Execution copy

THIS MEMORANDUM OF PARTIAL RELEASE is made the 31st day of March, 2008

BETWEEN

Goldman Sachs International, an unlimited liability company organised under the
laws of England and Wales whose registered office is at Peterborough Court, 133
Fleet Street, London EC4A, 2BB, England (the “Collateral Agent”); and

Fine Lake International Limited, a company duly incorporated in the British
Virgin Islands, whose registered office is at P.O. Box 957, Offshore
Incorporations Centre, Road Town, Tortola, British Virgin Islands (“Fine Lake”).

WHEREAS :-

(1) By a Share Charge dated 29 January 2008 (the “Share Charge”) executed by
Fine Lake and Mr. Xu Hongbin in favour of the Collateral Agent, 10,000 ordinary
shares of HK$1.00 each of Pilpol (HK) Biological Limited (活之生(香港)生物有限公司) (the
“Company”), representing its entire issued share capital, were charged to the
Collateral Agent as security for the Liabilities (as defined in the Share
Charge).

   

(2) All those security documents listed in Schedule 1 hereto (the “Security
Documents”) were executed by relevant parties as security under the Share
Charge.

   

(3)
Fine Lake has requested the Collateral Agent to, and the Collateral Agent has
agreed to, discharge 3,500 ordinary shares of the Company registered in the name
of Fine Lake, representing 35% of the entire issued share capital of the Company
(the “Released Shares”) from the Share Charge.

NOW THIS DEED WITNESSETH that the Collateral Agent (for and on behalf of the
Secured Parties (as defined in the Share Charge)) hereby :

 
(i)
DISCHARGES the Released Shares; and/or (as the circumstances require);

 
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(ii)
ASSIGNS as chargee unto Fine Lake the Released Shares TO HOLD the same unto Fine
Lake absolutely; and/or (as the circumstances require); and

 
(iii)
RELEASES AND ASSIGNS as chargee unto Fine Lake all rights and benefits of and
relating to the Released Shares charged or assigned unto the Collateral Agent
under the Share Charge TO HOLD the same unto Fine Lake absolutely

freed and absolutely discharged of and from the Share Charge and from the charge
or mortgage created thereunder PROVIDED that and (for avoidance of doubt) it is
hereby declared that the Share Charge shall remain in full force and effect with
regard to the remaining shares of the Company which remain subject to the Share
Charge AND the Collateral Agent hereby confirms to Fine Lake that the Collateral
Agent has not done, omitted or knowingly suffered or been party or privy to any
act, deed, matter or thing whereby or by means whereof the shares charged under
the Share Charge or any part thereof are or is or may be impeached, charged,
affected or incumbered in title, estate or otherwise AND PROVIDED further that
this Memorandum of Partial Release shall not in any way affect the obligations
and liabilities of (a) China Water and Drinks, Inc. (“China Water”) under the
Securities Purchase Agreement dated 24 January 2008 entered into between China
Water and the Buyers named therein (the “Securities Purchase Agreement”), (b)
China Water under the Notes (as defined in the Securities Purchase Agreement)
and (c) Fine Lake and Mr. Xu Hongbin under the Share Charge.

AND Fine Lake hereby undertakes to procure the relevant parties to sign the
blank instrument of transfer, blank bought and sold notes and undated board
minutes of the Company in the form and substance as set out in Schedules 2, 3
and 4 respectively and the new share certificate 10 in the name of Fine Lake in
respect of 6,499 ordinary shares of the Company and deliver the same to the
Collateral Agent within 7 days from the date of this Memorandum of Partial
Release.
 
