Exhibit 10.1

                                                               Execution Version

                      CONDITIONAL LOAN CONVERSION AGREEMENT

THIS CONDITIONAL LOAN CONVERSION AGREEMENT (this "Agreement") is entered into as
of November  16,  2007 by and between  China  Biopharmaceuticals  Holdings  Inc.
("CBH"),  and  RimAsia  Capital  Partners,  L.P.  ("RimAsia").  CBH and  RimAsia
hereinafter   collectively  may  be  referred  to  as  the  "Parties"  and  each
individually as a "Party."

                                    RECITALS

WHEREAS,   in  connection   with  the  prior   acquisition   of  Shenyang  Enshi
Pharmaceutical  Co.,  Ltd.  ("Enshi")  by  RACP  Pharmaceutical   Holdings  Ltd.
("RACP"),  which was set up by RimAsia  for the sole  purpose to acquire  Enshi,
RimAsia extended a loan in the aggregate  principal amount of US$11.5 million to
RACP (the "Loan") for the purpose of the  acquisition of Enshi,  pursuant to the
terms and conditions of that certain Facility  Agreement dated May 29, 2006 (the
"Loan Agreement").

WHEREAS,  CBH acquired RACP from RimAsia pursuant to a Stock Purchase  Agreement
and a  Conditional  Stock  Purchase  Agreement  dated May 29, 2006 and a Deed of
Accession dated June 30, 2006 (the "Deed of Accession"), and thereby RACP became
a wholly-owned subsidiary of CBH and the Loan was assumed by CBH in June 2006.

WHEREAS, the Loan is currently in default under the terms of the Loan Agreement,
with a total  amount  due and  payable  on  October  15,  2007 of  approximately
US$12,508,534 comprising of (i) a principal amount of US$11,500,000, (ii) unpaid
interest (up to October 15, 2007) of US$1,008,534 (the "Balance Outstanding").

WHEREAS,  RimAsia and CBH have entered into a definitive  letter of intent and a
term sheet to restructure  the Loan where RimAsia has agreed to convert the Loan
into newly issued Preferred Shares,  subject to the changes and modifications in
this Agreement.  The conversion of the Loan and the Balance Outstanding into the
Preferred Shares pursuant to this Agreement and the other Transaction  Documents
is to be referred to herein as the "Conversion."

WHEREAS,  pursuant to the provisions of this Agreement,  the Parties have agreed
that the Conversion is subject to the condition  subsequent of the completion of
one of the three  acquisitions  planned,  which are more  fully  described  in a
separate  confidential  side letter between the Parties due to the  confidential
nature of these possible acquisitions.


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THEREFORE,   in   consideration   of  the   premises,   agreements,   covenants,
representations and warranties  contained in this Agreement,  and other good and
valuable  consideration,  the  sufficiency  and  receipt  of  which  are  hereby
acknowledged, the Parties hereby agree as follows:

1. CERTAIN DEFINITIONS. For purposes of this Agreement, the following terms have
the respective indicated meanings below:

      1.1. "Action" has the meaning ascribed to such term in Section 3.1.10.

      1.2.  "Additional Warrant" means the warrant to be issued to RimAsia under
this Agreement  with its terms set forth in the Form of Additional  Common Stock
Purchase Warrant attached hereto as Exhibit C.

      1.3. "Affiliate" means any Person that, directly or indirectly through one
or more intermediaries,  controls or is controlled by or is under common control
with a Person,  as such terms are used in and construed under Rule 144 under the
Securities Act. With respect to RimAsia,  any investment fund or managed account
that is  managed  on a  discretionary  basis by the same  investment  manager as
RimAsia  will be deemed to be an  Affiliate  of  RimAsia.  For  purposes  of the
Transaction  Documents,  RimAsia  shall not be deemed an  "Affiliate"  of CBH or
Erye.

      1.4.  "Balance  Outstanding"  has the meaning ascribed to such term in the
Recitals of this Agreement.

      1.5.  "Closing"  means the closing of the  Conversion  and issuance of the
Securities pursuant to Section 2.1.

      1.6.  "Closing  Date" means the  Trading  Day when all of the  Transaction
Documents  have been executed and delivered by the applicable  parties  thereto,
and all  conditions  precedent to (i) RimAsia's  obligations to convert the Loan
and (ii) CBH's  obligations  to deliver the  Securities  have been  satisfied or
waived.

      1.7.   "Commission"  means  the  United  States  Securities  and  Exchange
Commission.

      1.8.  "Common  Stock"  means the common  stock of CBH, par value $.001 per
share,  and any other  class of  securities  into  which such  common  stock may
hereafter have been reclassified or changed into.

      1.9.  "Common  Stock  Equivalents"  means  any  securities  of  CBH or the
Subsidiaries  which  would  entitle  the  holder  thereof to acquire at any time
Common Stock, including,  without limitation, any debt, preferred stock, rights,
options,  warrants or other  instrument that is at any time  convertible into or
exercisable  or  exchangeable  for, or otherwise  entitles the holder thereof to
receive,  Common Stock or other  securities  that entitle the holder to receive,
directly or indirectly, Common Stock.


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      1.10. "Company Counsel" means Baker & McKenzie, LLP.

      1.11.  "Conversion  Shares" means the shares of Common Stock issuable upon
conversion of the Preferred Shares.

      1.12.   "Effectiveness   Date"   means  the  date  on  which  the  initial
Registration  Statement  filed  by  CBH  pursuant  to  the  Registration  Rights
Agreement is first declared effectively by the Commission.

      1.13. "Erye" means Suzhou Erye Pharmaceutical Company Ltd.

      1.14.  "Exchange  Act"  means  the  Securities  Exchange  Act of 1934,  as
amended, and the rules and regulations promulgated thereunder.

      1.15. "GAAP" has the meaning ascribed to such term in Section 3.1.8.

      1.16.  "Knowledge"  means,  with  respect  to any  statement  made  to the
knowledge of a party,  that the statement is based upon actual  knowledge of the
officers of such party having  responsibility for the matter or matters that are
the subject of the statement, after due inquiry.

      1.17. "Lien" means a lien, charge, security interest,  encumbrance,  right
of first refusal, preemptive right or other restriction.

      1.18.  "Litigation Agreement" means the agreement between CBH and RimAsia,
dated the date hereof,  concerning certain litigation matters,  substantially in
the form of Exhibit F attached hereto.

      1.19. "Loan" has the meaning ascribed to such term in the Recitals of this
Agreement.

      1.20.  "Material  Adverse Effect" has the meaning assigned to such term in
Section 3.1.2.

      1.21.  "Modified Warrant" means the warrant which was previously issued to
RimAsia  exercisable into 12,000,000 shares of the Common Stock (such previously
issued  warrant,  the "Original  Warrant")  and is being  modified to reduce the
per-share exercise price and to extend the exercise period to 4.5 years from the
Closing  Date,  all as set forth in the Form of Amended  Common  Stock  Purchase
Warrant attached hereto as Exhibit B.


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      1.22.  "Legend  Removal  Date" has the  meaning  ascribed  to such term in
Section 4.1.3.

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

      1.24. "Original Warrant" has the meaning ascribed to it in Section 1.21.

      1.25.  "Preferred  Shares"  means  6,185,607  shares  of  Series  B Senior
Convertible Redeemable Preferred Stock of CBH.

      1.26.  "Proceeding"  means  an  action,  claim,  suit,   investigation  or
proceeding   (including,   without  limitation,   an  investigation  or  partial
proceeding, such as a deposition), whether commenced or threatened.

      1.27.  "Registration  Rights  Agreement"  means  the  Registration  Rights
Agreement,  dated the date hereof, among between CBH and RimAsia, in the form of
Exhibit E attached hereto.

      1.28.  "Registration Statement" means a registration statement meeting the
requirements  set forth in the  Registration  Rights  Agreement and covering the
resale of the Conversion Shares and Warrant Shares by RimAsia as provided for in
the Registration Rights Agreement.

      1.29.  "Required  Approvals"  has the  meaning  ascribed  to such  term in
Section 3.1.5.

      1.30. "Rule 144" means Rule 144 promulgated by the Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

      1.31.  "SEC  Reports"  has the  meaning  ascribed  to such term in Section
3.1.8.

      1.32.  "Securities"  means the Preferred Shares,  the Modified Warrant and
the Additional Warrant.

      1.33.  "Securities Act" means the Securities Act of 1933, as amended,  and
the rules and regulations promulgated thereunder.

      1.34.  "Short  Sales"  means all  "short  sales" as defined in Rule 200 of
Regulation  SHO under the  Exchange  Act (but shall not be deemed to include the
location and/or reservation of borrowable shares of Common Stock).


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      1.35.  "Subsidiary"  means any  subsidiary  of CBH as disclosed in the SEC
Reports.

      1.36.  "Trading  Day" means a day on which the Common Stock is traded on a
Trading Market.

      1.37.  "Trading Market" means the following  markets or exchanges on which
the Common  Stock is listed or quoted for trading on the date in  question:  the
NASDAQ Capital Market, the American Stock Exchange, the New York Stock Exchange,
the NASDAQ National Market or the OTC Bulletin Board.

      1.38.  "Transaction  Document" means (a) this Agreement,  (b) the Modified
Warrant,  (c) the Additional  Warrant,  (d) CBH's  Certificate of Designation of
Series B Convertible  Redeemable  Preferred  Stock attached hereto as Exhibit A,
(e) the Registration Rights Agreement, (f) the Litigation Agreement, (g) Service
Agreement regarding Enshi (the "Service Agreement"); (h) Assignment of Claims by
CBH in favor of RACP (the "Damage  Assignment");  and (i) any other documents or
agreements executed in connection with the transactions contemplated hereunder.

      1.39. "VWAP" means, for any date, the price determined by the first of the
following clauses that applies: (a) if the Common Stock is then listed or quoted
on a Trading Market, the daily volume weighted average price of the Common Stock
for such date (or the nearest preceding date) on the Trading Market on which the
Common  Stock is then listed or quoted as reported by Bloomberg  Financial  L.P.
(based on a Trading Day from 9:30 a.m.  Eastern Time to 4:02 p.m. Eastern Time);
(b) if the Common Stock is not then listed or quoted on a Trading  Market and if
prices for the Common Stock are then reported in the "Pink Sheets"  published by
the Pink Sheets,  LLC (or a similar  organization  or agency  succeeding  to its
functions  of  reporting  prices),  the most  recent  bid price per share of the
Common Stock so reported;  or (c) in all other cases, the fair market value of a
share of Common Stock as determined by an independent appraiser selected in good
faith by RimAsia and reasonably acceptable to CBH.

      1.40. "Warrants" means the Modified Warrant and Additional Warrant.

      1.41.  "Warrant  Shares"  means shares of the Common Stock  issuable  upon
exercise of the Modified Warrant or Additional Warrant.

2. CONVERSION AND ISSUANCE OF SECURITIES

      2.1.  Closing.  On the  Closing  Date,  upon the terms and  subject to the
conditions set forth herein,  concurrent with the execution and delivery of this
Agreement by the parties  hereto,  RimAsia agrees to convert Twelve Million Four
Hundred  Ninety Four  Thousand  Six Hundred  Seventy One United  States  Dollars
(US$12,508,534  ),  representing  the total principal amount of the Loan and the
unpaid interest (up to October 15, 2007) of US$1,008,534  (the "Loan  Conversion
Amount") and the warrant to


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purchase  12,000,000  shares of Common Stock,  into 6,185,607  Preferred Shares,
with a conversion  price of US$2.0222  per  Preferred  Share,  and CBH agrees to
issue to RimAsia (a) the Preferred Shares,  (b) the Modified Warrant to purchase
12,000,000  shares of CBH's Common Stock with a new exercise  price of $1.26 per
share and with a new term of four and a half years from the  Closing  Date,  and
(c) the  Additional  Warrant  exercisable  into such a number of shares of CBH's
Common  Stock and at such an exercise  price to be  determined  according to the
terms of such  Additional  Warrants,  with a term of four years from the date of
issuance.   The   voting   powers,   designations,   preferences,   rights   and
qualifications,  limitations or restrictions of the Series B Preferred Stock are
all as set forth in the  Certificate  of  Designation  of  Series B  Convertible
Redeemable  Preferred  Stock  attached  hereto  as  Exhibit  A  (the  "Series  B
Certificate of Designation").  The terms and conditions of the Modified Warrants
are set forth in the Form of Amended  Common  Stock  Purchase  Warrant  attached
hereto as Exhibit B. The terms and conditions of the Additional  Warrant are set
forth in the Form of Additional Common Stock Purchase Warrant attached hereto as
Exhibit C.

      2.2. Deliveries.

            2.2.1.  On the  Closing  Date,  CBH  shall  deliver  or  cause to be
delivered to RimAsia the following:

                  2.2.1.1. this Agreement duly executed by CBH;

                  2.2.1.2. a certificate evidencing the Preferred Shares;

                  2.2.1.3.  the  Modified  Warrant  registered  in the  name  of
RimAsia;

                  2.2.1.4.  the  Additional  Warrant  registered  in the name of
RimAsia;

                  2.2.1.5.   the  legal   opinion   of   Company   Counsel,   in
substantially the form attached hereto as Exhibit D, addressed to RimAsia;

                  2.2.1.6.  the Registration Rights Agreement,  duly executed by
CBH;

                  2.2.1.7. the Litigation Agreement, duly executed by CBH;

                  2.2.1.8. the Service Agreement, duly executed by CBH; and

                  2.2.1.9. the Damage Assignment, duly executed by CBH.


