CARBON BLACK PURCHASE CONTRACT

Supplier:

Xin Jiang YaKeLa Carbon Black Limited

Contract No: 20050205

Purchaser:

Gui Zhou Guiyang Tires Company Limited

Place: Guiyang, China

1.

Product Description

Product Name

Specification and model

Quality Level

Unit

Quantity (Ton)

Unit Price/RMB

(Tax included)

Carbon Black

Pure carbon black

First

RMB/Ton

2,000

RMB 3,750

                    

Total Amount

RMB 9,375,000.00

2.

Delivery Time and Quantity

Delivery Time and Quantity

Total

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2,500

200

200

200

250

250

200

200

200

200

200

200

200

             

3.

Product delivery and Confirmation

i)

Supplier shall dispatch the goods to Purchaser within 15 days according to the
Purchaser's delivery order by fax.

ii)

If Supplier:

·

Fails to supply the confirmed ordering quantities

·

Delivers defective goods

·

Delays production

The Purchaser will have the right to obligate the Supplier to remedy the above
in order to satisfy the Purchaser’s production needs.  All expenses will be
incurred by the Supplier.  

4.

Quality Requirement

i)

According to the GB3778-94 1st level quality standard;

ii)

If the quality of product is not meeting the preset standards, Supplier has to
reduce the prices by RMB 200 per ton;

iii)

In case of economic losses caused by quality defect during the course of use,
the supplier is responsible for full compensation of the losses; if
miscellaneous defects other than product quality deficiencies are detected, the
supplier is required to pay RMB1, 000 – RMB 5,000 per incident as compensation
for quality assurance.

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5.

Delivery Place

i) The production plant

ii) The agent’s warehouse

6.

Delivery and Miscellaneous Expenses

All related cartage expenses are borne by the Supplier.  Risks of product damage
during the delivery have to be undertaken by the supplier.

7.

Packing Standard

i)

Products are packed in 20kg per bag and should be delivered to Purchaser with no
damage and pollution;

ii)

With clear labeling on the carton boxes identifying specification, model,
trademark and production date etc;

iii)

Supplier has to compensate the Purchaser should the packing of goods are damaged
during delivery.

8.

Standard for Receipt of Products

i)

Delivery schedule: the Purchaser can return the products to Supplier if Supplier
fails to deliver on schedule;

ii)

Quality and weight: the Purchaser can return all products that do not conform to
the Purchaser’s approval standard;

9.

Payment Method

i)

17% value added tax to be payable by the Supplier;

ii)

Subject to the goods are inspected and accepted by the Purchaser, the Supplier
offers 60 days credit term to Purchaser;

iii)

All payment shall be settled by money order.

11.

Other Terms:

If there is a price and quantity change, it should be agreed upon by both
parties. An agreement will be signed to that effect.  Facsimile signatures are
valid and binding.

 

12.

Contract Term of Validity

From January 2005 to December 2005.

Dated this February 5, 2005

Supplier

Division Name:

Division Address:

Authorized Person:

Tel No.:

Banker:

Account No.:

Postal Code:

Purchaser

Division Name:

Division Address:

Authorized Person:

Tel No.:

Banker:

Account No.:

Postal Code:

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