EXHIBIT 10.8

House Ownership Certificate

J.F. (L.C)Z.No. 50775

 
 

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To whom it may concern:

　　According to Constitution of the PRC, this is to protect the legal interest of
the house owner who applied to register for the listed house; it is the truth
through investigation, and thus is issued this certificate.
 
 
Jinan Real Estate Administration

 
 

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House owner
     
Nature of ownership
 
By the
Co-owner of ownership
 
Jinan Cigarette Factory
 
Property type
 
entire
Address: 
 
No. 80, Daqiao Road, Jinan City
 
Land No.
 
people
Status of
house
 
Building
No.
 
Rm. No.
 
Number of
rooms
 
Architectural
structure
 
Floor
 
Building
area (square
meters)
 
Note 
   
16
     
9
 
Mixture
 
01
 
958.46
       
17
     
15
 
Mixture
 
04
 
432.11
       
18
     
88
 
Mixture
 
04
 
2427.79
       
19
     
2
 
Mixture
 
01
 
42.55
       
20
     
3
 
Mixture
 
01
 
71.59
       
21
     
8
 
Mixture
 
01
 
620.94
       
22
     
215
 
Mixture
 
05
 
9429.36
       
23
     
215
 
Mixture
 
05
 
9429.36
       
24
     
23
 
Mixture
 
02
 
502.13
       
25
     
20
 
Mixture
 
01
 
1238.80
       
26
     
1
 
Mixture
 
01
 
34.10
       
27
     
5
 
Mixture
 
01
 
149.98
       
28
     
2
 
Mixture
 
01
 
76.89
       
29
     
7
 
Mixture
 
01
 
495.85
       
30
     
1
 
Mixture
 
01
 
21.12
   
Remarks
                           

Issued by: Jinan City Licheng District Rural and Urban House Ownership
Registration Office
Issued on:

 
 

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Lease Contract
 
Lessor: Jiangjun Trading Co., Ltd.
Address: No. 80 Jiangjun Road, Jinan City
Legal representative: Jiang Haiyan

 
 

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Lessee: Shandong Yaoyuan Pharmaceutical Company
Address: No. 80 Jiangjun Road, Jinan City
Legal representative: Song Yanliang

The two parties agree to conclude the contract with regards to the lease of the
workshop to the Lessee according to the Contract Law of the People’s Republic of
China and relevant regulations, on the principle of fairness and mutual
benefits.
Article 1: Status of house
(1)
The Lessor leases the house and attached facilities located in Dawang County,
Licheng district, Jinan City (hereinafter referred to as “The Leased Property”)
to the Lessee for breeding and planting as well as office administration.

(2)
The leased area of the house is 1160.46 square meters.

(3)
The Lessor shall guarantee that the building quality of the Leased Property
meets the safety requirements of the Lessee.

(4)
The Leased Property is used for breeding and planting as well as office
administration of the Lessee, if it intends to change its purpose, it shall get
the written permission of the Lessor, and all the relevant procedures shall be
reported by the Lessee according to national regulations; all the fees payable
shall be assumed by the Lessee; the Lessor shall not be responsible for the
compensation of dissolution and termination of the contract owing to any
reasons.

(5)
The Lessee shall guarantee that the current house and plants will not be
damaged, and the disposal right of plants is held by the Lessor. The Lessee is
responsible for the maintenance and repair of the over-ground house and
supported facilities like water & electricity.

(6)
It adopts the method of charter for the Leased Property.

Article 2: Cooperation period
(1)
The cooperation period is temporarily five years, and the contract will be
signed once a year; the contract term of the first year is from Mar. 1, 2010 to
Feb. 28, 2011.

(2)
After the contract term expires, the Lessor has right to take back the Leased
Property, and the Lessee shall return the Property and move out of the house in
advance of two weeks; if the Lessee needs to extend the lease term, it shall
propose within two months in advance of the expiry date; after the agreement of
the Lessor, the two parties shall sign a new contract. The Lessee has the
priority to lease the Property under the same conditions.