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Schedule 1

The Security Documents
 

(1) Blank Instrument of Transfer of 9,999 shares of the Company duly signed by
Fine Lake as transferor without the identity and signature of the transferee

   

(2)
Blank Bought and Sold Notes of 9,999 shares of the Company duly signed by Fine
Lake as transferor without the identity and signature of the transferee

(3)
Undated Board Minutes of the Company approving, inter alia, the transfer of
shares, changes in directors, changes in secretary duly signed by the directors
of the Company

(4)
Share Certificate No. 8 in the name of Fine Lake in respect of 9,999 shares of
the Company

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Schedule 2

INSTRUMENT OF TRANSFER
 
NAME OF COMPANY
Pilpol (HK) Biological Limited (活之生(香港)生物有限公司)
 
(the “Company”)

 
We, the Transferor
,
Fine Lake International Limited
of
:
P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin
Islands

 
in consideration of
:
 

 
paid to us by the Transferee
:
 
Occupation
:
 
of
:
             

(hereinafter called “the Transferee”) do hereby transfer to the Transferee the
- 6,499 -

shares standing in our name in the Register of the Company to hold unto the
Transferee, its/his/her executors, administrators or assigns, subject to the
several conditions upon which we hold the same at the time of execution hereof,
and I/we the Transferee do hereby agree to take the shares subject to the same
conditions.
 
Dated this
 
 day of
   

Witness to the signature of Transferor

Name:
Chung, Kai Shun  
[ex10-4sig1.jpg]
Address:
8/F., Skyline Plaza Hotel       644 Tong Fu Rd East, Guangzhou            
For and on behalf of
/s/ Chung, Kai Shun  
Fine Lake International Limited
Signature of Witness
 
Signature of Transferor

Witness to the signature of Transferee

Name:
     
Address:
                     
Signature of Transferee
Signature of Witness
   

 
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Schedule 3

BOUGHT AND SOLD NOTES

NAME OF COMPANY
Pilpol (HK) Biological Limited (活之生(香港)生物有限公司)
 
(the “Company”)

Transferor
:
Fine Lake International Limited
of
:
P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin
Islands

Transferee
:
 
of
:
             

Number of Shares Transferred
:
- 6,499 -

 
Par Value per Share
:
HK$1.00

 
Total Consideration
:
 

 
Dated this
 
day of
   

 

[ex10-4sig2.jpg]
     
For and on behalf of
Fine Lake International Limited
     
Signature of Transferor
   
Signature of Transferee
       

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Schedule 4

Pilpol (HK) Biological Limited (活之生(香港)生物有限公司)
(the “Company”)

BOARD MINUTES OF THE BOARD OF DIRECTORS of the Company made pursuant to Article
of the Articles of Association of the Company

PRESENT  Ms. Leung Tung Ha       Mr. Ng Ho Kwan

 
CHAIRMAN

Ms. Leung Tung Ha was elected Chairman of the meeting.

QUORUM

It was noted that a quorum was present throughout the meeting.

TRANSFER OF SHARES

It was resolved that the transfer of the following shares be approved, subject
to the transfer documents being duly stamped and presented for registration in
accordance with the provisions of the Articles of Association of the Company :-

Transferors
Transferee
No. of Shares
Fine Lake International Limited
 
Xu Hongbin
 
6,499
 
 
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It was further resolved that share certificate(s) be issued under the common
seal of the Company and whose name(s) shall be entered on the Company's Register
of Members and Transfers accordingly.

CHANGES IN DIRECTORS

IT IS RESOLVED that the following be appointed additional Directors of the
Company with immediate effect:-
 

IT IS RESOLVED that the resignation of the following persons as Directors of the
Company be accepted with immediate effect:-
 

  Leung Tung Ha       Ng Ho Kwan

 

CHANGES IN SECRETARY

IT IS RESOLVED that the following be appointed Secretary of the Company with
immediate effect:-
 

IT IS RESOLVED that the resignation of the following person as Secretary of the
Company be accepted with immediate effect:-

Kingspeed Consultants Limited 

 
CHANGE OF REGISTERED OFFICE

It was resolved that with immediate effect the registered office of the Company
be changed to

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BANK ACCOUNT

It was resolved that all existing bank mandates be cancelled with immediate
effect.
 
 
CONCLUSION

There being no further business, the Chairman declared the meeting closed.

              

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Chairman

 
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IN WITNESS whereof this Memorandum of Partial Release has been duly executed the
day and year first above written.
 

EXECUTED as a deed ) /s/ Buck Ratchford                         By Name : ) Buck
Ratchford For and on behalf of ) Managing Director Goldman Sachs International )
 

 

Witnessed
 

/s/ Thian Chew                     
Name: Thian Chew
Title: Executive Director

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