Unassociated Document


     

     Exhibit
10.2

     

    
      -
Unofficial Translation -

      


      (Title
Page)

      


      Equity
Transfer Agreement

      


      China

      


      October
18, 2010

      


      


      


      (2nd
Page)

      


      Table
of Contents

      


      


      
        	
                 
      

              	
                Article
      1

              	
                Definition

              


      

      
        	
                 
      

              	
                Article
      2

              	
                Equity
      Transfer

              


      

      
        	
                 
      

              	
                Article
      3

              	
                Price
      and Payment of the Equity Transfer

              


      

      
        	
                 
      

              	
                Article
      4

              	
                Equity
      Handover

              


      

      
        	
                 
      

              	
                Article
      5

              	
                Transforming
      Period Arrangement

              


      

      
        	
                 
      

              	
                Article
      6

              	
                Assumption
      of Taxes and Fees

              


      

      
        	
                 
      

              	
                Article
      7

              	
                Transferor’s
      Proclamation, Promise and Warranty

              


      

      
        	
                 
      

              	
                Article
      8

              	
                Transferee’s
      Proclamation, Promise and Warranty

              


      

      
        	
                 
      

              	
                Article
      9

              	
                Joint
      Proclamation, Promise and Warranty

              


      

      
        	
                 
      

              	
                Article
      10

              	
                Confidentiality
      and Non-Competition

              


      

      
        	
                 
      

              	
                Article
      11

              	
                Changes,
      Rescission or Termination of the
Agreement

              


      

      
        	
                 
      

              	
                Article
      12

              	
                Complete
      Agreement

              


      

      
        	
                 
      

              	
                Article
      13

              	
                Liability
      for Breach

              


      

      
        	
                 
      

              	
                Article
      14

              	
                Force
      Majeure

              


      

      
        	
                 
      

              	
                Article
      15

              	
                Resolution
      of Dispute

              


      

      
        	
                 
      

              	
                Article
      16

              	
                Notification
      and Delivery

              


      

      
        	
                 
      

              	
                Article
      17

              	
                Other
      Provisions

              


      

      


      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      This
agreement was signed by the following parties on October 22, 2010 in
Xi’An:

      


      
        	
                 
      

              	
                (1)

              	
                Chongqing
      Hua Neng Recycling for Old and Waste Materials Ltd.
      (“Transferor”)

              


      

      
        	
                 
      

              	
                Address:
      Shitawu She, Longqiao Town, Fuling District, Chongqing
  City

              


      

      
        	
                 
      

              	
                Legal
      Representative: LI Chao

              


      

      


      
        	
                 
      

              	
                (2)

              	
                Xi’An
      Bao Run Industrial Development Limited
  (“Transferee”)

              


      

      
        	
                 
      

              	
                Address:
      Rm. 10720, Dong Xing Century Plaza, No. 7 Huoju Road, Beilin District,
      Xi’An City

              


      

      
        	
                 
      

              	
                Legal
      Representative: GAO Xincheng

              


      

      


      
        	
                 
      

              	
                (3)

              	
                LIAO
      Xiaozhong

              


      

      
        	
                 
      

              	
                ID
      No.: 510225196510115234

              


      

      
        	
                 
      

              	
                Address:
      No. 30 Heng Street, Entrance 2, Apt. 9-2, Yangjiaping, Jiulongpo District,
      Chongqing City

              


      

      


      
        	
                 
      

              	
                (4)

              	
                XIE
      Hui

              


      

      
        	
                 
      

              	
                ID
      No.: 510225196510115245

              


      

      
        	
                 
      

              	
                Address:
      No. 30 Heng Street, Entrance 2, Apt. 9-2, Yangjiaping, Jiulongpo District,
      Chongqing City

              


      

      
        


        
          	
                   
      

                	
                  (5)

                	
                  WANG
      Xiaoyong

                


        

      

      
        	
                 
      

              	
                ID
      No.: 210302196112111537

              
	 	Address:
      No.116 Keyuansan Street, Jiulongpo District, Chongqing
  City


      

       

      
        	
                 
      

              	
                (6)

              	
                Chongqing
      Tian Run Energy Exploitation Inc. (“Target Company”)

              
	 	 	Address:
      CSPGP, Fuling District, Chongqing


      

      
 

      Whereas,

      


      1.           The
Transferor holds 100% equity stake in the Target Company; the Transferee intends
to acquire the 100% equity held by the Transferor in the Target
Company.

      


      2.           The
Transferor, as the owner of the Target Company, agrees to transfer its equity to
the Transferee in accordance with the stipulations of this
agreement;  the Transferee agrees to become the 100% equity controlled
shareholder of the Target Company by accepting the all-equity transfer from the
Transferor.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      Therefore,
the parties hereto, in pursuant to related laws and statutes such as the Company Law of the People’s Republic
of China and the Contract Law of the People’s
Republic of China and through friendly negotiation, have reached agreement on
this equity transfer as follows:

      
        


        
          
            
              	
                      Article
      1.  