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            2.2.2.  On the Closing  Date,  RimAsia  shall deliver or cause to be
delivered to CBH the following:

                  2.2.2.1. this Agreement duly executed by RimAsia;

                  2.2.2.2. the Litigation Agreement, duly executed by RimAsia;

                  2.2.2.3. the Service Agreement executed by RimAsia;

                  2.2.2.4.  the Registration Rights Agreement,  duly executed by
RimAsia; and

                  2.2.2.5.  The Original Warrant dated June 30, 2006 to purchase
12,000,000 shares of Common Stock.

      2.3. Closing Conditions.

            2.3.1.  The  obligations  of CBH  hereunder in  connection  with the
Closing  are  subject to the  following  conditions  precedent  being met by the
Closing Date, unless otherwise waived by CBH:

                  2.3.1.1.  the accuracy in all material  respects when made and
on the Closing Date of the  representations  and warranties of RimAsia contained
herein;

                  2.3.1.2. all obligations,  covenants and agreements of RimAsia
required  to be  performed  at or prior to the  Closing  Date  shall  have  been
performed; and

                  2.3.1.3.  the  delivery  by  RimAsia of the items set forth in
Section 2.2.2 of this Agreement.

                  2.3.2. The obligations of RimAsia hereunder in connection with
the Closing are subject to the following  conditions  precedent being met by the
Closing Date, unless otherwise waived by RimAsia:

                  2.3.2.1.  the accuracy in all material respects on the Closing
Date of the representations and warranties of CBH contained herein;

                  2.3.2.2.  all  obligations,  covenants  and  agreements of CBH
required  to be  performed  at or prior to the  Closing  Date  shall  have  been
performed;

                  2.3.2.3. the delivery by CBH of the items set forth in Section
2.2.1 of this Agreement;


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                  2.3.2.4.  since the date of  execution of this  Agreement,  no
event or series of events  shall have  occurred  that  reasonably  could have or
result in (i) an adverse effect on the legality,  validity or  enforceability of
any Transaction Document, or (ii) a Material Adverse Effect;

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

                  from the date  hereof  to the  Closing  Date,  trading  in the
Common Stock shall not have been suspended by the Commission or CBH's  principal
Trading Market (except for any suspension of trading of limited  duration agreed
to by CBH, which suspension  shall be terminated prior to the Closing),  and, at
any time prior to the Closing Date, trading in securities  generally as reported
by Bloomberg  Financial  Markets  shall not have been  suspended or limited,  or
minimum prices shall not have been  established  on securities  whose trades are
reported  by such  service,  or on any  Trading  Market,  nor  shall  a  banking
moratorium  have been  declared  either by the  United  States or New York State
authorities nor shall there have occurred any material outbreak or escalation of
hostilities or other national or international calamity of such magnitude in its
effect on, or any material  adverse  change in, any financial  market which,  in
each case, in the  reasonable  judgment of RimAsia,  makes it  impracticable  or
inadvisable to convert the Loan at the Closin

            2.3.3.  Notwithstanding  anything  in this  Agreement  or any  other
Transaction  Document  to the  contrary,  the  Conversion  contemplated  by this
Agreement is subject to the  conditions  subsequent  of (i) the  execution of an
Acquisition  LOI, as such term is defined in a side  letter  between the Parties
dated as of even date  herewith  (the "Side  Letter"),  by January 15, 2008 (the
"First Condition  Subsequent Cutoff Date"),  and, (ii) if an Acquisition LOI has
been executed by the First Condition Subsequent Cutoff Date, the actual closing,
by no later than June 30, 2008 (the "Second  Condition  Subsequent Cutoff Date";
each of the First  Condition  Subsequent  Cutoff  Date and the Second  Condition
Subsequent   Cutoff  Date,  a  "Condition   Subsequent  Cutoff  Date"),  of  the
Acquisition  (as such term is defined in the Side Letter)  which was the subject
of the  Acquisition  LOI. If no  Acquisition  LOI has been executed by the First
Condition  Subsequent  Cutoff Date or, following the execution of an Acquisition
LOI  by  the  First  Condition  Subsequent  Cutoff  Date,  the  closing  of  the
Acquisition  has not occurred by the Second  Condition  Subsequent  Cutoff Date,
RimAsia shall have the option to unwind the Conversion  within 60 days following
the relevant Condition Subsequent Cutoff Date by serving a written notice to CBH
(the "Re-Conversion Notice"). Upon the delivery of the Re-Conversion Notice, (a)
the  Preferred  Shares  shall  automatically,  and without  further  action,  be
converted  back  to  (via  a  conversion,  exchange,  a  repurchase  by  CBH  in
consideration  of the Loan and the  Outstanding  Balance  and the revival of the
Loan  Agreement and the Loan  Assumption  Agreement,  or any other lawful means)
(the "Re-


                                       8


Conversion")  the  Loan  and the  Outstanding  Balance,  (b) all the  terms  and
conditions of the Loan Agreement and the Loan Assumption  Agreement  (including,
without limitation,  interest accrual and RimAsia's right of acceleration) shall
be deemed  revived as if the  Conversion  had never  occurred,  (c) the Modified
Warrant  shall be deemed  reverted  back to the  Original  Warrant,  and (d) the
Additional Warrant shall be deemed cancelled. For purposes of clarification, the
Litigation  Agreement,  the Service  Agreement  and the Claim  Assignment  shall
survive the Re-Conversion  Notice.  In furtherance of the foregoing,  CBH hereby
represents and covenants that, at all times prior to the occurrence of the above
described condition  subsequent,  the Preferred Shares will always be treated as
debt and will not be treated as capital on its books. CBH hereby  represents and
warrants to RimAsia that nothing in (i) the Delaware  General  Corporation  Law,
CBH's  Certificate of Incorporation or bylaws, or any agreement or understanding
between CBH and any third party or (ii) CBH's financial condition, will prohibit
the Re-Conversion as contemplated by this section.

3. REPRESENTATIONS AND WARRANTIES

      3.1.   Representations  and  Warranties  of  CBH.  CBH  hereby  makes  the
representations  and warranties as of the date hereof and as of the Closing Date
set forth below to RimAsia.

            3.1.1. Subsidiaries.  All of the direct and indirect subsidiaries of
CBH have been  disclosed in the SEC Reports.  CBH owns,  directly or indirectly,
all of the capital stock or other equity  interests of each  Subsidiary free and
clear of any Liens,  and all the issued and outstanding  shares of capital stock
of each  Subsidiary  are validly issued and are fully paid,  non-assessable  and
free of preemptive and similar rights to subscribe for or purchase securities.

            3.1.2.   Organization  and  Qualification.   Each  of  CBH  and  its
Subsidiaries  is an entity duly  incorporated  or otherwise  organized,  validly
existing  and in  good  standing  under  the  laws  of the  jurisdiction  of its
incorporation  or  organization  (as  applicable),  with the requisite power and
authority to own and use its  properties and assets and to carry on its business
as currently  conducted.  Neither CBH nor any  Subsidiary is in violation of, or
default under,  any of the provisions of its respective  certificate or articles
of incorporation,  bylaws or other organizational or charter documents.  Each of
CBH and the  Subsidiaries  is duly qualified to conduct  business and is in good
standing as a foreign  corporation or other entity in each jurisdiction in which
the  nature  of the  business  conducted  or  property  owned by it  makes  such
qualification necessary,  except where the failure to be so qualified or in good
standing, as the case may be, could not, individually, or in the aggregate, have
or  reasonably  be  expected to result in (i) a material  adverse  effect on the
legality,  validity  or  enforceability  of  any  Transaction  Document,  (ii) a
material  adverse  effect  on  the  results  of  operations,  assets,  business,
prospects or condition  (financial or  otherwise)  of CBH and the  Subsidiaries,
taken as a whole, or (iii) a material adverse effect on CBH's ability to perform
in any material respect on a timely basis its obligations  under any Transaction
Document  (any of


                                       9


(i), (ii) or (iii),  a "Material  Adverse  Effect") and no  Proceeding  has been
instituted in any such jurisdiction revoking,  limiting or curtailing or seeking
to revoke, limit or curtail such power and authority or qualification.

            3.1.3. Authorization;  Enforcement.  CBH has the requisite corporate
power  and  authority  to  enter  into  and  to  consummate   the   transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations hereunder and thereunder.  The execution and delivery of each of the
Transaction  Documents  by CBH and the  consummation  by it of the  transactions
contemplated  thereby have been duly  authorized by all necessary  action on the
part of CBH and no further  action is required by CBH, its board of directors or
its  stockholders  in connection  therewith  other than in  connection  with the
Required  Approvals.  Each Transaction  Document has been (or upon delivery will
have been) duly executed by CBH and, when delivered in accordance with the terms
hereof and thereof,  will  constitute  the valid and binding  obligation  of CBH
enforceable  against CBH in  accordance  with its terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization,  moratorium and other laws of
general application affecting  enforcement of creditors' rights generally,  (ii)
as  limited  by laws  relating  to the  availability  of  specific  performance,
injunctive  relief  or  other  equitable   remedies  and  (iii)  in  so  far  as
indemnification and contribution provisions may be limited by applicable law.

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

            3.1.5.  Filings,  Consents  and  Approvals.  CBH is not  required to
obtain any consent,  waiver,  authorization  or order of, give any notice to, or
make any filing or registration  with, any court or other federal,  state, local
or  other  governmental  authority  or  other  Person  in  connection  with  the
execution,  delivery and performance by CBH of the Transaction Documents,  other
than (i)  filings  required  pursuant to Section  4.6,  (ii) the


                                       10


filing with the Commission of one or more Registration  Statements in accordance
with the  requirements  of the  Registration  Rights  Agreement,  (iii)  filings
required by state  securities  laws in accordance  with the  requirements of the
Registration Rights Agreement,  which when permitted,  will be made prior to the
Effectiveness  Date  (as  such  term  is  defined  in  the  Registration  Rights
Agreement),  (iv) the notice and/or  application(s)  to each applicable  Trading
Market for the issuance and sale of the Registrable  Securities (as such term is
defined in the Registration Rights Agreement) and the listing of the Registrable
Securities for trading thereon in the time and manner required thereby,  (v) the
filing of Form D with the Commission and such filings as are required to be made
under applicable state securities laws and (vi) the filing of the certificate of
designation for the Preferred Shares with the Secretary of the State of Delaware
(collectively, the "Required Approvals").

            3.1.6.   Issuance  of  the  Securities.   The  Securities  are  duly
authorized  and, when issued and paid for (or converted into) in accordance with
the applicable  Transaction  Documents,  will be duly and validly issued,  fully
paid and non-assessable,  free and clear of all Liens other than restrictions on
transfer  provided for in the Transaction  Documents.  The Conversion Shares and
the Warrant Shares,  when issued in accordance with the terms of the Transaction
Documents, will be validly issued, fully paid and non-assessable, free and clear
of all Liens,  other  than the  restrictions  on  transfer  provided  for in the
Transaction  Documents.  CBH has reserved from its duly authorized capital stock
the  number  of  shares  of  Common  Stock  issuable  pursuant  to the  Series B
Certificate of Designation,  the Modified Warrant and the Additional Warrants in
order to issue the Conversion Shares and the Warrant Shares.  The Securities are
not subject to any  preemptive  or similar  rights to subscribe  for or purchase
securities.

            3.1.7. Capitalization.  Other than disclosed in the SEC Reports, CBH
has not issued any  capital  stock  other than  pursuant  to the  conversion  or
exercise of outstanding  Common Stock  Equivalents.  Other than disclosed in the
SEC Reports, as of the date of this Agreement,  except for the Preferred Shares,
there is no share of any preferred  stock of CBH  outstanding.  No securities of
CBH are entitled to preemptive or similar  rights and no Person has any right of
first refusal, preemptive right, right of participation, or any similar right to
participate in the transactions contemplated by the Transaction Documents. As of
the date of this  Agreement,  except as  disclosed  in the SEC  Reports and as a
result of the  issuance of the  Securities,  there are no  outstanding  options,
warrants,  script rights to subscribe to, calls or  commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exercisable or exchangeable for, or giving any Person any right to subscribe for
or acquire,  any shares of the capital stock of CBH, or contracts,  commitments,
understandings  or  arrangements by which CBH or any Subsidiary is or may become
bound to issue  additional  shares of its capital stock, or securities or rights
convertible or exchangeable  into shares of Common Stock.  The issuance and sale
of the Securities will not obligate CBH to issue shares of Common Stock or other
securities  to any Person (other than RimAsia) and will not result in a right of
any holder of CBH  securities  to adjust the


                                       11


exercise, conversion,  exchange or reset price under such securities. All of the
outstanding  shares of capital stock of CBH are validly  issued,  fully paid and
non-assessable,  have  been  issued in  compliance  with all  federal  and state
securities laws, and none of such outstanding  shares was issued in violation of
any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any stockholder,  the Board of Directors
of CBH or others is required for the issuance  and sale of the  Securities,  the
Conversion Shares or the Warrant Shares.  There are no stockholders  agreements,
voting  agreements  or other  similar  agreements  with respect to CBH's capital
stock to which CBH is a party or, to the Knowledge of CBH,  between or among any
of CBH's stockholders.

