right is numbered
      Nanguoyong(2002)zi No.4835. The building is located in South to Century Avenue
      Jiaonan City with a Property Mortgage Certificate numbered Nanfangdigongzi
      No
      1268. 

    

    2. With
      respect to the loan of RMB24,000,000 extended by Agricultural Bank of China
      Zhangbei Branch on March 29, 2007 to Zhangjiakou Shengyuan Dairy Co., Ltd.,
      the
      entity has provided guarantee for the loan. Scope of the debt guaranteed include
      principal and accrued cost as well. 

    

    
      	(B)	
              Qingdao
                Shengyuan Dairy Co. Ltd. 

            

    

    

    1. With
      respect to the loan of RMB20,000,000 extended by Hengfeng Bank Economy and
      Development Zone Branch, Qingdao City on October 26, 2006 to Qingdao ST George
      Dairy Co. Ltd., the entity has provided guarantees for the loan. Scope of the
      debt guaranteed include principal and accrued cost as well. 

    

    2. With
      respect to the loan of RMB20,000,000 extended by Agricultural Bank of China
      Zhangbei Branch, in December, 2006 to Zhangjiakou Shengyuan Dairy Co., Ltd.,
      the
      entity has provided guarantees for the loan. Scope of the debt guaranteed
      includes principal and accrued cost as well. 

    

    
      	(C)	
              Zhangjiakou
                Shengyuan Dairy Co., Ltd.

            

    

    

    The
      entity has entered into a ceiling mortgage contract with Agricultural Bank
      of
      China Zhangbei Branch in July 5, 2006, to mortgage its land use rights,
      buildings and equipments for the loans (maximum of RMB80,000,000) over the
      period from July 5, 2006 to July 5, 2009. The land in relation to the land
      use
      right is located in Chabei Administration Zone, Zhangjiakou City, Hebei
      Province, and certificate of the land use right is numbered
      Zhangshichaguoyong2004zi No.0001. The mortgaged buildings are located Chabei
      Administration Zone, Zhangjiakou City, Hebei Province with a ownership
      certificate numbered Zhangfangquanzhengchazi No. 001027. The mortgaged
      equipments include an imported production line and a set of boiler. Such
      mortgage is registered with Zhangjiakou Commercial and Industry Administration,
      Chabei Branch, and is evidenced by a registration certificate numbered
      (2006)dizi No.002. 

    

    
      
         

      

      
        S-3

        
          

        

      

      
         

      

       

    

    ZHANG
      LIANG:

    

    None

    

    MENG
      XIUQING:

    

    None

    

    
      
         

      

      
        S-4

        
          

        

      

      
         

      

      
        SCHEDULE
          9.02

      

    

    

    NOTICE
      ADDRESSES AND LENDING OFFICE

    

    BORROWER:

    

    c/o
      Synutra International, Inc.

    2275
      Research Blvd, Suite 500

    Rockville,
      MD 20850, USA

    Attn:
      Weiguo Zhang 

    Telephone:
      +1-301-840-3888 / +1-202-246-8818

    Facsimile:
      +1-301-987-2344

    E-mail:
      wzhang@synutra.com

    

    INDIVIDUAL
      GUARANTORS:

    

    Liang
      Zhang

    Shenglong
      Garden

    No.
      103
      Dongluyuan

    Tongzhou
      District

    Beijing,
      101101, PRC

    Telephone:
      +86-10-5869-3222

    Facsimile:
      +86-10-5869-3221

    E-mail:
      zhangliang@vip.sina.com

    

    Xiuqing
      Meng

    c/o
      Liang
      Zhang

    Shenglong
      Garden

    No.
      103
      Dongluyuan

    Tongzhou
      District

    Beijing,
      101101, PRC

    Telephone:
      +86-10-5869-3222

    Facsimile:
      +86-10-5869-3221

    E-mail:
      sherrymeng@yahoo.com

    

    LENDER:

    

    ABN
      AMRO
      Bank N.V., Hong Kong Branch

    38/F,
      Cheung Kong Centre

    2
      Queen’s
      Road Central

    Hong
      Kong

    Attention:
      Shirley Yiu, Helen Fei, Carlos Wong, Clarice Tsang, Jessamine Lam

    Telephone:
      +852-2700-3209/3211/3297/3452/3281

    Facsimile:
      +852-2700-3202/3836/3300

    
      	E-mail:	
              shirley.yiu@hk.abmamro.com;
                helen.fei@hk.abnamro.com; carlos.wong@hk.abnamro.com;
                clarice.tsang@hk.abnamro.com; jessamine.lam@hk.abnamro.com
                

            

    

    

    
      
         

      

      
        S-5

        
          

        

      

      
         

      

    

    EXHIBIT
      A

    

    FORM
      OF COLLATERAL AGREEMENT

    

    COLLATERAL
      AGREEMENT

    

    AGREEMENT
      dated as of April 19, 2007 (this “Agreement”)
      among
      BEAMS POWER INVESTMENT LIMITED, an International Business Companies Act company
      re-registered as a BVI business company organized under the laws of the British
      Virgin Islands (the “Lien
      Grantor”),
      SYNUTRA INTERNATIONAL, INC., a Delaware corporation (the “Issuer”)
      and
      ABN AMRO BANK N.V., HONG KONG BRANCH as lender (the “Lender”)
      and as
      collateral agent (the “Collateral
      Agent”).

    

    W
      I T N E S S E T H :

    

    WHEREAS,
      the Obligors (as defined therein) and the Lender are parties to a Loan Agreement
      of even date herewith (as the same may be amended from time to time, the
“Loan
      Agreement”)
      providing for credit extensions to and on behalf of the Issuer; 

    

    WHEREAS,
      all of the equity interests in the Lien Grantor are owned by certain of the
      Obligors under the Loan Agreement; and

    

    WHEREAS,
      in order to induce the Lender to enter into the Loan Agreement, the Lien Grantor
      has agreed to grant a continuing security interest in and to the Collateral
      (as
      hereafter defined) to secure the Obligors’ obligations under the Loan
      Agreement;

    

    NOW,
      THEREFORE, in consideration of the premises and other good and valuable
      consideration, the receipt and sufficiency of which are hereby acknowledged,
      the
      parties hereto agree as follows:

    

    Section
      1. Definitions.
      

    

    (a) Terms
      Defined in the Loan Agreement.
      Terms
      defined in the Loan Agreement and not otherwise defined herein shall have,
      as
      used herein, the respective meanings provided for therein. 

    

    (b) Additional
      Definitions.
      The
      following additional terms, as used herein, have the following
      meanings:

    

    “Acceleration
      Default”
means
      an Event of Default which either (i) results in acceleration of the maturity
      of
      some or all of the Obligations or (ii) arises from a failure to pay the
      principal amount of some or all of the Obligations at final
      maturity.

    

    “BC
      Act”
has
      the
      meaning specified in Section 5(b).

    

    “Collateral”
has
      the
      meaning assigned to such term in Section 3(a).

    

    
      
         

      

      
        A-1

        
          

        

      

      
         

      

       

    

    “Default”
and
      “Event
      of Default”
have
      the meanings assigned such terms under the Loan Agreement and, for purposes
      of
      this Agreement only, Event of Default shall also include any payment defaults
      by
      the Issuer or the Lien Grantor arising under any other Loan
      Document.

    

    “Issuer”
has
      the
      meaning specified in the introductory paragraph hereto.

    

    “Pledged
      Stock”
means
      (i) the 25,000,000 shares of common stock of the Issuer owned by the Lien
      Grantor as of the date hereof and (ii) any other capital stock required to
      be
      pledged to the Collateral Agent pursuant to Section 3(b).

    

    “Post-Petition
      Interest”
means
      any interest that accrues after the commencement of any case, proceeding or
      other action relating to the bankruptcy, insolvency or reorganization of any
      Obligor (or would accrue but for the operation of applicable bankruptcy or
      insolvency laws), whether or not such interest is allowed or allowable as a
      claim in any such proceeding.

    

    “Proceeds”
means
      all proceeds of, and all other profits, products, rents or receipts, in whatever
      form, arising from the collection, sale, lease, exchange, assignment, licensing
      or other disposition of, or other realization upon, any Collateral, including
      all claims of the Lien Grantor against third parties for loss of, damage to
      or
      destruction of, or for proceeds payable under, or unearned premiums with respect
      to, policies of insurance in respect of, any Collateral.

    

    “Register
      of Charges”
has
      the
      meaning specified in Section 5(b).

    

    “Registrar”
has
      the
      meaning specified in Section 5(c).

    

    “Secured
      Obligations”
means
      the obligations secured under this Agreement including (i) the Obligations,
      (ii)
      any note issued pursuant to any of the Loan Documents and (iii) any renewals
      or
      extensions of any of the foregoing.

    

    “Security
      Interests”
means
      the security interests in the Collateral granted hereunder securing the Secured
      Obligations.

    

    “UCC”
means
      the Uniform Commercial Code as in effect from time to time in the State of
      New
      York; provided that, if perfection or the effect of perfection or non-perfection
      or the priority of the Security Interests on any Collateral is governed by
      the
      Uniform Commercial Code as in effect in a jurisdiction other than New York,
      “UCC” means the Uniform Commercial Code as in effect from time to time in such
      other jurisdiction for purposes of the provisions hereof relating to such
      perfection, effect of perfection or non-perfection or priority.

    

    Unless
      otherwise defined herein or in the Loan Agreement, or unless the context
      otherwise requires, all terms used herein which are defined in the UCC as in
      effect on the date hereof shall have the meanings therein stated.

    

    (c) Terms
      Generally.
      The
      definitions of terms herein (including those incorporated by reference to the
      UCC or to another document) apply equally to the singular and plural forms
      of
      the terms defined. Whenever the context may require, any pronoun includes the
      corresponding masculine, feminine and neuter forms. The words “include”,
      “includes”
and
      “including”
shall
      be deemed to be followed by the phrase “without
      limitation”.
      The
      word “will”
shall
      be construed to have the same meaning and effect as the word “shall”.
      Unless
      the context requires otherwise, (i) any definition of or reference to any
      agreement, instrument or other document herein shall be construed as referring
      to such agreement, instrument or other document as from time to time amended,
      supplemented or otherwise modified (subject to any restrictions on such
      amendments, supplements or modifications set forth herein), (ii) any reference
      herein to any Person shall be construed to include such Person’s successors and
      permitted assigns, (iii) the words “herein”,
      “hereof”
and
      “hereunder”,
      and
      words of similar import, shall be construed to refer to this Agreement in its
      entirety and not to any particular provision hereof, (iv) all references herein
      to Sections, Exhibits and Schedules shall be construed to refer to Sections
      of,
      and Exhibits and Schedules to, this Agreement, and (v) the word “property”
shall
      be construed to refer to any and all tangible and intangible assets and
      properties, including cash, securities, accounts and contract
      rights.

    

    
      
         

      

      
        A-2

        
          

        

      

      
         

      

       

    

    Section
      2. Representations
      and Warranties.
      The
      Lien Grantor represents and warrants as follows:

    

    (a) Title
      to Pledged Stock.
      The
      Lien Grantor owns all of the Pledged Stock, free and clear of any Liens other
      than the Security Interests. All of the Pledged Stock has been duly authorized
      and validly issued, and is fully paid and non-assessable, and is not subject
      to
      options to purchase, claims or similar rights of any Person. The Lien Grantor
      is
      not and will not become a party to or otherwise bound by any agreement, other
      than this Agreement, which restricts in any manner the rights of the Lender,
      the
      Collateral Agent or any present or future holder of any of the Pledged Stock
      with respect thereto.

    

    (b) Pledged
      Stock.
      As of
      the date hereof, the Pledged Stock represents at least 49.9% of the issued
      and
      outstanding common stock of the Issuer. 

    

    (c) Validity,
      Perfection and Priority of Security Interests.
      Upon
      delivery of the certificates representing the Pledged Stock to the Collateral
      Agent or its designee in accordance with Section 4 hereof, the Collateral Agent
      will have a valid and perfected security interest in the Collateral subject
      to
      no prior Lien. Except as set forth in Section 5, no registration, recordation
      or
      filing with any governmental body, agency or official is required in connection
      with the execution or delivery of this Agreement or necessary for the validity
      or enforceability hereof or for the perfection or enforcement of the Security
      Interests. Neither the Lien Grantor nor any of its Subsidiaries has performed
      or
      will perform any acts which could prevent the Collateral Agent from enforcing
      any of the terms and conditions of this Agreement or which would limit the
      Collateral Agent in any such enforcement.

    

    (d) Lien
      Grantor and UCC Filing Locations.
      The
      Lien Grantor is duly organized, validly existing and in good standing under
      the
      laws of the British Virgin Islands.

    

    (e) Authorization;
      No Contravention.
      The
      execution, delivery and performance by the Lien Grantor of this Agreement has
      been duly authorized by all necessary corporate action on its part, and does
      not
      and will not contravene the terms of its Organization Documents. The execution,
      delivery and performance by the Lien Grantor of this Agreement does not and
      will
      not (a) conflict with or result in any breach or contravention of, or the
      creation of any Lien (other than those contemplated hereby) under (i) any
      Contractual Obligation to which the Lien Grantor is a party or (ii) any order,
      injunction, writ or decree of any Governmental Authority or any arbitral award
      to which the Lien Grantor or its property is subject or (b) violate any Law
      applicable to the Lien Grantor, this Agreement or any of the transactions
      contemplated hereby.

    

    
      
         

      

      
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    (f) Governmental
      Authorization; Other Consents.
      Except
      as set forth in Section 5, no approval, consent, exemption, authorization,
      or
      other action by, or notice to, or filing with, any Governmental Authority or
      any
      other Person is necessary or required in connection with the execution, delivery
      or performance by, or enforcement against, the Lien Grantor or the Collateral
      of
      this Agreement or any other Loan Document.

    

    (g) Binding
      Effect.
      This
      Agreement has been duly executed and delivered by the Lien Grantor. The
      Agreement constitutes a legal, valid and binding obligation of the Lien Grantor,
      enforceable against it in accordance with its terms.

    

    Section
      3. The
      Security Interests.
      In
      order to secure the full and punctual payment of the Secured Obligations in
      accordance with the terms thereof, and to secure the performance of all the
      obligations of the Lien Grantor and the Issuer hereunder:

    

    (a) The
      Lien
      Grantor hereby assigns and pledges to and with the Collateral Agent for the
      benefit of the Lender and grants to the Collateral Agent for the benefit of
      the
      Lender a security interest in the Pledged Stock, and all of its rights and
      privileges with respect to the Pledged Stock, and all income and profits
      thereon, and all interest, dividends and other payments and distributions with
      respect thereto, and all Proceeds of the foregoing (the “Collateral”).
      Contemporaneously with the execution and delivery hereof, the Lien Grantor
      is
      delivering the certificates representing the Pledged Stock in pledge
      hereunder.

    

    (b) In
      the
      event that the Issuer at any time issues any additional or substitute shares
      of
      capital stock of any class to the Lien Grantor, the Lien Grantor will
      immediately (i) pledge and deposit with the Collateral Agent certificates,
      if
      any, representing a pro
      rata
      portion
      of such shares as additional security for the Secured Obligations that is equal
      to the ratio of the Pledged Stock to the aggregate shares of common stock of
      the
      Issuer owned by the Lien Grantor on the date hereof and (ii) take all other
      steps required to grant or maintain, as applicable, a first priority security
      interest in such shares to the Collateral Agent for the benefit of the Lender.
      All such shares constitute Pledged Stock and are subject to all provisions
      of
      this Agreement.