                    	
                            
                        Definition

                      

                    


            

          

        

      

       

      
        	
                1.1

              	
                Unless
      it is stipulated elsewhere herein, the terms listed below are defined as
      follows:

              	
                 

              


      

    

    
       

      “Target
Equity”, pursuant to provisions herein, means 100% of the equity as well as its
subsidiary rights the Transferor holds in the Target Company and obligations,
which the Transferor intends to transfer to the Transferee.

      


      “Equity
Transfer”   means the act that the Transferor transfers its
Target Equity to the Transferee.

      


      “Equity
Transfer Price” means all amounts to be paid by the Transferee with regard to
the transfer of the Target Equity.

      


      “Handover
Preconditions” means the pre-conditions to the Handover of the Equity Transfer
prescribed in Provision 4.1 hereunder.

      


      “The
Handover Date”  means the date of completion of this equity transfer,
which is the date stipulated in Provision 4.2.1 herein.

      


      “Date of
Business Registration Change ” means the completion date of the change in
business registration of this equity transfer.

      


      “Industrial
and Commercial Bureau” means  Fuling District Administration Bureau
for Industry and Commerce in Chongqing City.

      


      “Transforming
Period” means the time period of transition prescribed in Provision 5.1
hereunder.

      


      “Charter
of Company” means the current effective charter of the Target
Company.

      


      “Business
Day” means any day that Chinese domestic banks are in service for the public,
but not including statutory holidays.

      


      “Equity
Handover” means that the Transferor shall complete the procedure of change in
business registration in connection with this Equity Transfer on the Handover
Date.

      


      “Day(s)”
means business day(s).

      


      “Base
Date” is October 31, 2010.

      


      “yuan”
means Renminbi (RMB) yuan.

      


      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      


      “Intellectual
Property” means all patents, trademarks, service marks, registered designs,
domain names, utility models, copyrights, inventions, classified information,
brand names, rights to database, business names, as well as any similar right or
aforesaid interest (subject to restrictions)  in any country (in any
event, regardless of registration status, including applications for any
aforesaid rights as well as the rights to applying for any aforesaid rights in
any part of the world).

      


      “Business
Secrets” means any proprietary technology information or commercial information
owned by the Target Company but unknown to the public. Such information is of
economic value and practicality for the Target Company which has adopted
appropriate measures to protect the information. Such information includes but
is not limited to the following information or materials owned by the Target
Company (regardless of whether or not the information is tangible, and
regardless of the media used to store or record such information): (i) all
files, documents and electronic media owned by the Target Company, such as
agreements, contracts, letters of intent, personal files, and administrative
documents in any format as well as other information in connection with the
investors, material sellers, clients and suppliers of the Target Company; (ii)
information in connection with the Target Company’s business activities,
business development and anticipated business, such as costs, business plans,
business strategies (including pricing strategies), marketing strategies and
plans, distributors, distribution channels, sale models, sales, price quotes,
client lists and other relevant information. (iii) information about the Target
Company’s finances, such as revenues, expenses, profit ratios, assets, debts,
taxes, accounts receivable, business operation and investments; (iv) information
about the Target Company’s management strategies, such as descriptive materials
of the systems, methods, plans or programs adopted in the Company’s business
development or anticipated business operation; (v) information or data about
production methods, compositions and structures of any product or planned
product by the Target Company as well as other related information or data about
efficiency, negative effects, or popularity in connection to such products,
regardless of whether such products are produced by a third party for the Target
Company, or produced by the Company for a third party; and (vi) information
about proprietary techniques, including technical methods, technical measures,
statistics, blueprints, production methods, technical specifications, quality
control and management, and other relevant information unknown to the
public.

      


      “Anti-Bribery
Law” means any related law, statute, rule, regulation, ordinance, code,
protocol, standard, command, announcement and legally-binding judicial
interpretation with regard to corruption and bribery (including but not limited
to commercial bribery).

      


      “Prohibited
Act” means any prohibited act as prescribed in Provision 7.1.2.15
hereunder.

      


      “Original
Shareholders” are LIAO Xiaozhong, XIE Hui and WANG Xiaoyong.

      


      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  1.2

                	
                  Any
      law or standardized document mentioned herein means the current effective
      laws or standardized
documents.

                


        

      

      
        
        

      

      


      1.3           The
headings in this agreement are merely intended for the search convenience, and
all the Provisions hereof shall be governed by the terms and details prescribed
under each article, rather than interpreted in reference to the
headings.

      


      1.4           When
any action or step is to be taken within or after a certain period of time, and
if the ending date falls on a non-business day, the time period shall instead
end on the next business day.

       

      
        
          	
                  Article
      2

                	
                  Equity
      Transfer

                


        

      

       

      
        
          	
                  2.1

                	
                  Target
      Equity

                


        

        


        
          	
                  2.2

                	
                  The
      Target Equity to be transferred by the Transferor is 100% equity stake the
      Transferor holds in the Target
Company.