            3.1.8. SEC Reports; Financial Statements. CBH has filed all reports,
schedules,  forms,  statements  and other  documents  required to be filed by it
under the  Securities  Act and the Exchange Act,  including  pursuant to Section
13(a) or 15(d)  thereof,  for the two years  preceding  the date hereof (or such
shorter  period as CBH was required by law to file such material) (the foregoing
materials,   including  the  exhibits  thereto  and  documents  incorporated  by
reference therein,  being collectively  referred to herein as the "SEC Reports")
on a timely basis or has  received a valid  extension of such time of filing and
has filed any such SEC Reports prior to the expiration of any such extension. As
of their respective dates,  other than the SEC Reports relating to Enshi,  which
may  be  subject  to  further  amendment   pursuant  to  new  investigation  and
discoveries,  the  SEC  Reports  complied  in all  material  respects  with  the
requirements  of the  Securities  Act and the Exchange  Act, and none of the SEC
Reports,  when  filed,  contained  any untrue  statement  of a material  fact or
omitted to state a material fact  required to be stated  therein or necessary in
order to make the statements  therein,  in the light of the circumstances  under
which they were made, not misleading.  The financial  statements of CBH included
in the SEC Reports comply in all material  respects with  applicable  accounting
requirements  and the rules  and  regulations  of the  Commission  with  respect
thereto as in effect at the time of filing. Such financial  statements have been
prepared  in  accordance  with  United  States  generally  accepted   accounting
principles  applied on a consistent basis during the periods involved  ("GAAP"),
except as may be otherwise  specified in such financial  statements or the notes
thereto,  and fairly present in all material respects the financial  position of
CBH and its  consolidated  Subsidiaries  as of and for the dates thereof and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.
CBH  maintains  and will  continue to maintain a standard  system of  accounting
established  and  administered  in  accordance  with  GAAP  and  the  applicable
requirements of the Exchange Act.

            3.1.9.  Material  Changes.  Since  the  date of the  latest  audited
financial  statements  included  within the SEC Reports,  except as specifically
disclosed in the SEC Reports or certain  litigation events previously  disclosed
to RimAsia, (i) there has been no event,  occurrence or development that has had
or that,  individually,  or in the  aggregate,  could  reasonably be expected to
result in a Material  Adverse Effect,  (ii) CBH has not incurred any liabilities
(contingent  or otherwise)  other than (A) trade  payables and accrued  expenses
incurred in the ordinary course of business  consistent with past practice,


                                       12


(B)  liabilities  not  required to be reflected  in CBH's  financial  statements
pursuant  to  GAAP  or  required  to be  disclosed  in  filings  made  with  the
Commission,  and (C) other  liabilities  that would not,  individually or in the
aggregate,  have a Material Adverse Effect, (iii) CBH has not altered its method
of accounting or the identity of its auditors, (iv) CBH has not declared or made
any dividend or  distribution  of cash or other property to its  stockholders or
purchased,  redeemed or made any  agreements to purchase or redeem any shares of
its  capital  stock and (v) CBH has not  issued  any  equity  securities  to any
officer, director or Affiliate, except pursuant to existing Company stock option
plans.  As of the date of this  Agreement,  CBH does not have pending before the
Commission any request for confidential treatment of information.

            3.1.10.  Litigation.  Except  as  disclosed  in the SEC  Reports  or
previously disclosed to RimAsia,  there is no action,  suit, inquiry,  notice of
violation,  proceeding  or  investigation  pending or, to the  Knowledge of CBH,
threatened  against or affecting CBH, any Subsidiary or any of their  respective
properties  before or by any court,  arbitrator,  governmental or administrative
agency or regulatory authority (federal, state, county, local or foreign) (each,
an "Action") which , could, if there were an unfavorable decision, individually,
or in the  aggregate,  have or  reasonably  be  expected to result in a Material
Adverse  Effect.  Neither CBH nor any  Subsidiary,  nor any  director or officer
thereof, is or has been the subject of any Action involving a claim of violation
of or liability  under federal or state  securities laws or a claim of breach of
fiduciary  duty.  There has not been,  and to the Knowledge of CBH, there is not
pending or contemplated,  any  investigation by the Commission  involving CBH or
any current or former  director or officer of CBH. The Commission has not issued
any stop order or other order  suspending the  effectiveness of any registration
statement  filed  by  CBH  or  any  Subsidiary  under  the  Exchange  Act or the
Securities  Act. No executive  officer,  to the  Knowledge of CBH, is, or is now
expected to be, in violation of any material  term of any  employment  contract,
confidentiality,    disclosure   or   proprietary   information   agreement   or
non-competition agreement, or any other contract or agreement or any restrictive
covenant,  and the continued  employment of each such executive officer does not
subject CBH or any of its  Subsidiaries  to any liability with respect to any of
the foregoing  matters.  CBH and its  Subsidiaries  are in  compliance  with all
applicable laws and regulations relating to employment and employment practices,
terms and conditions of employment and wages and hours, except where the failure
to be in compliance could not,  individually or in the aggregate,  reasonably be
expected to have a Material Adverse Effect.

            3.1.11. Labor Relations.  Neither CBH nor any of its Subsidiaries is
a party  to a  collective  bargaining  agreement,  and CBH and its  Subsidiaries
believe that their  relationships  with their  employees  are good.  No material
labor  dispute  exists or, to the  Knowledge of CBH, is imminent with respect to
any of the  employees of CBH which could  reasonably  be expected to result in a
Material Adverse Effect.

            3.1.12.  Compliance.  Except  as  disclosed  in the SEC  Reports  or
previously  disclosed to RimAsia in connection with certain  litigation  events,
neither CBH nor any  Subsidiary  (i) is in default under or in violation of (and
no event has  occurred


                                       13


that has not been  waived  that,  with  notice  or lapse of time or both,  would
result  in a  default  by CBH or  any  Subsidiary  under),  nor  has  CBH or any
Subsidiary  received notice of a claim that it is in default under or that it is
in violation of, any indenture,  loan or credit agreement or any other agreement
or instrument to which it is a party or by which it or any of its  properties is
bound  (whether or not such default or violation  has been  waived),  (ii) is in
violation of any order of any court,  arbitrator or governmental  body, or (iii)
is or  has  been  in  violation  of  any  statute,  rule  or  regulation  of any
governmental authority, including without limitation all foreign, federal, state
and local laws  applicable  to its  business  and all such laws that  affect the
environment,  except  in  each  case  as  could  not,  individually,  or in  the
aggregate,  have a  Material  Adverse  Effect.  CBH is in  compliance  with  all
effective  requirements of the Sarbanes-Oxley  Act of 2002, as amended,  and the
rules and regulations  thereunder,  that are applicable to it, except where such
noncompliance, individually or in the aggregate, could not have or reasonably be
expected to result in a Material Adverse Effect.

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

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

            3.1.15.  Patents and Trademarks.  CBH and the Subsidiaries  have, or
have rights to use,  all patents,  patent  applications,  trademarks,  trademark
applications, service marks, trade names, trade secrets, inventions, copyrights,
licenses and other  intellectual  property rights or similar rights necessary or
material for use in connection with their respective  businesses as described in
the SEC Reports and which the failure to so have could, individually,  or in the
aggregate,  have or  reasonably  be expected to have a Material  Adverse  Effect
(collectively,   the  "Intellectual  Property  Rights").  Neither  CBH  nor  any
Subsidiary has received a notice  (written or otherwise)  that the  Intellectual
Property  Rights used by CBH or any  Subsidiary  violates or infringes  upon the
rights of any Person. All such Intellectual  Property Rights are enforceable and
do not violate or infringe  the  Intellectual  Property  Rights of others in any
respect that would, individually


                                       14


or in the  aggregate,  reasonably  be expected  to result in a Material  Adverse
Effect and,  to the  Knowledge  of CBH,  there is no  existing  infringement  by
another Person of any of CBH's or the Subsidiary's Intellectual Property Rights.
CBH and its Subsidiaries have taken reasonable  security measures to protect the
secrecy,  confidentiality  and  value of all of their  intellectual  properties,
except  where  failure to do so could  not,  individually  or in the  aggregate,
reasonably be expected to have a Material Adverse Effect.

            3.1.16.  Insurance. CBH and the Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are  prudent and  customary  in the  businesses  in which CBH and the
Subsidiaries are engaged,  including, but not limited to, directors and officers
insurance  coverage at least equal to the aggregate Loan Conversion  Amount.  To
the best  Knowledge of CBH, such  insurance  contracts and policies are accurate
and complete.  Neither CBH nor any  Subsidiary has any reason to believe that it
will not be able to renew  its  existing  insurance  coverage  as and when  such
coverage  expires or to obtain similar  coverage from similar insurers as may be
necessary to continue its business without a significant increase in cost.

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

            3.1.18.  Sarbanes-Oxley;  Internal  Accounting  Controls.  CBH is in
compliance  with all  provisions  of the  Sarbanes-Oxley  Act of 2002  which are
applicable to it as of the Closing Date.

            3.1.19.  Private  Placement.  Assuming  the  accuracy  of  RimAsia's
representations  and warranties set forth in Section 3.2, no registration  under
the  Securities  Act is required for the offer and sale of the Securities by CBH
to RimAsia as  contemplated  hereby.  The  issuance  and sale of the  Securities
hereunder does not contravene the rules and  regulations of the Trading  Market.
Except as described  in the SEC Reports,  CBH has not granted or agreed to grant
to any Person any rights (including  "piggy-back"  registration  rights) to have
any securities of CBH registered  with the Commission or any other  governmental
authority that have not been satisfied.

            3.1.20.  Investment Company. CBH is not, and is not an Affiliate of,
and immediately after issuance of the Securities, will not be or be an Affiliate
of, an "investment  company" within the meaning of the Investment Company Act of
1940, as amended. CBH shall conduct its business in a manner so that it will not
become subject to the Investment Company Act.


                                       15


            3.1.21.  Registration Rights.  RimAsia has the right to cause CBH to
effect the  registration  under the Securities Act pursuant to the  Registration
Rights Agreement.

            3.1.22. Listing and Maintenance Requirements.  CBH's Common Stock is
registered  pursuant to Section  12(g) of the Exchange Act, and CBH has taken no
action  designed to, or which to its  Knowledge is likely to have the effect of,
terminating the  registration of the Common Stock under the Exchange Act nor has
CBH received any notification  that the Commission is contemplating  terminating
such  registration.  CBH has not, in the 24 months  preceding  the date  hereof,
received notice from any Trading Market on which the Common Stock is or has been
listed or quoted to the effect that CBH is not in compliance with the listing or
maintenance  requirements of such Trading  Market.  CBH is, and has no reason to
believe that it will not in the foreseeable future continue to be, in compliance
with all such listing and maintenance requirements. The issuance and sale of the
Securities  under the  Transaction  Documents  does not contravene the rules and
regulations of the Trading Market on which the Common Stock is currently  listed
or quoted, and no approval of the stockholders of CBH thereunder is required for
CBH  to  issue  and  deliver  to  RimAsia  the  Securities  contemplated  by the
Transaction  Documents.  As of the date hereof,  CBH's Common Stock is listed on
the OTC Bulletin Board.

            3.1.23. No Integrated  Public Offering.  Neither CBH, nor any of its
Affiliates,  nor any Person  acting on its or their  behalf,  has,  directly  or
indirectly,  made any offers or sales of any security or solicited any offers to
buy any  security,  under  circumstances  that would cause this  offering of the
Securities  to be  integrated  with prior  offerings  by CBH for purposes of the
Securities Act or any applicable  shareholder approval  provisions,  which would
have made the  issuance of the  Securities  in this  offering a public  offering
subject to a registration statement,  including,  without limitation,  under the
rules and  regulations  of any Trading  Market on which any of the securities of
CBH are listed or designated.

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


                                       16


payable  on or in respect of its  debt).  CBH has no  Knowledge  of any facts or
circumstances  which lead it to believe that it will file for  reorganization or
liquidation  under the  bankruptcy or  reorganization  laws of any  jurisdiction
within one year from the Closing Date.

            3.1.25. Tax Status.  Except for matters that would not, individually
or in the  aggregate,  have or  reasonably  be  expected to result in a Material
Adverse Effect, CBH and each Subsidiary has filed all necessary  federal,  state
and foreign  income and  franchise tax returns and has paid or accrued all taxes
shown as due thereon,  and CBH has no Knowledge  of a tax  deficiency  which has
been asserted or threatened against CBH or any Subsidiary.

            3.1.26. No General  Solicitation.  Neither CBH nor any person acting
on  behalf  of CBH has  offered  or sold  any of the  Securities  by any form of
general solicitation or general advertising.  CBH has offered the Securities for
sale only to RimAsia.

            3.1.27.   No   Disagreements   with   Accountants.   There   are  no
disagreements of any kind presently existing,  or reasonably  anticipated by CBH
to arise,  with the  accountants  formerly  or  presently  employed  by CBH with
respect to CBH's financial statements.

            3.1.28.  Acknowledgment  Regarding  RimAsia's Receipt of Securities.
CBH  acknowledges and agrees that RimAsia is acting solely in the capacity of an
arm's length acquiror of securities  with respect to the  Transaction  Documents
and the transactions  contemplated hereby. CBH further acknowledges that RimAsia
is not acting as a  financial  advisor or  fiduciary  of CBH (or in any  similar
capacity)  with  respect to this  Agreement  and the  transactions  contemplated
hereby and any advice given by RimAsia or any of its  representatives  or agents
in connection with this Agreement and the  transactions  contemplated  hereby is
merely  incidental  to  RimAsia's  acquisition  of the  Securities.  CBH further
represents to RimAsia that CBH's  decision to enter into this Agreement has been
based solely on the  independent  evaluation  of the  transactions  contemplated
hereby by CBH and its representatives.

            3.1.29.  Certain Fees. RimAsia shall have no obligation with respect
to any fees or with respect to any claims  (other than such fees or  commissions
owed by RimAsia pursuant to written agreements executed by RimAsia which fees or
commissions shall be the sole responsibility of RimAsia) made by or on behalf of
other Persons for fees of a type contemplated in this Section that may be due in
connection with the transactions contemplated by this Agreement.

            3.1.30. No Additional Agreements. CBH does not have any agreement or
understanding with RimAsia with respect to the transactions  contemplated by the
Transaction Documents other than as specified in the Transaction Documents.


                                       17


            3.1.31.  Disclosure.  All disclosure  provided to RimAsia  regarding
CBH,  its business  and the  transactions  contemplated  hereby,  including  the
Disclosure  Schedules to this  Agreement,  furnished by or on behalf of CBH with
respect to the  representations  and warranties made herein are true and correct
with  respect to such  representations  and  warranties  and do not  contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the  statements  made  therein,  in light of the  circumstances
under which they were made, not  misleading.  CBH  acknowledges  and agrees that
RimAsia makes or has made no  representations  or warranties with respect to the
transactions  contemplated  hereby  other than those  specifically  set forth in
Section 3.2 hereof.

      3.2.  Representations and Warranties of RimAsia. RimAsia hereby represents
and warrants as of the date hereof and as of the Closing Date to CBH as follows:

            3.2.1. Organization; Authority. RimAsia is an entity duly organized,
validly  existing and in good standing under the laws of the jurisdiction of its
organization with full right,  partnership power and authority to enter into and
to consummate the  transactions  contemplated by the  Transaction  Documents and
otherwise to carry out its obligations hereunder and thereunder.  The execution,
delivery and  performance by RimAsia of the  transactions  contemplated  by this
Agreement have been duly authorized by all necessary  partnership  action on the
part of RimAsia.  Each Transaction Document to which it is a party has been duly
executed by RimAsia,  and when delivered by RimAsia in accordance with the terms
hereof,  will  constitute the valid and legally  binding  obligation of RimAsia,
enforceable  against it in accordance  with its terms,  except (i) as limited by
general   equitable   principles   and   applicable   bankruptcy,    insolvency,
reorganization,  moratorium  and other  laws of  general  application  affecting
enforcement of creditors' rights generally,  (ii) as limited by laws relating to
the availability of specific  performance,  injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.

            3.2.2.  Own Account.  RimAsia  understands  that the  Securities are
"restricted securities" and have not been registered under the Securities Act or
any applicable state securities law and is acquiring the Securities as principal
for its own account and not with a view to or for distributing or reselling such
Securities  or any  part  thereof  in  violation  of the  Securities  Act or any
applicable state securities law, has no present intention of distributing any of
such  Securities  in violation of the  Securities  Act or any  applicable  state
securities law and has no direct or indirect  arrangement or understandings with
any other persons to distribute or regarding the distribution of such Securities
in violation of the  Securities  Act or any  applicable  state  securities  law.
Subject to the immediately preceding sentence, nothing contained herein shall be
deemed a  representation  or warranty by RimAsia to hold the  Securities for any
period of time.  RimAsia is acquiring the  Securities  hereunder in the ordinary
course of its business.  RimAsia does not have any  agreement or  understanding,
directly or  indirectly,  with any



                                       18


Person to distribute any of the  Securities.  This  representation  and warranty
shall  not  limit  RimAsia's  right  to  sell  the  Securities  pursuant  to the
Registration  Statement or otherwise in compliance with  applicable  federal and
state securities laws.

            3.2.3.  Investor  Status.  At  the  time  RimAsia  was  offered  the
Securities,  it was,  and at the date hereof it is, and on each date on which it
exercises  either  the  Modified  Warrant or the  Additional  Warrant it will be
either:  (i) an  "accredited  investor"  as defined in Rule  501(a)(1),  (a)(2),
(a)(3),  (a)(7)  or  (a)(8)  under  the  Securities  Act,  or (ii) a  "qualified
institutional  buyer" as  defined  in Rule  144A(a)  under the  Securities  Act.
RimAsia is not required to be registered as  broker-dealers  under Section 15 of
the Exchange Act.

            3.2.4.  Experience  of Investor.  RimAsia,  either alone or together
with its representatives,  have such Knowledge, sophistication and experience in
business and financial  matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and have so evaluated the
merits and risks of such  investment.  RimAsia is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a
complete loss of such investment.

            3.3. Acknowledgment by CBH. CBH acknowledges and agrees that RimAsia
does not make or have not made any representations or warranties with respect to
the transactions  contemplated hereby other than those specifically set forth in
Section 3.2.

4. OTHER AGREEMENTS OF THE PARTIES.

      4.1. Transfer Restrictions.

            4.1.1.  The  Securities  may only be disposed of in compliance  with
state and federal securities laws. In connection with any transfer of Securities
other than pursuant to an effective  registration  statement or Rule 144, to CBH
or to an affiliate of RimAsia or in connection  with a pledge as contemplated in
Section  4.1.2,  CBH may  require  the  transferor  thereof to provide to CBH an
opinion of counsel selected by the transferor and reasonably  acceptable to CBH,
the form and substance of which opinion shall be reasonably satisfactory to CBH,
to the  effect  that  such  transfer  does  not  require  registration  of  such
transferred Securities under the Securities Act.

            4.1.2.  RimAsia agrees to the imprinting,  so long as is required by
this Section 4.1.2, of a legend on any of the Securities in the following form:

            NEITHER THESE  SECURITIES  NOR THE  SECURITIES  INTO WHICH
            THESE  SECURITIES ARE  EXERCISABLE  CONVERTIBLE  HAVE BEEN
            REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION OR
            THE SECURITIES


                                  19


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

CBH  acknowledges  and agrees that RimAsia may from time to time pledge pursuant
to a bona fide  margin  agreement  with a  registered  broker-dealer  or grant a
security  interest in some or all of the  Securities to a financial  institution
that is an "accredited  investor" as defined in Rule 501(a) under the Securities
Act and, if required under the terms of such  arrangement,  RimAsia may transfer
pledged or secured Securities to the pledgees or secured parties.  Such a pledge
or  transfer  would not be subject to  approval  of CBH and no legal  opinion of
legal  counsel of the  pledgee,  secured  party or pledgor  shall be required in
connection  therewith.  Further,  no notice shall be required of such pledge. At
the  expense  of  RimAsia,   CBH  will  execute  and  deliver  such   reasonable
documentation as a pledgee or secured party of Securities may reasonably request
in connection  with a pledge or transfer of the  Securities,  including,  if the
Securities  are  subject to  registration  pursuant to the  Registration  Rights
Agreement,  the  preparation  and filing of any required  prospectus  supplement
under Rule 424(b)(3) under the Securities Act or other  applicable  provision of
the  Securities  Act to  appropriately  amend the list of  Selling  Stockholders
thereunder.

            4.1.3.  Certificates  evidencing the  Conversion  Shares and Warrant
Shares shall not contain any legend  (including  the legend set forth in Section
4.1.2 hereof):  (i) whenever the Conversion Shares and Warrant Shares are resold
following  the  Effective  Date  concerning  the resale of such shares,  or (ii)
following  any sale or  transfer  of such  Conversion  Shares or Warrant  Shares
pursuant to Rule 144, or (iii) while such  Conversion  Shares or Warrant  Shares
are eligible for sale under Rule 144(k),  or (iv) if


                                       20


such legend is not required under applicable  requirements of the Securities Act
(including judicial  interpretations  and pronouncements  issued by the staff of
the  Commission).  CBH shall cause its counsel to issue a standing legal opinion
to CBH's  transfer  agent promptly after the Effective Date if required by CBH's
transfer  agent to effect the removal of the legend  hereunder.  Following  such
time as  restrictive  legends  are not  required  to be placed  on  certificates
representing  the Conversion  Shares or Warrant Shares,  CBH will, no later than
three Trading Days  following  the delivery by RimAsia to CBH or CBH's  transfer
agent of (i) a certificate representing such Conversion Shares or Warrant Shares
containing  a  restrictive  legend  (endorsed  or  with  stock  power  attached,
signatures guaranteed, and otherwise in form necessary to affect reissuance and/
or transfer), or (ii) an Exercise Notice in the manner stated in the Warrants to
affect the  exercise of such  Warrant in  accordance  with its terms (such tenth
Trading Day, the "Legend Removal Date"), deliver or cause to be delivered to Rim
Asia a certificate representing such Conversion Shares or Warrant Shares that is
free from all  restrictive  and other legends.  CBH may not make any notation on
its records or give  instructions  to any transfer agent of CBH that enlarge the
restrictions on transfer set forth in this Section.  Certificates for securities
subject to legend removal  hereunder  shall be transmitted by the transfer agent
of CBH to RimAsia by crediting  the account of  RimAsia's  prime broker with the
Depository Trust Company System.

            4.1.4. In addition to RimAsia's other available remedies,  CBH shall
pay to RimAsia, in cash, as partial liquidated damages and not as a penalty, for
each $1,000 of Conversion Shares and Warrant Shares,  respectively (based on the
VWAP of the Common  Stock on the date such  securities  are  submitted  to CBH's
transfer agent)  delivered for removal of the restrictive  legend and subject to
Section 4.1.3, $7.5 per Trading Day (increasing to $15 per Trading Day 5 Trading
Days  after the  Legend  Removal  Date) for each  Trading  Day after the  Legend
Removal Date until such certificate is delivered without a legend. Payment shall
be made to RimAsia no later than on each monthly anniversary of each such Legend
Removal Date until the  applicable  certificate  free from all  restrictive  and
other legends is delivered. Nothing herein shall limit RimAsia's right to pursue
actual  damages  for CBH's  failure to  deliver  certificates  representing  any
securities as required by the Transaction Documents,  and RimAsia shall have the
right to pursue all remedies  available  to them at law or in equity  including,
without limitation, a decree of specific performance and/or injunctive relief.

      4.2. Acknowledgment of Dilution. CBH acknowledges that the issuance of the
Securities  may result in dilution of the  outstanding  shares of Common  Stock,
which dilution may be substantial under certain market  conditions.  CBH further
acknowledges  that its obligations  under the Transaction  Documents,  including
without limitation its obligation to issue the Securities, the Conversion Shares
and Warrant Shares pursuant to the Transaction Documents,  are unconditional and
absolute  and not  subject  to any  right  of set  off,  counterclaim,  delay or
reduction,  regardless  of the effect of any such  dilution or any claim CBH may
have against  RimAsia and  regardless of the dilutive  effect that such issuance
may have on the ownership of the other stockholders of CBH.


                                       21


      4.3.  Furnishing of  Information.  As long as RimAsia owns the Securities,
CBH covenants to timely file (or obtain  extensions in respect  thereof and file
within the  applicable  grace  period) all  reports  required to be filed by CBH
after the date hereof  pursuant to the Exchange Act. As long as RimAsia owns the
Securities, if CBH is not required to file reports pursuant to the Exchange Act,
it will prepare and furnish to RimAsia and make publicly available in accordance
with Rule  144(c)  such  information  as is  required  for  RimAsia  to sell the
Securities under Rule 144. CBH further  covenants that it will take such further
action as any holder of Securities  may  reasonably  request,  all to the extent
required from time to time to enable such Person to sell such Securities without
registration  under the  Securities  Act within the limitation of the exemptions
provided by Rule 144.

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

      4.5. Conversion and Exercise Procedures.

            4.5.1.  The form of Notice of Exercise  included in the Warrants set
forth the  totality of the  procedures  required of RimAsia in order to exercise
the Warrants.  No additional legal opinion or other  information or instructions
shall be required of RimAsia to exercise the Warrants. CBH shall honor exercises
of the Warrants and shall deliver  Warrant Shares in accordance  with the terms,
conditions and time periods set forth in the Transaction Documents.

            4.5.2. The section entitled  "Mechanics of Conversion" in the Series
B Certificate of Designation sets forth the totality of the procedures  required
of holders of the Preferred Shares in order to convert the Preferred Shares into
shares of the Common Stock. No additional legal opinion or other  information or
instructions  shall be required of such holders to convert the Preferred Shares.
CBH shall honor conversions of the Preferred Shares and shall deliver Conversion
Shares in accordance  with the terms,  conditions  and time periods set forth in
the Transaction Documents.

      4.6. Shareholder Rights Plan. No claim will be made or enforced by CBH or,
to the Knowledge of CBH, any other Person that RimAsia is an "Acquiring  Person"
under any  shareholder  rights plan or similar plan or  arrangement in effect or
hereafter  adopted  by CBH,  or that  RimAsia  could be  deemed to  trigger  the
provisions of any such plan or  arrangement,  by virtue of receiving  Securities
under the  Transaction  Documents or under any other  agreement  between CBH and
RimAsia.  CBH shall  conduct its business in a manner so that it will not become
subject to the Investment Company Act.


                                       22


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

      4.8.  Reimbursement.  If  RimAsia  becomes  the target of a lawsuit or any
other Proceeding  brought by any Person who is a stockholder of CBH (except as a
result of sales, pledges, margin sales and similar transactions by RimAsia to or
with any current  stockholder),  solely as a result of RimAsia's  acquisition of
the  Securities  under  this  Agreement,  CBH  will  reimburse  RimAsia  for its
reasonable legal and other  defense-related  expenses  (including the reasonable
cost of any  investigation  preparation  and  travel  in  connection  therewith)
incurred  in  connection   therewith,   as  such  expenses  are  incurred.   The
reimbursement  obligations of CBH under this  paragraph  shall be in addition to
any liability which CBH may otherwise have, shall extend upon the same terms and
conditions to any  Affiliates of RimAsia who are actually  named in such action,
proceeding or  investigation,  and partners,  directors,  agents,  employees and
controlling  persons  (if  any),  as the case may be,  of  RimAsia  and any such
Affiliate, and shall be binding upon and inure to the benefit of any successors,
assigns,  heirs  and  personal  representatives  of CBH,  RimAsia  and any  such
Affiliate and any such Person. CBH also agrees that neither RimAsia nor any such
Affiliates,  partners, directors, agents, employees or controlling persons shall
have any  liability  to CBH or any  Person  asserting  claims on behalf of or in
right  of CBH  solely  as a  result  of  acquiring  the  Securities  under  this
Agreement.