    

    (c) The
      Security Interests are granted as security only and shall not subject the
      Collateral Agent or the Lender to, or transfer or in any way affect or modify,
      any obligation or liability of the Lien Grantor with respect to any of the
      Collateral or any transaction in connection therewith.

    

    Section
      4. Delivery
      of Pledged Stock.
      All
      certificates representing Pledged Stock delivered to the Collateral Agent or
      its
      designee by the Lien Grantor pursuant hereto shall be (x) in suitable form
      for
      transfer by delivery, or shall be accompanied by duly executed instruments
      of
      transfer or assignment in blank, with signatures appropriately guaranteed,
      and
      accompanied by any required transfer tax stamps, all in form and substance
      satisfactory to the Collateral Agent and (y) accompanied by a completed notice
      to the stock transfer agent of the Issuer as contemplated by Section 17 below.
      

    

    
      
         

      

      
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    Section
      5. Further
      Assurances.
      Section
      1 The Lien Grantor agrees that it will, at its expense and in such manner and
      form as the Collateral Agent may reasonably require, execute, deliver, file
      and
      record any financing statement, specific assignment or other paper and take
      any
      other action that may be necessary or desirable, or that the Collateral Agent
      may reasonably request, in order to create, preserve, perfect or validate any
      Security Interest or to enable the Collateral Agent to exercise and enforce
      its
      rights hereunder with respect to any of the Collateral. To the extent permitted
      by applicable law, the Lien Grantor hereby authorizes the Collateral Agent
      to
      execute and file, in the name of the Lien Grantor or otherwise, financing
      statements (which may be carbon, photographic, photostatic or other
      reproductions of this Agreement or of a financing statement relating to this
      Agreement) which the Collateral Agent in its reasonable discretion may deem
      necessary or appropriate to further perfect the Security Interests.

    

    (a) The
      Lien
      Grantor agrees that it will not change Section 2 its name, identity or corporate
      structure in any manner or Section 3 the location of its chief executive office
      unless it shall have given the Collateral Agent not less than 30 days’ prior
      notice thereof (or such shorter period consented to by the Collateral Agent
      in
      its sole discretion).

    

    (b) The
      Lien
      Grantor shall enter, or shall procure the entry, in its register of relevant
      charges (the “Register
      of Charges”)
      maintained by the Lien Grantor pursuant to Part VIII of the BVI Business
      Companies Act, 2004 (as the same may be amended from time to time) (the
“BC
      Act”)
      such
      particulars regarding the charge created by this Agreement as are specified
      in
      section 162 of the BC Act (or any similar provision in any statute pursuant
      to
      which the Lien Grantor is incorporated or existing from time to time) and submit
      a copy of such revised Register of Charges to its registered agent in the
      British Virgin Islands to keep at the Lien Grantor’s registered office and at
      the office of its registered agent in the British Virgin Islands.

    

    (c) The
      Lien
      Grantor shall make an application, or procure that an application is made,
      in
      the approved form to the Registrar of Corporate Affairs in the British Virgin
      Islands (the “Registrar”)
      to
      register the charge created by this Agreement in the register of registered
      charges kept by the Registrar for the Lien Grantor and, forthwith upon receipt
      by the Lien Grantor of the certificate of registration of the charge issued
      by
      the Registrar, send a copy of such certificate of registration to the Issuer
      and
      the Collateral Agent.

    

    Section
      6. Record
      Ownership of Pledged Stock.
      The
      Collateral Agent may at any time or from time to time, in its sole discretion,
      cause any or all of the Pledged Stock to be transferred of record into the
      name
      of the Collateral Agent or its nominee. The Lien Grantor will promptly give
      to
      the Collateral Agent copies of any notices or other communications received
      by
      it with respect to Pledged Stock registered in the name of the Lien Grantor
      and
      the Collateral Agent will promptly give to the Lien Grantor copies of any
      notices and communications received by the Collateral Agent with respect to
      Pledged Stock registered in the name of the Collateral Agent or its
      nominee.

    

    Section
      7. Right
      to Receive Distributions on Collateral.
      The
      Collateral Agent shall have the right to receive and, during the continuance
      of
      any Default, to retain as Collateral hereunder all dividends and other payments
      and distributions made upon or with respect to the Collateral and the Lien
      Grantor shall take all such action as the Collateral Agent may deem necessary
      or
      appropriate to give effect to such right. All such dividends and other payments
      and distributions which are received by the Lien Grantor shall be received
      in
      trust for the benefit of the Collateral Agent and the Lender and, if the
      Collateral Agent so directs during the continuance of a Default, shall be
      segregated from other funds of the Lien Grantor and shall, forthwith upon demand
      by the Collateral Agent during the continuance of a Default, be paid over to
      the
      Collateral Agent as Collateral in the same form as received (with any necessary
      endorsement). After all Defaults have been cured, the Collateral Agent’s right
      to retain dividends, interest and other payments and distributions under this
      Section 7 shall cease and the Collateral Agent shall pay over to the Lien
      Grantor any such Collateral retained by it during the continuance of a
      Default.

    

    
      
         

      

      
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    Section
      8. Right
      to Vote Pledged Stock.
      Unless
      an Acceleration Default shall have occurred and be continuing, the Lien Grantor
      shall have the right, from time to time, to vote and to give consents,
      ratifications and waivers with respect to the Pledged Stock, and the Collateral
      Agent shall, upon receiving a written request from the Obligor accompanied
      by a
      certificate signed by its principal financial officer stating that no Default
      has occurred and is continuing, deliver to the Lien Grantor or as specified
      in
      such request such proxies, powers of attorney, consents, ratifications and
      waivers in respect of any of the Pledged Stock which is registered in the name
      of the Collateral Agent or its nominee as shall be specified in such request
      and
      be in form and substance satisfactory to the Collateral Agent.

    

    If
      an
      Acceleration Default shall have occurred and be continuing, the Collateral
      Agent
      shall have the right to the extent permitted by law and the Lien Grantor shall
      take all such action as may be necessary or appropriate to give effect to such
      right, to vote and to give consents, ratifications and waivers, and take any
      other action with respect to any or all of the Pledged Stock with the same
      force
      and effect as if the Collateral Agent were the absolute and sole owner
      thereof.

    

    Section
      9. General
      Authority.
      The
      Lien Grantor hereby irrevocably appoints the Collateral Agent its true and
      lawful attorney, with full power of substitution, in the name of the Lien
      Grantor, the Collateral Agent, the Lender or otherwise, for the sole use and
      benefit of the Collateral Agent and the Lender, but at the expense of the Lien
      Grantor, to the extent permitted by law to exercise, at any time and from time
      to time while an Event of Default has occurred and is continuing, all or any
      of
      the following powers with respect to all or any of the Collateral:

    

    (a) to
      demand, sue for, collect, receive and give acquittance for any and all monies
      due or to become due upon or by virtue thereof,

    

    (b) to
      settle, compromise, compound, prosecute or defend any action or proceeding
      with
      respect thereto,

    

    (c) to
      sell,
      transfer, assign or otherwise deal in or with the same or the proceeds or avails
      thereof, as fully and effectually as if the Collateral Agent were the absolute
      owner thereof, and

    

    (d) to
      extend
      the time of payment of any or all thereof and to make any allowance and other
      adjustments with reference thereto;

    

    provided
      that the
      Collateral Agent (x) shall not sell or otherwise dispose of the Pledged Stock
      unless an Acceleration Default has occurred and is continuing and (y) shall
      give
      the Lien Grantor at least ten days’ prior written notice of the time and place
      of any public sale thereof or the time after which any private sale or other
      intended disposition thereof will be made. Any such notice shall (i) contain
      the
      information specified in UCC Section 9-613, (ii) be authenticated and (iii)
      be
      sent to the parties required to be notified pursuant to UCC Section 9-611(c);
      provided that, if the Collateral Agent fails to comply with this sentence in
      any
      respect, its liability for such failure shall be limited to the liability (if
      any) imposed on it as a matter of law under the UCC.

    

    
      
         

      

      
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    Section
      10. Remedies
      upon Event of Default.
      If any
      Event of Default shall have occurred and be continuing, the Collateral Agent
      may
      exercise on behalf of the Lender all the rights of a secured party under the
      UCC
      (whether or not in effect in the jurisdiction where such rights are exercised)
      and, in addition, the Collateral Agent may, without being required to give
      any
      notice, except as herein provided or as may be required by mandatory provisions
      of law, (i) apply the cash, if any, then held by it as Collateral as specified
      in Section 13 and (ii) if there shall be no such cash or if such cash shall
      be
      insufficient to pay all the Secured Obligations in full, but only if an
      Acceleration Default has occurred and is continuing, sell the Collateral or
      any
      part thereof at public or private sale or at any broker’s board or on any
      securities exchange, for cash, upon credit or for future delivery, and at such
      price or prices as the Collateral Agent may deem satisfactory. The Lender may
      be
      the purchaser of any or all of the Collateral so sold at any public sale (or,
      if
      the Collateral is of a type customarily sold in a recognized market or is of
      a
      type which is the subject of widely distributed standard price quotations,
      at
      any private sale). The Collateral Agent is authorized, in connection with any
      such sale, if it deems it advisable so to do, (A) to restrict the prospective
      bidders on or purchasers of any of the Pledged Stock to a limited number of
      sophisticated investors who will represent and agree that they are purchasing
      for their own account for investment and not with a view to the distribution
      or
      sale of any of such Pledged Stock, (B) to cause to be placed on certificates
      for
      any or all of the Pledged Stock or on any other securities pledged hereunder
      a
      legend to the effect that such security has not been registered under the United
      States Securities Act of 1933, as amended, and may not be disposed of in
      violation of the provision of said Act, and (C) to impose such other limitations
      or conditions in connection with any such sale as the Collateral Agent deems
      necessary or advisable in order to comply with said Act or any other law. The
      Lien Grantor will execute and deliver such documents and take such other action
      as the Collateral Agent deems necessary or advisable in order that any such
      sale
      may be made in compliance with law. Upon any such sale the Collateral Agent
      shall have the right to deliver, assign and transfer to the purchaser thereof
      the Collateral so sold. Each purchaser at any such sale shall hold the
      Collateral so sold absolutely and free from any claim or right of whatsoever
      kind, including any equity or right of redemption of the Lien Grantor which
      may
      be waived, and the Lien Grantor, to the extent permitted by law, hereby
      specifically waives all rights of redemption, stay or appraisal which it has
      or
      may have under any law now existing or hereafter adopted. The notice (if any)
      of
      such sale required by Section 9 shall (1) in the case of a public sale, state
      the time and place fixed for such sale, (2) in the case of a sale at a broker’s
      board or on a securities exchange, state the board or exchange at which such
      sale is to be made and the day on which the Collateral, or the portion thereof
      so being sold, will first be offered for sale at such board or exchange, and
      (3)
      in the case of a private sale, state the day after which such sale may be
      consummated. Any such public sale shall be held at such time or times within
      ordinary business hours and at such place or places as the Collateral Agent
      may
      fix in the notice of such sale. At any such sale the Collateral may be sold
      in
      one lot as an entirety or in separate parcels, as the Collateral Agent may
      determine. The Collateral Agent shall not be obligated to make any such sale
      pursuant to any such notice. The Collateral Agent may, without notice or
      publication, adjourn any public or private sale or cause the same to be
      adjourned from time to time by announcement at the time and place fixed for
      the
      sale, and such sale may be made at any time or place to which the same may
      be so
      adjourned. In the case of any sale of all or any part of the Collateral on
      credit or for future delivery, the Collateral so sold may be retained by the
      Collateral Agent until the selling price is paid by the purchaser thereof,
      but
      the Collateral Agent shall not incur any liability in the case of the failure
      of
      such purchaser to take up and pay for the Collateral so sold and, in the case
      of
      any such failure, such Collateral may again be sold upon like notice. The
      Collateral Agent, instead of exercising the power of sale herein conferred
      upon
      it, may proceed by a suit or suits at law or in equity to foreclose the Security
      Interests and sell the Collateral, or any portion thereof, under a judgment
      or
      decree of a court or courts of competent jurisdiction.

    

    
      
         

      

      
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    Section
      11. Expenses.
      Each of
      the Lien Grantor and the Issuer jointly and severally agrees that it will
      forthwith upon demand pay to the Collateral Agent:

    

    (a) the
      amount of any taxes which the Collateral Agent may have been required to pay
      by
      reason of the Security Interests or to free any of the Collateral from any
      Lien
      thereon, and

    

    (b) the
      amount of any and all out-of-pocket expenses, including the fees and
      disbursements of counsel and of any other experts, which the Collateral Agent
      may incur in connection with Section 4 the administration or enforcement of
      this
      Agreement, including such expenses as are incurred to preserve the value of
      the
      Collateral and the validity, perfection, rank and value of any Security
      Interest, Section 5 the collection, sale or other disposition of any of the
      Collateral, Section 6 the exercise by the Collateral Agent of any of the rights
      conferred upon it hereunder or Section 7 any Default or Event of
      Default.

    

    Any
      such
      amount not paid on demand shall bear interest at the rate equal to the Default
      Rate and shall be treated as additional Secured Obligations
      hereunder.

    

    Section
      12. Limitation
      on Duty of Collateral Agent in Respect of Collateral; Indemnity.
      Section 8 Beyond the exercise of reasonable care in the custody thereof,
      the Collateral Agent shall have no duty as to any Collateral in its possession
      or control or in the possession or control of any agent or bailee or any income
      thereon or as to the preservation of rights against prior parties or any other
      rights pertaining thereto. The Collateral Agent shall be deemed to have
      exercised reasonable care in the custody and preservation of the Collateral
      in
      its possession if the Collateral is accorded treatment substantially equal
      to
      that which it accords its own property, and shall not be liable or responsible
      for any loss or damage to any of the Collateral, or for any diminution in the
      value thereof, by reason of the act or omission of any agent or bailee selected
      by the Collateral Agent in good faith. In no event shall the Collateral Agent
      be
      liable to the Lien Grantor or the Issuer or any other party to this Agreement
      for any consequential (being loss of business, goodwill, opportunity or profit)
      or punitive loss or damages, even if advised of the possibility of such loss
      or
      damage.

    

    (a) Each
      of
      the Lien Grantor and the Issuer agrees to be jointly and severally responsible
      for and will indemnify each of the Collateral Agent, any predecessor Collateral
      Agent and their agents, employees, officers and directors for, and hold it
      harmless against, any loss or liability or expense incurred by it without
      negligence or willful misconduct on its part arising out of or in connection
      with the acceptance or administration of this Agreement and its duties under
      this Agreement, including the costs and expenses of defending itself against
      any
      claim or liability and of complying with any process served upon it or any
      of
      its officers in connection with the exercise or performance of any of its powers
      or duties under this Agreement.

    

    
      
         

      

      
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    (b) This
      Section 12 shall survive the termination of the Security Interests and the
      release of the Collateral.

