Offshore Subscription Agreement Between China Fruits Corporation and Ms. Ning, Fen

1.

Purchase and Sale.   On the basis of the representations and warranties herein contained, subject to the terms and conditions set forth herein, MS. NING hereby agrees to purchase the Shares at a purchase price of twenty cents (US$.20) per share (aggregate sum of $350,000), and CHFR hereby agrees to sell the Shares to MS. NING for such Consideration.

2.

Closing.  The closing of the purchase and sale contemplated by this Agreement (the “Closing”) shall occur upon the transfer of the Consideration to CHFR at Fu Xi Technology & Industry Park, Nan Feng County, Jiang Xi Province, P. R. China (the “Corporate Address”). CHFR shall deliver the Shares to MS. NING within 14 days of receiving full payment under this Agreement.

3.

      Private Offering.  MS. NING and CHFR both understand and agree that the purchase and sale of securities contemplated herein constitutes a private, arms-length transaction between a willing seller and willing buyer without the use or reliance upon a broker, distributor or securities underwriter.

A.  

Purchase for Investment.  Neither MS. NING nor CHFR are underwriters of, or dealers in, the securities to be sold and exchanged hereunder.

B.   

Investment Risk.  Because of CHFR’s financial position and other factors as disclosed in CHFR’s business plan (which MS. NING represents it has received and reviewed), the  transaction contemplated by this Agreement may involve a high degree of financial risk, including the risk that one or both parties may lose its entire investment, and both parties hereby  agree that they have each undertaken an independent evaluation of the risks associated with the Shares, and both parties understand those risks and are willing to accept the risk that they may be required to bear the financial risks of this investment for an indefinite period of time.

C.   

Access to Information.  MS. NING and CHFR and their advisors have been afforded the opportunity to discuss the transaction with legal and accounting professionals and to examine and evaluate the financial impact of the sale and exchange contemplated herein. MS. NING acknowledges that it has been furnished with the information required to conform with the provisions of subparagraph (a)(5) of Rule 15c2-11 of the Securities and Exchange Commission.

4.

Representations and Warranties of MS. NING: MS. NING hereby covenants and represents and warrants to CHFR that:

Organization.  MS. NING is an individual, with the power and authority to carry on business as now being conducted.  This Agreement has been duly executed and delivered by MS. NING and constitutes a binding and enforceable obligation of MS. NING.

Third Party Consent.  No authorization, consent, or approval of, or registration or filing with, any governmental authority or any other person is required to be obtained or made by MS. NING in connection with the execution, delivery, or performance of this Agreement or the transfer of the Shares, or if any such is required, MS. NING will have or will obtain the same prior to Closing.

Litigation.  MS. NING is not a defendant against whom a claim has been made or a judgment rendered in any litigation or proceedings before any local, state, or federal government, including but not limited to the United States, or any department, board, body, or agency thereof.

Authority.  This Agreement has been duly executed by MS. NING, and the execution and performance of this Agreement will not violate, or result in a breach of, or constitute a default in, any agreement, instrument, judgment, order, or decree to which MS. NING is a party or to which the Consideration is subject.

Offshore Transaction. MS. NING represents and warrants to CHFR as follows: (i) MS. NING is not a “U.S. person” as that term is defined in Rule 902 of Regulation S; (ii) at the execution of this Agreement, as well as the time this transaction is or was due, MS. NING was outside the United States, and no offer to purchase the Shares was made in the United States; (iii) MS. NING agrees that all offers and sales of the Shares shall not be made to U.S. persons unless the Shares are registered or a valid exemption from registration can be relied on under applicable U.S. state and federal securities laws; (iv) MS. NING is not a distributor or dealer; (v) the transactions contemplated hereby have not been and will not be made on behalf of any U.S. person or pre-arranged by MS. NING with a purchaser located in the United States or a purchaser which is a U.S. person, and such transactions are not and will not be part of a plan or scheme to evade the registration provisions of the Act; (vi)all offering documents received by MS. NING include statements to the effect that the Shares have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States or to U.S. Persons (other than distributors as defined in Regulation S) during the Restricted Period unless the Shares are registered under the Securities Act of 1933 or an exemption from registration is available.

Accredited Investor.  MS. NING is an accredited investor as that term is defined in Rule 501(a) of Regulation D promulgated under the Act.

Beneficial Owner.  MS. NING is purchasing stock for its own account or for the account of beneficiaries for whom MS. NING has full investment discretion with respect to stock and whom MS. NING has full authority to bind, so that each such beneficiary is bound hereby as if such beneficiary were a direct signatory hereunder, and all representations, warranties and agreements herein were made directly by such beneficiary.

Directed Selling Efforts.  MS. NING will not engage in any activity for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for any of the Shares sold hereunder.  To the best of its knowledge, neither MS. NING nor any person acting for MS. NING has conducted any “directed selling efforts” as that term is defined in Rule 902 of Regulation S.