      4.9. Indemnification of RimAsia. Subject to the provisions of this Section
4.9  and in  addition  to the  indemnity  provided  in the  Registration  Rights
Agreement,  CBH will  indemnify  and hold RimAsia and its  directors,  officers,
shareholders,  members,  partners,  employees  and agents (and any other Persons
with  a   functionally   equivalent   role  of  a  Person  holding  such  titles
notwithstanding  a lack of such  title or any  other  title),  each  Person  who
controls  RimAsia  (within the meaning of Section 15 of the  Securities  Act and
Section 20 of the Exchange Act), and the directors,  officers,  agents, members,
partners or employees (and any other Persons with a functionally equivalent role
of a Person  holding  such  titles  notwithstanding  a lack of such title or any
other title) of such controlling  person (each, a "RimAsia Party") harmless from
any and all losses, liabilities,  obligations,  claims, contingencies,  damages,
reasonable  costs  and  expenses,  including  all  judgments,  amounts  paid  in
settlements,   court  costs  and  reasonable   attorneys'   fees  and  costs  of
investigation  that any such RimAsia Party may suffer or incur as a result of or
relating  to (a)  any  breach,  misrepresentation  or  inaccuracy  of any of the
representations,  warranties,  covenants  or  agreements  made  by CBH  in  this
Agreement or in the other  Transaction  Documents  or (b) any action  instituted
against RimAsia, or any of its Affiliates,  by any stockholder of CBH who is not
an Affiliate of RimAsia, with respect to any of the transactions contemplated by
the Transaction Documents (unless such action is based


                                       23


upon a material  breach of RimAsia's  representations,  warranties  or covenants
under the Transaction Documents or any agreements or understandings that RimAsia
may have with any such  stockholder  or any  violations  by  RimAsia of state or
federal securities laws or any conduct by RimAsia which constitutes fraud, gross
negligence,  willful misconduct or malfeasance).  If any action shall be brought
against any RimAsia Party in respect of which  indemnity may be sought  pursuant
to this Agreement,  such RimAsia Party shall promptly notify CBH in writing, and
CBH shall have the right to assume the defense  thereof  with counsel of its own
choosing.  Any RimAsia Party shall have the right to employ separate  counsel in
any  such  action  and  participate  in the  defense  thereof,  but the fees and
expenses of such counsel shall be at the expense of such RimAsia Party except to
the extent that (i) the employment  thereof has been specifically  authorized by
CBH in writing,  (ii) CBH has failed after a reasonable period of time to assume
such  defense  and to employ  counsel or (iii) in such  action  there is, in the
reasonable  opinion  of an  independent  counsel,  a  material  conflict  on any
material  issue  between the  position of CBH and the  position of such  RimAsia
Party.  CBH will not be liable to any RimAsia Party under this Agreement (i) for
any settlement by a RimAsia Party effected  without CBH's prior written consent,
which shall not be unreasonably  withheld or delayed; or (ii) to the extent, but
only to the extent that a loss,  claim,  damage or liability is  attributable to
any RimAsia Party's material breach of any of the  representations,  warranties,
covenants  or  agreements  made by  RimAsia  in this  Agreement  or in the other
Transaction Documents.

      4.10.  Form D. CBH  agrees to  timely  file a Form D with  respect  to the
Securities  as  required  under  Regulation  D and to  provide  a copy  thereof,
promptly upon request of RimAsia.

      4.11.  Subsequent  Registrations.  Other than pursuant to the Registration
Statement,  prior to the  Effective  Date,  CBH may not  file  any  registration
statement  (other  than on Form S-8) with the  Commission  with  respect  to any
securities of CBH.

      4.12.  Limitation  on Issuance  of Future  Priced  Securities.  During the
twelve (12) months  following the Closing Date, CBH shall not issue any security
that would be a "Future  Priced  Securities"  as such term is  described by NASD
IM-4350-1,  that would have a  conversion  price lower than $1.0111 per share or
exercise price lower than $1.26 per share.

      4.13.  Listing of Common Stock.  CBH hereby agrees to use its best efforts
to maintain  the listing  and  trading of its Common  Stock on the OTC  Bulletin
Board (or another nationally  recognized Trading Market). CBH further agrees, if
CBH applies to have the Common Stock traded on any other Trading Market, it will
include in such application the Conversion  Shares and Warrant Shares,  and will
take such other action as is necessary or desirable in the opinion of RimAsia to
cause all of the Conversion Shares and Warrant Shares to be listed on such other
Trading  Market as promptly as possible.  CBH will use its best efforts and take
all action  reasonably  necessary  to  continue  the  listing and trading of its
Common Stock on the Trading Market on which the Common


                                       24


Stock is currently  listed or quoted and will comply in all respects  with CBH's
reporting,  filing  and  other  obligations  under  the  bylaws or rules of such
Trading Market.

      4.14. Form SB-2 or Form S-1  Eligibility.  CBH is eligible to register the
resale of the  Conversion  Shares and the Warrant  Shares by RimAsia  under Form
SB-2 or Form S-1 promulgated  under the Securities Act and CBH hereby  covenants
and agrees to use its best efforts to maintain its  eligibility to use Form SB-2
until the Registration  Statement  covering the resale of the Conversion  Shares
and Warrant  Shares shall have been filed with,  and declared  effective by, the
Commission.  If for any reason CBH is not eligible to register the resale of the
Conversion  Shares  and the  Warrant  Shares by RimAsia  under  Form  SB-2,  CBH
covenants and agrees to register the resale of the Conversion Shares and Warrant
Shares on Form S-1 promulgated under the Securities Act.

      4.15.  Other  Reporting.  From the Closing  Date to the earlier of (a) the
date of the fourth anniversary of the Closing Date and (b) the date on which all
Preferred  Shares are redeemed or converted into shares of the Common Stock, CBH
shall provide RimAsia the following information:

            4.15.1.  Summary  management  financial and operational  report on a
monthly and  quarterly  basis within 15 and 30 calendar  days of the end of each
month or quarter, respectively, both for CBH on a consolidated basis and each of
its Subsidiaries on a stand-alone basis;

            4.15.2.  Annual  consolidated  accounts  of  CBH  and  each  of  its
Subsidiaries on a stand-alone basis within 120 days of the fiscal year end;

            4.15.3.  Business plan and budget for the overall  Company within 60
days prior to the commencement of each new fiscal year; and

            4.15.4.  Special updates and analysis with respect to  extraordinary
events such as merger and acquisition transactions and major financings of CBH.

      4.16. Certain Disclosures. Subject to confidentiality and relevant insider
trading  restrictions,  from July 15, 2007 until such time as all the  Preferred
Shares will have been converted or redeemed, CBH shall provide RimAsia a copy of
any and all public  disclosures  (including  without limitation filings with the
Commission, press releases, and similar statements) for RimAsia's reference and,
where such disclosure  involves a reference to RimAsia,  the comments by RimAsia
at least 72 hours prior to the filing or release of such disclosure.

      4.17.  Taxation of Payments.  Any and all payments  required to be made by
CBH to RimAsia under any  Transaction  Document  shall be paid free and clear of
any taxes, withholdings or similar levies.

      4.18 Ratio of Assets versus Liabilities


                                       25


      After  the  conditional  conversion  and  until  the  satisfaction  of the
condition  subsequent as provided in Section 2.3.3, CBH shall not incur any debt
which will make total liabilites exceed total assets.

5. MISCELLANEOUS

      5.1. Fees and Expenses.

            5.1.1.   Following   the  Closing,   upon   RimAsia's   request  and
presentation  of invoices  for all expenses  including,  but not limited to, the
fees of its attorneys, advisors, consultants, auditors, travel and accommodation
expenses,  and other related out-of-pocket  expenses incurred in connection with
the transactions  contemplated in the Transaction  Documents (the  "Reimbursable
Costs"), CBH shall reimburse RimAsia such expenses up to US$40,000.

            5.1.2.  Except as specified in Section  5.1.1,  each Party shall pay
the fees and expenses of its advisers,  counsel,  accountants and other experts,
if  any,  and  all  other  expenses  incurred  by  such  Party  incident  to the
negotiation, preparation, execution, delivery and performance of the Transaction
Documents.  CBH  shall  pay all stamp  and  other  taxes  and  duties  levied in
connection  with the issuance of the Securities,  the Conversion  Shares and the
Warrant Shares.

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

            5.2.1. by written agreement of both Parties; or

            5.2.2.  by CBH or RimAsia upon written notice to the other Party, if
the Closing shall not have taken place by 6:30 p.m. Eastern time on November 15,
2007;  provided,  that the right to terminate this Agreement  under this Section
shall  not be  available  to  any  Person  whose  failure  to  comply  with  its
obligations  under  this  Agreement  has been the  cause of or  resulted  in the
failure of the Closing to occur on or before such time.

            5.2.3.  Upon a termination in accordance with this Section,  CBH and
RimAsia shall have no further obligation or liability (including as arising from
such termination) to the other except pursuant to Section 4.9.

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


                                       26


      5.4.  Notices.  Any and all notices or other  communications or deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of  transmission,  if
such notice or  communication  is delivered via  facsimile  (provided the sender
receives a  machine-generated  confirmation of successful  transmission)  at the
facsimile  number set forth on the signature pages attached hereto prior to 5:30
p.m.  (New York City time) on a Trading  Day, (b) the next Trading Day after the
date of transmission, if such notice or communication is delivered via facsimile
at the facsimile  number set forth on the signature  pages attached  hereto on a
day that is not a Trading  Day or later  than 5:30 p.m.  (New York City time) on
any Trading Day, (c) the 2nd Trading Day following the date of mailing,  if sent
by U.S. nationally  recognized overnight courier service, (d) the fifth calendar
following the date of mailing,  if sent by a commonly  recognized  international
courier, or (e) upon actual receipt by the party to whom such notice is required
to be given. The addresses for such notices and  communications  shall be as set
forth on the signature pages attached  hereto.  Any notice to any Party shall be
simultaneously copied to the receiving Party's legal counsel.

      5.5.  Amendments;  Waivers.  No provision of this Agreement may be waived,
modified,  supplemented or amended except in a written instrument signed, in the
case of an  amendment,  by CBH and RimAsia  or, in the case of a waiver,  by the
Party against whom  enforcement  of any such waiver is sought.  No waiver of any
default  with  respect  to any  provision,  condition  or  requirement  of  this
Agreement shall be deemed to be a continuing waiver in the future or a waiver of
any  subsequent  default  or a  waiver  of any  other  provision,  condition  or
requirement  hereof, nor shall any delay or omission of either Party to exercise
any right hereunder in any manner impair the exercise of any such right.

      5.6.  Headings.  The  headings  herein are for  convenience  only,  do not
constitute a part of this  Agreement  and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the Parties to express their mutual intent,  and no
rules of strict  construction  will be applied against any party. This Agreement
shall be construed as if drafted  jointly by the Parties,  and no presumption or
burden of proof shall arise favoring or  disfavoring  any party by virtue of the
authorship  of any  provisions  of  this  Agreement  or  any of the  Transaction
Documents.

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

      5.8. No  Third-Party  Beneficiaries.  This  Agreement  is intended for the
benefit of the Parties and their respective successors and permitted assigns and
is not for


                                       27


the benefit of, nor may any  provision  hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.9.

      5.9.  Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Delaware,  without
regard to the principles of conflicts of law thereof. Each Party agrees that all
legal proceedings arising from any Transaction Document (whether brought against
a party hereto or its respective affiliates,  directors, officers, shareholders,
employees  or agents)  shall be commenced  exclusively  in the state and federal
courts sitting in Wilmington, Delaware. Each Party hereby irrevocably submits to
the  exclusive  jurisdiction  of such  courts  in such  proceedings  and  hereby
irrevocably  waives any  objection  to the  jurisdiction  of such courts in such
proceedings on grounds of lack of personal  jurisdiction or inconvenient  forum.
If either Party shall commence an action or proceeding to enforce any provisions
of the  Transaction  Documents,  then the  prevailing  party in such  action  or
proceeding shall be reimbursed by the other Party for its reasonable  attorneys'
fees and other costs and expenses incurred with the  investigation,  preparation
and prosecution of such action or proceeding.

      5.10.  Survival.  The  representations,  warranties,  covenants  and other
agreements contained herein shall survive the Closing and the delivery, exercise
and/or conversion of the Securities,  as applicable for the applicable statue of
limitations.

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

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

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


                                       28


however, in the case of a rescission of exercise of a Warrant,  RimAsia shall be
required  to return any  shares of Common  Stock  subject to any such  rescinded
exercise notice.

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

      5.15. Liquidated Damages.  CBH's obligations to pay any partial liquidated
damages or other amounts owing under the  Transaction  Documents is a continuing
obligation of CBH and shall not terminate  until all unpaid  partial  liquidated
damages  and other  amounts  have been  paid  notwithstanding  the fact that the
instrument  or security  pursuant to which such  partial  liquidated  damages or
other amounts are due and payable shall have been canceled.