                


        

        


        
          	
                  2.2

                	
                  The
      Transferor is to transfer the Target Equity and all of its subsidiary
      rights and obligations.

                


        

      

       

      2.3           All
rights and interests derived from the Target Equity shall be owned by the
Transferee upon the signing of this agreement, including but not limited to all
the tangible and intangible assets, intellectual properties, lands, real
estates, production equipment and facilities, employees, interests and profits
(except ones that have been already distributed); and the Transferee shall bear
its corresponding obligations as a shareholder.

       

      
        
          	
                  Article
      3

                	
                  Price
      and Payment of the Equity Transfer

                


        

        


        
          	
                  3.1

                	
                  Transfer
      Price

                


        

        


        It has
been decided through negotiation that the Transfer Price for the Target Equity
is 110,000,000 yuan (amount in words: RMB One Hundred and Ten million
yuan).

        


        
          	
                  3.2

                	
                  The
      Payment for the Transfer Price.

                


        

        


        
          	
                  3.2.1

                	
                  The
      Transferor shall provide legal, valid account receivable for the
      Transferee to
      pay the price amount of the Equity
  Transfer.

                


        

3.2.2        This
agreement shall become effective on the date of signing. Within 10 business days
upon the fulfillment of all the pre-conditions stipulated in Provision 4.1, the
Transferee shall pay 60% of the Transfer Price, a sum of 66,000,000 yuan (amount
in words: Sixty-Six million yuan), which includes the security deposit of
10,000,000 yuan that the Transferee has injected to the co-monitored account of
both parties.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      3.2.3        Upon
the completion of the matters stipulated in Provision 4.2 and the completion of
the Equity Handover, the Transferee shall pay 30% of the Transfer Price, a sum
of 33,000,000 yuan (amount in words: Thirty-Three million yuan).

      


      3.2.4        Within
30 days after the completion date of  the Equity Transfer, the
Transferee shall pay the remaining Transfer Price, namely 10% of the Transfer
Price,  a sum of 11,000,000 yuan (amount in words: Eleven million
yuan).

       

       

      
        
          	
                  Article
      4

                	
                  Equity
      Handover

                


        

        


        
          	
                  4.1

                	
                  Handover
      Preconditions 

                
	 	The
      handover can only be proceeded when the following conditions are
      fulfilled:


        

         

      

      4.1.1        An
investigation report on “Zero Defect up to the Base Date” with regard to the
Target Company to be issued by the law firm and accounting firm appointed by the
Transferee.

      


      4.1.2       
The Transferor and the Original Shareholders have not violated any of the
obligations, promises and warranties stipulated in Articles 5 and 7
hereof.

      


      
        
          	
                  4.2

                	
                  The
      Handover Date and Each Party’s Rights and Obligations
      Thereafter.

                


        



      4.2.1        Within
10 business days of the execution of this agreement, the Transferor shall
complete the procedure of change in business registration, for which the
Transferee shall actively cooperate with the Transferor. The date on which the
Transferor has completed all the following procedures of change in business
registration (provided that this change of business registration has neither
made nor demanded major changes to the provisions hereof)  for this
Equity Transfer shall be the date of Equity Handover.

      


      4.2.1.1     The
finalized the Company Charter shall be submitted to the Industrial and
Commercial Bureau for record.

      


      4.2.1.2     The
Transferee shall obtain a business license issued by the Industrial and
Commercial Bureau after the change of business registration, indicating that the
Transferee is the sole holder of the Target Equity, who however shall not reduce
or restrict the current scope of business (to avoid interpretation otherwise,
the scope of business carried by the new license after the change of business
registration includes, but not limited to: “production, sales: bio-diesel;
sales: lubricant oil, chemical products (not including hazardous chemicals);
importation and exportation of goods: trees and plants”).

      


      4.2.1.3     The
Contribution Certificate of the Target Equity ownership that the Target Company
issued to the Transferor shall be cancelled, and the Target Company shall issue
a new Contribution Certificate to the Transferee; and

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      4.2.1.4     The
incumbent board directors and legal representatives at the Target Company shall
submit legal, valid letters of resignations, definitely effective on the
Handover Date.

      


      
        
          	
                  4.2.2

                	
                  The
      Transferor and the Original Shareholders promise and warrant the following
      to their best within 12 months from the Handover
  Date:

                


        



      4.2.2.1     With
regard to the transfer of rights of technology use stipulated in the provisions
of the Technology
Contract signed on January 18, 2006 between the Target Company and
Chongqing De-Meng-Te Science and Technology Development Ltd (CQ-DMT), the
Transferor and Original Shareholders have urged CQ-DMT to obtain written
consents or permissions from the patentees.

      


      4.2.2.2     With
regard to the Technical
Cooperation Agreement signed on June 11, 2008 between the Target Company
and Chongqing City Engineering Technology Research Center for Oil Products and
Application Technology (CQ-ETRC), the Transferor and the Original Shareholders
have urged CQ-ETRC to sign an extended agreement valid for at least three (3)
years.

      


      4.2.2.3     The
ownership of the automobiles listed under the Fixed Assets of the Target Company
has been transferred to the Target Company; and

      


      4.2.2.4      The
Target Company has obtained the current, valid Qualification Certificate of
Chongqing City Environmental Pollution Control and Certificate of Chongqing City Key
New Product.

      


      4.2.3        Unless
it is stipulated elsewhere herein, starting from the Handover Date, the
Transferor will be no longer entitled with any shareholder rights, nor
shareholder obligations.

      


      4.2.4        The
Transferee has the right to determine the name list of the Target Company’s
legal representatives, board members and executive officers.  The
Transferor, while handling the change of business registration, shall register
the newly appointed legal representatives, board of directors and executive
officers for record based on the name list provided by the
Transferee.

      


      
        
          	
                  Article
      5

                	
                  Transforming
      Period Arrangement

                


        

        


        
          	
                  5.1

                	
                  Transforming
      Period

                


        

        


        The
Transforming Period provided herein means the period between the Signing Date of
this agreement and the Handover Date.

        


        
          	
                  5.2

                	
                  Joint
      Management

                


        

         

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      5.2.1        On
the Signing Date of this agreement, both the Transferor and the Transferee
appoint a personnel to form a Target Company Management Committee, managing all
the business of the Target Company.

      


      5.2.2        Any
consent, resolution or policy issued by the Management Committee can be valid
only when a joint written permission is acquired from the Management Committee
members.  Without such written permission, the shareholder assembly,
board of directors, or operation authorities shall not take the liberty of
making any decision; without such written permission in advance, the Target
Company shall not sign any legal documents with an outside party.

      


      5.2.3        During
the Joint Management period, all the official stamps of contract, financial
order, personal signature, internal administration, as well as other seals that
may represent the entity of the Target Company (hereafter “Stamps”) shall be
properly and safely kept as agreed below:

      


      5.2.3.1     In
terms of the safe-keeping method, the Transferor and the Transferee shall
jointly decide a safe-keeping location and a safe box. The safe box shall have a
dual-lock setting, with each lock designed by each party. Each party has a key
to its own lock, but shall not open the safe without the presence of the other
party.

      


      5.2.3.2     If
the Transferor needs to use the Stamps during the Joint Management period, a
written permission shall be obtained in advance from the Management Committee,
and the Transferee shall assist in opening the safe in time. The course of using
the Stamps shall be monitored and documented, and the Transferee has the right
of keeping photocopies of the documents on which the Stamps are
used.

      


      5.2.4        During
the Joint Management Period, the legal representative of the Target Company
shall not exercise its rights if without written permission in advance from the
Management Committee.

      


      
        
          	
                  5.3

                	
                  During
      the Transforming Period, both parties shall comply with the following
      terms:

                


        

      

      


      5.3.1        The
Transferor shall exercise its shareholder rights in the Target
Company  pursuant to laws, statutes and the Company Charter and shall
not conduct any act that may cause damage to the Transferee or the Target
Company, while urging the Target Company to operate the business in honesty and
integrity, and in accordance with laws.

      


      5.3.2        The
Transferor shall urge the Transferee to operate the business in accordance with
the conventional manners employed before the signing of this agreement,
including, but not limited to: the aspects of safe production, environmental
protection, employee management of the Target Company, so as to not cause
significant adverse affects on the operation of the Target Company. The
Transferee shall not conduct any “Prohibited Acts”.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      5.3.3        The
Transferor is under the obligation to urge its nominated or appointed board
directors, supervisors and executive officers of the Target Company to continue
being loyal and arduous in performance of duty for the Target
Company.

      


      
        
          	
                  5.3.4        
      

                	
                  The
      Transferor shall ensure that the following shareholder decisions will be
      made prior to the Handover
Date:

                


        



      5.3.4.1     Giving
the approval to the Target Company for canceling the Contribution Certificate
issued by the Target Company to the Transferor (effective on the Handover Date);
and giving approval to the Target Company for issuing a new Contribution
Certificate to the Transferee (effective on the Handover Date).

      


      5.3.4.2     Allowing
the Transferor-appointed legal representative and board directors of the Target
Company to resign from their positions, while appointing the
Transferee-appointed legal representative and board directors for the Target
Company (effective on the Handover Date); and

      


      5.3.4.3     Authorizing
(effective on the Handover Date) the legal representative to
notify  concerned banks of new management officers’ signature patterns
in connection with all the current bank accounts of the Target
Company.

      


      5.3.4.4     The
Transferor shall hand over a photocopy of the aforesaid approvals after
verification to the Transferee prior to the Handover Date.

