SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (the “ Agreement ”), dated as of February 1, 2008, by
and among China Automotive Systems, Inc., a Delaware corporation, with headquarters located at No. 1
Henglong Road, Yu Qiao Development Zone, Shashi District, Jing Zhou City, Hubei Province, People’s
Republic of China (the ” Company ”), and the investors listed on the Schedule of Buyers attached hereto
(individually, a “ Buyer ” and collectively, the “ Buyers ”).
The Company and each Buyer is executing and delivering this Agreement in reliance upon the
exemption from securities registration afforded by Section 4(2) of the Securities Act of 1933, as amended (the “
1933 Act ”), and Rule 506 of Regulation D (“ Regulation D ”) as promulgated by the United States Securities
and Exchange Commission (the “ SEC ”) under the 1933 Act.
The Company has authorized a new series of senior convertible notes of the Company, which
notes shall be convertible into shares (as converted, the “ Note Conversion Shares ”) of the Company’s
common stock, par value $0.0001 per share (the “ Common Stock ”), in accordance with the terms of the
Notes (as defined below).
The Company has authorized the issuance of certain warrants of the Company, which warrants
shall be exercisable for the purchase of shares (as exercised, the “ Warrant Conversion Shares ” and together
with the Note Conversion Shares, the “ Conversion Shares ”) of the Common Stock in accordance with the
terms of each Warrant (as defined below).
Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms and
conditions stated in this Agreement, (i) that aggregate principal amount of the notes, in substantially the forms
attached hereto as Exhibits A-1 (the “ Closing Note ”), Exhibit A-2 (the “ Henglong Note ”) and Exhibit A-3
(the “ Escrow Note ” and together with the Closing Note and the Henglong Note, collectively, the “ Notes ”),