LAW OFFICE OF Esq. RULE 144 OPINION LETTER FOR AFFILIATE SHAREHOLDER EFFECTUATING A BONA FIDE PLEDGE OF SECURITIES VIA FEDERAL EXPRESS AND E-MAIL Attention: Restricted Stock Transfer Re: Bona fide pledge by Kexuan Yao of shares of common stock of China Armco Metals, Inc. (CNAM:NYSE AMEX), evidenced by certificate nos. and registered in the name of Kexuan Yao pledged as collateral in connection with that certain private loan transaction by and hetween Kexuan Yao as borrower and as lender. Dear Sir or Madam: ‘You have requested us to furnish our opinion to you concerning the transfer and pledge of shares (the 'Pledged Shares’) of common stock of China Armco Metals, Inc, (the “Company’), pursuant to that certain Suspension Collateral Substitution Agreement dated as of nd that certain Loan Agreement dated as of (collectively, the "Loan") by and hetween Kexuan Yao (the "Borrower") and (the "Lender") and those certain other documents identified in, and ancillary to the Loan (Logether with the Loan, the "Loan Documents"). This opinion is being provided to facilitate a request from the Borrower for the removal of the restrictive legend referring to the Securities Act of 1933, as amended (the “Act”) for the purpose of making a bona fide pledge of the Pledged Shares to the Lender as Collateral for the Loan. In connection with this opinion, we have examined originals of the Loan Documents, as well as (0) copies of the original stock certificates numbered and issued by the Company to the Borrower and listed on Schedule A hereto (ure “Certificates”); and (2) the Company's Annual Report on form 10-K filed with the U.S. Securities and Exchange Commission ‘on March 31, 2010 and the Company's Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission on May 17, 2010, In rendering the opinions set forth in this opinion letter, we assume the following: (a) the legal capacity of each natural person and the legal existence of all parties to the transactions referred 0 in the Loan Documents. (b) the power and authority of each person to execute, deliver and perform each document executed and delivered and to do each other act done or to be done by such person; (c) the due authorization, execution and delivery by each person of each of the Loan Documents evevuted and delivered as part of the Loan Documents or to be executed and delivered by such person;(4) the legality, validity, binding effect and enforceability as to cach person of each of the Loan Documents executed and delivered or to be executed or delivered and of each other act done or to be done by such person: (c) the payment of all the required documentary stamps, taxes end fees imposed upon the execution, filing or recording of the Loan Documents: (f) that there have been no undisclosed modifications of any provision of any document reviewed by us in connection with the rendering of the opinions set forth in this letter and no undisclosed prior waiver of any right or remedy contained in the Loan Documents; (@) the genuineness of each signature, the completeness of each document submitted 10 us the authenticity of each document reviewed by usas an original, the conformity to the original of each document reviewed by us ax a copy and the authenticity of the original of each decument reccived by usa copy; (h) the truth fulness of each statement as to al factual matters otherwise not known to us co be untruthful contained in any document encompassed within the due diligence review undertaken by us; (i) thac the transactions referred to in the Loan Documents comply with all tests of good. faith, fairness and conscionability required by law (j) that routine procedural matters such as service of process or qualification to do business in the relevant jurisdictions will be satisfied by the parties sccking to enforce the Loan Document; ((e) that all statutes, judieial and administrative decisions, and rules and regulations of governmental agencies constituting the law for which we are assuming responsibility are published (eg. reported court decisions and the specialized reporting services af BNA, CCH and Prentice-Tlall) or otherwise generally accessible (e.g., LEXIS or WESTLAW) in cach case in a manner generally available (i, in terms of access and distribution following publication) to lawyers practicing in our judicial cireui () that the other agreements related to the transactions referred to in the Loan Documents will he enforced as written: (m) that no action, discretionary or otherwise, will be taken by or on behalf of the parties in the future that might result in a violation of law; (n) that there are no other agreements or understandings among the parties that would modify the terms of the Loan Documents or the respective rights or obligations of the parties (o the Loan Documents: (0) that with respect to the Loan Documents and to the transactions referred to therein, there has benno mutual mistake of fact, and there exists na Iraud or duress; and (p) the adoption, execution and delivery of the Loan Documents have been approved by all necessary corporate and shareholder action.‘The restrictive legend was originally placed upon the Pledged Shares to provide assurance that the Pledged Shares, whose issuance was unregistered, would not be sold publicly contrary t0 the registration requirements of the Act Pursuant to Rule 144, a lender may sell shares held as collateral under a pledge and may tack the full holding period of the shares provided that the pledge is bona fide, the loan is full recourse and the shares are sold only upon an event of default. In our opinion, the foregoing conditions are satisfied by the terms of the Loan Documents. Therefore, it is also our opinion that the Lender may sell the Pledged Shares pursuant to Rule 144(b)(x) upon an event of default under the Loan Documents and that a restrictive legend is not required to be placed upon the Pledged Shares for the purpeses sought by the Borrower and the Lender thereunder: Accordingly, and based on the foregoing, upon receipt of appropriate transfer instructions from the Borrower, the Company's transfer agent may transfer the Pledged Shares to the DTC account of Lender in the Lender's name without restrictive legend. ‘This opinion is furnished pursuant to the request of the addressee hereof and is rendered by us solely for the benefit of the addressee hereof in connection with the Loan Documents, We are not hereby assuming any professional responsibilities to any other person whatsoever. This opinion may be relied upon only in connection with the Loan Documents. This opinion may not be used. disseminated. circulated quoted, referred to or relied upon by any other person {including by way of subrogation or assignment) or for any other purpose without our prior ‘written consent. This opinion is rendered as of the date set forth above, and we express no opinion as to circumstances oF events that may oceur subsequent to such date. We assume no duty to update or supplement this opinion co reflect any facts or circumstances that may hereafter come to our attention or reflect any changes in any law that may hereafter occur or become effective Sincerely yours, The Law Office ofwid