      


      5.3.5        The
Transferee shall not use the act of this Equity Transfer to damage the legal
rights and interests of the Target Company and its shareholders that include the
Transferor.

      


      5.3.6        Each
party shall promptly perform and actively assist with the other in the
concerning procedures of this Equity Transfer, including but not limited to:
internal decisions, authorizations, policies, and changes of business
registration.

      


      5.3.7        The
Transferor shall not sell, transfer, pledge, or dispose in other methods, the
Target Equity.

      


      5.3.8        The
Transferor shall not make decisions on or payments from the Target Company’s
distributable profits; the Transferor shall not support or offer opinions,
suggestions or proposals with regard to either drawing dividends or other forms
of shareholders profit distribution.

      


      5.3.9       
The Transferor ensures that, beyond the scope of daily business, the Target
Company shall not purchase, dispose, or permit the purchase or disposal of, any
asset; nor bear or generate, or permit the bearing or generation of, any debt,
obligation or expense (that it actually has or may have).

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      5.3.10     
The Transferor ensures the Target Company shall not revise or terminate
significant agreements, arrangements or obligations of the Target Company as a
party herein.

      


      5.3.11     
The Transferor ensures that the Target Company shall not change the employment
terms and conditions (including salaries and benefits)  regarding any
board director, other officer or employee, unless a written
permission  is given by the Transferee; the Transferor shall not
offer, or permit the offer of, gratuitous payments or benefits for any board
directors, managers or employees (or any of their relatives); also the
Transferor shall not employ, hire, or prematurely terminate the employment or
hiring of, any personnel.

      


      5.3.11     
The Transferor ensures that the Target Company shall not revise any loan
provision or debt provision of loan attributes; nor provide any loan to, borrow
from, have any obligation of loan attributes with, or agree to engage in any of
the aforesaid acts with a third party.

      


      5.3.12     
The Transferor and the Original Shareholders ensure that the Target Company
shall not reach any agreement, arrangement or obligation (regardless of whether
it can be proceeded in accordance with law or not) that may concern the
interests of the following parties: the Transferor or any of its related
parties, the Original Shareholders, or the Target Company, the Transferor or any
of its shareholders, board directors or managers, or any related personnel of
all the aforesaid parties (including immediate family members and people from
marital or adoptive relationships).

      


      5.3.13     
The transferor ensures that the Target Company’s shareholder assembly or board
of directors will not make resolutions with regard to corporate merger,
spin-off, increase or decrease of registered capital, dissolution or bankruptcy,
change in business registration, foreign investment, and provision of security
to foreign parties; ensures that the Target Company will not sign any agreement,
contract or warrant; not conduct any asset disposal; not take any loan nor other
acts that may lead to debts; and not engage in personnel employment or
arrangement.

      


      5.3.14     
In the event the Target Company undergoes changes in the aspects of assets,
personnel, business, and business registration, or in the event the Target
Company undergoes any matter that concerns administrative penalty, controversy,
dispute, lawsuit or arbitration, the Transferor shall notify the Transferee
immediately.

      


      5.3.15     
On the Handover Date, the Transferor shall turn over to the Transferee all the
credentials (licenses), stamps (including but not limited to stamps of company,
finance, business and contract), originals of documents, as well as all the
registries, minute books, financial and account books, and other journals
concerning the Target Company, all ensured to be authentic, accurate and
complete.

      


      5.3.16     
The Transferor ensures to, upon the Transferee’s written request, sign and
deliver, or promptly urge the signing and delivery of, necessary follow-up
documents required by any law or reasonably requested by the Transferee,
documents that not only help put this agreement in full force and effect and
fully realize the goal of this Equity Transfer, but also help the Transferor
gain all the benefits hereunder.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      5.3.17     
The Transferor guarantees and ensures that, starting from the signing date of
this agreement, there are no existing events, transactions, conditions or
changes that have been or may be reasonably foreseen to cause material adverse
effects on the following matters: business, production, assets, responsibility,
cash flow, operation, situation (financial or other), operating result, state of
production order, revenue, relationship between client and supplier,
relationship between employee and sales agent, and applicable statutes or
business prospect. For the purpose of this provision, “material adverse effects”
include, but are not limited to, any event, effect or situation that either
respectively or jointly leads to: (i)  a decrease of more than 50,000
yuan in the Target Company’s  net asset between the signing date of
this agreement and the Handover Date; (ii) a suspension of business operation
for more than five days between the signing date of this agreement and the
Handover Date.

      


      5.3.18     
[both parties] shall perform, pursuant to the aim of this Equity Transfer, all
other obligations and duties that both the Transferor and the Transferee shall
fulfill during the Transforming Period.

      


      
        
          	
                  Article
      6

                	
                  Assumption
      of Taxes and Fees

                


        

      

      


      6.1     
     The associated taxes payable with the Equity
Transfer hereunder shall be handled by both the Transferor and Transferee in
accordance with related laws and statutes.

      


      
        
          	
                  6.2

                	
                  The
      Transferor shall be responsible for the fees of changing business
      registration associated in the Equity Transfer
  hereof.

                


        

        


        
          	
                  Article
      7

                	
                  The
      Transferor and Original Shareholders’ Proclamation, Promise and
      Warranty

                


        

        


        
          	
                  7.1

                	
                  Proclamation,
      Promise and Warranty regarding legal
capacity

                


        



      7.1.1       
The Target Company is an enterprise legal person established in accordance with
the law and statutes of the People’s Republic of China. Since its establishment,
the Target Company has been operating in compliance with the law and there is
neither risk nor potential risk of its ceasing or dissolving operation pursuant
to the Company Law of People’s Republic of China.

      


      7.1.2       
The Transferor and Original Shareholders have right, authority and authorization
necessary to sign, deliver this agreement, to sign each document upon or prior
to the completion of the transaction, and to perform all rights and obligations
stipulated in the provisions hereof.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      7.1.3       
The Transferor legally owns the Target Equity. When being transferred, the
Transferor’s ownership of the Target Equity is free of defects (including but
not limited to security interests such as warrant and pledge).

      


      7.1.4       
The Transferor, Original Shareholders and Target Company’s signing, delivering
and performing this Agreement as well as completing the transaction determined
herein will not violate the current, valid laws, statutes and effective
documents that are legally binding on the Transferor and Target
Company.

      


      7.1.5       
Provided that the Handover Pre-conditions are fulfilled,  the
Transferor and Original Shareholders’ signing and delivery of this Agreement, as
well as their completing the transaction contemplated herein, will not need
permission from any other parties.

      


      7.1.6       
The Transferor and Original Shareholders warrant that they will comply and
fulfill all other related obligations and duties stipulated herein, while
conforming to the principle of good faith.

      


      
        
          	
                  7.2

                	
                  Proclamation,
      Promise and Warranty regarding the Target Company’s General
      State.

                


        

        


        
          	
                  7.2.1

                	
                  Financial
      Reports

                


        

        


        Financial
reports, in all significant aspects, have truly and impartially reflected the
Target Company’s business result and cash-flow situation concerning the
financial state on the Base Date and during the related financial
periods.  The Target Company does not own declared-yet-unpaid
dividends or other distributions.

        


        
          	
                  7.2.2

                	
                  Taxes

                


        

        


        The
Target Company has promptly and accurately paid all taxes payable, and has no
unlawful acts in connection with taxation.  The Target Company does
not have and never had disputes with any government agencies regarding tax
issues.  No government agency has investigated or indicated to
investigate the Target Company’s tax issue, and no event or situation may lead
to taxation disputes.

        


        
          	
                  7.2.3

                	
                  Debts

                


        

        


        
          
            	
                    7.2.3.1

                  	
                    Aside
      from what is disclosed in its financial reports, the Target Company has
      neither outstanding debts nor potential debts of any other
      form.

                  


          

           

        

      

      7.2.3.2    Aside
from what is disclosed in its financial reports, the Target Company has never
had defaults in connection with the Target Company’s debts, nor had events that
may cause the warrants, promises, or other obligations associated with the
Target Company’s debts to become legally enforceable.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  7.2.3.3

                	
                  The
      Target Company does not have actual or potential debts of tort
      (intellectual property rights, personal rights,
  etc).

                


        



      
        
          	
                  7.2.4

                	
                  Lawsuit
      and Law-abidingness

                


        

      

      


      7.2.4.1    
The Target Company has not been involved in any unresolved or threatened
lawsuit, arbitration or administrative procedure reasonably anticipated to have
material adverse effects on its overall financial state.

      


      7.2.4.2    
No courts, arbitration courts or government agencies have issued any judgment,
ruling or decision of arbitration against the Target Company, which, under
reasonable anticipation, may have material adverse effects on Target Company’s
overall financial state.

      


      
        
          	
                  7.2.4.3

                	
                  The
      Target Company does not have actual or potential items of administrative
      penalty.

                


        

        


        
          	
                  7.2.5

                	
                  Free
      of Pledge

                


        



      The
Target Equity is free of any right encumbrance, pledge and third-party right,
nor restricted by any agreement, arrangement (including but not limited to such
rights as option, first refusal, and convertible equity) or obligation
(regardless of attached conditions).

      


      
        
          	
                  7.2.6

                	
                  Assets

                


        

      

      


      The
Target Company legally owns its assets as transferable equity, free of defects.
The Assets include all capital, properties, rights, authorities, and interests
that are subject to the Target Company’s ownership, lease, operation or any
other use of such attributes.  Such assets are necessary for the
complete operation of all of the Target Company’s current and future business,
as well as its engaged business within 12 months prior to the Handover Date.
Such assets will enable the Transferee to operate the Target Company in the same
operation manner employed by the Transferor prior to or on the Handover
Date.

      


      
        
          	
                  7.2.7

                	
                  Intellectual
      Property Rights

                


        

      

      


      The
Amendment 1 to this agreement includes complete, accurate and latest details
with regard to the intellectual property rights owned by the Target Company as
the holder of the right to use, the registered owner, the beneficial owner or
the registered applicant. The Target Company legally and beneficially owns all
the intellectual property rights and business secrets that are necessary for all
of its present operation or planned operation. All these intellectual property
rights, legally and beneficially owned by the Target Company, or subjected to
its use pursuant to the valid permit, are free of obligations of license,
encumbrance, use restriction or disclosure. Such intellectual property rights
are all valid and executable. There is no and has never been any event in which
a third party is engaged in the tort, stealing, inappropriately use, violation
or unauthorized use of the Target Company’s intellectual
property.  The Target Company is not nor has ever been engaged in any
tort, stealing, inappropriate use, violation or unauthorized use of a third
party’s intellectual property.  Unless done otherwise pursuant to a
written confidentiality agreement, the Target Company has never disclosed any of
its business secrets to a third party.

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  7.2.8

                	
                  Environmental
      Protection, Quality Standards

                


        

      

       

      The
Target Company comply with all the applicable laws and statutes with regard to
the significant aspects of environmental protection and quality
standards.

      


      
        
          	
                  7.2.9

                	
                  Major
      Contracts and Commitments

                


        

      

      


      7.2.9.1    
Other than what has been disclosed, the Target Company does not have contracts
that have already been executed but have not been performed or completely
performed nor does it have any contracts that, though they have been fulfilled,
still have major impact on the company.

      


      7.2.9.2    
The contracts which the Target Company is currently in the course of fulfilling
contains no instances that constitute, or potentially constitute, any breach;
and there are no outstanding claims from any third party against the Target
Company demanding compensation for any breach.

      


      
        
          	
                  7.2.10

                	
                  Certificates

                


        

      

       

      The
certificates, technological permits and licenses are all legitimate and
valid.  There are no current or potential situations (including but
not limited to this Equity Transfer) that may cause the aforementioned
certificates, technological permits and licenses to be revoked, suspended,
withdrawn, modified or ineligible for renewal.

      


      
        
          	
                  7.2.11

                	
                  No
      Liability Not Disclosed

                


        

      

       

      None of
the transactions conducted by Target Company, its actions or lack of thereof
prior to or at the handover date or the factual situations, including taxes
arising from or in connection with any transaction or event prior to or at the
handover date, have caused the Target Company to have any liabilities (including
all debts, obligations, loss, taxes, administrative penalty, fines, claims, or
loss, expenses, cost and expenditures in any other form or of any
nature).

      


      
        
          	
                  7.2.12

                	
                  Employment
      and Labor

                


        

      

       

      The
Target Company has no material illegal practices in the area of employment and
labor.

      


      
        
          	
                  7.2.13

                	
                  Qualification
      and Administrative Permits

                


        

      

       

      All the
operation qualification, certificates and administrative permits received by the
Target Company are authentic, legitimate and remain valid and there are no
potential instances that will have material adverse effect on their annual
inspection, extension and continuous effectiveness.

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  7.2.14

                	
                  Disclosure

                


        

      

      


      There is
no information not already disclosed by the Transferor, its original
shareholders and the Target Company to the Transferee that will, based on the
reasonable expectation, have substantial effect on the transaction that the
Transferee desires.

      


      
        
          	
                  7.2.15

                	
                  Anti-Corruption
      and Anti-Bribery

                


        

      

      


      None of
the Transferor, the Target Company, the original shareholders or the
representatives acting on behalf of the Transferor and the Target Company or
their affiliates, directors, officers, members, employees, agents, or any third
party that bears any responsibility on behalf of the Transferor or the Target
Company because of their actions or breach, have been directly or indirectly:
(1) used any funds for illegal contributions, gifts, entertainments or payments
for expenses related to political activities; (2) proposed or made or agreed to
make to any State personnel any payment, contribution, gift or other inducement
in an act in violation of, or in an attempt to violate, the anti-bribery law in
China or any such laws in other jurisdictions; or (3) paid or provided any
bribery, expenses, commission, refund, settlement, influence payment, rebate or
money in any amount or assets in any other form to any agent, customer, State
personnel in China or in other jurisdictions (or receive such from them) in an
act in violation of, or in an attempt to violate, the anti-bribery law in China
or any such laws in other jurisdictions, regardless in what name (acts listed in
this provision, “Forbidden Acts”).

      


      
         

        
          
            	
                    7.2.16

                  	
                    [sic]
      No Forbidden Acts

                  


          

        

      

      


      The
Transferor and its original shareholders promise and agree to ensure that, in
the course of fulfilling the obligations herein, conducting the transaction
hereunder and completing all the necessary registration and filings with the AIC
in connection with this equity transfer, the Transferor, the Target Company, the
original shareholders, or their affiliates and their respective directors,
officers, employees and agents will not engage in any forbidden
acts.