    

    Section
      13. Application
      of Proceeds.
      Upon
      the occurrence and during the continuance of an Event of Default, the proceeds
      of any sale of, or other realization upon, all or any part of the Collateral
      and
      any cash held shall be applied by the Collateral Agent in the following order
      of
      priorities:

    

    first,
      to pay
      the expenses of such sale or other realization, including reasonable
      compensation to agents and counsel for the Collateral Agent, and all expenses,
      liabilities and advances incurred or made by the Collateral Agent in connection
      therewith, and any other unreimbursed expenses for which the Collateral Agent
      or
      the Lender is to be reimbursed pursuant to Section 9.04 of the Loan Agreement
      or
      Section 11 hereof and unpaid fees owing to the Collateral Agent or the Lender
      under any Loan Document;

    

    second,
      to pay
      ratably all interest (including Post-Petition Interest, to the fullest extent
      permitted by applicable Law) on the Secured Obligations, until payment in full
      of all such interest shall have been made;

    

    third,
      to pay
      the unpaid principal of the Secured Obligations, until payment in full of the
      principal of the Secured Obligations shall have been made;

    

    fourth,
      to pay
      all other Secured Obligations, until payment in full of all such other Secured
      Obligations shall have been made; and

    

    finally,
      to
      payment to the Lien Grantor or its successors or assigns, or as a court of
      competent jurisdiction may direct, of any surplus then remaining from such
      proceeds.

    

    The
      Collateral Agent may make distributions hereunder in cash or in kind or, on
      a
      ratable basis, in any combination thereof.

    

    Section
      14. Concerning
      the Collateral Agent.
      The
      provisions of Article 7 of the Loan Agreement shall inure to the benefit of
      the
      Collateral Agent in respect of this Agreement and shall be binding upon the
      parties to the Loan Agreement in such respect. In furtherance and not in
      derogation of the rights, privileges and immunities of the Collateral Agent
      therein set forth:

    

    (a) The
      Collateral Agent is authorized to take all such action as is provided to be
      taken by it as Collateral Agent hereunder and all other action reasonably
      incidental thereto. As to any matters not expressly provided for herein
      (including, without limitation, the timing and methods of realization upon
      the
      Collateral) the Collateral Agent shall act or refrain from acting in accordance
      with written instructions from the Lender or, in the absence of such
      instructions, in accordance with its discretion.

    

    
      
         

      

      
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    (b) The
      Collateral Agent shall not be responsible for the existence, genuineness or
      value of any of the Collateral or for the validity, perfection, priority or
      enforceability of the Security Interests in any of the Collateral, whether
      impaired by operation of law or by reason of any action or omission to act
      on
      its part hereunder. The Collateral Agent shall have no duty to ascertain or
      inquire as to the performance or observance of any of the terms of this
      Agreement by the Lien Grantor.

    

    Section
      15. Appointment
      of Co-Collateral Agents.
      At any
      time or times, in order to comply with any legal requirement in any
      jurisdiction, the Collateral Agent may appoint another bank or trust company
      or
      one or more other persons, either to act as co-collateral agent or co-collateral
      agents, jointly with the Collateral Agent, or to act as separate collateral
      agent or collateral agents on behalf of the Lender with such power and authority
      as may be necessary for the effectual operation of the provisions hereof and
      may
      be specified in the instrument of appointment (which may, in the discretion
      of
      the Collateral Agent, include provisions for the protection of such
      co-collateral agent or separate collateral agent similar to the provisions
      of
      Section 14).

    

    Section
      16. Termination
      of Security Interests; Release of Collateral.
      Upon
      the repayment in full of all Secured Obligations and the termination of all
      lending commitments under the Loan Agreement, the Security Interests shall
      terminate and all rights to the Collateral shall revert to the Lien Grantor.
      At
      any time and from time to time prior to such termination of the Security
      Interests, the Collateral Agent may release any of the Collateral with the
      prior
      written consent of the Lender. Upon any such termination of the Security
      Interests or release of Collateral, the Collateral Agent will, at the expense
      of
      the Lien Grantor, execute and deliver to the Lien Grantor such documents as
      the
      Lien Grantor shall reasonably request to evidence the termination of the
      Security Interests or the release of such Collateral, as the case may be,
      including but not limited to a notice to the stock transfer agent of the Pledged
      Stock.

    

    Section
      17. Acknowledgment
      by the Issuer, Stop Transfer Instructions.
      The
      Issuer hereby acknowledges the Security Interests in the Pledged Stock. The
      Issuer agrees to effect or recognize any transfer of the Pledged Stock only
      if
      and to the extent such transfer is made in accordance with the provisions of
      this Agreement. Prior to the date hereof, the Issuer and the Lien Grantor have
      instructed the stock transfer agent for the Pledged Stock by means of delivery
      of a notice in substantially the form of Exhibit A hereto to refrain from
      effecting any proposed transfer of Pledged Stock without the prior written
      consent of the Collateral Agent and the Issuer has delivered a copy of such
      notice, acknowledged and confirmed by the stock transfer agent, to the
      Collateral Agent. 

    

    Section
      18. Notices.
      All
      notices hereunder shall be (x) in the case of the Lien Grantor; in writing
      (including by facsimile transmission) and mailed, faxed or delivered to the
      address, facsimile number or electronic mail address specified for notices
      to
      the Lien Grantor on Schedule A hereto, (y) in the case of the Collateral Agent;
      in writing (including by facsimile transmission) and mailed, faxed or delivered
      to the address, facsimile number or electronic mail address specified for
      notices to Collateral Agent on Schedule A hereto and (z) in the case of any
      other party, given in accordance with Section 9.02 of the Loan Agreement.

    

    Section
      19. Waivers,
      Non-exclusive Remedies.
      No
      failure on the part of the Collateral Agent to exercise, and no delay in
      exercising and no course of dealing with respect to, any right under this
      Agreement shall operate as a waiver thereof; nor shall any single or partial
      exercise by the Collateral Agent of any right under any Loan Document preclude
      any other or further exercise thereof or the exercise of any other right. The
      rights in this Agreement and the other Loan Documents are cumulative and are
      not
      exclusive of any other remedies provided by law.

    

    
      
         

      

      
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    Section
      20. Successors
      and Assigns.
      This
      Agreement is for the benefit of the Collateral Agent and the Lender and their
      successors and assigns (if any), and in the event of an assignment of all or
      any
      of the Secured Obligations, the rights hereunder, to the extent applicable
      to
      the indebtedness so assigned, may be transferred with such indebtedness. This
      Agreement shall be binding on the Lien Grantor and its successors and
      assigns.

    

    Section
      21. Amendments
      and Waivers.
      Neither
      this Agreement nor any provision hereof may be changed, waived, discharged
      or
      terminated orally, but only in writing signed by the Lien Grantor and the
      Collateral Agent with the consent of the Lender.

    

    Section
      22. New
      York Law.
      THIS
      AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
      THE
      STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
      WITHIN SUCH STATE; PROVIDED
      THAT THE
      LENDER AND COLLATERAL AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
      

    

    Section
      23. Submission
      to Jurisdiction.
      ANY
      LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN
      THE
      COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, NEW YORK
      CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY
      EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO CONSENTS, FOR ITSELF
      AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE
      COURTS. EACH PARTY HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
      OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
      NON CONVENIENS,
      WHICH
      IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN
      SUCH
      JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO.
      EACH PARTY HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
      PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
      STATE. THE LIEN GRANTOR AGREES THAT A FINAL JUDGMENT IN ANY SUCH SUIT, ACTION
      OR
      PROCEEDING BROUGHT IN SUCH A COURT SHALL BE CONCLUSIVE AND BINDING UPON IT
      AND
      WILL BE GIVEN EFFECT IN ANY OTHER JURISDICTION TO THE FULLEST EXTENT PERMITTED
      BY APPLICABLE LAW AND MAY BE ENFORCED IN ANY COURT TO THE JURISDICTION OF WHICH
      SUCH PARTY IS OR MAY BE SUBJECT BY A SUIT UPON SUCH JUDGMENT, PROVIDED THAT
      SERVICE OF PROCESS IS EFFECTED UPON IT IN ONE OF THE MANNERS SPECIFIED HEREIN
      OR
      AS OTHERWISE PERMITTED BY LAW.

    

    Section
      24. Waiver
      of Right to Jury Trial.
      EACH
      PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
      OF
      ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
      OR
      IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
      PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
      TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
      ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
      HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
      ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
      THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
      ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
      WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

    

    
      
         

      

      
        A-11

        
          

        

      

      
         

      

       

    

    Section
      25. Process
      Agent.
      

    

    Without
      prejudice to any other mode of service allowed under any relevant Law, each
      of
      the Lien Grantor and the Issuer:

    

    (a) irrevocably
      appoints CT Corporation System, located at 111 Eighth Avenue, New York, NY
      10011
      as its agent for service of process in relation to any proceedings before the
      courts of the State of New York sitting in the Borough of Manhattan, New York
      City or of the United States for the Southern District of such State in
      connection with this Agreement; and

    

    (b) agrees
      that failure by a process agent to notify it of the process will not invalidate
      the proceedings concerned. 

    

    Section
      26. Severability.
      If any
      provision hereof is invalid or unenforceable in any jurisdiction, then, to
      the
      fullest extent permitted by law, (i) the other provisions hereof shall remain
      in
      full force and effect in such jurisdiction and shall be liberally construed
      in
      favor of the Collateral Agent and the Lender in order to carry out the
      intentions of the parties hereto as nearly as may be possible; and (ii) the
      invalidity or unenforceability of any provision hereof in any jurisdiction
      shall
      not affect the validity or enforceability of such provision in any other
      jurisdiction.

    

    Section
      27. Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      an original but all of which together shall constitute one
      instrument.xxx

     

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
      executed by their respective authorized officers as of the day and year first
      above written.

     

    
      	 	
              BEAMS
                POWER INVESTMENT LIMITED

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            

    

     

    
      
         

      

      
        A-12

        
          

        

      

      
         

      

       

    

    
      	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Collateral Agent

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            
	 	
               

            
	 	 
	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Lender

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            
	 	
               

            
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title

            

    

    

    
      
         

      

      
        A-13

        
          

        

      

      
         

      

    

    [Schedule
      A]

    

    NOTICE
      ADDRESSES

    

    LIEN
      GRANTOR:

    

    Beams
      Power Investment Limited

    Akara
      Bldg., 24 De Castro Street

    Wickham
      Cay I,

    Road
      Town, Tortola

    British
      Virgin Islands

    Attn:
      Xiuqing Meng

    Facsimile:
      +86-10-5869-3221

    E-mail:
      sherrymeng@yahoo.com

    

    COLLATERAL
      AGENT:

    

    ABN
      AMRO
      Bank N.V., Hong Kong Branch

    38/F,
      Cheung Kong Center

    2
      Queen’s
      Road Central

    Hong
      Kong

    

    Attn:
      Shirley Yin / Helen Fei / Carlos Wong / Clarice Tsang / Jessamine
      Lam

    Facsimile:
      +85-2-2700-3202 / 2700-3836 / 2700-3300

    
      	
              E-mail:

            	
              Shirley.yin@hk.abnamro.com
                / helen.fei@hk.abnamro.com / carlos.wong@hk.abnamro.com /
                clarice.tsang@hk.abnamro.com /
                jessamine.lam@hk.abnamro.com

            

    

    

    
      
         

      

      
        A-14

        
          

        

      

      
         

      

    

    [Exhibit
      A]

    

    FORM
      OF NOTICE OF PLEDGE OF PLEDGED STOCK TO

    SYNUTRA
      STOCK TRANSFER AGENT

    

    [LETTERHEAD
      OF ISSUER]

    

    

    U.S.
      Stock Transfer Corporation

    1745
      Gardena Avenue, Suite 200

    Glendale,
      CA 91204-2991

    United
      States

    Attention:
      Rich Tilton

    Facsimile:
      +1-818-502-0057

    

    
      	 	
              Re:

            	
              Shares
                of Common Stock of Synutra International, Inc. - Notice of Pledge
                and
                Limitation on Transfers

            

    

    

    Beams
      Power Investment Limited and Synutra International, Inc. hereby notify U.S.
      Stock Transfer Corporation that the shares evidenced by the share certificate
      numbered [_____________] of Synutra International, Inc. (the “Pledged
      Stock”)
      on the
      date hereof registered in the name of Beams Power Investment Limited are pledged
      to ABN AMRO Bank N.V., Hong Kong Branch, as Collateral Agent (“Collateral
      Agent”)
      under
      the Collateral Agreement dated April 19, 2007 among Beams Power Investment
      Limited, Synutra International, Inc. and ABN AMRO Bank N.V., Hong Kong Branch,
      for the benefit of ABN AMRO Bank N.V., Hong Kong Branch as Lender under the
      Loan
      Agreement dated April 19, 2007 among Synutra International, Inc., Liang Zhang,
      Xiuqing Meng and ABN AMRO Bank N.V., Hong Kong Branch. 

    

    Beams
      Power Investment Limited and Synutra International, Inc. hereby direct and
      request that U.S. Stock Transfer Corporation shall not register or effect any
      transfer of the Pledged Stock without the written consent of the Collateral
      Agent. The direction and request set forth in the preceding sentence shall
      be
      revocable only with the written consent of the Collateral Agent. 

     

     

    
      	 	
              BEAMS
                POWER INVESTMENT LIMITED

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            

    

     

    
      
         

      

      
        A-15

        
          

        

      

      
         

      

       

    

    
      	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            

    

    

    
      
         

      

      
        A-16

        
          

        

      

      
         

      

    

    EXHIBIT
      B

    

    FORM
      OF

    LOAN
      DRAWDOWN NOTICE

    

    Date:
      ___________, 200_

    

    
      	To:	
              ABN
                AMRO Bank N.V., Hong Kong Branch

            

    

    

    Reference
      is made to that certain Loan Agreement dated as of April ·, 2007 (as amended,
      restated, extended, supplemented or otherwise modified in writing from time
      to
      time, the “Agreement”, the terms defined therein being used herein as therein
      defined) among Synutra International, Inc. (the “Borrower”), Liang Zhang,
      Xiuqing Meng and ABN AMRO Bank N.V., Hong Kong Branch, as Lender and Collateral
      Agent.

    

    The
      undersigned hereby requests a Loan:

    

    
      	1.	
              On                                (a
                Business Day).

            

    

    

    
      	2.	
              In
                the amount of US$

            

    

    

    
      	3.	
              By
                wire transfer to:

            

    

    

    Account
      Name: [_______]

    

    Account
      No.: [_______]

    

    Account
      Type: [_______]

    

    Bank
      Name: [_______]

    

    ABA
      No.:
      [_______]

    

    Routing
      No.: [_______]

    

    SWIFT
      Code: [_______]

    

    The
      Borrower hereby represents and warrants that the conditions specified in Section
      4.01 shall be satisfied on and as of the date of the requested Credit
      Extension.

     

    
      	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _______________________________________

              Name:

              Title:

            

    

    

    
      
         

      

      
        B-1

        
          

        

      

      
         

      

    

    EXHIBIT
      C

    

    FORM
      OF U.S. COUNSEL OPINION

    

    April
      19,
      2007

    

    To
      the
      Lender party to the

    Loan
      Agreement referred to below

    and
      ABN
      AMRO Bank N.V., Hong Kong Branch, 

    as
      Collateral Agent

    

    
      	
            	Re:	
              Synutra
                International Inc. - Loan
                Agreement

            

    

    

    Ladies
      and Gentlemen:

    

    We
      have
      acted as special New York counsel for Synutra International Inc., a Delaware
      corporation (the “Borrower”)
      and
      the Individual Guarantors in connection with the Loan Agreement dated as of
      April 19, 2007 (the “Loan
      Agreement”)
      among
      the Borrower, the Individual Guarantors listed therein (the “Individual
      Guarantors”
and
      the
      Borrower, collectively the “Obligors”),
      ABN
      AMRO Bank N.V., Hong Kong Branch as Lender (the “Lender”)
      and
      the Collateral Agent (the “Collateral
      Agent”).
      We
      are providing this opinion to you at the request of the Obligors pursuant to
      Section 4.01(a)(v) of the Loan Agreement. Except as otherwise indicated,
      capitalized terms used in this opinion and defined in the Loan Agreement will
      have the meanings given in the Loan Agreement.