      5.16.  Construction.  The  Parties  agree that each of them  and/or  their
respective counsel has reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved  against the drafting party shall not be employed
in the interpretation of the Transaction Documents or any amendments hereto.

      5.17.  Languages.  The  Transaction  Documents  shall in both  English and
Chinese with equal force and validity.


                                       29


IN WITNESS WHEREOF, the Parties have caused this Conditional Loan Conversion
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.


                                (86)-512-6855-0568
                                (86)-512-6855-0578

___________________________
Chris Mao__________________
CEO

RimAsia Capital Partners, L.P.

                                c/o RimAsia Capital Partners (Hong Kong) Ltd.
                                1808 Hutchison House
                                10 Harcourt Road, Admiralty
                                Hong Kong
                                Attention: Eric Wei
                                Fax: 852-2970-0078

___________________________
___________________________
___________________________


                                       30


1.    CERTAIN DEFINITIONS...................................................   2

2.    CONVERSION AND ISSUANCE OF SECURITIES.................................   5

   2.1.     Closing.........................................................   5

   2.2.     Deliveries......................................................   6

   2.3.     Closing Conditions..............................................   7

3.    REPRESENTATIONS AND WARRANTIES........................................   9

   3.1.     Representations and Warranties of CBH...........................   9
      3.1.1.   Subsidiaries.................................................   9
      3.1.2.   Organization and Qualification...............................   9
      3.1.3.   Authorization; Enforcement...................................  10
      3.1.4.   No Conflicts.................................................  10
      3.1.5.   Filings, Consents and Approvals..............................  10
      3.1.6.   Issuance of the Securities...................................  11
      3.1.7.   Capitalization...............................................  11
      3.1.8.   SEC Reports; Financial Statements............................  12
      3.1.9.   Material Changes.............................................  12
      3.1.10.  Litigation...................................................  13
      3.1.11.  Labor Relations..............................................  13
      3.1.12.  Compliance...................................................  13
      3.1.13.  Regulatory Permits...........................................  14
      3.1.14.  Title to Assets..............................................  14
      3.1.15.  Patents and Trademarks.......................................  14
      3.1.16.  Insurance....................................................  15
      3.1.17.  Transactions with Affiliates and Employees...................  15
      3.1.18.  Sarbanes-Oxley; Internal Accounting Controls.................  15
      3.1.19.  Private Placement............................................  15
      3.1.20.  Investment Company...........................................  15
      3.1.21.  Registration Rights..........................................  16
      3.1.22.  Listing and Maintenance Requirements.........................  16
      3.1.23.  No Integrated Public Offering................................  16
      3.1.24.  Solvency.....................................................  16
      3.1.25.  Tax Status...................................................  17
      3.1.26.  No General Solicitation......................................  17
      3.1.27.  No Disagreements with Accountants............................  17
      3.1.28.  Acknowledgment Regarding RimAsia's Receipt of Securities.....  17
      3.1.29.  Certain Fees.................................................  17
      3.1.30.  No Additional Agreements.....................................  17
      3.1.31.  Disclosure...................................................  18

   3.2.     Representations and Warranties of RimAsia.......................  18
      3.2.1.   Organization; Authority......................................  18
      3.2.2.   Own Account..................................................  18
      3.2.3.   Investor Status..............................................  19
      3.2.4.   Experience of Investor.......................................  19


                                        i


   3.3.     Acknowledgment by CBH...........................................  19

4.    OTHER AGREEMENTS OF THE PARTIES.......................................  19

   4.1.     Transfer Restrictions...........................................  19

   4.2.     Acknowledgment of Dilution......................................  21

   4.3.     Furnishing of Information.......................................  22

   4.4.     Integration.....................................................  22

   4.5.     Conversion and Exercise Procedures..............................  22

   4.6.     Shareholder Rights Plan.........................................  22

   4.7.     Non-Public Information..........................................  23

   4.8.     Reimbursement...................................................  23

   4.9.     Indemnification of RimAsia......................................  23

   4.10.    Form D..........................................................  24

   4.11.    Subsequent Registrations........................................  24

   4.12.    Limitation on Issuance of Future Priced Securities..............  24

   4.13.    Listing of Common Stock.........................................  24

   4.14.    Form SB-2 or Form S-1 Eligibility...............................  25

   4.15.    Other Reporting.................................................  25

   4.16.    Certain Disclosures.............................................  25

   4.17.    Taxation of Payments............................................  25

5.    MISCELLANEOUS.........................................................  26

   5.1.     Fees and Expenses...............................................  26

   5.2.     Termination.....................................................  26

   5.3.     Entire Agreement................................................  26

   5.4.     Notices.........................................................  27

   5.5.     Amendments; Waivers.............................................  27

   5.6.     Headings........................................................  27

   5.7.     Successors and Assigns..........................................  27

   5.8.     No Third-Party Beneficiaries....................................  27

   5.9.     Governing Law...................................................  28

   5.10.    Survival........................................................  28

   5.11.    Execution.......................................................  28

   5.12.    Severability....................................................  28

   5.13.    Rescission and Withdrawal Right.................................  28

   5.14.    Remedies........................................................  29

   5.15.    Liquidated Damages..............................................  29

   5.16.    Construction....................................................  29

   5.17.    Languages.......................................................  29


                                       ii



                                                               Execution Version

                           CERTIFICATE OF DESIGNATIONS
                                       OF
                            SERIES B PREFERRED STOCK
                                       OF
                     CHINA BIOPHARMACEUTICALS HOLDINGS, INC.
         (Pursuant to Section 151 of the General Corporation Law of the
                               State of Delaware)

      China  Biopharmaceuticals  Holdings,  Inc., a  corporation  organized  and
existing   under  the  General   Corporation   Law  of  the  State  of  Delaware
(hereinafter, the "Corporation"), hereby certifies that the following resolution
was duly  adopted by the Board of Directors  of the  Corporation  as required by
Section 151 of the General Corporation Law of the State of Delaware:

      RESOLVED,  that pursuant to the authority  expressly granted to and vested
in the Board of Directors of the  Corporation in accordance  with the provisions
of the certificate of incorporation  of the Corporation,  the Board of Directors
of the Corporation  hereby creates out of the authorized but unissued  preferred
stock, par value $0.01 per share, of the Corporation  ("Preferred Stock"), a new
series of Preferred  Stock,  and hereby states the designation and the number of
shares of such series, and fixes the relative, participating,  optional or other
special rights, preferences,  privileges, powers, qualifications and limitations
thereof as follows:

1. SERIES B PREFERRED STOCK

2. DESIGNATION AND AMOUNT.

      2.1.  General.  The shares of such series shall be designated as shares of
"Series B Preferred  Stock," par value $0.01 per share, of the Corporation  (the
"Series B Preferred Stock"),  and the number of shares  constituting such series
shall be 6,185,607 ("Series B Preferred Shares").

3. DIVIDENDS.

      3.1. General.

            3.1.1.  Entitlement.  On or after the original  issuance date of the
Series B Preferred Stock pursuant to the Conditional Loan Conversion  Agreement,
dated on or about  November  16,  2007,  by and  among the  Corporation  and the
original holder of the Series B Preferred Stock (the "Series B Issuance  Date"),
the holders of Series B Preferred Shares shall be entitled to receive  dividends
(the  "Dividends"),  if, as and when  declared by the Board of  Directors of the
Corporation  (the  "Board of  Directors")  out of any assets  legally  available
therefor at the dividend rates (the "Dividend  Rates") as provided below in this
Section 2.

            3.1.2.  Original  Price.  The Dividend Rates herein are expressed as
percentages  of the original  issue price of $2.0222 for each Series B Preferred
Share  (as  adjusted  for  any  stock  splits,  stock  dividends,  combinations,
subdivisions,  recapitalizations,  reclassifications or the like) (the "Original
Series B Issue Price").



            3.1.3. Annual Payment.  The holders of the Series B Preferred Shares
shall be entitled to receive an annual  dividend of 5% of the Original  Series B
Issue  Price  (the  "Annual  Dividend"),  payable  annually  on the first day of
January (the "Annual Dividend Payment Date"). Payment of the Annual Dividend may
be either in cash or in kind as  determined  by the Board of  Directors.  In the
event that the Annual Dividend Payment Date shall fall due on a Saturday, Sunday
or legal  holiday in the State of Delaware,  the dividend due on such date shall
be paid on the next  day  thereafter  that is not a  Saturday,  Sunday  or legal
holiday in the State of Delaware.  The Annual  Dividend  shall be cumulative and
shall begin to accrue on  outstanding  Series B Preferred  Shares from and after
the Series B Issuance  Date on a daily basis  computed on the basis of a 365-day
year and compounded  annually  whether or not the Corporation  shall have assets
legally available therefor.

            3.1.4.  Limitation  on  Other  Dividends.  So long as any  Series  B
Preferred Shares shall be outstanding,  no dividend shall be declared or paid or
set apart for payment on any class or series of stock of the Corporation ranking
junior to the Series B  Preferred  Shares as to  dividends,  including,  without
limitation, the common stock, par value $0.01 per share, of the Corporation (the
"Common Stock") and the Series A Convertible Preferred Stock par value $0.01 per
share, of the Corporation (the "Series A Preferred  Stock"),  unless there shall
also  have been  declared  and paid or set apart  for  payment  on the  Series B
Preferred  Shares,  all accrued and unpaid Annual  Dividends.  In the event that
full  cumulative  dividends  on the  Series  B  Preferred  Shares  have not been
declared and paid or set apart for payment when due, the  Corporation  shall not
declare  or pay or set  apart  for  payment  any  dividends  or make  any  other
distributions  on, or make  payment on account of the  purchase,  redemption  or
other  retirement  of any  other  class or  series  of stock of the  Corporation
ranking  junior to the Series B  Preferred  Shares as to  dividends,  including,
without  limitation,  the Common Stock and the Series A Preferred  Stock,  until
full cumulative  dividends on the Series B Preferred Shares shall have been paid
or declared and set a part for payment;  provided,  however,  that the foregoing
shall not  apply to (i) any  dividend  payable  solely in shares of any class or
series of stock of the  Corporation  ranking  junior to the  Series B  Preferred
Shares as to dividends,  including, without limitation, the Common Stock and the
Series A Preferred  Stock,  or (ii) the  purchase,  redemption  or conversion of
shares of any class or series of stock of the Corporation  ranking junior to the
Series B Preferred Shares as to dividends,  including  without  limitation,  the
Common Stock and the Series A Preferred  Stock, in exchange solely for shares of
any  other  class or series of stock of the  Corporation  ranking  junior to the
Series B Preferred Shares as to dividends, including, without limitation, Common
Stock and the Series A Preferred Stock.

            3.1.5. Timing. Accrued but unpaid Annual Dividends shall cumulate as
of each Annual Dividend  Payment Date on which they first become payable whether
or not the  Corporation  shall have  assets  legally  available  for the payment
thereof,  and shall be payable as provided in this Section 2.1 and/or as further
provided herein.

            3.1.6.   Waiver.   To  the  fullest  extent  permitted  by  law  and
notwithstanding  anything  contained herein to the contrary,  the holders of the
outstanding  Series B Preferred  Shares may waive any Annual  Dividend that such
holders shall be entitled to receive  under this Section 2.1 by the  affirmative
vote or written  consent of the  holders of at least a majority  of the Series B
Preferred Shares then outstanding.


                                       2


4. LIQUIDATION PREFERENCE.

      4.1. Liquidation Amount.

            4.1.1.  In the event of any  Liquidation  Event (as defined  below),
either voluntary or involuntary,  the holders of outstanding  Series B Preferred
Shares shall be entitled to receive, out of (i) the proceeds of such Liquidation
Event  received by the  Corporation,  in the case of a  Liquidation  Event under
Section  3.3.1,   (ii)  the  proceeds   received  by  the  stockholders  of  the
Corporation,  in the case of a Liquidation  event under Section 3.3.2 or Section
3.3.3, or (iii) the assets of the Corporation legally available for distribution
to the stockholders of the Corporation, in the case of a Liquidation event under
Section 3.3.4 (as  applicable,  the  "Proceeds")  prior and in preference to the
holders of Common  Stock,  the Series A  Preferred  Stock or any other  class or
series of stock of the  Corporation  ranking  junior to the  Series B  Preferred
Shares  with  respect to any  Liquidation  Event,  by reason of their  ownership
thereof,  an amount equal to the sum of (i) $3.0333  (the "Series B  Liquidation
Price") per Series B Preferred  Share,  (ii) an amount  equal to all declared or
accrued  but unpaid  dividends  on such share,  (iii) the  accrued  Four-Percent
Suspendible   Premium  (as  defined  in  Section  5.1),  and  (iv)  the  accrued
Six-Percent Triggered Premium (as defined in Section 5.1), if any (the "Series B
Liquidation Amount").

            4.1.2. If upon the occurrence of any Liquidation Event, the Proceeds
thus  distributed  among the  holders  of  Series B  Preferred  Shares  shall be
insufficient  to  permit  the  payment  to such  holders  of the  full  Series B
Liquidation  Amount,  then, the Proceeds shall be distributed  ratably among the
holders  of  Series  B  Preferred  Stock  in  proportion  to the  full  Series B
Liquidation  Amount each such holder is otherwise entitled to receive under this
Section 3.1.

      4.2.  Distribution  of  Remaining  Proceeds.  Upon the  completion  of the
distribution required by Section 3.1 and any distribution required for any other
class or series of Preferred Stock ranking as to such distribution  prior to the
Common  Stock,  all of the Proceeds  shall be  distributed  among the holders of
Series B  Preferred  Stock and  Common  Stock  and any other  class or series of
Preferred  Stock  entitled  thereto  pro rata  based on the  number of shares of
Common Stock held by each  (assuming  full  conversion of all Series B Preferred
Shares).

      4.3.  "Liquidation  Event"  Defined.  For  purposes  of this  Section 3, a
"Liquidation Event" shall include:

            4.3.1.  the  closing  of  the  sale,  lease,   exchange,   transfer,
conveyance,  exclusive  license or other disposition of all or substantially all
of the Corporation's assets;

            4.3.2.  the  consummation  of the  merger  or  consolidation  of the
Corporation  with or into another  entity (except a merger or  consolidation  in
which the holders of capital stock of the Corporation  immediately prior to such
merger or consolidation continue to hold at least 50% of the voting power of the
capital stock of the Corporation or the surviving or acquiring entity);

            4.3.3. the closing of the transfer (whether by merger, consolidation
or  otherwise),  in one  transaction or a series of related  transactions,  to a
person  or  group  of  affiliated  persons  (other  than an  underwriter  of the
Corporation's  securities),  of the  Corporation's


                                       3


securities  if, after such closing,  such person or group of affiliated  persons
would hold 50% or more of the  outstanding  voting stock of the  Corporation (or
the surviving or acquiring entity); or

            4.3.4. a liquidation,  dissolution or winding up of the Corporation;
provided,  however,  that a transaction  described  above shall not constitute a
Liquidation   Event  if  its  sole  purpose  is  to  change  the  state  of  the
Corporation's incorporation or to create a holding company that will be owned in
substantially  the same  proportions  by the persons who held the  Corporation's
securities  immediately  prior  to  such  transaction.  To  the  fullest  extent
permitted by law and notwithstanding  anything contained herein to the contrary,
the treatment of any particular transaction or series of related transactions as
a Liquidation  Event may be waived by the affirmative vote or written consent of
the  holders  of at least a  majority  of the  Series B  Preferred  Shares  then
outstanding.

      3.4 Liquidation  Event Notice.  The Corporation  shall give each holder of
record of Series B Preferred Shares written notice of any impending  Liquidation
Event  not  later  than 20 days  prior to the  stockholders'  meeting  called to
approve such  transaction,  or 20 days prior to the closing of such transaction,
whichever is earlier, and shall also notify such holders in writing of the final
approval of such  transaction.  The first of such  notices  shall  describe  the
material terms and conditions of the impending transaction and the provisions of
this Section 3, and the  Corporation  shall  thereafter give such holders prompt
notice of any material  changes.  The  transaction  shall in no event take place
sooner than 20 days after the  Corporation  has given the first notice  provided
for herein or sooner than 10 days after the  Corporation has given notice of any
material  changes;  provided,  however,  that,  subject to  compliance  with the
Delaware  General  Corporation  Law (the "DGCL"),  such periods may be shortened
upon the  affirmative  vote or  written  consent  of the  holders  of at least a
majority of the Series B Preferred Shares then outstanding.

5. REDEMPTION.

      5.1. Optional Redemption.  Prior to the fourth anniversary of the Series B
Issuance Date, the  Corporation may at any time it may lawfully do so (including
upon the  non-approval  by a majority  of the  holders of the Series B Preferred
Shares of the events  referred to in Section 7.6 through 7.10), at the option of
the Board of Directors and after giving the holders of Series B Preferred Shares
written notice thereof  containing the redemption  date (which date shall not be
less than 60 days from the date of such  notice)  (the  "Redemption  Date")  and
offering  the  holders  of the  Series B  Preferred  Shares  at least 60 days to
convert  all such  shares  into  shares of Common  Stock  pursuant to Section 5,
redeem  in  whole,  but not in part,  all the  Series B  Preferred  Shares  then
outstanding by paying in cash, for each share, an amount equal to the sum of (i)
the Original Series B Issue Price,  (ii) all accrued but unpaid Annual Dividends
on such share,  (iii) 5% of the Original  Series B Issue Price per annum,  which
amount shall be deemed to have begun to accrue from and after the  occurrence of
a Triggering  Event (as defined below) and until the occurrence of a cure of the
Triggering  Event,  on a daily basis computed on the basis of a 365-day year and
compounded annually,  and (iv) the Four-Percent  Suspendible Premium (as defined
below)  (such sum, as adjusted  for any stock  splits,  dividends  combinations,
subdivisions,  recapitalizations,  reclassifications  or the like, the "Optional
Redemption Price").


                                       4


      5.2. Mandatory Redemption. At any time following the fourth anniversary of
the  Series B Issuance  Date,  within  sixty (60) days after the  receipt by the
Corporation of the written request of the holders of not less than a majority of
the Series B Preferred Shares then outstanding, the Corporation shall redeem all
of the  Series B  Preferred  Shares  (or,  if less,  the  maximum  amount it may
lawfully  redeem) by paying in cash , for each share, an amount equal to the sum
of (i) the  Original  Series B Issue Price,  (ii) all accrued but unpaid  Annual
Dividends on such share,  and (iii) 5% of the Original  Series B Issue Price per
annum,  which  amount shall be deemed to have begun to accrue from and after the
occurrence of a Triggering  Event (as defined below) and until the occurrence of
a cure of the  Triggering  Event,  on a daily  basis  computed on the basis of a
365-day  year and  compounded  annually  (such sum,  as  adjusted  for any stock
splits,     dividends     combinations,     subdivisions,     recapitalizations,
reclassifications or the like, the "Mandatory Redemption Price").

      5.3. Triggering Event. For purposes of Section 4 and 5, "Triggering Event"
shall  mean  any one or more of the  following,  whether  or not the same may be
cured and reoccur from time to time:

                  4.3.1 The  Corporation's  failure to pay any Annual Dividends,
                        Mandatory  Redemption  Price or any other amount due and
                        payable on the Series B Preferred Shares;

                  4.3.2 The Corporation's failure to comply with its obligations
                        under Section 4;

                  4.3.3 The Corporation's failure to comply with its obligations
                        under that  certain  Litigation  Agreement,  dated as of
                        November __, 2007; or

                  4.3.4 The  Corporation's  failure to provide  operational  and
                        financial  reports on a monthly basis within 15 calendar
                        days of the end of the preceding  month,  or operational
                        and  financial  reports on a quarterly  basis  within 30
                        calendar days of the end of the proceeding  quarter,  in
                        each case,  to the  holders  of the  Series B  Preferred
                        Shares then outstanding.

6. CONVERSION.

      6.1. Right to Convert. Each Series B Preferred Share shall be convertible,
at the  option of the  holder  thereof,  at any time after the Series B Issuance
Date but before the fourth anniversary  thereof,  into such number of fully paid
and  non-assessable  shares of Common Stock as is determined by dividing (x) the
sum of (1) the Original Series B Issue Price,  (2) all accrued but unpaid Annual
Dividends on such share,  (3) 4% of the Original Series B Issue Price per annum,
which amount shall be deemed to have begun to accrue from and after the Series B
Issuance Date and shall  continue to accrue until the occurrence of a Suspension
Date (as defined below), on a daily basis based on a 365-day year and compounded
annually (the "Four-Percent  Suspendible  Premium"),  and (4) 6% of the Original
Series B Issue Price per annum,  which  amount  shall be deemed to have begun to
accrue  from and  after  the  occurrence  of a  Triggering  Event  and until the
occurrence of a cure of the Triggering  Event,  on a daily basis computed on the
basis of a 365-day year and  compounded  annually  (the  "Six-Percent  Triggered
Premium")


                                       5


by (y) the Initial  Conversion Price (as defined below) (as adjusted pursuant to
Section  5.3,  "Conversion  Price")  applicable  to such  share,  determined  as
hereinafter  provided,  in effect on the date the certificate for such shares is
surrendered for conversion (the "Conversion Rate").

            6.1.1.  For purposes of this  Section  5.1, the "Initial  Conversion
Price" shall be 50% of the Original Series B Issue Price.

            6.1.2. For purposes of this Section 5.1, the "Suspension Date" shall
mean the date when the  average  closing  price of the  Common  Stock  (which is
traded on a recognized  market) over a prior  period of 30  consecutive  trading
days each with a daily trading  volume of no fewer than 100,000  shares  exceeds
the  following  price  thresholds:  during  the  second  year from the  Series B
Issuance Date, US$1.40;  during the third year,  US$1.58,  and during the fourth
year,  US$1.72,  in each  case as  adjusted  for any  stock  splits,  dividends,
combinations,  subdivisions,  recapitalizations,  reclassifications  or the like
with respect to the Common Stock.

      6.2. Mechanics of Conversion.

            6.2.1.  Any holder of Series B Preferred  Shares desiring to convert
such  shares,  into  shares of Common  Stock  pursuant  to  Section  5.1,  shall
surrender the certificate or certificates therefor, duly endorsed, at the office
of the  Corporation or of any transfer  agent for Series B Preferred  Shares and
shall give written notice to the Corporation at its principal  corporate office,
of the election to convert the same and shall state therein the name or names in
which the  certificate  or  certificates  for  shares of Common  Stock are to be
issued and the number of Series B Preferred Shares sought to be converted.

            6.2.2.  In the event the Corporation has given such holder notice of
its intent to redeem such holder's Series B Preferred Shares pursuant to Section
4.1,  such holder's  written  notice to the  Corporation  shall be sufficient to
permit such holder to convert pursuant to this Section 5.2 notwithstanding  such
redemption notice, provided that such holder delivers such certificates prior to
the Redemption Date.

            6.2.3.  The Corporation  shall,  as soon as practicable  thereafter,
issue and  deliver at such office to such holder of shares of Series B Preferred
Stock so converted or to the nominee or nominees of such holder,  a  certificate
or  certificates  for the number of shares of Common  Stock to which such holder
shall be entitled as aforesaid.

            6.2.4. Such conversion shall be deemed to have been made immediately
prior to the close of  business on the date of such  surrender  of the shares of
Series B Preferred Stock to be converted,  and the person or persons entitled to
receive  the  shares of Common  Stock  issuable  upon such  conversion  shall be
treated  for all  purposes  as the record  holder or  holders of such  shares of
Common Stock as of such date.

            6.2.5.  If the  conversion  is in  connection  with an  underwritten
offering of securities  registered  pursuant to the  Securities  Act of 1933, as
amended,  the conversion  may, at


                                       6


the  option of any  holder  tendering  shares of  Series B  Preferred  Stock for
conversion, be conditioned upon the closing with the underwriters of the sale of
securities  pursuant to such  offering,  in which event the persons  entitled to
receive  the Common  Stock upon  conversion  of the shares of Series B Preferred
Stock sought to be converted  pursuant to this Section 5.2,  shall not be deemed
to have  converted  such  shares of Series B Preferred  Stock until  immediately
prior to the closing of such sale of securities.

      6.3. Conversion Price Adjustments for Certain Dilutive  Issuances,  Splits
and Combinations.  The Conversion Price shall be subject to adjustment from time
to time as follows:

            6.3.1.  If the  Corporation  shall  issue,  on or after the Series B
Issuance Date, any  Additional  Stock (as defined below) without  consideration,
the  Conversion  Price in effect  immediately  prior to each such issuance shall
forthwith (except as otherwise  provided in this Section 5.3.1) be adjusted to a
price  determined  by  multiplying  such  Conversion  Price by a  fraction,  the
numerator of which shall be the number of shares of Common Stock Outstanding (as
defined below) immediately prior to such issuance;  and the denominator of which
shall be the number of shares of Common Stock  Outstanding  immediately prior to
such issuance plus the number of shares of such Additional  Stock.  For purposes
of this Section 5.3, the term "Common Stock  Outstanding" shall mean and include
the  following:  (1)  outstanding  Common Stock;  (2) Common Stock issuable upon
conversion  of  outstanding  Preferred  Stock;  (3) Common Stock  issuable  upon
exercise of  outstanding  stock  options;  and (4) Common  Stock  issuable  upon
exercise (and, in the case of warrants to purchase Preferred Stock,  conversion)
of  outstanding  warrants.  Shares  described  in (1) through (4) above shall be
included whether vested or unvested,  whether  contingent or non-contingent  and
whether exercisable or not yet exercisable.

            6.3.2.  If the  Corporation  shall issue after the Series B Issuance
Date any Additional  Stock at a per-share price lower than the Conversion  Price
then in effect,  the Conversion Price shall be decreased to equal such per-share
price of the Additional Stock.

            6.3.3.  In the  case  of the  issuance  of  Additional  Stock  for a
consideration in whole or in part other than cash, the consideration  other than
cash shall be deemed to be the fair market value thereof as mutually  determined
in good faith by the Board of Directors  and a majority of the holders of Series
B Preferred Shares then outstanding.

            6.3.4.  In the case of the issuance of options to purchase or rights
to subscribe for Common Stock,  securities  by their terms  convertible  into or
exchangeable  for Common Stock or options to purchase or rights to subscribe for
such  convertible or exchangeable  securities,  the following  provisions  shall
apply for  purposes  of  determining  the number of shares of  Additional  Stock
issued and the consideration paid therefor:

                  6.3.4.1.  The  aggregate  maximum  number  of shares of Common
Stock deliverable upon exercise  (assuming the satisfaction of any conditions of
exercisability,  including, without limitation, the passage of time, but without
taking into  account  potential  anti-dilution  adjustments)  of such options to
purchase or rights to  subscribe  for Common  Stock shall be deemed to have been
issued at the time such  options or rights were  issued and for a  consideration
equal  to the  consideration,  if any,  received  by the  Corporation  upon  the
issuance of


                                       7


such options or rights plus the minimum  exercise price provided in such options
or rights (without taking into account potential anti-dilution  adjustments) for
the Common Stock covered thereby.