Article 3: Delivery
After taking effect, the Lessor shall deliver the Property to the Lessee, and
the Lessee agrees to rent the Property and facilities based on its current
status. The two parties shall sign and confirm the infrastructure on the
transfer list when deliver the Property.

 
 

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Article 4: Lease fee
(1)
Lease deposit

The lease deposit of this contact is 10,000 Yuan (Say Ten Thousand Yuan Only).
(2)
Rent

The rent is 30,000 Yuan each year, and it will increase 5% year by year since
the second year.
(3)
Water & electricity fees

The Lessee shall pay the water & electricity fees to the relevant management
department independently, and the Lessee shall take charge of the coordination.
Article 5: Payment way of lease fee
(1)
The Lessee shall remit the deposit to the specified account within three days
after signing the contract.

After the expiry date of the contract, and the following conditions are
satisfied, the Lessor shall return the deposit to the Lessee within 15 working
days without the interests.
1.
The Lessee has settled all the charges generated from the lease (including but
not limited in fees of water, electricity, heat supply, telecom, environment &
health and public security);

2.
It shall comply with the contract regulations to return the Leased Property and
assume other responsibilities to the Lessee.

3.
The Leased Property, attached facilities and equipment shall have no abnormal
damage through the confirmation of the Lessor.

“Abnormal damage” refers to the situations except for the normal wearing and
aging.
If there is “abnormal damage”, the two parties shall confirm the direct fees of
the damage, and the deposit that deducted the direct fees shall be returned to
the Lessee, and the lacking part shall be supplemented by the Lessee.
(2)
This contract will be based on the principle to pay the rent first and then take
use of the Property, the Lessee shall pay the first-year rent and deposit within
three days since the effective date of the contract; after then, the Lessee
shall pay the rent of next year on 25 of last month before each calendar year or
in advance of this date, and it shall remit to the specified account of the
Lessor, or it can comply with other ways of payment agreed in the written form
by the two parties.

Bank of deposit of Lessor:
Account No:
If the Lessor changes the payment account No. or bank of deposit, it shall
promptly notify the Lessee.
The Lessee shall pay the liquidated damages to the Lessor if the rent is
overdue, with the amount of: delayed days ×5/10000 of total owed rent.
Article 6: relevant fees
(1)
During the contract term, the Lessee shall assume the water & electricity fees,
communication fees, decoration fees and all the fees needed for the normal use
of relevant supported facilities.

(2)
The use right of the Leased Property belongs to the Lessee during the lease
term.

 
 

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Article 7: Repair and maintenance
(1)
The Lessee shall enjoy the use right of the Leased Property and attached
facilities during the lease term, and it shall be responsible for the repair and
maintenance of relevant facilities in the Property; it shall guarantee that the
relevant facilities are in the good state and it can be returned together with
the Leased Property during the lease term when the contract terminates. The
Lessee has right to examine and supervise.

The Lessee has responsibility to properly use and maintain the Leased Property,
and it shall eliminate the possible faults and dangers promptly, so as to avoid
all the possible troubles.
(2)
If the Lessee intends to decorate or increase the attached facilities and
equipment, it shall get the permission of the Lessor and submit to the relevant
department for approval, which shall not damage the main structure of the Leased
Property as well as damage the Property substantially; and it shall not damage
other building and facilities of the Lessor. Otherwise, the Lessee shall assume
the responsibility for compensation.

Article 8: Safety management
(1)
The Lessee shall seriously comply with the Fire Protection Regulation of the
People's Republic of China and relevant system of the Lessor; it shall
coordinate the Lessor to prepare the relevant works, otherwise, all the
responsibilities and losses shall be assumed by the Lessee.

(2)
The Lessee shall allocate the fire control equipment according to the relevant
regulations; it forbids using fire control facilities for other use.

(3)
If it needs t works owing to the maintenance (including welding and gas welding,
etc.), it shall get the permission of the principal department of Lessor; and
the issues that need the approval of the principal department, it shall get the
approval of fire control department.

(4)
The Lessee shall take charge of the fire and stealing control in the Leased
Property according to the relevant regulations of the fire control department,
and take self-examination and self-correction works. The Lessee has right to
examine the fire and stealing control safety in the reasonable time agreed by
the two parties, and it shall give the written notice to the Lessee; the Lessee
shall not refuse unreasonably or delay the approval. The safety examination
behaviors of the Lessor shall not exempt from the safety requirements like
safety examination of the Lessee.

(5)
During the contract term, the two parties shall observe national laws and
regulations, and it shall not use the Leased Property to engage in the illegal
activities; meanwhile, the Lessor has right to urge the Lessee to do well the
works with regards to fire control, safety and health.

(6)
The Lessee shall observe the safety management of the state and the Lessor, so
as to promptly eliminate the personal harms as well as the harms to the Lessor.
The Lessee shall take the security and protection for the properties, and assume
all the responsibilities.

(7)
The Lessee shall comply with the national regulations to use the relevant
equipment and facilities; otherwise, it will assume all the responsibilities as
well as the losses of the Lessor.

Article 9: Responsibility of insurance
During the lease term, the Lessee shall take charge of purchasing the insurance
of Lessor’s property and other necessary insurances (including the liability
insurance). If the Lessee doesn’t purchase the above insurance, the Lessor has
right to terminate the contract, and the Lessee shall assume all the
compensations and responsibilities.

 
 

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Article 10: Leased property and surrounding environment management
(1)
If the Lessee’s behavior affects or harms the surrounding environment, it shall
eliminate the effect and recover the original state, and it shall bear the
responsibility for the damage.

(2)
When the lease term expires or the contract terminates in advance, the Lessee
shall clean the Leased Property and move out of the Property, and return the
property to the Lessor. If the Lessee doesn’t clean the house, it shall bear the
fees related to cleaning of the Lessor.

(3)
The Lessee must comply with the laws and regulations of the People’s Republic of
China as well as the provisions relevant to property management of the Lessor,
if it violates the regulations, it shall bear the relevant responsibilities. If
the Lessee affects the normal works of other users owing to its violation of
above regulations, the losses shall be assumed by the Lessor.

Article 11: Provisions of decoration
(1)
During the contract term, if the Lessee needs to decorate or rebuild the Leased
Property, it shall submit the relevant plans to the Lessor and get the approval;
meanwhile, it shall report to the relevant government department for approval.
If the decoration and rebuilding plans may affect the public building or other
adjacent users, the Lessor can propose the disputes on these plans, and the
Lessee shall revise promptly. The rebuilding and decoration fees shall be
assumed by the Lessor.

(2)
If the decoration and rebuilding plans may affect the main structure of the
Leased Property, it shall get the written approval of the Lessor and original
design unit.

(3)
The Lessee shall handle the acceptance procedures after second decoration as
well as the relevant fees; the Lessee shall recover the original state for free
after the contract expires.

Article 12: Termination
The Lessee shall not terminate the contract in advance without the written
permission of the Lessor. If the Lessee needs to terminate the contract in
advance, it shall notify the Lessor in the written form before two months, and
it can terminate the contract after completing the following procedures:
1.
Return the Leased Property to the Lessor;

2.
Pay off the rent and other relevant fees;

3.
It shall pay the item that is equal to 2 times of the rent of the current month
as the compensation for the Lessor at the day before the termination date or in
advance of this date.

Article 13: Exception clauses
(1)
The two parties will not assume the responsibilities for breach of the contract
if the Lessor cannot perform the contract owing to the revision of relevant
national laws and regulations or local government behavior or the policy
regulations of higher-level principal department of the Lessor. But they shall
comply with the regulated period of Article 2 to perform the obligations of
notification.

(2)
If one party cannot perform the contract owing to natural disaster, wars or
other unforeseeable force majeure factors that cannot be prevented or avoided,
the relevant party shall notify the other party by means of main or fax; and it
shall provide the detail of force majeure and the certificates for the
non-performing of the contract or demand for delaying the performance within 30
days. These certificates shall be issued by the notary public of the place
encountered from force majeure, if it cannot obtain the certificates issued by
the notary public, it can provide other forcible certificates. The party
suffered from the force majeure can be exempted from the responsibilities.