    

    In
      our
      capacity as such counsel, we have examined originals or copies of those
      corporate and other records and documents we considered appropriate, including
      the following (the documents listed in clauses (a) through (b) below
      collectively being referred to herein as the “Loan Documents”):

    

    (a) the
      Loan
      Agreement; and

    

    (b) the
      Collateral Agreement dated as of April 19, 2007 (the “Collateral
      Agreement”)
      among
      Beams Power Investment Ltd., an International Business Companies Act company
      re-registered as a BVI business company under the laws of the British Virgin
      Islands (the “Lien Grantor”), the Borrower, the Lender and the Collateral
      Agent.

    

    As
      to
      relevant factual matters, we have relied upon, among other things, each
      Obligor’s and the Lien Grantor’s factual representations in the certificate by
      such Obligor or the Lien Grantor, as applicable (each, an “Opinion
      Certificate”)
      and in
      the Loan Documents. In addition, we have obtained and relied upon those
      certificates of public officials we considered appropriate. 

    

    We
      have
      assumed the genuineness of all signatures, the authenticity of all documents
      submitted to us as originals and the conformity with originals of all documents
      submitted to us as copies. We have assumed that each natural person, including
      each Individual Guarantor, who is a party to the transaction has sufficient
      legal capacity to enter into and carry out his or her obligations under the
      Agreement. To the extent each Obligor’s or the Lien Grantor’s respective
      obligations depend on the enforceability of the Loan Documents against other
      parties to the Loan Documents, we have assumed that the Loan Documents are
      enforceable against such other parties.

    

    
      
         

      

      
        C-1

        
          

        

      

      
         

      

       

    

    On
      the
      basis of such examination, our reliance upon the assumptions in this opinion
      and
      our consideration of those questions of law we considered relevant, and subject
      to the limitations and qualifications in this opinion, we are of the opinion
      that:

    

    (1) The
      Borrower is a corporation validly existing in good standing under the laws
      of
      the State of Delaware with corporate power to enter into the Loan Documents
      and
      to perform its obligation under the Loan Documents. 

    

    (2) The
      execution, delivery and performance of the Loan Documents have been duly
      authorized by all necessary corporate action on the part of the Borrower, and
      the Loan Documents have been duly executed and delivered by the
      Borrower.

    

    (3) Each
      of
      the Loan Documents constitutes the legally valid and binding obligation of
      each
      Obligor party thereto, and assuming the due authorization, execution and
      delivery of the Collateral Agreement by the parties thereto, the Collateral
      Agreement constitutes the legally valid and binding obligation of the Lien
      Grantor, in each case, enforceable against such Person in accordance with its
      terms, except as may be limited by bankruptcy, insolvency, reorganization,
      moratorium or similar laws relating to or affecting creditors’ rights generally
      (including, without limitation, fraudulent conveyance laws), and by general
      principles of equity, including, without limitation, concepts of materiality,
      reasonableness, good faith and fair dealing and the possible unavailability
      of
      specific performance or injunctive relief, regardless of whether considered
      in a
      proceeding in equity or at law.

    

    (4) The
      execution and delivery by the Borrower of the Loan Documents to which it is
      a
      party do not, and the Borrower’s performance of its obligations under such Loan
      Documents will not (i) violate the Borrower’s certificate of incorporation or
      bylaws or other constitutive documents of the Borrower, (ii) violate, breach,
      or
      result in a default under, any existing obligation of or restriction on the
      Borrower under any other agreement (the “Other
      Agreements”)
      identified in Schedule I attached hereto, or (iii) breach or otherwise violate
      any existing obligation of or restriction on the Borrower under any order,
      judgment or decree of any New York or federal court or governmental authority
      binding on the Borrower identified in the Opinion Certificate. If an Other
      Agreement is governed by the laws of a jurisdiction other than New York, we
      have
      assumed such Other Agreement is governed by the laws of the State of New
      York.

    

    (5) The
      execution and delivery by the Borrower of the Loan Documents to which it is
      a
      party do not, and the Borrower’s performance of its obligations under such Loan
      Documents will not, violate the Delaware General Corporation Law or any current
      New York or federal statute, rule or regulation that we have, in the exercise
      of
      customary professional diligence, recognized as applicable to the Borrower
      or to
      transactions of the type contemplated by the Loan Documents.

    

    (6) No
      order,
      consent, permit or approval of any New York or federal governmental authority
      that we have, in the exercise of customary professional diligence, recognized
      as
      applicable to the Borrower or the Lien Grantor or to transactions of the type
      contemplated by the Loan Documents is required on the part of the Borrower
      or
      the Lien Grantor for the execution and delivery of, and performance of their
      respective obligations under, the Loan Documents to which it is a party,
      respectively, except for such as have been made or obtained.

    

    
      
         

      

      
        C-2

        
          

        

      

      
         

      

       

    

    (7) The
      Collateral Agreement is effective to create in favor of the Collateral Agent
      a
      security interest in that Collateral (which term is used in this Opinion as
      such
      term is defined in the Collateral Agreement) of the Lien Grantor in which a
      security interest may be created under Article 9 of the Uniform Commercial
      Code
      as in effect in the State of New York (the “NY
      Code”).

    

    (8) The
      Collateral Agreement is effective to create in favor of the Collateral Agent
      a
      security interest in the Certificated Security (as defined below) identified
      on
      Schedule II attached hereto under the NY Code. Upon delivery of the security
      certificate representing the Certificated Security listed on Schedule II
      attached hereto to the Collateral Agent in the State of New York, effectively
      endorsed to the Collateral Agent or in blank, Collateral Agent will acquire
      a
      perfected security interest in such Certificated Security, free of adverse
      claims. For purposes of this paragraph, “Certificated Security” means
“certificated securities” as defined in Section 8-102 of the Code.

    

    (9) Neither
      the Borrower nor the Lien Grantor is an investment company required to register
      under the Investment Company Act of 1940, as amended.

    

    (10) Neither
      the extension of credit nor the use of proceeds provided in the Loan Agreement
      will violate Regulation T, U or X of the Board of Governors of the Federal
      Reserve System. For purposes of this opinion, we have assumed that none of
      the
      Lenders is a “creditor” as defined in Regulation T.

    

    Our
      opinion in paragraph 3 above as to the enforceability of the Loan Documents
      is
      subject to: 

    

    (i) public
      policy considerations, statutes or court decisions that may limit the rights
      of
      a party to obtain indemnification against its own negligence, willful misconduct
      or unlawful conduct;

    

    (ii) the
      unenforceability under certain circumstances of broadly or vaguely stated
      waivers or waivers of rights granted by law where the waivers are against public
      policy or prohibited by law;

    

    (iii) the
      unenforceability under certain circumstances of provisions imposing penalties,
      liquidated damages or other economic remedies; and

    

    (iv) the
      unenforceability under certain circumstances of provisions appointing one party
      as trustee for an adverse party or provisions for the appointment of a
      receiver.

    

    Our
      opinion in paragraph 3 is subject to the qualification that certain rights,
      remedies, waivers and other provisions of the Loan Documents may not be
      enforceable, but such unenforceability will not, subject to the other
      exceptions, qualifications and limitations set forth herein, render the Loan
      Documents invalid as a whole or substantially interfere with the substantial
      realization of the principal benefits or security, or both, that the Loan
      Documents purports to provide (except for the economic consequences of
      procedural or other delay).

    

    
      
         

      

      
        C-3

        
          

        

      

      
         

      

       

    

    For
      purposes of the opinions expressed in paragraphs 4, 5 and 6, we have assumed
      that the Borrower will not in the future take any discretionary action
      (including a decision not to act) permitted by the Loan Documents that would
      cause the performance of the Loan Documents to violate any organizational
      document of the Borrower, the Delaware General Corporation Law or any New York
      or federal statute, rule or regulation, or require an order, consent, permit
      or
      approval to be obtained from a New York or federal governmental
      authority.

    

    We
      express no opinion as to the effect of non-compliance by you with any state
      or
      federal laws or regulations applicable to the transactions contemplated by
      the
      Loan Documents because of the nature of your business.

    

    We
      express no opinion as to any provision of the Loan Documents insofar as it
      purports to grant a right of setoff in respect of any Obligor’s assets to any
      person other than a creditor of such Obligor.

    

    We
      advise
      you that Section 9.15 of the Loan Agreement, which provides for non-exclusive
      jurisdiction of the courts of the State of New York and federal courts sitting
      in the State of New York, may not be binding on the federal courts sitting
      in
      the State of New York (or any federal appellate court).

    

    We
      advise
      you that if an action based on the Loan Documents were commenced in a federal
      or
      state court in New York, a judgment for money relating to the Loan Documents
      ordinarily would be enforced only in United States dollars. The method used
      to
      determine the rate of conversion of foreign currency into United States dollars
      will depend on various factors.

    

    We
      express no opinion concerning (i) federal or state securities laws or
      regulations or (ii) the foreign assets control regulations of the Trading with
      the Enemy Act, as amended, the United States Treasury Department, the Uniting
      and Strengthening America by Providing Appropriate Tools Required to Intercept
      and Obstruct Terrorism (USA PATRIOT Act) Act of 2001, as amended, Executive
      Order No. 13,224 of September 24, 2001, Blocking Property and Prohibiting
      Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism,
      as amended, and any enabling legislation, rules, regulations or executive orders
      relating thereto.

    

    Our
      opinions in paragraphs 7 and 8 are (i) limited to Article 9 of the NY Code
      (except our opinion in paragraph 8 to the extent it addresses Article 8 of
      the
      NY Code) and do not address (A) laws of jurisdictions other than New York,
      (B)
      collateral not subject to Article 9 of the NY Code (including by reason of
      Section 9-109(c) or (d) thereof), or (C) under Sections 9-301 through 9-306
      of
      the Uniform Commercial Code as in effect in any jurisdiction, or otherwise,
      what
      law governs the perfection of the security interests granted in the collateral
      covered by those opinion paragraphs, and (ii) subject to the effect of
      bankruptcy, insolvency, reorganization, moratorium or similar laws relating
      to
      or affecting creditors’ rights generally (including, without limitation,
      fraudulent conveyance laws) and to the effect of general principles of
      equity.

    

    
      
         

      

      
        C-4

        
          

        

      

      
         

      

       

    

    We
      express no opinion with respect to:

    

    (i) the
      priority of any security interest, except as set forth in paragraph 8 relating
      to Certificated Security or the perfection of any security interest except
      as
      set forth in paragraph 8; and

    

    (ii) Collateral
      consisting of real property, copyrights, farm products, consumer goods,
      as-extracted collateral, commercial tort claims, cooperative interests (as
      such
      terms are defined in the NY Code) and timber to be cut.

    

    We
      express no opinion regarding any provision of the Collateral Agreement that
      purports to permit Collateral Agent or any other person to sell or otherwise
      dispose of any Collateral subject thereto except in compliance with the NY
      Code,
      any other applicable federal and state laws and any agreement governing such
      Collateral, or to impose on Collateral Agent standards of care of Collateral
      in
      Collateral Agent’s possession other than as provided in Section 9-207 of the NY
      Code. We advise you that federal and state securities laws may limit the right
      to transfer or dispose of Collateral that may constitute securities under such
      laws.

    

    In
      rendering the opinions in paragraphs 7 and 8, we have assumed that:

    

    (i) the
      Lien
      Grantor has, or will have at the relevant time, rights in the Collateral in
      which the Lien Grantor has granted a security interest to Collateral Agent
      within the meaning of Section 9-203(b)(2) of the NY Code at all times relevant
      to this opinion;

    

    (ii) the
      Collateral is reasonably identified in the description of collateral set forth
      in the Collateral Agreement in accordance with Section 9-108 of the NY
      Code;

    

    (iii) at
      all
      times relevant to this opinion, value has been given within the meaning of
      Section 9-203(b)(1) of the NY Code; and

    

    (iv) neither
      Collateral Agent nor the Lenders have notice of any adverse claims to the
      Certificated Security referred to in paragraph 8.

    

    We
      advise
      you that we have not made or undertaken to make any investigation as to the
      existence of or state of title to the Collateral and we express no opinion
      as to
      the existence, condition, or location of the Collateral.

    

    The
      law
      covered by this opinion is limited to the present federal law of the United
      States, the present law of the State of New York and the present Delaware
      General Corporation Law and Article 9 of the Delaware Code, in each case, as
      in
      effect on the date hereof. We express no opinion as to the laws of any other
      jurisdiction and no opinion regarding the statutes, administrative decisions,
      rules, regulations or requirements of any county, municipality, subdivision
      or
      local authority of any jurisdiction.

    

    
      
         

      

      
        C-5

        
          

        

      

      
         

      

       

    

    This
      opinion is furnished by us as special New York counsel for Borrowers and may
      be
      relied upon by you only in connection with the Loan Documents. It may not be
      used or relied upon by you for any other purpose or by any other person, nor
      may
      copies be delivered to any other person, without in each instance our prior
      written consent. You may, however, deliver a copy of this opinion to your
      accountants, attorneys, and other professional advisors, to governmental
      regulatory agencies having jurisdiction over you, to permitted assignees of
      the
      Loans in connection with such assignment and to participants in connection
      with
      their purchase of a participation interest in the Loans. At your request, we
      hereby consent to reliance on this opinion by such assignees (but not such
      participants) to the same extent as the addressees hereof as if this opinion
      were addressed and had been delivered to them on the date of this opinion,
      on
      the condition and understanding that we assume no responsibility or obligation
      to consider the applicability or correctness of this opinion to any person
      other
      than its addressee(s). This opinion is expressly limited to the matters set
      forth above, and we render no opinion, whether by implication or otherwise,
      as
      to any other matters. This letter speaks only as of the date hereof and we
      assume no obligation to update or supplement this opinion to reflect any facts
      or circumstances that arise after the date of this opinion and come to our
      attention, or any future changes in laws.

     

    
      	 	
              Respectfully
                submitted,

            

    

    

    
      
         

      

      
        C-6

        
          

        

      

      
         

      

    

    

    Schedule
      I

    

    Other
      Agreements

    

    Agreement
      dated June 8, 2006 between Synutra International, Inc. and the Department of
      Finance of Zhen Lan Qi (County) of Inner Mongolia.

    

    Share
      Exchange Agreement dated June 14, 2005 among Vorsatech Ventures Inc., Thomas
      Braun and Berlin Capital Investments, Beams Power Investment Corporation and
      Strong Gold Finance Corporation, and Synutra International, Inc.

    

    License
      and Supply Agreement dated September 1, 2003 between Martek Biosciences
      Corporation and American St. George Biological Technology Corporation (n/k/a
      Synutra International, Inc.).

    

    
      
         

      

      
        C-7

        
          

        

      

      
         

      

    

    

    Schedule
      II

    

    Certificated
      Security

     

    
      	
              Issuer

            	 	
              Certificate
                No.

            	 	
              Percent
                Pledged

            
	
              Synutra
                International, Inc.

            	 	
              [·]2 

            	 	
              100%

            

    

     

     

    
      
        

      

    

    
      
        2  OM&M
          /Troy Gould to provide.

      

    

    
      
         

      

      
        C-8

        
          

        

      

      
         

      

    

    EXHIBIT
      D

    

    FORM
      OF PRC COUNSEL OPINION

    

    April
      19,
      2007

    

    ABN
      AMRO
      Bank N.V., Hong Kong Branch

    38/F,
      Cheung Kong Centre

    2
      Queen’s
      Road Central

    Hong
      Kong
      SAR

    

    
      	
            	Re:	
              Synutra
                International Inc. - Loan Agreement

            

    

    

    Dear
      Sirs,

    

    We
      have
      acted as special PRC counsel for Synutra International Inc. (the “Company”), a
      Delaware corporation, and its PRC Subsidiaries (the “Subsidiaries”) and the
      Individual Guarantors in connection with the Loan Agreement dated as of April,
      2007 (the “Loan Agreement”) among the Company, the Individual Guarantors listed
      therein (the “Individual Guarantors”, and the Individual Guarantors and the
      Company, collectively the “Obligors”), ABN AMRO Bank N.V., Hong Kong Branch as
      Lender (the “Lender”) and Collateral Agent (the “Collateral Agent”). Terms used
      (but not defined) herein have the meanings assigned to them in the Loan
      Agreement or, if not defined in the Loan Agreement, the meanings assigned to
      them in the Collateral Agreement.

    

    We
      have
      reviewed executed copies of:

    

    (a) the
      Loan
      Agreement; and

    

    (b) the
      Collateral Agreement dated as of April 19, 2007 (the “Collateral
      Agreement”)
      among
      the Lien Grantor, the Borrower, the Lender and the Collateral
      Agent.

    

    The
      documents listed in items (a) through (b) above are sometimes hereinafter
      referred to as the “Loan
      Documents”.
      The
      documents listed in item (b) above is sometimes hereinafter referred to as
      the
“Collateral
      Documents”.

    

    We
      have
      also examined originals or copies, certified or otherwise identified to our
      satisfaction, of such documents, corporate records and certificates of public
      officials and officers of the Company and the Subsidiaries and have conducted
      such other investigations of fact and law as we have deemed necessary or
      advisable for purposes of this opinion. 

    

    Based
      on
      the foregoing, and subject to the assumptions and qualifications set forth
      below, we are of the opinion that:

    

    1. Each
      Subsidiary of the Company organized under the laws of the PRC (each
“PRC
      Subsidiary”)
      is
      validly existing and in good standing under the laws of the PRC.

    

    
      
         

      

      
        D-1

        
          

        

      

      
         

      

       

    

    2. The
      execution, delivery and performance by each Individual Guarantor of the Loan
      Documents to which it is a party, is within its power. Each Individual Guarantor
      has duly executed and delivered each Loan Document to which it is a
      party.

    

    3. Each
      Obligor and each PRC Subsidiary of the Company has all requisite power and
      authority and all requisite governmental licenses, authorizations, consents
      and
      approvals to (1) own its assets and carry on its business and (2) execute,
      deliver and perform its obligations under the Loan Documents to which it is
      a
      party.

    

    4. Each
      of
      the Company and its Subsidiaries is duly qualified and licensed and in good
      standing under the laws of the PRC to the extent that its ownership, lease
      or
      operation of properties or the conduct of its business requires such
      qualification or license.

    

    5. The
      execution, delivery and performance, by, and the enforcement against, each
      Obligor of each Loan Document to which it is a party require no action by or
      in
      respect of, or filing with, any governmental body, agency or official under
      PRC
      law and do not contravene any provision of applicable PRC law or
      regulation.

    

    6. The
      execution, delivery and performance by each Obligor of each Loan Document to
      which he or it is a party do not and will not conflict with or result in any
      breach or contravention of, or the creation of any Lien (other than the Liens
      created by the Collateral Agreements) under, (a) any Contractual Obligation,
      governed by PRC Law, to which any Obligor or any Affiliate of any Obligor is
      a
      party or (b) any order, injunction, writ or decree of any Governmental Authority
      in the PRC or any arbitral award to which any Obligor or any Affiliate of any
      Obligor or his or its property is subject.

    

    7. Each
      Loan
      Document constitutes a valid and binding agreement of each Individual Guarantor
      party thereto, in each case enforceable against such Individual Guarantor in
      accordance with its terms.

    

    8. There
      are
      no actions, suits, proceedings, claims or disputes pending or, to our knowledge
      after due and diligent investigation, threatened or contemplated, at law, in
      equity, in arbitration or before any Governmental Authority in the PRC, by
      or
      against any Obligor or any Affiliate of any Obligor or against any of its or
      their properties or revenues that (a) purport to affect or pertain to this
      Agreement or any other Loan Document, or any of the transactions contemplated
      hereby or (b) either individually or in the aggregate, if determined adversely,
      could reasonably be expected to have a Material Adverse Effect.

    

    9. The
      payment obligations of each Individual Guarantor under the Loan Documents rank
      at least pari
      passu
      with the
      claims of all of his (or her) or its other unsecured and unsubordinated
      creditors. 

    

    10. Meng
      Xiuqing is not a resident of the PRC as defined in Article 1 of the Notice
      No.
      75.

    

    11. Each
      Individual Guarantor has obtained all applicable governmental licenses,
      registrations, authorizations, consents and approvals for their respective
      direct or indirect investments in the Borrower, including any registration
      pursuant to Article 1 of the Notice (Hui Fa 2005 No. 75) issued by the State
      Administration of Foreign Exchange of the PRC and have delivered all applicable
      notices to Governmental Authorities in connection therewith.

    

    
      
         

      

      
        D-2

        
          

        

      

      
         

      

       

    

    12. Each
      PRC
      Subsidiary has obtained or completed (a) all approvals, consents, exemptions,
      authorizations or other actions by or notices to, or filings with any PRC
      Governmental Authority or any person and (b) any corporate or shareholder
      approval necessary or required in order to permit such PRC Subsidiary to pay
      dividends or make any other distributions on its Capital Stock.

    

    13. The
      choice of New York law as the governing law of each of the Loan Documents is
      a
      valid choice of law.

    

    14. Each
      of
      the Individual Guarantors has validly appointed CT Corporation System as its
      agent for service of process pursuant to Section 9.17 of the Loan Agreement.
      

    

    15. The
      choice of New York law as the proper law to govern the obligations of the
      parties under the Loan Documents should be upheld as a valid choice of law
      by
      the courts of the PRC and applied by such courts in proceedings relating to
      the
      obligations of the parties under the Loan Documents, unless the application
      of
      New York law would contravene the public policy of the PRC law. We are not
      aware
      of any public policy of the PRC law that would be impugned by the enforcement
      of
      the express provisions of the Loan Documents. 

    

    16. Each
      Individual Guarantor has validly submitted to the jurisdiction as set forth
      in
      Section 9.15 of the Loan Agreement.

    

    The
      law
      covered by this opinion is limited to the law of the PRC and any province or
      other political subdivision thereof. We express no opinion as to the laws of
      any
      other jurisdiction.

     

    
      	 	
              Very
                truly yours,

            

    

    

    
      
         

      

      
        D-3

        
          

        

      

      
         

      

    

    EXHIBIT
      E

    

    FORM
      OF BVI COUNSEL OPINION

    

    19
      April
      2007

    

    ABN
      AMRO
      Bank N.V., Hong Kong Branch

    38/F,
      Cheung Kong Centre

    2
      Queen’s
      Road Central

    Hong
      Kong
      SAR

    

    Attention
      : the board of directors

    

    Dear
      Sirs,

    

    Beams
      Power Investment Limited

    

    We
      have
      acted as special legal counsel in the British Virgin Islands to Beams Power
      Investment Limited (the “Company”) in connection with the granting by the
      Company of a security interest over shares of Synutra International, Inc. a
      Delaware corporation (the “Issuer”).

    

    For
      the
      purposes of giving this opinion, we have examined a collateral agreement between
      the Company, the Issuer and ABN AMRO Bank N.V., Hong Kong Branch (the “Bank”)
      dated 19 April, 2007, which is herein sometimes referred to as the “Document”
(which term does not include any other instrument or agreement whether or not
      specifically referred to therein or attached as an exhibit or schedule
      thereto).

    

    We
      have
      also reviewed the memorandum of association and the articles of association
      of
      the Company, as obtained from the Registrar of Corporate Affairs on [ ] April
      2007, resolutions in writing signed by all the directors of the Company and
      dated [ ] April 2007 and resolutions in writing signed by all the shareholders
      of the Company and dated [ ] April 2007, (the “Minutes”), and such other
      documents and made such enquiries as to questions of law as we have deemed
      necessary in order to render the opinion set forth below.

    

    We
      have
      assumed (a) the genuineness and authenticity of all signatures and the
      conformity to the originals of all copies (whether or not certified) examined
      by
      us and the authenticity and completeness of the originals from which such copies
      were taken; (b) that where a document has been examined by us in draft form,
      it
      will be or has been executed in the form of that draft, and where a number
      of
      drafts of a document have been examined by us all changes thereto have been
      marked or otherwise drawn to our attention; (c) the capacity, power and
      authority of each of the parties to the Documents, other than the Company,
      to
      enter into and perform its respective obligations under the Document; (d) the
      due execution and delivery of the Document by each of the parties thereto,
      other
      than the Company, and the physical delivery thereof by the Company with an
      intention to be bound thereby; (e) the accuracy and completeness of all factual
      representations made in the Document and other documents reviewed by us; (f)
      that the resolutions contained in the Minutes were passed at one or more duly
      convened, constituted and quorate meetings or by unanimous written resolution,
      remain in full force and effect and have not been rescinded or amended; (g)
      that
      there is no provision of the law of any jurisdiction, other than the British
      Virgin Islands, which would have any implication in relation to the opinions
      expressed herein; (h) the validity and binding effect under the laws of the
      Sate
      of New York (the “Foreign Laws”) of the Document which is expressed to be
      governed by such Foreign Laws in accordance with its terms; (i) the validity
      and
      binding effect under the Foreign Laws of the submission by the Company pursuant
      to the Document to the non-exclusive jurisdiction of the courts of the State
      of
      New York sitting in the Borough of Manhattan, New York City or of the United
      States for the Southern District of such state (the “Foreign Courts”) and (j)
      that on the date of entering into the Document the Company is, and immediately
      after entering into the Document will be, able to pay its liabilities as they
      become due.

    

    
      
         

      

      
        E-1

        
          

        

      

      
         

      

       

    

    The
      term
“enforceable” as used in this opinion means that an obligation is of a type
      which the courts of the British Virgin Islands enforce. It does not mean that
      those obligations will be enforced in all circumstances in accordance with
      the
      terms of the Document. In particular, the obligations of the Company under
      the
      Document (a) will be subject to the laws from time to time in effect relating
      to
      bankruptcy, insolvency, liquidation, possessory liens, rights of set off,
      reorganisation, merger, consolidation, moratorium or any other laws or legal
      procedures, whether of a similar nature or otherwise, generally affecting the
      rights of creditors; (b) will be subject to statutory limitation of the time
      within which proceedings may be brought; (c) will be subject to general
      principles of equity and, as such, specific performance and injunctive relief,
      being equitable remedies, may not be available; (d) may not be given effect
      to
      by a British Virgin Islands court, whether or not it was applying the Foreign
      Laws, if and to the extent they constitute the payment of an amount which is
      in
      the nature of a penalty and not in the nature of liquidated damages; and (e)
      may
      not be given effect by a British Virgin Islands court to the extent that they
      are to be performed in a jurisdiction outside the British Virgin Islands and
      such performance would be illegal under the laws of that jurisdiction.
      Notwithstanding any contractual submission to the jurisdiction of specific
      courts, a British Virgin Islands court has inherent discretion to stay or allow
      proceedings in the British Virgin Islands courts.

    

    We
      express no opinion as to the enforceability of any provision of the Document
      which provides for the payment of a specified rate of interest on the amount
      of
      a judgment after the date of judgment or which purports to fetter the statutory
      powers of the Company.

    

    We
      have
      made no investigation of and express no opinion in relation to the laws of
      any
      jurisdiction other than the British Virgin Islands. This opinion is to be
      governed by and construed in accordance with the laws of the British Virgin
      Islands and is limited to and is given on the basis of the current law and
      practice in the British Virgin Islands. This opinion is issued solely for your
      benefit and is not to be relied upon by any other person, firm or entity or
      in
      respect of any other matter.

    

    On
      the
      basis of and subject to the foregoing, we are of the opinion that:

    

    1. The
      Company is duly incorporated and existing under the laws of the British Virgin
      Islands in good standing (meaning solely that it has not failed to make any
      filing with any British Virgin Islands governmental authority or to pay any
      British Virgin Islands government fee or tax which would make it liable to
      be
      struck off the Register of Companies and thereby cease to exist under the laws
      of the British Virgin Islands).

    

    
      
         

      

      
        E-2

        
          

        

      

      
         

      

       

    

    2. The
      Company has the necessary corporate power and authority to enter into and
      perform its obligations under the Document. The execution and delivery of the
      Document by the Company and the performance by the Company of its obligations
      thereunder will not violate the memorandum of association or articles of
      association of the Company nor any applicable law, regulation, order or decree
      in the British Virgin Islands.

    

    3. The
      Company has taken all corporate action required to authorise its execution,
      delivery and performance of the Document. The Document has been duly executed
      and delivered by or on behalf of the Company, and constitutes the valid and
      binding obligations of the Company enforceable against it in accordance with
      the
      terms thereof.

    

    4. No
      order,
      consent, approval, licence, authorisation or validation of or exemption by
      any
      government or public body or authority of the British Virgin Islands or any
      sub-division thereof is required to authorise or is required in connection
      with
      the execution, delivery, performance and enforcement of the
      Document.

    

    5. Except
      as
      set out in this paragraph, it is not necessary or desirable to ensure the
      enforceability in the British Virgin Islands of the Document that it be
      registered in any register kept by, or filed with, any governmental authority
      or
      regulatory body in the British Virgin Islands. The Company is required to keep
      a
      register of all charges created on or after the date that the Company
      re-registered as a BVI business company under the BVI Business Companies Act
      2004 (“relevant charges”). To the extent that the Document creates a relevant
      charge over assets of the Company, particulars of the charge must be entered
      in
      the register and a copy of the register shall be kept at the registered office
      of the Company or at the office of its registered agent. Where the Document
      creates a relevant charge, it may be desirable to ensure the priority in the
      British Virgin Islands of the charge that the particulars of the charge be
      registered at the office of the Registrar of Corporate Affairs pursuant to
      Section 163(1) of the BVI Business Companies Act, 2004. On registration, to
      the
      extent that British Virgin Islands law governs the priority of a charge, such
      charge will have priority in the British Virgin Islands over a relevant charge
      on the property that is subsequently registered in accordance with section
      163
      and a relevant charge on the property that is not registered in accordance
      with
      that section, provided that a registered floating charge is postponed to a
      subsequently registered fixed charge unless the floating charge contains a
      prohibition or restriction on the power of the company to create any future
      charge ranking in priority to or equally with the charge. A registration fee
      of
      $100.00 will be payable in respect of the registration.

    

    It
      should
      be noted that charges created before the date that the Company re-registered
      as
      a BVI business company under the BVI Business Companies Act 2004 ("Preexisting
      Charges") will continue to rank in the order in which they would have ranked
      had
      the relevant section of the BVI Business Companies Act 2004 not come into force
      and thus may have priority over any of the Documents which creates a relevant
      charge.

    

    Under
      BVI
      law, “charge” means any form of security interest, whether fixed or floating,
      over property, wherever situated, other than an interest arising by operation
      of
      law.

    

    However,
      as the Document is governed by the Foreign Laws, the question of whether it
      would constitute a charge would be determined under the Foreign
      Laws.

    

    
      
         

      

      
        E-3

        
          

        

      

      
         

      

       

    

    6. The
      Document will not be subject to ad valorem stamp duty in the British Virgin
      Islands and no registration, documentary, recording, transfer or other similar
      tax, fee or charge is payable in the British Virgin Islands in connection with
      the execution, delivery, filing, registration or performance of the Document
      other than as stated in paragraph 5 hereof. 

    

    7. The
      choice of the Foreign Laws as the governing law of the Document is a valid
      choice of law and would be recognised and given effect to in any action brought
      before a court of competent jurisdiction in the British Virgin Islands, except
      for those laws (i) which such court considers to be procedural in nature, (ii)
      which are revenue or penal laws or (iii) the application of which would be
      inconsistent with public policy, as such term is interpreted under the laws
      of
      the British Virgin Islands. The submission in the Document to the non exclusive
      jurisdiction of the Foreign Courts is valid and binding upon the Company and
      enforceable against it.

    

    8. The
      courts of the British Virgin Islands would recognise as a valid judgment, a
      final and conclusive judgment in personam obtained in the Foreign Courts against
      the Company based upon the Document under which a sum of money is payable (other
      than a sum of money payable in respect of multiple damages, taxes or other
      charges of a like nature or in respect of a fine or other penalty) and would
      give a judgment based thereon provided that (a) such courts had proper
      jurisdiction over the parties subject to such judgment, (b) such courts did
      not
      contravene the rules of natural justice of the British Virgin Islands, (c)
      such
      judgment was not obtained by fraud, (d) the enforcement of the judgment would
      not be contrary to the public policy of the British Virgin Islands, (e) no
      new
      admissible evidence relevant to the action is submitted prior to the rendering
      of the judgment by the courts of the British Virgin Islands and (f) there is
      due
      compliance with the correct procedures under the laws of the British Virgin
      Islands. 

    

    9. There
      is
      no income or other tax of the British Virgin Islands imposed by withholding
      or
      otherwise on any payment to be made to or by the Company pursuant to the
      Document.

    

    10. Based
      solely upon a search of the Index of Civil Suits maintained at the Supreme
      Court
      Registry, Road Town, Tortola, British Virgin Islands conducted at ____ on
      ___________ 2007 (which would not reveal details of proceedings which have
      been
      filed but not actually entered in the Index of Civil Suits at the time of our
      search), there are no judgments against the Company, nor any legal proceedings
      pending in the British Virgin Islands to which the Company is subject.

    

    11. Based
      solely on a search of the public records in respect of the Company maintained
      at
      the offices of the Registrar of Corporate Affairs at _____ on ___________ 2007
      (which would not reveal details of matters which have not been lodged for
      registration or have been lodged for registration but not actually registered
      at
      the time of our search) and a search of the Index of Civil Suits maintained
      at
      the Supreme Court Registry, Road Town, Tortola British Virgin Islands conducted
      at _____ on _________ 2007 (which would not reveal details of proceedings which
      have been filed but not actually entered in the Index of Civil Suits at the
      time
      of our search), there are no judgments against the Company, nor any legal or
      governmental proceedings pending in the British Virgin Islands to which the
      Company is subject. Further, based solely on the search of the public records
      in
      respect of the Company maintained at the offices of the Registrar of Corporate
      Affairs mentioned above, no details have been lodged of any steps taken in
      the
      British Virgin Islands for the appointment of a receiver, administrator or
      liquidator to, or for the winding-up, dissolution, reconstruction or
      reorganisation of the Company (however, it should be noted that (i) failure
      to
      file notice of appointment of a receiver does not invalidate the receivership
      but only gives rise to penalties on the part of the receiver and (ii) in the
      case of the appointment of a liquidator, notice of the appointment of a
      liquidator may be filed up to 14 days after the actual
      appointment).

    

    
      
         

      

      
        E-4

        
          

        

      

      
         

      

       

    

    12. Based
      solely on a search of the public records in respect of the Company maintained
      at
      the offices of the Registrar of Corporate Affairs at _____ on __________ 2007,
      (which would not reveal details of matters which have not been lodged for
      registration or which have been lodged for registration but not actually
      registered at the time of our search) no register of mortgages, charges and
      other encumbrances of the Company has been filed at the offices of the Registrar
      of Corporate Affairs under the International Business Companies Act (the “IBC
      Act”). No charge has been registered at the Registrar of Corporate Affairs in
      respect of the Company under Section 163 of the BVI Business Companies Act
      (“BC
      Act”). Based on our review of a registered agent’s certificate issued by the
      registered agent of the Company dated [ ] April 2007 and a certificate issued
      by
      a director of the Company dated [ ] April 2007, the Company does not maintain
      a
      register of mortgages, charges and other encumbrances at its registered office
      under the IBC Act or a register of relevant charges at its registered office
      or
      the office of its registered agent under Section 162 of the BC Act. It should
      be
      noted that (i) the creation of a register of mortgages, charges and other
      encumbrances is not mandatory under the IBC Act and if such a register is
      created and maintained at the registered office of the Company , the filing
      of
      such register at the office of the Registrar of Corporate Affairs is further
      not
      mandatory under the IBC Act and (ii) it is mandatory for a register of charges
      to be created and maintained at the registered office of the Company or at
      the
      office of its registered agent under the BC Act but the filing of such register
      at the offices of the Registrar of Corporate Affairs is not mandatory under
      the
      BC Act.

    

    13. The
      Bank
      will not be deemed to be resident, domiciled or carrying on business in the
      British Virgin Islands by reason only of the execution, performance and/or
      enforcement of the Document by the Company.

    

    14. The
      Bank
      has standing to bring an action or proceedings before the appropriate courts
      in
      the British Virgin Islands for the enforcement of the Document. It is not
      necessary or advisable in order for the Bank to enforce its rights under the
      Document, including the exercise of remedies thereunder, that it be licensed,
      qualified or otherwise entitled to carry on business in the British Virgin
      Islands.

    

    15. The
      Company is not entitled to any immunity under the laws of the British Virgin
      Islands, whether characterised as sovereign immunity or otherwise, from any
      legal proceedings to enforce the Document in respect of itself or its
      property.

    

    16. The
      obligations of the Company under the Document will rank at least pari passu
      in
      priority of payment with all other unsecured unsubordinated indebtedness of
      the
      Company, other than indebtedness which is preferred by virtue of any provision
      of the laws of the British Virgin Islands of general application.

    

    
      
         

      

      
        E-5

        
          

        

      

      
         

      

       

    

    17. The
      Document is in an acceptable legal form under the laws of the British Virgin
      Islands for enforcement thereof in the British Virgin Islands.

    

    18. The
      appointment of CT Corporation System to accept service of process in the Foreign
      Courts pursuant to the Document is legal, valid and binding on the
      Company.

     

    
      	 	
              Yours
                faithfully,

            

    

    

    
      
         

      

      
        E-6Exhibit
        10.2

    

     

    COLLATERAL
      AGREEMENT

    

    AGREEMENT
      dated as of April 19, 2007 (this “Agreement”)
      among
      BEAMS POWER INVESTMENT LIMITED, an International Business Companies Act company
      re-registered as a BVI business company organized under the laws of the British
      Virgin Islands (the “Lien
      Grantor”),
      SYNUTRA INTERNATIONAL, INC., a Delaware corporation (the “Issuer”)
      and
      ABN AMRO BANK N.V., HONG KONG BRANCH as lender (the “Lender”)
      and as
      collateral agent (the “Collateral
      Agent”).

    

    WITNESSETH:

    

    WHEREAS,
      the Obligors (as defined therein) and the Lender are parties to a Loan Agreement
      of even date herewith (as the same may be amended from time to time, the “Loan
      Agreement”) providing for credit extensions to and on behalf of the Issuer;

    

    WHEREAS,
      all of the equity interests in the Lien Grantor are owned by certain of the
      Obligors under the Loan Agreement; and

    

    WHEREAS,
      in order to induce the Lender to enter into the Loan Agreement, the Lien Grantor
      has agreed to grant a continuing security interest in and to the Collateral
      (as
      hereafter defined) to secure the Obligors’ obligations under the Loan
      Agreement;

    

    NOW,
      THEREFORE, in consideration of the premises and other good and valuable
      consideration, the receipt and sufficiency of which are hereby acknowledged,
      the
      parties hereto agree as follows:

    

    Section
      1. Definitions.
      

    

    (a) Terms
      Defined in the Loan Agreement.
      Terms
      defined in the Loan Agreement and not otherwise defined herein shall have,
      as
      used herein, the respective meanings provided for therein. 

    

    (b) Additional
      Definitions.
      The
      following additional terms, as used herein, have the following
      meanings:

    

    “Acceleration
      Default”
means
      an Event of Default which either (i) results in acceleration of the maturity
      of
      some or all of the Obligations or (ii) arises from a failure to pay the
      principal amount of some or all of the Obligations at final
      maturity.

    

    “BC
      Act”
has
      the
      meaning specified in Section 5(c).

    

    “Collateral”
has
      the
      meaning assigned to such term in Section 3(a).

    

    “Default”
and
      “Event
      of Default”
have
      the meanings assigned such terms under the Loan Agreement and, for purposes
      of
      this Agreement only, Event of Default shall also include any payment defaults
      by
      the Issuer or the Lien Grantor arising under any other Loan
      Document.

    

    “Issuer”
has
      the
      meaning specified in the introductory paragraph hereto.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    “Pledged
      Stock”
means
      (i) the 25,000,000 shares of common stock of the Issuer owned by the Lien
      Grantor as of the date hereof and (ii) any other capital stock required to
      be
      pledged to the Collateral Agent pursuant to Section 3(b).

    

    “Post-Petition
      Interest”
means
      any interest that accrues after the commencement of any case, proceeding or
      other action relating to the bankruptcy, insolvency or reorganization of any
      Obligor (or would accrue but for the operation of applicable bankruptcy or
      insolvency laws), whether or not such interest is allowed or allowable as a
      claim in any such proceeding.

    

    “Proceeds”
means
      all proceeds of, and all other profits, products, rents or receipts, in whatever
      form, arising from the collection, sale, lease, exchange, assignment, licensing
      or other disposition of, or other realization upon, any Collateral, including
      all claims of the Lien Grantor against third parties for loss of, damage to
      or
      destruction of, or for proceeds payable under, or unearned premiums with respect
      to, policies of insurance in respect of, any Collateral.

    

    “Register
      of Charges”
has
      the
      meaning specified in Section 5(c).

    

    “Registrar”
has
      the
      meaning specified in Section 5(d).

    

    “Secured
      Obligations”
means
      the obligations secured under this Agreement including (i) the Obligations,
      (ii)
      any note issued pursuant to any of the Loan Documents and (iii) any renewals
      or
      extensions of any of the foregoing.

    

    “Security
      Interests”
means
      the security interests in the Collateral granted hereunder securing the Secured
      Obligations.

    

    “UCC”
means
      the Uniform Commercial Code as in effect from time to time in the State of
      New
      York; provided that, if perfection or the effect of perfection or non-perfection
      or the priority of the Security Interests on any Collateral is governed by
      the
      Uniform Commercial Code as in effect in a jurisdiction other than New York,
      “UCC”
means
      the Uniform Commercial Code as in effect from time to time in such other
      jurisdiction for purposes of the provisions hereof relating to such perfection,
      effect of perfection or non-perfection or priority.

    

    Unless
      otherwise defined herein or in the Loan Agreement, or unless the context
      otherwise requires, all terms used herein which are defined in the UCC as in
      effect on the date hereof shall have the meanings therein stated.

    

    (c) Terms
      Generally.
      The
      definitions of terms herein (including those incorporated by reference to the
      UCC or to another document) apply equally to the singular and plural forms
      of
      the terms defined. Whenever the context may require, any pronoun includes the
      corresponding masculine, feminine and neuter forms. The words “include”,
      “includes”
and
      “including”
shall
      be deemed to be followed by the phrase “without
      limitation”.
      The
      word “will” shall be construed to have the same meaning and effect as the word
“shall”.
      Unless
      the context requires otherwise, (i) any definition of or reference to any
      agreement, instrument or other document herein shall be construed as referring
      to such agreement, instrument or other document as from time to time amended,
      supplemented or otherwise modified (subject to any restrictions on such
      amendments, supplements or modifications set forth herein), (ii) any reference
      herein to any Person shall be construed to include such Person’s successors and
      permitted assigns, (iii) the words “herein”,
      “hereof”
and
      “hereunder”,
      and
      words of similar import, shall be construed to refer to this Agreement in its
      entirety and not to any particular provision hereof, (iv) all references herein
      to Sections, Exhibits and Schedules shall be construed to refer to Sections
      of,
      and Exhibits and Schedules to, this Agreement, and (v) the word “property”
shall
      be construed to refer to any and all tangible and intangible assets and
      properties, including cash, securities, accounts and contract
      rights.

    

    
      
         

      

      
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    Section
      2. Representations
      and Warranties.
      The
      Lien Grantor represents and warrants as follows:

    

    (a) Title
      to Pledged Stock.
      The
      Lien Grantor owns all of the Pledged Stock, free and clear of any Liens other
      than the Security Interests. All of the Pledged Stock has been duly authorized
      and validly issued, and is fully paid and non-assessable, and is not subject
      to
      options to purchase, claims or similar rights of any Person. The Lien Grantor
      is
      not and will not become a party to or otherwise bound by any agreement, other
      than this Agreement, which restricts in any manner the rights of the Lender,
      the
      Collateral Agent or any present or future holder of any of the Pledged Stock
      with respect thereto.

    

    (b) Pledged
      Stock.
      As of
      the date hereof, the Pledged Stock represents at least 49.9% of the issued
      and
      outstanding common stock of the Issuer. 

    

    (c) Validity,
      Perfection and Priority of Security Interests.
      Upon
      delivery of the certificates representing the Pledged Stock to the Collateral
      Agent or its designee in accordance with Section 4 hereof, the Collateral Agent
      will have a valid and perfected security interest in the Collateral subject
      to
      no prior Lien. Except as set forth in Section 5, no registration, recordation
      or
      filing with any governmental body, agency or official is required in connection
      with the execution or delivery of this Agreement or necessary for the validity
      or enforceability hereof or for the perfection or enforcement of the Security
      Interests. Neither the Lien Grantor nor any of its Subsidiaries has performed
      or
      will perform any acts which could prevent the Collateral Agent from enforcing
      any of the terms and conditions of this Agreement or which would limit the
      Collateral Agent in any such enforcement.

    

    (d) Lien
      Grantor and UCC Filing Locations.
      The
      Lien Grantor is duly organized, validly existing and in good standing under
      the
      laws of the British Virgin Islands.