Independent Investigation; Access.  MS. NING, in electing to purchase the Shares herein, has relied solely upon independent investigation made by him and his representatives.  MS. NING has been given no oral or written representation or warranty from CHFR other than as set forth in this Agreement.  MS. NING and his representatives, if any, have, prior to any sale to it, been given access and the opportunity to examine all material books and records of CHFR, all material contracts and documents relating to CHFR and this offering and an opportunity to ask questions of, and to receive answers from, CHFR or any officer of CHFR acting on its behalf concerning CHFR and the terms and conditions of this offering. MS. NING and his advisors, if any, have been furnished with access to all publicly available materials relating to the business, finances and operations of CHFR and materials relating to the offer and sale of the Shares which have been requested. MS. NING and his advisors, if any, have received complete and satisfactory answers to any such inquiries.

No Government Recommendation or Approval. MS. NING understands that no United States federal or state agency, or similar agency of any other country, has passed upon or made any recommendation or endorsement of the Shares, or this transaction.

No Formation or Membership in “Group.”  MS. NING is not part of a “group” as that term is defined under the Act.  MS. NING is not, and does not intend to become, included with two or more persons acting as a partnership, syndicate, or other group for the purpose of acquiring, holding or disposing of securities of the Company.

Hedging Transactions.  MS. NING hereby agrees not to engage in any hedging transactions involving the securities described herein unless in compliance with the Act and Regulation S promulgated thereunder.

5.

Conditions Precedent to CHFR’s Closing.  All obligations of CHFR under his Agreement, and as an inducement to CHFR to enter into this Agreement, are subject to MS. NING’s covenants and agreements to each of the following:

Acceptance of Documents.  All instruments and documents delivered to CHFR pursuant to this Agreement or reasonably requested by CHFR to verify the representations and warranties of MS. NING herein, shall be satisfactory to CHFR and its legal counsel.

Representations and Warranties.  The representations and warranties by MS. NING set forth in this Agreement shall be true and correct at and as of the Closing date, with the same force and effect as though made at and as of the date hereof, except for changes permitted or contemplated by this Agreement.

No Breach or Default.  MS. NING shall have performed and complied with all covenants, agreements, and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing.

 6.

Termination.  This Agreement may be terminated at any time prior to the date of Closing by either party if (a) there shall be any actual or threatened action or proceeding by or before any court or any other governmental body which shall seek to restrain, prohibit, or invalidate the transaction contemplated by this Agreement, and which in the judgment of such party giving notice to terminate and based upon the advice of legal counsel makes it inadvisable to proceed with the transaction contemplated by this Agreement, or (b) if this Agreement has not been approved and properly executed by the parties by May 31, 2009.

7. 

Restrictive Legend.  MS. NING agrees that the Shares shall bear a restrictive legend to the effect that transfer is prohibited except in accordance with the provisions of Regulation S, pursuant to registration under the Act, or pursuant to an available exemption from registration, and that hedging transactions involving those securities may not be conducted unless in compliance with the Act.

8.

CHFR’s Obligation to Refuse Transfer.  Pursuant to Regulation S promulgated under the Act, CHFR hereby agrees to refuse to register any transfer of the Shares not made in accordance with the provisions of Regulation S, pursuant to registration under the Act, or pursuant to an available exemption from registration.

9. 

Miscellaneous.

Authority.  MS. NING and the officers of CHFR executing this Agreement are duly authorized to do so, and each party has taken all action required for valid execution.

Notices.  Any notice under this Agreement shall be deemed to have been sufficiently given if sent by registered or certified mail, postage prepaid, or by express mail service substantially equivalent to Federal Express, addressed as follows

 

       To MS. NING:     Ms. Ning, Fen.

 

       To CHFR:

China Fruits Corporation

Entire Agreement. This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous representations, warranties, agreements and understandings in connection therewith. This Agreement may be amended only by a writing executed by all parties hereto.

Severability.  If a court of competent jurisdiction determines that any clause or provision of this Agreement is invalid, illegal or unenforceable, the other clauses and provisions of the Agreement  shall remain in full force and effect and the clauses and provisions which are determined to be void, illegal or unenforceable shall be limited so that they shall remain in effect to the extent permissible by law.

Assignment.  None of the parties hereto may assign this Agreement without the express written consent of the other parties and any approved assignment shall be binding on and inure to the benefit of such successor or, in the event of death or incapacity, on assignor’s heirs, executors, administrators, representatives, and successors.

Applicable Law. This Agreement has been negotiated and is being contracted for in the United States, State of Delaware.  It shall be governed by and interpreted in accordance with the laws of the United States and the State of Delaware, regardless of any conflict-of-law provision to the contrary.

Attorney’s Fees.  If any legal action or other proceeding (including but not limited to binding arbitration) is brought for the enforcement of or to declare any right or obligation under this Agreement or as a result of a breach, default or misrepresentation in connection with any of the provisions of this Agreement, or otherwise because of a dispute among the parties hereto, the prevailing party will be entitled to recover actual attorney’s fees (including for appeals and collection and including the actual cost of in-house counsel, if any) and other expenses incurred in such action or proceeding, in addition to any other relief to which such party may be entitled.

Counterparts and Facsimile.  This Agreement may be executed in any number of identical counterparts (except as to signature only), each of which may be deemed an original for all purposes.  A fax, telecopy or other reproduction of this instrument may be executed by one or more parties hereto and such executed copy may be delivered by facsimile or similar instantaneous electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes.