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Exhibit 10.4

Employment Agreement

This Employment Agreement (“Agreement”), dated as of June, 1, 2008, is entered
into between China Biologic Products, Inc., a company established in the United
States with its principal office located at No. 14., East Hushan Road, Taian
City, Shandong, PRC (“Company”), and Chao Ming Zhao (the “Executive”).  

WHEREAS, the Company desires to engage the Executive as, and the Executive
agrees to serve as, Chief Executive Officer of the Company, upon the terms and
conditions contained herein.

NOW THEREFORE, for good and valuable consideration, the sufficiency of which is
hereby acknowledged by the parties, the parties hereto hereby agree as follows:

1.

EFFECTIVENESS OF AGREEMENT AND EFFECTIVE DATE

This Agreement will become effective as of the date hereof. For the purpose of
this Agreement, the term “Effective Date” means June 1, 2008.

2.

EMPLOYMENT AND DUTIES

2.1

General. The Executive will perform such duties and services for the Company as
may be designated from time to time by the Board of Directors of the Company
(the “Board”). The Executive agrees to serve the Company faithfully and to the
best of his ability under the direction of the Board and to carry out the
functions typically performed by a Chief Executive Officer.  He further agrees
to perform such duties in accordance with the general fiduciary duties of
officers and directors arising under the Delaware General Corporation Law. The
Executive and the Company further agree that the Executive is also serving as
Vice President of Shandong Taibang Biological Products Co., Ltd. (“Shandong
Taibang”) the Company’s primary operating subsidiary, pursuant to an Employment
Agreement dated as of June 1, 2008, that a substantial portion of the CEO’s time
and attention will be devoted to the business and affairs of Shandong Taibang
and the Company’s other subsidiary companies (collectively the “Subsidiaries”),
that such time and attention to the business and affairs of the Subsidiaries is
for the benefit of the Company and in furtherance of the Executive’s duties and
responsibilities to the Company under this Agreement and applicable law, and
that the CEO will not be required to allocate any fixed minimum amount of time
to any one entity during any one time period, although is expected and required
to devote substantially all of his time and attention during normal business
hours to the affairs of the Company and/or the Subsidiaries.    

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2.2

Term of Employment. The Executive’s employment under this Agreement will
 commence as of the date hereof and will terminate on the first year of the
Effective Date; provided, however, that the term of the Executive’s employment
will be automatically extended without further action of either party for
additional one (1) year periods unless written notice of either party’s
intention not to extend has been given to the other party hereto at least thirty
(30) days prior to the expiration of the then effective term (the initial term
and any extensions thereof, the “Term of Employment”). Notwithstanding the
foregoing, the Executive’s employment may be terminated during the Term of
Employment as provided in Section 5 below.

2.3

Reimbursement of Expenses. Unless otherwise agreed to by the Executive and the
Company, the Company will reimburse the Executive for reasonable travel and
other business expenses incurred by him to fulfill his duties hereunder upon
presentation by the Executive of an itemized account of such expenditures, in
accordance with Company practices consistently applied.

3.

COMPENSATION

3.1

Base Salary. From the Effective Date, the Executive will be entitled to receive
a base salary (“Base Salary“) at a rate of ￥840,000 per annum, payable in
accordance with the Company’s payroll practices and applicable law. If the rate
of Base Salary per annum paid to Executive is increased during the Term of
Employment, such increased rate will thereafter constitute the Base Salary for
all purposes of this Agreement.  Base Salary will not be decreased during the
Term of Employment without the mutual consent of Executive and the Company.

3.2

Annual Review. The Executive’s Base Salary will be reviewed by the Board, based
upon the Executive’s performance not less than annually.

3.3

Bonus Compensation.  In addition to his Base Salary, Executive shall be eligible
to receive an annual cash performance bonus (the “Bonus”) for each calendar year
during the Term of Employment in an amount equivalent to one month’s Base Salary
if, and to the extent that, Executive remains employed by the Company on
December 15th of such calendar year. Such Bonus shall be paid no later than
January 15th of the calendar year following the year in which the Bonus is
earned.  Executive further may be eligible receive additional bonus compensation
as may be awarded to the Executive from time to time by the Board in the sole
and absolute discretion of the Board.

3.4

Additional Compensation.

3.4.1

Initial Stock Option. Subject to approval by the Board of Directors (or an
appropriate Committee appointed by such Board of Directors), on or before June
1, 2008, Executive will be granted an option (the “Initial Option”) to purchase
115,000 shares of the Company’s common stock (the “Shares”) under the Company’s
2008 Equity Incentive Plan (the “Plan”).  The exercise price of the Initial
Option will be $4.00 per share; provided, however, that if the fair market value
of the Shares as of the grant date is greater than $4.00 per share, then the
exercise price of the Initial Option will be the fair market value as of the
grant date.  The Initial Option will be vested in full and exercisable on the
grant date.  The Initial Option will be evidenced by a Stock Option Agreement as
contemplated by the Plan, both of which will govern the Initial Option,
notwithstanding any other provision of this Agreement.      

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3.4. 2

The Company may, in its sole discretion, award Executive additional equity-based
compensation. Employee further will be eligible to participate in any employment
compensation plan established by the Company under the same terms as other
Company executives and at levels recommended by the CEO of the Company and
approved by the Board of Directors.  

4.

EMPLOYEE BENEFITS

4.1

Leave.  The Executive will be entitled to accrue 15 working days paid annual
leave each calendar year (which will not be carried over in the event that they
are not used by the Executive).  All annual leave days will be taken at times
mutually agreed by the Executive and the Company and will be subject to the
business needs of the Company.  If, however, in any calendar year during the
Term of Employment, the Executive is unable to take any annual leave due to the
business needs of the Company, the Company, in its discretion, shall either pay
the Executive the equivalent of 15 working days, or permit the Executive to
carry such leave over into the following calendar year.  

4.2

Other Programs.  The Executive will, during his employment under this Agreement,
be included to the extent eligible thereunder in all employee benefit plans,
programs or arrangements (including, without limitation, any plans, programs or
arrangements providing for retirement benefits, incentive compensation, profit
sharing, bonuses, disability benefits, health and life insurance, or vacation
and paid holiday) which may be established by the Company for, or made available
to, its executives generally.

5.

TERMINATION OF EMPLOYMENT

5.1

Termination Events.

5.1.1.

By the Company. The Company may terminate the Executive’s employment immediately
with Cause, without Cause upon thirty (30) days notice to the Executive, or upon
the Executive’s death or Permanent Disability (as hereinafter defined).

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5.1.2.

By the Executive. The Executive may terminate his employment at any time for any
reason upon thirty (30) days written notice to the Company.     

5.2

Termination by Company With Cause. If the Executive’s employment is terminated
by the Company with Cause, the Company shall pay to the Executive all
compensation to which the Executive is entitled through the date of termination,
and thereafter, all of the Company’s obligations under this Agreement shall
cease.

5.3

Termination by Company Without Cause.  Except in situations where the
Executive’s employment is terminated for Cause, by death or by Permanent
Disability, in the event that the Company terminates Executive’s employment at
any time without Cause, Executive shall continue to receive his Base Salary
through the last day of the thirty (30) day notice period, payable in the form
of salary continuation.       

5.4

Voluntary Resignation. If the Executive terminates his employment voluntarily,
then the Executive shall not be entitled to receive payment of any severance
benefits.  The Company further shall have the option, in its sole discretion, to
make Executive’s termination effective at any time prior to the end of notice
period required under Section 5.1.2 as long as the Company provides Executive
with all compensation to which he would be entitled for continuing employment
through the last day of the notice period.  Thereafter, all obligations of the
Company under this Agreement shall cease.

5.5

Cause. Termination for “Cause” means termination of the Executive’s employment
by the Company because of:

(i)

any act or omission that constitutes a breach by the Executive of any of his
obligations under this Agreement or any Company policy or procedure and failure
to cure such breach after notice of, and a reasonable opportunity to cure, such
breach;

(ii)

the continued willful failure or refusal of the Executive to substantially
perform the duties reasonably required of him as an employee of the Company;

(iii)

an alleged act (with credible substantiated evidence) of moral turpitude,
dishonesty, fraud or violation of law (whether or not connected to the Company
or its Affiliates (as defined in Section 8.1)) by, or criminal conviction of,
the Executive which in the determination of the Board (in its sole discretion)
would render his continued employment by the Company damaging or detrimental to
the Company or its Affiliates in any way; or

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(iv)

any misappropriation of Company property by the Executive.

6.

DEATH OR DISABILITY

In the event of termination of employment by reason of non-work-related death or
Permanent Disability, the Executive (or his estate, as applicable) will be
entitled to Base Salary and benefits determined under Sections 3 and 4 through
the date of termination.  In the event of termination of employment by reason of
work related death or Permanent Disability, the Executive (or his estate, as
applicable) will be entitled to the greater of (i) Base Salary and benefits
determined under Sections 3 and 4 through the date of termination, or (ii) the
minimum compensation permitted by applicable law. Other benefits will be
determined in accordance with the benefit plans maintained by the Company, and
the Company will have no further obligation hereunder. For purposes of this
Agreement, “Permanent Disability” means a physical or mental disability or
infirmity of the Executive that prevents the normal performance of substantially
all his duties as an employee of the Company, which disability or infirmity
exists for any continuous period of 180 days.

7.

CONFIDENTIALITY

7.1

Confidentiality. The Executive covenants and agrees with the Company that he
will not at any time during the Term of Employment and thereafter, except in
performance of his obligations to the Company hereunder or with the prior
written consent of the Company, directly or indirectly, disclose any secret or
confidential information that he may learn or has learned by reason of his
association with the Company or any of its subsidiaries and Affiliates. The term
“confidential information” includes information not previously made generally
available to the public or to the trade by the Company’s management, with
respect to the Company’s or any of its subsidiaries’ or Affiliates’ products,
facilities, applications and methods, trade secrets and other intellectual
property, systems, procedures, manuals, confidential reports, product price
lists, customer lists, technical information, financial information (including
the revenues, costs or profits associated with any of the Company’s products),
business plans, prospects or opportunities, but will exclude any information
which is or becomes generally available to the public or is generally known in
the industry or industries in which the Company operates other than as a result
of disclosure by the Executive in violation of his agreements under Section 7.1.
The Executive will be released of his obligations under this Section 7.1 to the
extent the Executive is required to disclose under any applicable laws,
regulations or directives of any government agency, tribunal or authority having
jurisdiction in the matter or under subpoena or other process of law provided
that the Executive provides the Company with prompt written notice of such
requirement.

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7.2

Acknowledgment of Company Assets. The Executive acknowledges that the Company,
at the Company’s expense, has acquired, created and maintains, and will continue
to acquire, create and maintain, significant goodwill with its current and
prospective customers, vendors and employees, and that such goodwill is valuable
property of the Company.  The Executive further acknowledges that to the extent
such goodwill will be generated through the Executive’s efforts, such efforts
will be funded by the Company and the Executive will be fairly compensated for
such efforts. The Executive acknowledges that all goodwill developed by the
Executive relative to the Company’s customers, vendors and employees will be the
sole and exclusive property of the Company and will not be personal to the
Executive.

7.3

Exclusive Property. The Executive confirms that all confidential information is
and will remain the exclusive property of the Company.  All business records,
papers and documents kept or made by Executive relating to the business of the
Company will be and remain the property of the Company, except for such papers
customarily deemed to be the personal copies of the Executive.  Upon termination
of the Executive’s employment with the Company for any reason, the Executive
will promptly deliver to the Company all of the following that are in the
Executive’s possession or under his control: (i) all computers,
telecommunication devices and other tangible property of the Company and its
Affiliates, and (ii) all documents and other materials, in whatever form, which
include confidential information or which otherwise relate in whole or in part
to the present or prospective business of the Company or its Affiliates,
including but not limited to, drawings, graphs, charts, specifications, notes,
reports, memoranda, and computer disks and tapes, and all copies thereof.

7.4

Communication to Third Parties. The Executive agrees that Company will have the
right to communicate the terms of this Section 7 to any third parties, including
but not limited to, any prospective employer of the Executive. The Company
waives any right to assert any claim for damages against Company or any officer,
employee or agent of Company arising from such disclosure of the terms of this
Section 7.

7.5

Independent Obligations. The provisions of this Section 7 will be independent of
any other provision of this Agreement. The existence of any claim or cause of
action by the Executive against the Company, whether predicated on this
Agreement or otherwise, will not constitute a defense of the enforcement of this
Section 7 by the Company.

7.6

Non-Exclusivity. The Company’s rights and the Executive’s obligations set forth
in this Section 7 are in addition to, and not in lieu of, all rights and
obligations provided by applicable statutory or common law.

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8.

INDEMNIFICATION

8.1

Indemnification of the Executive. The Company agrees to indemnify Executive (and
his heirs, executors, and administrators), and to advance expenses related to
this indemnification, to the fullest extent permitted under applicable law and
regulations, against any and all expenses and liabilities that Executive
reasonably incurs in connection with or arising out of any action, suit, or
proceeding in which he may be involved by reason of his service as an Executive
of the Company or any of its subsidiaries or Affiliates (whether or not he
continues to be an Executive at the time of incurring any such expenses or
liabilities). Covered expenses and liabilities include, but are not limited to,
judgments, court costs, and attorneys’ fees and the costs of reasonable
settlements, subject to Board approval, if the action is brought against
Executive in his capacity as an Executive of the Company or any of its
subsidiaries or Affiliates. Indemnification for expenses will not extend to
matters related to Executive’s termination for Cause. Notwithstanding anything
in this Section 8.1 to the contrary, the Company will not be required to provide
indemnification prohibited by applicable law or regulation. The obligations of
this Section 8.1 will survive the term of this Agreement by a period of six (6)
years.  “Affiliate” means, with respect to any person or entity, any other
person or entity that is directly, or indirectly through one or more
intermediaries, controlled by, controlling or under common control with such
person or entity.

8.2

Indemnification of the Company.

The Executive will indemnify and keep the Company fully indemnified at all times
from and against all claims, suits, proceedings, fines, punishment, loss,
damage, costs and liabilities whatsoever incurred or sustained by the Company in
connection with or arising out of or as a consequence of any breach by the
Executive of the confidentiality obligations set forth above.

9.

FOREIGN CORRUPT PRACTICES ACT.

The Company and the Executive each represent and warrant that it is aware of and
familiar with the provisions of the Foreign Corrupt Practices Act of 1977, as
amended by the Omnibus Trade and Competitiveness Act of 1988 (“FCPA”), and the
rules and regulations thereunder, and its purpose.  Each party agrees that it
will take no action and make no payment in violation of, or which might cause
the Company or the Executive to be in violation of, the FCPA, including, but not
limited to, the making of unlawful payments to foreign or domestic government
officials or employees or to any foreign or domestic political parties or
campaigns from corporate funds.

10.

MISCELLANEOUS.

10.1

Severability. The parties intend this Agreement to be enforced as written.
 However, (i) if any portion or provision of this Agreement is to any extent be
declared illegal or unenforceable by a duly authorized court having
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, will not be affected thereby, and each
portion and provision of this Agreement will be valid and enforceable to the
fullest extent permitted by law and (ii) if any provision, or part thereof, is
held to be unenforceable because of the duration of such provision, the
geographic area covered thereby, or other aspect of the scope of such provision,
the court making such determination will have the power to reduce the duration,
geographic area of such provision, or other aspect of the scope of such
provision, and/or to delete specific words and phrases (“blue-penciling”), and
in its reduced or blue-penciled form, such provision will then be enforceable
and will be enforced.  

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10.2

Assignment. The rights and obligations of this Agreement will bind and inure to
the benefit of any successor of the Company by reorganization, merger or
consolidation, or any assignee of all or substantially all of the Company’s
business and properties.  Neither this Agreement nor any rights hereunder will
be assignable or otherwise subject to hypothecation by the Executive.

10.3

Entire Agreement. This Agreement represents the entire agreement of the Company
and the Executive and will supersede any and all previous contracts,
arrangements or understandings.

10.4

Governing Law.  This Agreement will be construed and interpreted in accordance
with and governed by the law of the State of Delaware, USA, without regard to
the choice-of-law provisions thereof that might direct the application of the
law of another jurisdiction.

10.5

Dispute Resolution.  Any legal action or proceeding with respect to this
Agreement shall be brought in the courts of Delaware, or the United States
District Court for the District of Delaware.  By execution and delivery of this
Agreement, each of the parties hereto accepts for itself and in respect of its
property, generally and unconditionally, the exclusive jurisdiction of the
aforesaid courts.   

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Executive and the authorized representative of China
Biologic Products, Inc., execute and enter into this Agreement as of the date
first written above.

 

    EXECUTIVE           _____________________________ Mr. Chao Ming Zhao
Passport No: 43403715   Date: May ___, 2008     CHINA BIOLOGIC PRODUCTS, INC.  
  By:  _____________________________

Name:

Title:

Date:

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