WAIVER AND CONSENT
THIS WAIVER AND
CONSENT (this “ Agreement ”) is made on
the 30 th
of June, 2009 by and among CHINA
GREEN AGRICULTURE, INC., a Nevada corporation (the “
Company ”), and the undersigned Investors. Each
of the capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Stock Purchase Agreement
described below.
RECITALS
WHEREAS , on December 26, 2007, the Company, previously
known as Discovery Technologies, Inc., and the Investors,
consummated a private placement by entering into a Securities
Purchase Agreement (the “SPA”) and its ancillary
documents pursuant to which the Company issued and sold to the
Investors an aggregate of 6,313,617 shares of common stock, par
value $.001 per share, of the Company for total gross proceeds of
$20,519,255;
WHEREAS , pursuant to Section 4.14 of the SPA, the
Investors have a right of first refusal on any new offering of the
Company’s securities until August 6, 2009, being one year
anniversary of the effectiveness of the Registration Statement on
Form S-1 which was declared effective by the U.S. Securities and
Exchange Commission (the “SEC”) on August 6,
2008;
WHEREAS , the Company filed with the SEC a registration
statement on Form S-3 for a shelf registration of up to $50,000,000
on June 8, 2009 (the “S-3”) which was declared
effective by the SEC on June 12, 2009;
WHEREAS , the Company deems it is in its best interest
to proceed with a takedown from the S-3 in the form of an
underwritten offering on or around July 1, 2009 or any appropriate
date thereafter (the “S-3 Shelf Takedown”);
WHEREAS , as of the date hereof the Company granted an
aggregate of 198,000 options to its directors, officers and
employees (the “Option Grant”) which were subject to
the Investors’ right of first refusal pursuant to Section
4.14 of the SPA;
WHEREAS , Section 4.16 of the SPA setting forth
Liquidated Damages for Governmental Rescission of the Transaction
triggered the accounting treatment that the 6,313,617 shares issued
pursuant to the SPA are deemed temporary equity instead of
permanent equity because they are subject to redemption;
and
WHEREAS, Section 6.4 of the SPA enables the
Company and Investors holding a majority of the Shares to waive
and/or amend provisions of the SPA by written agreement and the
undersigned Investors constitute “Investors holding a
majority of the Shares.”
NOW,
THEREFORE , for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, pursuant to Section 6.4 of the SPA, the
parties hereby agree as follows:
Section
1.
Consent and Waiver of Right of First Refusal with regard to S-3
Shelf Takedown. The Investors hereby
waive the right of first refusal with respect to the S-3 Shelf
Takedown and any offering of securities thereafter so that it
therefore ceases to have any effect whatsoever as of the date
hereof.
Section
2.
Consent and Waiver of Right of First Refusal with regard to the
Option Grant. The Investors hereby consent to the
Option Grant and hereby waive the right of first refusal and any
claim(s) arising from said right of first refusal each with respect
to the Option Grant, effective as of the dates of each grant
constituting the Option Grant.
Section
3.
Consent on the Termination of the Effect of Section 4.16 of the
SPA. The Investors hereby waive any and all rights
arising under Section 4.