    

    (e) Authorization;
      No Contravention.
      The
      execution, delivery and performance by the Lien Grantor of this Agreement has
      been duly authorized by all necessary corporate action on its part, and does
      not
      and will not contravene the terms of its Organization Documents. The execution,
      delivery and performance by the Lien Grantor of this Agreement does not and
      will
      not (a) conflict with or result in any breach or contravention of, or the
      creation of any Lien (other than those contemplated hereby) under (i) any
      Contractual Obligation to which the Lien Grantor is a party or (ii) any order,
      injunction, writ or decree of any Governmental Authority or any arbitral award
      to which the Lien Grantor or its property is subject or (b) violate any Law
      applicable to the Lien Grantor, this Agreement or any of the transactions
      contemplated hereby.

    

    (f) Governmental
      Authorization; Other Consents.
      Except
      as set forth in Section 5, no approval, consent, exemption, authorization,
      or
      other action by, or notice to, or filing with, any Governmental Authority or
      any
      other Person is necessary or required in connection with the execution, delivery
      or performance by, or enforcement against, the Lien Grantor or the Collateral
      of
      this Agreement or any other Loan Document.

    

    
      
         

      

      
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    (g) Binding
      Effect.
      This
      Agreement has been duly executed and delivered by the Lien Grantor. The
      Agreement constitutes a legal, valid and binding obligation of the Lien Grantor,
      enforceable against it in accordance with its terms.

    

    Section
      3. The
      Security Interests.
      In
      order to secure the full and punctual payment of the Secured Obligations in
      accordance with the terms thereof, and to secure the performance of all the
      obligations of the Lien Grantor and the Issuer hereunder:

    

    (a) The
      Lien
      Grantor hereby assigns and pledges to and with the Collateral Agent for the
      benefit of the Lender and grants to the Collateral Agent for the benefit of
      the
      Lender a security interest in the Pledged Stock, and all of its rights and
      privileges with respect to the Pledged Stock, and all income and profits
      thereon, and all interest, dividends and other payments and distributions with
      respect thereto, and all Proceeds of the foregoing (the “Collateral”).
      Contemporaneously with the execution and delivery hereof, the Lien Grantor
      is
      delivering the certificates representing the Pledged Stock in pledge
      hereunder.

    

    (b) In
      the
      event that the Issuer at any time issues any additional or substitute shares
      of
      capital stock of any class to the Lien Grantor, the Lien Grantor will
      immediately (i) pledge and deposit with the Collateral Agent certificates,
      if
      any, representing a pro
      rata
      portion
      of such shares as additional security for the Secured Obligations that is equal
      to the ratio of the Pledged Stock to the aggregate shares of common stock of
      the
      Issuer owned by the Lien Grantor on the date hereof and (ii) take all other
      steps required to grant or maintain, as applicable, a first priority security
      interest in such shares to the Collateral Agent for the benefit of the Lender.
      All such shares constitute Pledged Stock and are subject to all provisions
      of
      this Agreement.

    

    (c) The
      Security Interests are granted as security only and shall not subject the
      Collateral Agent or the Lender to, or transfer or in any way affect or modify,
      any obligation or liability of the Lien Grantor with respect to any of the
      Collateral or any transaction in connection therewith.

    

    Section
      4. Delivery
      of Pledged Stock.
      All
      certificates representing Pledged Stock delivered to the Collateral Agent or
      its
      designee by the Lien Grantor pursuant hereto shall be (x) in suitable form
      for
      transfer by delivery, or shall be accompanied by duly executed instruments
      of
      transfer or assignment in blank, with signatures appropriately guaranteed,
      and
      accompanied by any required transfer tax stamps, all in form and substance
      satisfactory to the Collateral Agent and (y) accompanied by a completed notice
      to the stock transfer agent of the Issuer as contemplated by Section 17 below.
      

    

    Section
      5. Further
      Assurances.
      

    

    (a) The
      Lien
      Grantor agrees that it will, at its expense and in such manner and form as
      the
      Collateral Agent may reasonably require, execute, deliver, file and record
      any
      financing statement, specific assignment or other paper and take any other
      action that may be necessary or desirable, or that the Collateral Agent may
      reasonably request, in order to create, preserve, perfect or validate any
      Security Interest or to enable the Collateral Agent to exercise and enforce
      its
      rights hereunder with respect to any of the Collateral. To the extent permitted
      by applicable law, the Lien Grantor hereby authorizes the Collateral Agent
      to
      execute and file, in the name of the Lien Grantor or otherwise, financing
      statements (which may be carbon, photographic, photostatic or other
      reproductions of this Agreement or of a financing statement relating to this
      Agreement) which the Collateral Agent in its reasonable discretion may deem
      necessary or appropriate to further perfect the Security Interests.

    

    
      
         

      

      
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    (b) The
      Lien
      Grantor agrees that it will not change Section 6 its name, identity or corporate
      structure in any manner or Section 7 the location of its chief executive office
      unless it shall have given the Collateral Agent not less than 30 days’ prior
      notice thereof (or such shorter period consented to by the Collateral Agent
      in
      its sole discretion).

    

    (c) The
      Lien
      Grantor shall enter, or shall procure the entry, in its register of relevant
      charges (the “Register
      of Charges”)
      maintained by the Lien Grantor pursuant to Part VIII of the BVI Business
      Companies Act, 2004 (as the same may be amended from time to time) (the
“BC
      Act”)
      such
      particulars regarding the charge created by this Agreement as are specified
      in
      section 162 of the BC Act (or any similar provision in any statute pursuant
      to
      which the Lien Grantor is incorporated or existing from time to time) and submit
      a copy of such revised Register of Charges to its registered agent in the
      British Virgin Islands to keep at the Lien Grantor’s registered office and at
      the office of its registered agent in the British Virgin Islands.

    

    (d) The
      Lien
      Grantor shall make an application, or procure that an application is made,
      in
      the approved form to the Registrar of Corporate Affairs in the British Virgin
      Islands (the “Registrar”)
      to
      register the charge created by this Agreement in the register of registered
      charges kept by the Registrar for the Lien Grantor and, forthwith upon receipt
      by the Lien Grantor of the certificate of registration of the charge issued
      by
      the Registrar, send a copy of such certificate of registration to the Issuer
      and
      the Collateral Agent.

    

    Section
      6. Record
      Ownership of Pledged Stock.
      The
      Collateral Agent may at any time or from time to time, in its sole discretion,
      cause any or all of the Pledged Stock to be transferred of record into the
      name
      of the Collateral Agent or its nominee. The Lien Grantor will promptly give
      to
      the Collateral Agent copies of any notices or other communications received
      by
      it with respect to Pledged Stock registered in the name of the Lien Grantor
      and
      the Collateral Agent will promptly give to the Lien Grantor copies of any
      notices and communications received by the Collateral Agent with respect to
      Pledged Stock registered in the name of the Collateral Agent or its
      nominee.

    

    Section
      7. Right
      to Receive Distributions on Collateral.
      The
      Collateral Agent shall have the right to receive and, during the continuance
      of
      any Default, to retain as Collateral hereunder all dividends and other payments
      and distributions made upon or with respect to the Collateral and the Lien
      Grantor shall take all such action as the Collateral Agent may deem necessary
      or
      appropriate to give effect to such right. All such dividends and other payments
      and distributions which are received by the Lien Grantor shall be received
      in
      trust for the benefit of the Collateral Agent and the Lender and, if the
      Collateral Agent so directs during the continuance of a Default, shall be
      segregated from other funds of the Lien Grantor and shall, forthwith upon demand
      by the Collateral Agent during the continuance of a Default, be paid over to
      the
      Collateral Agent as Collateral in the same form as received (with any necessary
      endorsement). After all Defaults have been cured, the Collateral Agent’s right
      to retain dividends, interest and other payments and distributions under this
      Section 7 shall cease and the Collateral Agent shall pay over to the Lien
      Grantor any such Collateral retained by it during the continuance of a
      Default.

    

    
      
         

      

      
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    Section
      8. Right
      to Vote Pledged Stock.
      Unless
      an Acceleration Default shall have occurred and be continuing, the Lien Grantor
      shall have the right, from time to time, to vote and to give consents,
      ratifications and waivers with respect to the Pledged Stock, and the Collateral
      Agent shall, upon receiving a written request from the Obligor accompanied
      by a
      certificate signed by its principal financial officer stating that no Default
      has occurred and is continuing, deliver to the Lien Grantor or as specified
      in
      such request such proxies, powers of attorney, consents, ratifications and
      waivers in respect of any of the Pledged Stock which is registered in the name
      of the Collateral Agent or its nominee as shall be specified in such request
      and
      be in form and substance satisfactory to the Collateral Agent.

    

    If
      an
      Acceleration Default shall have occurred and be continuing, the Collateral
      Agent
      shall have the right to the extent permitted by law and the Lien Grantor shall
      take all such action as may be necessary or appropriate to give effect to such
      right, to vote and to give consents, ratifications and waivers, and take any
      other action with respect to any or all of the Pledged Stock with the same
      force
      and effect as if the Collateral Agent were the absolute and sole owner
      thereof.

    

    Section
      9. General
      Authority.
      The
      Lien Grantor hereby irrevocably appoints the Collateral Agent its true and
      lawful attorney, with full power of substitution, in the name of the Lien
      Grantor, the Collateral Agent, the Lender or otherwise, for the sole use and
      benefit of the Collateral Agent and the Lender, but at the expense of the Lien
      Grantor, to the extent permitted by law to exercise, at any time and from time
      to time while an Event of Default has occurred and is continuing, all or any
      of
      the following powers with respect to all or any of the Collateral:

    

    (a) to
      demand, sue for, collect, receive and give acquittance for any and all monies
      due or to become due upon or by virtue thereof,

    

    (b) to
      settle, compromise, compound, prosecute or defend any action or proceeding
      with
      respect thereto,

    

    (c) to
      sell,
      transfer, assign or otherwise deal in or with the same or the proceeds or avails
      thereof, as fully and effectually as if the Collateral Agent were the absolute
      owner thereof, and

    

    (d) to
      extend
      the time of payment of any or all thereof and to make any allowance and other
      adjustments with reference thereto;

    

    provided
      that the
      Collateral Agent (x) shall not sell or otherwise dispose of the Pledged Stock
      unless an Acceleration Default has occurred and is continuing and (y) shall
      give
      the Lien Grantor at least ten days’ prior written notice of the time and place
      of any public sale thereof or the time after which any private sale or other
      intended disposition thereof will be made. Any such notice shall (i) contain
      the
      information specified in UCC Section 9-613, (ii) be authenticated and (iii)
      be
      sent to the parties required to be notified pursuant to UCC Section 9-611(c);
      provided that, if the Collateral Agent fails to comply with this sentence in
      any
      respect, its liability for such failure shall be limited to the liability (if
      any) imposed on it as a matter of law under the UCC.

    

    
      
         

      

      
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    Section
      10. Remedies
      upon Event of Default.
      If any
      Event of Default shall have occurred and be continuing, the Collateral Agent
      may
      exercise on behalf of the Lender all the rights of a secured party under the
      UCC
      (whether or not in effect in the jurisdiction where such rights are exercised)
      and, in addition, the Collateral Agent may, without being required to give
      any
      notice, except as herein provided or as may be required by mandatory provisions
      of law, (i) apply the cash, if any, then held by it as Collateral as specified
      in Section 13 and (ii) if there shall be no such cash or if such cash shall
      be
      insufficient to pay all the Secured Obligations in full, but only if an
      Acceleration Default has occurred and is continuing, sell the Collateral or
      any
      part thereof at public or private sale or at any broker’s board or on any
      securities exchange, for cash, upon credit or for future delivery, and at such
      price or prices as the Collateral Agent may deem satisfactory. The Lender may
      be
      the purchaser of any or all of the Collateral so sold at any public sale (or,
      if
      the Collateral is of a type customarily sold in a recognized market or is of
      a
      type which is the subject of widely distributed standard price quotations,
      at
      any private sale). The Collateral Agent is authorized, in connection with any
      such sale, if it deems it advisable so to do, (A) to restrict the prospective
      bidders on or purchasers of any of the Pledged Stock to a limited number of
      sophisticated investors who will represent and agree that they are purchasing
      for their own account for investment and not with a view to the distribution
      or
      sale of any of such Pledged Stock, (B) to cause to be placed on certificates
      for
      any or all of the Pledged Stock or on any other securities pledged hereunder
      a
      legend to the effect that such security has not been registered under the United
      States Securities Act of 1933, as amended, and may not be disposed of in
      violation of the provision of said Act, and (C) to impose such other limitations
      or conditions in connection with any such sale as the Collateral Agent deems
      necessary or advisable in order to comply with said Act or any other law. The
      Lien Grantor will execute and deliver such documents and take such other action
      as the Collateral Agent deems necessary or advisable in order that any such
      sale
      may be made in compliance with law. Upon any such sale the Collateral Agent
      shall have the right to deliver, assign and transfer to the purchaser thereof
      the Collateral so sold. Each purchaser at any such sale shall hold the
      Collateral so sold absolutely and free from any claim or right of whatsoever
      kind, including any equity or right of redemption of the Lien Grantor which
      may
      be waived, and the Lien Grantor, to the extent permitted by law, hereby
      specifically waives all rights of redemption, stay or appraisal which it has
      or
      may have under any law now existing or hereafter adopted. The notice (if any)
      of
      such sale required by Section 9 shall (1) in the case of a public sale, state
      the time and place fixed for such sale, (2) in the case of a sale at a broker’s
      board or on a securities exchange, state the board or exchange at which such
      sale is to be made and the day on which the Collateral, or the portion thereof
      so being sold, will first be offered for sale at such board or exchange, and
      (3)
      in the case of a private sale, state the day after which such sale may be
      consummated. Any such public sale shall be held at such time or times within
      ordinary business hours and at such place or places as the Collateral Agent
      may
      fix in the notice of such sale. At any such sale the Collateral may be sold
      in
      one lot as an entirety or in separate parcels, as the Collateral Agent may
      determine. The Collateral Agent shall not be obligated to make any such sale
      pursuant to any such notice. The Collateral Agent may, without notice or
      publication, adjourn any public or private sale or cause the same to be
      adjourned from time to time by announcement at the time and place fixed for
      the
      sale, and such sale may be made at any time or place to which the same may
      be so
      adjourned. In the case of any sale of all or any part of the Collateral on
      credit or for future delivery, the Collateral so sold may be retained by the
      Collateral Agent until the selling price is paid by the purchaser thereof,
      but
      the Collateral Agent shall not incur any liability in the case of the failure
      of
      such purchaser to take up and pay for the Collateral so sold and, in the case
      of
      any such failure, such Collateral may again be sold upon like notice. The
      Collateral Agent, instead of exercising the power of sale herein conferred
      upon
      it, may proceed by a suit or suits at law or in equity to foreclose the Security
      Interests and sell the Collateral, or any portion thereof, under a judgment
      or
      decree of a court or courts of competent jurisdiction.

    

    
      
         

      

      
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    Section
      11. Expenses.
      Each of
      the Lien Grantor and the Issuer jointly and severally agrees that it will
      forthwith upon demand pay to the Collateral Agent:

    

    (a) the
      amount of any taxes which the Collateral Agent may have been required to pay
      by
      reason of the Security Interests or to free any of the Collateral from any
      Lien
      thereon, and

    

    (b) the
      amount of any and all out-of-pocket expenses, including the fees and
      disbursements of counsel and of any other experts, which the Collateral Agent
      may incur in connection with Section 14 the administration or enforcement of
      this Agreement, including such expenses as are incurred to preserve the value
      of
      the Collateral and the validity, perfection, rank and value of any Security
      Interest, Section 15 the collection, sale or other disposition of any of the
      Collateral, Section 16 the exercise by the Collateral Agent of any of the rights
      conferred upon it hereunder or Section 17 any Default or Event of
      Default.