                  6.3.4.2.  The  aggregate  maximum  number  of shares of Common
Stock  deliverable upon conversion of or in exchange  (assuming the satisfaction
of any  conditions to  convertibility  or  exchangeability,  including,  without
limitation,  the passage of time,  but without  taking  into  account  potential
anti-dilution  adjustments) for any such convertible or exchangeable  securities
or upon the  exercise  of options to purchase  or rights to  subscribe  for such
convertible or  exchangeable  securities  and subsequent  conversion or exchange
thereof  shall be deemed to have been  issued at the time such  securities  were
issued or such  options or rights were issued and for a  consideration  equal to
the  consideration,  if any, received by the Corporation for any such securities
and related options or rights (excluding any cash received on account of accrued
interest or accrued dividends),  plus the minimum additional  consideration,  if
any,  to be  received  (without  taking  into  account  potential  anti-dilution
adjustments)  by the  Corporation  upon  the  conversion  or  exchange  of  such
securities or the exercise of any related options or rights).

                  6.3.4.3. In the event of any change in the number of shares of
Common Stock deliverable or in the consideration payable to the Corporation upon
exercise of such options or rights or upon conversion of or in exchange for such
convertible or exchangeable  securities,  the Conversion Price, to the extent in
any way affected by or computed using such options, rights or securities,  shall
be recomputed to reflect such change,  but no further  adjustment  shall be made
for the actual  issuance of Common  Stock or any  payment of such  consideration
upon the exercise of any such options or rights or the conversion or exchange of
such securities.

                  6.3.4.4.  Upon the  expiration  of any such options or rights,
the  termination  of any such rights to convert or exchange or the expiration of
any options or rights related to such  convertible or  exchangeable  securities,
the  Conversion  Price,  to the extent in any way affected by or computed  using
such  options,  rights  or  securities  or  options  or rights  related  to such
securities,  shall be  recomputed  to reflect the issuance of only the number of
shares of Common Stock (and  convertible or exchangeable  securities that remain
in effect) actually issued upon the exercise of such options or rights, upon the
conversion or exchange of such securities or upon the exercise of the options or
rights related to such securities.

                  6.3.4.5.  The  number  of shares of  Additional  Stock  deemed
issued and the  consideration  deemed paid therefor pursuant to Sections 5.3.4.1
and 5.3.4.2 shall be appropriately  adjusted to reflect any change,  termination
or expiration of the type described in either Section 5.3.4.3 or 5.3.4.4.

            6.3.5.  "Additional  Stock"  shall mean any  shares of Common  Stock
issued  (or  deemed  to have  been  issued  pursuant  to  Section  5.3.4) by the
Corporation after the Series B Issuance Date other than:

                  6.3.5.1.   Common  Stock  issued  pursuant  to  a  transaction
described in Section 5.3.8;


                                       8


                  6.3.5.2.  Up to 10,000,000  shares of Common Stock  (excluding
shares repurchased at cost by the Corporation in connection with the termination
of  service)  issued to  employees,  directors,  consultants  and other  service
providers  for the primary  purpose of soliciting  or retaining  their  services
pursuant to plans or agreements approved by the Board of Directors; or

                  6.3.5.3.  Common  Stock  issued or deemed  issued  pursuant to
Section 5.3.4 as a result of a decrease in the Conversion Price of any series of
Preferred Stock resulting from the operation of this Section 5.3.

            6.3.6.  If the  Corporation  should at any time or from time to time
after the Series B Issuance  Date fix a record  date for the  effectuation  of a
split  or  subdivision  of  the  outstanding  shares  of  Common  Stock  or  the
determination of holders of Common Stock entitled to receive a dividend or other
distribution payable in additional shares of Common Stock or other securities or
rights  convertible into, or entitling the holder thereof to receive directly or
indirectly,  additional  shares of Common  Stock  ("Common  Stock  Equivalents")
without payment of any consideration by such holder for the additional shares of
Common Stock or the Common Stock Equivalents (including the additional shares of
Common Stock  issuable upon  conversion or exercise  thereof),  then, as of such
record date (or the date of such dividend distribution,  split or subdivision if
no record date is fixed), the Conversion Price shall be appropriately  decreased
so that the number of shares of Common Stock  issuable  upon  conversion of each
share of Series B  Preferred  Stock shall be  increased  in  proportion  to such
increase in the aggregate number of shares of Common Stock outstanding and those
issuable with respect to such Common Stock Equivalents.

            6.3.7.  If the number of shares of Common Stock  outstanding  at any
time after the Series B Issuance Date is decreased by a split or  combination of
the outstanding shares of Common Stock, then,  following the record date of such
split or combination,  the Conversion Price shall be appropriately  increased so
that the number of shares of Common Stock issuable upon conversion of each share
of Series B Preferred Stock shall be decreased in proportion to such decrease in
outstanding shares of Common Stock.

      6.4. Other  Distributions.  If the Corporation shall declare a dividend or
distribution  payable in securities of other persons,  evidences of indebtedness
issued by the Corporation or other persons, assets (excluding cash dividends) or
options or rights not  referred to in Section 5.3,  then,  in each such case for
the purpose of this Section 5.4, the holders of Series B Preferred  Shares shall
be entitled to a  proportionate  share of any such dividend or  distribution  as
though  they were the  holders  of the  number of shares of Common  Stock of the
Corporation into which their Series B Preferred Shares are convertible as of the
record date fixed for the  determination  of the holders of Common  Stock of the
Corporation entitled to receive such dividend or distribution.

      6.5.  Recapitalizations or Reclassifications.  If at any time or from time
to time there shall be a recapitalization  or  reclassification  of Common Stock
(other  than a split,  subdivision,  combination  or  merger  or sale of  assets
transaction  provided for elsewhere in this Section 5 provision shall be made so
that the holders of Series B Preferred  Stock  shall  thereafter  be entitled to
receive upon conversion of each share of Series B Preferred Shares the number of
shares of


                                       9


stock or other securities or property of the Corporation or otherwise,  to which
a holder of Common Stock deliverable upon conversion would have been entitled on
such  recapitalization  or  reclassification.  In  any  such  case,  appropriate
adjustment  shall be made in the application of the provisions of this Section 5
with respect to the rights of the holders of Series B Preferred Shares after the
recapitalization  or  reclassification  to the end that the  provisions  of this
Section 5 (including  adjustment of the Conversion  Price then in effect and the
number of shares purchasable upon conversion of each share of Series B Preferred
Stock) shall be  applicable  after that event as nearly  equivalently  as may be
practicable.

      6.6. No Impairment.  The Corporation may not, without the affirmative vote
or  written  consent  of the  holders  of at least a  majority  of the  Series B
Preferred  Shares  then   outstanding,   by  amendment  of  its  certificate  of
incorporation  (whether by merger,  consolidation  or  otherwise) or through any
reorganization,  recapitalization,  transfer of assets,  consolidation,  merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the  observance or  performance of any of the terms to be observed
or performed  hereunder by the Corporation,  but will at all times in good faith
assist in the  carrying out of all the  provisions  of this Section 5 and in the
taking of all such lawful action as may be necessary or  appropriate in order to
protect the  conversion  rights of the holders of the Series B Preferred  Shares
against impairment.

      6.7. Notices of Record Date. In the event of any taking by the Corporation
of a record of the  holders  of any class or series of stock of the  Corporation
for the purpose of determining  the holders  thereof who are entitled to receive
any dividend or other distribution, the Corporation shall mail to each holder of
Series B Preferred Shares at least 10 days prior to the date specified  therein,
a notice  specifying  the date on which  any such  record is to be taken for the
purpose of such dividend or  distribution,  and the amount and character of such
dividend or distribution.

      6.8.  Notices.  Any notice required by the provisions of this Section 5 to
be given to the holders of Series B Preferred  Shares  shall be deemed  given if
deposited in the United States mail,  postage prepaid first class  international
airmail,  and  addressed  to each  holder of record at his,  her or its  address
appearing on the books of the Corporation.

      6.9. Status of Reacquired  Stock. If any share of Series B Preferred Stock
is purchased,  redeemed or otherwise  acquired by the  Corporation in any manner
whatsoever,  the share of Series B  Preferred  Stock so acquired  shall,  to the
fullest extent permitted by law, be retired and cancelled upon such acquisition,
and shall not be reissued as a share of Series B Preferred  Stock.  The share of
Series  B  Preferred   Stock  so  acquired   shall,   upon  its  retirement  and
cancellation,  and upon the  taking of any  action  required  by law,  become an
authorized but unissued share of Preferred  Stock  undesignated as to series and
may be  reissued  a part of a new  series of  Preferred  Stock,  subject  to the
conditions and restrictions set forth in the certificate of incorporation of the
Corporation or imposed by the DGCL.


                                       10


7. VOTING RIGHTS.

Except as otherwise  required by law or provided herein,  the Series B Preferred
Shares  shall  have no special  voting  rights  and their  consent  shall not be
required for the taking of any corporate action.

8.  PROTECTIVE  PROVISIONS.  So long as any of  Series B  Preferred  Shares  are
outstanding,  the Corporation shall not without first obtaining the approval (by
vote or written  consent)  of the holders of at least a majority of the Series B
Preferred Shares then outstanding, voting together as a separate class:

      8.1. sell,  lease,  exchange,  transfer,  convey,  exclusively  license or
otherwise  dispose of all or substantially  all of the  Corporation's  assets or
merge into or consolidate with any other corporation  (other than a wholly-owned
subsidiary   corporation   provided  that  the   Corporation  is  the  surviving
corporation)  or effect any  transaction  or series of related  transactions  in
which 50% or more of the  voting  power of the  Corporation  is  transferred  or
otherwise disposed of;

      8.2.  amend,   alter,  or  repeal  any  provision  of  the   Corporation's
certificate of  incorporation  or Bylaws  (whether by merger,  consolidation  or
otherwise)  if such  amendment,  alteration  or repeal would alter or change the
powers,  preferences or special rights of the Series B Preferred Shares so as to
effect them adversely;

      8.3. authorize,  create or issue any class or series of stock or any other
securities  convertible  into or  exercisable  for or issued in connection  with
equity  securities of the Corporation  having rights,  preferences or privileges
superior to or on parity with the Series B Preferred Shares;

      8.4.  increase or  decrease  the number of  authorized  shares of Series B
Preferred Stock;

      8.5. pay any dividend or other  distribution on, or make any repurchase or
redemption of, any shares(s) of any class or series of stock or other securities
of the Corporation;  provided, however, that this restriction shall not apply to
the redemption described in Section 4;

      8.6.  incur any debt  obligations or any other  liabilities  (beyond those
existing on the Series B Issuance Date),  provided such  restrictions will apply
only with respect to: (A) the funding of merger,  consolidation  and acquisition
transactions  (or the portion  thereof)  undertaken  by the  Corporation  or its
affiliates that are paid in cash; and (B) financings by the  Corporation  and/or
any of its  subsidiaries  (collectively,  the "CBH Group")  that are  undertaken
outside of the normal  course of  business  such as  capital  expenditure,  bank
financing or  refinancing,  or similar  funding  normally  undertaken by the CBH
Group  pursuant  to prior  board  approvals  or  within  pre-approved  operating
budgets;

      8.7.  asset  disposals  by  the  CBH  Group  over  cumulative   amount  of
$10,000,000 or resulting in total remaining carrying cost of net property, plant
and equipment and other long-term  tangible  assets of the CBH Group  decreasing
below $15,000,000;

      8.8.  diversifications into ventures not related to the Corporation's core
business on the Series B Issuance Date;


                                       11


      8.9.  the  departure  of Mr. Shi  Mingsheng or Mm. Zhang Jian from the CBH
Group (voluntary or otherwise); or

      8.10. the occurrence of any  transaction or series of related  transaction
pursuant to which  stockholders  of the  Corporation  comprising  members of its
senior  management  and  directors  on the  Series B  Issuance  Date,  and those
shareholders  affiliated  with Suzhou Erye  Pharmaceutical  Company Ltd.,  sell,
exchange,  transfer,  convey, pledge or otherwise dispose in full or in part any
of their securities in the Corporation to an unrelated third party who then as a
result will have the ability to exert  control of the  Corporation  by virtue of
gaining control of the Board of Directors or through other similar means.

9. GROSS-UP

      Notwithstanding  any provision  herein to the  contrary,  if any amount in
cash,  stock,  property,  or other item of value paid or  reimbursed  to holders
hereunder is subject to any deductions or withholdings for any present or future
taxes,  withholding taxes, levies, imposts,  duties, fees, deductions,  charges,
withholdings,  or liabilities  imposed by any competent  governmental  authority
then an additional amount shall be paid or reimbursed to holders as is necessary
so that the  amount  actually  received  by  holders  after  such  deduction  or
withholding  shall  equal the full  amount to be  payable,  due or  reimbursable
hereunder.  Any such  deductions or  withholdings  shall be paid promptly to the
appropriate  governmental authority, and receipts or other proof of such payment
shall be provided to holders promptly.

                            [Signature Page Follows]


                                       12


IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation
of the Series B Preferred Stock of China  Biopharmaceuticals  Holdings, Inc., on
this ___ day of November, 2007.

                                         China Biopharmaceuticals Holdings, Inc.


                                         _______________________________________
                                         Name:
                                         Title:


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