 
 

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(3)
The contract will terminate if it cannot be executed owing to the above two
reasons; the Lessor shall return the deposits and overpayments to the Lessee
within 30 working days since the termination date,, and other matters shall be
handled in accordance with the national regulations.

Article 14: Relevant agreements of contract termination or dissolution
(1)
If the contract terminates in advance or the contract expires, and the two
parties don’t continue the agreements, the Lessee shall move out of the house at
the termination date or expiry date, and return the Property to the Lessor. If
the Lessee doesn’t move out of the Property or return the Property in time, it
shall pay the doubled rent to the Lessor; while the Lessor has right to notify
for refusing the doubled rent in the written form, and it has right to take back
the Leased Property and remove the properties forcibly; and it has no
responsibility to keep the properties. If there are still the properties of
Lessee within five days after moving, if the two parties have no agreements, it
will be deemed as wavier of the ownership, and the Lessor will dispose these
properties. If the Lessee has difficulties to find the workshop or there are
other special reasons, the Lessor shall allow for delaying the term for 20 days,
but the Lessee shall pay off the rent and relevant fees at one time according to
the agreed rent in the contract.

(2)
After the contract term expires, if the Lessee intends to continue the contract,
it shall notify the Lessor in advance of 30 days, and the Lessor shall propose
the disputes or negotiate to continue the agreements with the Lessee within 30
working days since receiving the notice; if it doesn’t reply within 30 working
days since receiving the notice, it will be deemed as agreeing the reletting;
the contract will extend for half a year, which will be calculated since the
expiry date. After the lease term expires, if the Lessor intends to continue
leasing the Property, the Lessee has the priority to lease the Property based on
the same rent.

(3)
The Leased Property shall comply with the normal using state when returning;
otherwise, the Lessee shall assume the responsibility for the compensations.

Article 15: Operation and advertisement
(1)
The Lessor shall not interfere in the legal operation and production of the
Lessee, and the production and operation behaviors and results have no relations
with the Lessor. The Lessee (sublessee) shall not use the Lessor’s name, word
size and image symbol in the self propaganda or operation activities; the Lessee
shall ensure that its or the sublessee’s behaviors cannot harm the legal rights
of the Lessor. Otherwise, the Lessee shall take charge of the compensations and
bear the responsibilities according to the provisions for breach of the
contract.

(2)
If the Lessee needs to establish the billboard on the house surface, wall and
other parts or the places owned or managed by the Lessor surrounded the Leased
Property, it shall get the written permission of the Lessor; the relevant fees
shall be confirmed through negotiation of the two parties; the Lessee will be
responsible for completing the relevant procedures according to the government
regulations as well as submit to the Lessor for filing.

Article 16: Relevant taxes
In accordance with the regulations of the local government, the relevant taxes
of this contract shall be assumed respectively by the two parties abiding by the
regulations. The Lessor shall handle the relevant procedures for registration.

 
 

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Article 17: Notice
All the notices related to the contract or the documents related to the two
parties as well as the relevant requirements shall be in the written form.
Article 18: Responsibility for breach of contract and claim 1
(1)
Any party will be deemed as breach of the contract if it doesn’t execute any
clauses in the contract.

(2)
After receiving the written notice for the details of breach of contract of one
party, any party shall confirm or propose the written disputes or supplementary
notes within 15 working days. If it doesn’t reply in the written form within 15
working days, it will be deemed as acceptance of the contents; in this case, the
two parties shall negotiate the issue; if it fails to be solved in this way, it
shall be handled according to the clauses in this agreement. The default party
shall assume the economic losses of the observant party caused by its breach of
the contract.

(3)
Claim

1.
If the contract cannot be performed owing to illegal reasons of the Lessor, it
shall return the overpayments and deposits of the Lessee, and it will give the
Lessee 15 days for moving out of the Leases property for free.

2.
If the contract cannot be performed owing to illegal reasons of the Lessee, the
Lessee shall pay the relevant rent in lump sum within 7 days since the invalid
date agreed in the contract as the compensations, which will be deemed as the
indirect compensation for the Lessor; otherwise, the Lessor has right to detain
the paid rent and deposit of the Lessee; meanwhile, the Lessor will not make any
compensations for all the fees invested by the Lessee based on the trust at the
beginning.

3.
If the disputes aroused from the contract cannot be solved through negotiation,
the default party shall assume the expenses of the observant party for
maintaining its rights, including but not limited in the travel fees, lawsuit
fees, investigation fees and lawyer’s fees.

Article 19: Disputes solution
The disputes aroused from this contract shall be solved through negotiation of
the two parties; for failure of negotiation, it shall make the lawsuit to the
people’s court at the location of the Leased Property.
Article 20: Other clauses
(1)
After signing the contract, if the enterprise name has change, the change party
shall provide the registration materials of industry and commerce related to the
change to the other party, if the change doesn’t comply with the contract, this
contract clauses will not be changed, and it will continue to be performed until
the contract expires.

(2)
The unsettled matters herein shall be negotiated by the two parties to sign the
supplementary agreement.

(3)
This contract will take effect after signing and sealing of the two parties as
well as receiving the deposit paid by the Lessee.

Lessor: Jiangjun Trading Co., Ltd.
Authorizes representative (signature):
Date: Mar. 1, 2010

 
 

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Lessee: Shandong Yaoyuan Pharmaceutical Company
Authorizes representative (signature):
Date: Mar. 1, 2010

Contract
 
Lessor: Jiangjun Trading Co., Ltd.
Address: No. 80 Jiangjun Road, Licheng District, Jinan City
Legal representative: Jiang Haiyan

Lessee: Shandong Yaoyuan Pharmaceutical Company
Address: No. 80 Jiangjun Road, Licheng District, Jinan City
Legal representative: Song Yanliang

The two parties agree to conclude the contract with regards to the lease of the
land (owned by the Lessor) to the Lessee according to the Contract Law of the
People’s Republic of China and relevant regulations, on the principle of
fairness and mutual benefits.

Article 1: Status of land
(1)
The Lessor leases the land located in Dawang County, Licheng District, Jinan
City (land certificate No: (Licheng) G.Y.(95) No. 0539018, hereinafter referred
to as “The Land”) to the Lessee.

(2)
The Land covers the area of 156020 square meters.

(3)
The Lessee shall notify the Lessor in the written form if it needs new
facilities demanded by the breeding and planting, and get the permission of the
Lessor.

(4)
The Land is only used for breeding and planting the agricultural and byproducts,
and it shall seriously comply with the land use scope regulated in the land
certificate, and it is forbidden to make the waste of land; otherwise, the
Lessee shall assume the relevant responsibilities.

(5)
It adopts the method of charter for the Land.

(6)
The Lessee shall guarantee that the current house and plants will not be
damaged, and the disposal right of plants is held by the Lessor.

Article 2: Lease term
(1)
The cooperation period is temporarily five years, and the contract will be
signed once a year; the contract term of the first year is from Mar. 1, 2010 to
Feb. 28, 2011.

 
 

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(2)
After the contract term expires, the Lessor has right to take back the Leased
Property, and the Lessee shall return the Property and move out of the house in
advance of two weeks; if the Lessee needs to extend the lease term, it shall
propose within two months in advance of the expiry date; after the agreement of
the Lessor, the two parties shall sign a new contract. The Lessee has the
priority to lease the Property under the same conditions.

Article 3: Rent and other fees
(1)
Deposit

The deposit is 100,000 Yuan totally.
(2)
Rent

The rent is 180,000 Yuan each year, and it will increase 5% year by year since
the second year.
(4)
Water & electricity fees

The Lessee shall pay the water & electricity fees to the relevant management
department independently, and the Lessee shall take charge of the coordination.

Article 4: Payment of rent and other fees as well as land delivery
(1)
The Lessee shall remit the deposit and the rent of the first year to the
specified bank account of the Lessor within three days after signing the
contract, and the Lessor shall deliver the Land to the Lessee within three days
after receiving the above items.

After the expiry date of the contract, and the following conditions are
satisfied, the Lessor shall return the deposit to the Lessee within 15 working
days without the interests.
1.
The Lessee has paid off all the rent and water & electricity fees to the Lessor.

2.
The Lessee has settled all the charges generated from the lease (including but
not limited in fees of water, electricity, heat supply, telecom, environment &
health and public security);

3.
It shall comply with the contract regulations to return the Land and assume
other responsibilities to the Lessee.

4.
The Land, house, power and plants shall have no abnormal damage through the
confirmation of the Lessor.

“Abnormal damage” refers to the situations except for the normal wearing and
aging.
If there is “abnormal damage”, the two parties shall confirm the direct fees of
the damage, and the deposit that deducted the direct fees shall be returned to
the Lessee, and the lacking part shall be supplemented by the Lessee.
(2)
This contract will be based on the principle to pay the rent first and then take
use of the Land, the Lessee shall pay the first-year rent and deposit within
three days since the effective date of the contract; after then, the Lessee
shall pay the rent of next year on 25 of last month before each calendar year or
in advance of this date, and it shall remit to the specified account of the
Lessor, or it can comply with other ways of payment agreed in the written form
by the two parties.

Bank of deposit of Lessor: Jinan City Industrial Road Branch of Industrial Bank
Account No: 1602003209002600646

 
 

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If the Lessor changes the payment account No. or bank of deposit, it shall
promptly notify the Lessee.
The Lessee shall pay the liquidated damages to the Lessor if the rent is
overdue, with the amount of: delayed days ×5/10000 of total owed rent.
Article 5: relevant fees
(3)
During the contract term, the Lessee shall assume the water & electricity fees,
communication fees, decoration fees and all the fees needed for the normal use
of relevant supported facilities.

(4)
The use right of the Leased Property belongs to the Lessee during the lease
term.

Article 6: Safety management
(1)
The Lessee shall seriously comply with the Fire Protection Regulation of the
People's Republic of China and relevant system of the Lessor; it shall
coordinate the Lessor to prepare the relevant works, otherwise, all the
responsibilities and losses shall be assumed by the Lessee.

(2)
The Lessee shall comply with all the safety management system and implement the
safety inspection regularly, so as to eliminate the safety dangers; the Lessee
shall comply with the relevant regulations to allocate the fire control
equipment.

(3)
If it needs t works owing to the maintenance (including welding and gas welding,
etc.), it shall get the permission of the principal department of Lessor; and
the issues that need the approval of the principal department, it shall get the
approval of fire control department.

(4)
The Lessee shall take charge of the fire and stealing control in the Leased
Property according to the relevant regulations of the fire control department,
and take self-examination and self-correction works. The Lessee has right to
examine the fire and stealing control safety in the reasonable time agreed by
the two parties, and it shall give the written notice to the Lessee; the Lessee
shall not refuse unreasonably or delay the approval. The safety examination
behaviors of the Lessor shall not exempt from the safety requirements like
safety examination of the Lessee.

(5)
During the contract term, the two parties shall observe national laws and
regulations, and it shall not use the Leased Property to engage in the illegal
activities; meanwhile, the Lessor has right to urge the Lessee to do well the
works with regards to fire control, safety and health.

(6)
The Lessee shall observe the safety management of the state and the Lessor, so
as to promptly eliminate the personal harms as well as the harms to the Lessor.
The Lessee shall take the security and protection for the properties, and assume
all the responsibilities.

(7)
The Lessee shall comply with the national regulations to use the relevant
equipment and facilities, otherwise, it will assume all the responsibilities as
well as the losses of the Lessor.

Article 7: Responsibility of insurance
During the lease term, the Lessee shall take charge of purchasing the insurance
of Lessor’s property and other necessary insurances (including the liability
insurance). If the Lessee doesn’t purchase the above insurance, it shall assume
all the compensations and responsibilities.
Article 8: The Land and surrounding environment management
(1)
If the Lessee’s behavior affects or harms the surrounding environment, it shall
eliminate the effect and recover the original state, and it shall bear the
responsibility for the damage.

 
 

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(2)
When the lease term expires or the contract terminates in advance, the Lessee
shall clean the Land and move out, and return the Land to the Lessor. If the
Lessee doesn’t clean the Land, it shall bear the fees related to cleaning of the
Lessor.

(3)
The Lessee must comply with the laws and regulations of the People’s Republic of
China as well as the provisions relevant to property management of the Lessor,
if it violates the regulations, it shall bear the relevant responsibilities. If
the Lessee affects the normal works of other users owing to its violation of
above regulations, the losses shall be assumed by the Lessor.

Article 9: Contract termination
(1)
During the lease term, if the Lessee doesn’t pay the rent or water & electricity
management fees exceeding one month’s valid date, within five days since the
Lessor notifies the Lessee of the payments in the written form, the Lessee
doesn’t pay the relevant items; in this case, the Lessor has right to terminate
the contract, and the Lessee shall take all the responsibilities.

(2)
If the Lessee doesn’t pay the rent or water & electricity management fees
exceeding two months’ valid date, the Lessor has right to terminate the contract
in advance and execute according to this contract. Since the date that the
Lessor notifies the Lessee by means of fax or letter, this contract will
terminate. The Lessor has right to detain the properties of the Lessee in the
leased area, and after five days since sending the termination notice, the
Lessor has right to auction the detained properties, and the obtained fees will
be used to compensate for all the fees generated from the leasing behaviors of
the Lessee.

(3)
The Lessee shall not terminate the contract in advance without the written
permission of the Lessor. If the Lessee needs to terminate the contract in
advance, it shall notify the Lessor in the written form before two months, and
it can terminate the contract after completing the following procedures:

1.
Return the Land to the Lessor;

2.
Pay off the rent and other relevant fees;

3.
It shall pay the item that is equal to 2 times of the rent of the current month
as the liquidated damages for the Lessor at the day before the termination date
or in advance of this date.

Article 10: Exception clauses
(1)
The two parties will not assume the responsibilities for breach of the contract
if the Lessor cannot perform the contract owing to the revision of relevant
national laws and regulations or local government behavior. If the state and
government makes land acquisition, the two parties shall abide by the national
regulations to take the relevant responsibilities; but they shall comply with
the regulated period of Article 2 to perform the obligations of notification.

(2)
If one party cannot perform the contract owing to natural disaster, wars or
other unforeseeable force majeure factors that cannot be prevented or avoided,
the relevant party shall notify the other party by means of main or fax; and it
shall provide the detail of force majeure and the certificates for the
non-performing of the contract or demand for delaying the performance within 30
days. These certificates shall be issued by the notary public of the place
encountered from force majeure, if it cannot obtain the certificates issued by
the notary public, it can provide other forcible certificates. The party
suffered from the force majeure can be exempted from the responsibilities.

 
 

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(3)
The contract will terminate if it cannot be executed owing to the above two
reasons; the Lessor shall return the deposits and the rent during the period
that the contract is not executed to the Lessee within 30 working days since the
termination date, and other matters shall be handled in accordance with the
national regulations.

Article 11: Relevant agreements of contract termination or dissolution
(1)
If the contract terminates in advance or the contract expires, and the two
parties don’t continue the agreements, the Lessee shall move out of the house at
the termination date or expiry date, and return the Land to the Lessor. If the
Lessee doesn’t move out of the Land or returnit in time, it shall pay the
doubled rent to the Lessor; while the Lessor has right to notify for refusing
the doubled rent in the written form, and it has right to take back the Land and
remove the properties forcibly; and it has no responsibility to keep the
properties. If there are still the properties of Lessee within five days after
moving, if the two parties have no agreements, it will be deemed as wavier of
the ownership of the Lessee, and the Lessor will dispose these properties. If
the Lessee has difficulties to find the workshop or there are other special
reasons, the Lessor shall allow for delaying the term for 20 days, but the
Lessee shall pay off the rent and relevant fees in a lump sum according to the
agreed rent in the contract.

(2)
After the contract term expires, if the Lessee intends to continue the contract,
it shall notify the Lessor in advance of 30 days, and the Lessor shall propose
the disputes or negotiate to continue the agreements with the Lessee within 30
working days since receiving the notice; if it doesn’t reply within 30 working
days since receiving the notice, it will be deemed as agreeing the reletting;
the contract will extend for half a year, which will be calculated since the
expiry date. After the lease term expires, if the Lessor intends to continue
leasing the Land, the Lessee has the priority to lease the Land based on the
same rent.

(3)
The Land shall comply with the normal using state when returning; otherwise, the
Lessee shall assume the responsibility for the compensations.

Article 12: Operation and advertisement
(3)
The Lessor shall not interfere in the legal operation and production of the
Lessee, and the production and operation behaviors and results have no relations
with the Lessor. The Lessee (sublessee) shall not use the Lessor’ name, word
size and image symbol in the self propaganda or operation activities; the Lessee
shall ensure that its or the sublessee’s behaviors cannot harm the legal rights
of the Lessor. Otherwise, the Lessee shall take charge of the compensations and
bear the responsibilities according to the provisions for breach of the
contract.

(4)
If the Lessee needs to establish the billboard on the house surface, wall and
other parts or the places owned or managed by the Lessor surrounded the Land, it
shall get the written permission of the Lessor; the relevant fees shall be
confirmed through negotiation of the two parties; the Lessee will be responsible
for completing the relevant procedures according to the government regulations
as well as submit to the Lessor for filing.

Article 13: Relevant taxes
In accordance with the regulations of the state and local government, the
relevant taxes of this contract shall be assumed respectively by the two
parties.

 
 

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Article 14: Notice
All the notices related to the contract or the documents related to the two
parties as well as the relevant requirements shall be in the written form.
Article 15: Responsibility for breach of contract and claim
(1)
Any party will be deemed as breach of the contract if it doesn’t execute any
clauses in the contract.

(2)
After receiving the written notice for the details of breach of contract of one
party, any party shall confirm or propose the written disputes or supplementary
notes within 15 working days. If it doesn’t reply in the written form within 15
working days, it will be deemed as acceptance of the contents; in this case, the
two parties shall negotiate the issue; if it fails to be solved in this way, it
shall be handled according to the clauses in this agreement. The default party
shall assume the economic losses of the observant party caused by its breach of
the contract.

(3)
Claim

1.
If the contract cannot be performed owing to illegal reasons of the Lessor, the
rent will be settled by the contract standard and actual using time of the
Lessee, and any excess payment shall be refunded and any deficiency shall be
repaid; it shall return the overpayments and deposits of the Lessee, and it will
give the Lessee 15 days for moving out of the Land for free.

2.
If the contract cannot be performed owing to illegal reasons of the Lessee, the
Lessee shall move out of the Land and pay off the relevant fees within 15 days
since receiving the written notice of the Lessor, and it will charge 5/10000
fees each day as the liquidated damages.  The Lessor will return the deposit
without interests within three days after the Lessee completing the above
obligations.

3.
If the disputes aroused from the contract cannot be solved through negotiation,
the default party shall assume the expenses of the observant party for
maintaining its rights, including but not limited in the travel fees, lawsuit
fees, investigation fees and lawyer’s fees.

Article 16: Disputes solution
The disputes aroused from this contract shall be solved through negotiation of
the two parties; for failure of negotiation, it shall make the lawsuit to the
people’s court at the location of the Land.
Article 17: Other clauses
(1)
After signing the contract, if the enterprise name has change, the change party
shall provide the registration materials of industry and commerce related to the
change to the other party.

(2)
The unsettled matters herein shall be negotiated by the two parties to sign the
supplementary agreement. The contract has 6 copies, with each party holding
three.

(3)
This contract will take effect after signing and sealing of the two parties as
well as receiving the deposit paid by the Lessee.

Lessor: Jiangjun Trading Co., Ltd.
Legal representative:

 
 

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Lessee: Shandong Yaoyuan Pharmaceutical Company
Legal representative: Song Yanliang
Date: Mar. 1, 2010

 
 

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