    

    Any
      such
      amount not paid on demand shall bear interest at the rate equal to the Default
      Rate and shall be treated as additional Secured Obligations
      hereunder.

    

    Section
      12. Limitation
      on Duty of Collateral Agent in Respect of Collateral; Indemnity.

    

    (a) Beyond
      the exercise of reasonable care in the custody thereof, the Collateral Agent
      shall have no duty as to any Collateral in its possession or control or in
      the
      possession or control of any agent or bailee or any income thereon or as to
      the
      preservation of rights against prior parties or any other rights pertaining
      thereto. The Collateral Agent shall be deemed to have exercised reasonable
      care
      in the custody and preservation of the Collateral in its possession if the
      Collateral is accorded treatment substantially equal to that which it accords
      its own property, and shall not be liable or responsible for any loss or damage
      to any of the Collateral, or for any diminution in the value thereof, by reason
      of the act or omission of any agent or bailee selected by the Collateral Agent
      in good faith. In no event shall the Collateral Agent be liable to the Lien
      Grantor or the Issuer or any other party to this Agreement for any consequential
      (being loss of business, goodwill, opportunity or profit) or punitive loss
      or
      damages, even if advised of the possibility of such loss or damage.

    

    (b) Each
      of
      the Lien Grantor and the Issuer agrees to be jointly and severally responsible
      for and will indemnify each of the Collateral Agent, any predecessor Collateral
      Agent and their agents, employees, officers and directors for, and hold it
      harmless against, any loss or liability or expense incurred by it without
      negligence or willful misconduct on its part arising out of or in connection
      with the acceptance or administration of this Agreement and its duties under
      this Agreement, including the costs and expenses of defending itself against
      any
      claim or liability and of complying with any process served upon it or any
      of
      its officers in connection with the exercise or performance of any of its powers
      or duties under this Agreement.

    

    
      
         

      

      
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    (c) This
      Section 12 shall survive the termination of the Security Interests and the
      release of the Collateral.

    

    Section
      13. Application
      of Proceeds.
      Upon
      the occurrence and during the continuance of an Event of Default, the proceeds
      of any sale of, or other realization upon, all or any part of the Collateral
      and
      any cash held shall be applied by the Collateral Agent in the following order
      of
      priorities:

    

    first,
      to pay
      the expenses of such sale or other realization, including reasonable
      compensation to agents and counsel for the Collateral Agent, and all expenses,
      liabilities and advances incurred or made by the Collateral Agent in connection
      therewith, and any other unreimbursed expenses for which the Collateral Agent
      or
      the Lender is to be reimbursed pursuant to Section 9.04 of the Loan Agreement
      or
      Section 11 hereof and unpaid fees owing to the Collateral Agent or the Lender
      under any Loan Document;

    

    second,
      to pay
      ratably all interest (including Post-Petition Interest, to the fullest extent
      permitted by applicable Law) on the Secured Obligations, until payment in full
      of all such interest shall have been made;

    

    third,
      to pay
      the unpaid principal of the Secured Obligations, until payment in full of the
      principal of the Secured Obligations shall have been made;

    

    fourth,
      to pay
      all other Secured Obligations, until payment in full of all such other Secured
      Obligations shall have been made; and

    

    finally,
      to
      payment to the Lien Grantor or its successors or assigns, or as a court of
      competent jurisdiction may direct, of any surplus then remaining from such
      proceeds.

    

    The
      Collateral Agent may make distributions hereunder in cash or in kind or, on
      a
      ratable basis, in any combination thereof.

    

    Section
      14. Concerning
      the Collateral Agent.
      The
      provisions of Article 7 of the Loan Agreement shall inure to the benefit of
      the
      Collateral Agent in respect of this Agreement and shall be binding upon the
      parties to the Loan Agreement in such respect. In furtherance and not in
      derogation of the rights, privileges and immunities of the Collateral Agent
      therein set forth:

    

    (a) The
      Collateral Agent is authorized to take all such action as is provided to be
      taken by it as Collateral Agent hereunder and all other action reasonably
      incidental thereto. As to any matters not expressly provided for herein
      (including, without limitation, the timing and methods of realization upon
      the
      Collateral) the Collateral Agent shall act or refrain from acting in accordance
      with written instructions from the Lender or, in the absence of such
      instructions, in accordance with its discretion.

    

    (b) The
      Collateral Agent shall not be responsible for the existence, genuineness or
      value of any of the Collateral or for the validity, perfection, priority or
      enforceability of the Security Interests in any of the Collateral, whether
      impaired by operation of law or by reason of any action or omission to act
      on
      its part hereunder. The Collateral Agent shall have no duty to ascertain or
      inquire as to the performance or observance of any of the terms of this
      Agreement by the Lien Grantor.

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

       

    

    Section
      15. Appointment
      of Co-Collateral Agents.
      At any
      time or times, in order to comply with any legal requirement in any
      jurisdiction, the Collateral Agent may appoint another bank or trust company
      or
      one or more other persons, either to act as co-collateral agent or co-collateral
      agents, jointly with the Collateral Agent, or to act as separate collateral
      agent or collateral agents on behalf of the Lender with such power and authority
      as may be necessary for the effectual operation of the provisions hereof and
      may
      be specified in the instrument of appointment (which may, in the discretion
      of
      the Collateral Agent, include provisions for the protection of such
      co-collateral agent or separate collateral agent similar to the provisions
      of
      Section 14).

    

    Section
      16. Termination
      of Security Interests; Release of Collateral.
      Upon
      the repayment in full of all Secured Obligations and the termination of all
      lending commitments under the Loan Agreement, the Security Interests shall
      terminate and all rights to the Collateral shall revert to the Lien Grantor.
      At
      any time and from time to time prior to such termination of the Security
      Interests, the Collateral Agent may release any of the Collateral with the
      prior
      written consent of the Lender. Upon any such termination of the Security
      Interests or release of Collateral, the Collateral Agent will, at the expense
      of
      the Lien Grantor, execute and deliver to the Lien Grantor such documents as
      the
      Lien Grantor shall reasonably request to evidence the termination of the
      Security Interests or the release of such Collateral, as the case may be,
      including but not limited to a notice to the stock transfer agent of the Pledged
      Stock.

    

    Section
      17. Acknowledgment
      by the Issuer, Stop Transfer Instructions.
      The
      Issuer hereby acknowledges the Security Interests in the Pledged Stock. The
      Issuer agrees to effect or recognize any transfer of the Pledged Stock only
      if
      and to the extent such transfer is made in accordance with the provisions of
      this Agreement. Prior to the date hereof, the Issuer and the Lien Grantor have
      instructed the stock transfer agent for the Pledged Stock by means of delivery
      of a notice in substantially the form of Exhibit A hereto to refrain from
      effecting any proposed transfer of Pledged Stock without the prior written
      consent of the Collateral Agent and the Issuer has delivered a copy of such
      notice, acknowledged and confirmed by the stock transfer agent, to the
      Collateral Agent. 

    

    Section
      18. Notices.
      All
      notices hereunder shall be (x) in the case of the Lien Grantor; in writing
      (including by facsimile transmission) and mailed, faxed or delivered to the
      address, facsimile number or electronic mail address specified for notices
      to
      the Lien Grantor on Schedule A hereto, (y) in the case of the Collateral Agent;
      in writing (including by facsimile transmission) and mailed, faxed or delivered
      to the address, facsimile number or electronic mail address specified for
      notices to Collateral Agent on Schedule A hereto and (z) in the case of any
      other party, given in accordance with Section 9.02 of the Loan Agreement.

    

    Section
      19. Waivers,
      Non-exclusive Remedies.
      No
      failure on the part of the Collateral Agent to exercise, and no delay in
      exercising and no course of dealing with respect to, any right under this
      Agreement shall operate as a waiver thereof; nor shall any single or partial
      exercise by the Collateral Agent of any right under any Loan Document preclude
      any other or further exercise thereof or the exercise of any other right. The
      rights in this Agreement and the other Loan Documents are cumulative and are
      not
      exclusive of any other remedies provided by law.

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

       

    

    Section
      20. Successors
      and Assigns.
      This
      Agreement is for the benefit of the Collateral Agent and the Lender and their
      successors and assigns (if any), and in the event of an assignment of all or
      any
      of the Secured Obligations, the rights hereunder, to the extent applicable
      to
      the indebtedness so assigned, may be transferred with such indebtedness. This
      Agreement shall be binding on the Lien Grantor and its successors and
      assigns.

    

    Section
      21. Amendments
      and Waivers.
      Neither
      this Agreement nor any provision hereof may be changed, waived, discharged
      or
      terminated orally, but only in writing signed by the Lien Grantor and the
      Collateral Agent with the consent of the Lender.

    

    Section
      22. New
      York Law.
      THIS
      AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
      THE
      STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
      WITHIN SUCH STATE; PROVIDED THAT THE LENDER AND COLLATERAL AGENT SHALL RETAIN
      ALL RIGHTS ARISING UNDER FEDERAL LAW. 

    

    Section
      23. Submission
      to Jurisdiction.
      ANY
      LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN
      THE
      COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, NEW YORK
      CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY
      EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO CONSENTS, FOR ITSELF
      AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE
      COURTS. EACH PARTY HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
      OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
      CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
      OR
      PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
      DOCUMENT RELATED THERETO. EACH PARTY HERETO WAIVES PERSONAL SERVICE OF ANY
      SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
      PERMITTED BY THE LAW OF SUCH STATE. THE LIEN GRANTOR AGREES THAT A FINAL
      JUDGMENT IN ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT SHALL
      BE
      CONCLUSIVE AND BINDING UPON IT AND WILL BE GIVEN EFFECT IN ANY OTHER
      JURISDICTION TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW AND MAY BE
      ENFORCED IN ANY COURT TO THE JURISDICTION OF WHICH SUCH PARTY IS OR MAY BE
      SUBJECT BY A SUIT UPON SUCH JUDGMENT, PROVIDED THAT SERVICE OF PROCESS IS
      EFFECTED UPON IT IN ONE OF THE MANNERS SPECIFIED HEREIN OR AS OTHERWISE
      PERMITTED BY LAW.

    

    Section
      24. Waiver
      of Right to Jury Trial.
      EACH
      PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
      OF
      ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
      OR
      IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
      PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
      TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
      ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
      HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
      ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
      THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
      ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
      WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

    

    
      
         

      

      
        11

        
          

        

      

      
         

      

       

    

    Section
      25. Process
      Agent.
      

    

    Without
      prejudice to any other mode of service allowed under any relevant Law, each
      of
      the Lien Grantor and the Issuer:

    

    (a) irrevocably
      appoints CT Corporation System, located at 111 Eighth Avenue, New York, NY
      10011
      as its agent for service of process in relation to any proceedings before the
      courts of the State of New York sitting in the Borough of Manhattan, New York
      City or of the United States for the Southern District of such State in
      connection with this Agreement; and

    

    (b) agrees
      that failure by a process agent to notify it of the process will not invalidate
      the proceedings concerned. 

    

    Section
      26. Severability.
      If any
      provision hereof is invalid or unenforceable in any jurisdiction, then, to
      the
      fullest extent permitted by law, (i) the other provisions hereof shall remain
      in
      full force and effect in such jurisdiction and shall be liberally construed
      in
      favor of the Collateral Agent and the Lender in order to carry out the
      intentions of the parties hereto as nearly as may be possible; and (ii) the
      invalidity or unenforceability of any provision hereof in any jurisdiction
      shall
      not affect the validity or enforceability of such provision in any other
      jurisdiction.

    

    Section
      27. Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      an original but all of which together shall constitute one
      instrument.

    

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
      executed by their respective authorized officers as of the day and year first
      above written.

     

    
      	 	
              BEAMS
                POWER INVESTMENT LIMITED

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Collateral Agent

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              ABN
                AMRO BANK N.V., HONG KONG BRANCH, as Lender

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title

            

    

    

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    Schedule
      A

    

    NOTICE
      ADDRESSES

    

    LIEN
      GRANTOR:

    

    Beams
      Power Investment Limited

    Akara
      Bldg., 24 De Castro Street

    Wickham
      Cay I,

    Road
      Town, Tortola

    British
      Virgin Islands

    Attn:
      Xiuqing Meng

    Facsimile:
      +86-10-5869-3221

    E-mail:
      sherrymeng@yahoo.com

    

    COLLATERAL
      AGENT:

    

    ABN
      AMRO
      Bank N.V., Hong Kong Branch

    38/F,
      Cheung Kong Center

    2
      Queen’s
      Road Central

    Hong
      Kong

    

    Attn:
      Shirley Yin / Helen Fei / Carlos Wong / Clarice Tsang / Jessamine
      Lam

    Facsimile:
      +85-2-2700-3202 / 2700-3836 / 2700-3300

    
      	
              E-mail:

            	
              shirley.yin@hk.abnamro.com
                / helen.fei@hk.abnamro.com / carlos.wong@hk.abnamro.com /
                clarice.tsang@hk.abnamro.com / jessamine.lam@hk.abnamro.com

            

    

    

    
      
         

      

      
        S-1

        
          

        

      

      
         

      

    

    Exhibit
      A

    

    

    FORM
      OF NOTICE OF PLEDGE OF PLEDGED STOCK TO

    SYNUTRA
      STOCK TRANSFER AGENT

    

    [LETTERHEAD
      OF ISSUER]

    

    

    U.S.
      Stock Transfer Corporation

    1745
      Gardena Avenue, Suite 200

    Glendale,
      CA 91204-2991

    United
      States

    Attention:
      Rich Tilton

    Facsimile:
      +1-818-502-0057

    

    Re: Shares
      of
      Common Stock of Synutra International, Inc. - Notice of Pledge  and
      Limitation on Transfers

    

    Beams
      Power Investment Limited and Synutra International, Inc. hereby notify U.S.
      Stock Transfer Corporation that the shares evidenced by the share certificate
      numbered [_____________] of Synutra International, Inc. (the “Pledged
      Stock”)
      on the
      date hereof registered in the name of Beams Power Investment Limited are pledged
      to ABN AMRO Bank N.V., Hong Kong Branch, as Collateral Agent (“Collateral
      Agent”)
      under
      the Collateral Agreement dated April 19, 2007 among Beams Power Investment
      Limited, Synutra International, Inc. and ABN AMRO Bank N.V., Hong Kong Branch,
      for the benefit of ABN AMRO Bank N.V., Hong Kong Branch as Lender under the
      Loan
      Agreement dated April 19, 2007 among Synutra International, Inc., Liang Zhang,
      Xiuqing Meng and ABN AMRO Bank N.V., Hong Kong Branch. 

    

    Beams
      Power Investment Limited and Synutra International, Inc. hereby direct and
      request that U.S. Stock Transfer Corporation shall not register or effect any
      transfer of the Pledged Stock without the written consent of the Collateral
      Agent. The direction and request set forth in the preceding sentence shall
      be
      revocable only with the written consent of the Collateral Agent. 

     

    
      	 	
              BEAMS
                POWER INVESTMENT LIMITED

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title:

            

    

     

    
      
         

      

      
        A-1

        
          

        

      

      
         

      

       

    

    
      	 	
              SYNUTRA
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:
                _________________________________

              Name:

              Title:

            

    

    

    
      
         

      

      
        A-2

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