      


      
        
          	
                  7.2.16

                	
                  Accounting
      Books and Records

                


        

      

      


      The
accounting books, records and accounts maintained by the Target Company have
reasonable details that accurately and reasonably reflect all the transactions
and dispositions of assets, and internal accounting system established by the
Target Company can reasonably ensure that only on conditions that are within the
scope of the authorization by the management can the transactions be conducted,
payments be made and other assets be accessed.

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  7.2.17

                	
                  Information

                


        

      

      


      The
Transferor, the Target Company and the original shareholders or their authorized
representatives have, in the course of the due diligence investigation conducted
by the Transferee, already provided all the information in writing or in other
electronic format at the request of the Transferee and its advisors or agents
and warrant that such information provided in writing or in other electronic
format is true and complete and is not misleading judging by the international
industry practices and standards.

      


      


      
        
          	
                  Article
      8

                	
                  The
      Transferee’s Representations, Warranties and
  Promises

                


        

      

      


      The
Transferee makes the following representations, warranties and promises and
confirms that this Agreement is executed on the basis of these representations,
warranties and promises.

      


      8.1           The
Transferee is a Chinese existing enterprise legal person established in
accordance with the Chinese law and has all the necessary certificates and
permits for the business activities it currently conducts.

      


      8.2           The
Transferee all the necessary power and authorization for the execution and
delivery of this Agreement, the purchase of the Target Equity, the completion of
the transaction completed herein and the performance of all the obligations
hereunder.

      


      8.3           This
Agreement is immediately legally binding to the Transferee after it takes effect
upon its due execution and delivery by both parties and is enforceable pursuant
to the provisions herein.

      


      8.4           The
due execution and delivery of this Agreement and the performance by the
Transferee does not require obtaining consent from any other
entities.

      


      8.5           The
Transferee warrants that all the information contained in the documents and
material provided to the Transferor and its original shareholders in connection
with this equity transfer is true, accurate and complete.

      


      8.6          
The Transferee warrants that the source of funds for receiving the equity
transfer is legitimate.

      


      8.7          
The execution and performance of this Agreement by the Transferee will not
violate any law, statutes and standard documents from regulatory authorities to
which it is bound, nor will they violate the Transferee’s Articles of
Incorporation, any agreement with any other third party to which it is a party
and any of the representations, warranties and promises it has made to the
Transferor.

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      8.8          
The Transferee’s execution and performance is based on its review of the
relevant documents regarding the Target Equity and the Target Company and is at
its sole judgment.

      


      8.9           The
Transferee promises abide by and fulfill other relevant obligations and
responsibilities provided herein with honesty and integrity.

      


      


      
        
          	
                  Article
      9

                	
                  Joint
      Representations, Warranties and
Promises

                


        

      

      


      9.1          
The representation, warranties and promises were made by each party based on the
facts in existence as of the date of execution of this Agreement and the
interpretation of each representation, warranty and promise should be made
solely on its own and should not be restricted by any other representation,
warranty and promise and by provisions herein.

      


      9.2          
Each party hereto promises that, when it becomes aware, prior to the Handover
Date, of any event or situation that constitutes or may potentially constitute a
substantial violation of, or is inconsistent with, any representation, warranty
and promise it already made, it will promptly notify the other
parties.

      


      
        
          	
                  Article
      10

                	
                  Confidentiality
      and Non-Competition

                


        

      

      


      10.1        
Each party hereto shall keep strictly confidential any other party's commercial
secrets and operation secrets obtained in connection with and in the course of
the performance of this Agreement, including but not limited to all the
provisions herein and the negotiations about this Agreement, and shall not
reveal them to any third party without prior consent from other parties
hereto.  It shall not make them known to any person within the company
of each who has no need to have any knowledge thereof, nor shall it use such
information for any purpose other than this Agreement.

      


      "Confidential Information" refers to
any and all information regarding the negotiation and execution of this
Agreement and the provisions herein, and all the oral and written information
regarding the business operation, business strategy, business plan, investment
plan and financial situation of any party hereto or the company under its
control, including but not limited to all the reports, notes, copies (including
electronic copies) and facsimiles that contain such information.

      


      
        
          	
                  10.2

                	
                  Any
      of the parties hereto may disclose confidential information under the
      following circumstances:

                


        

        


        
          	
                  10.2.1

                	
                  The
      disclosure of such information is required by law and administrative
      statutes;

                


        

        


        
          	
                  10.2.2

                	
                  The
      disclosure of such information is required by relevant judicial
      organizations and government
organizations;

                


        

         

      

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

       

      10.2.3      Prior
to its receiving or accessing the confidential information, such information has
already been made known to the public or the recipient has obtained such
information legally from a third party;

      


      
        
          	
                  10.2.4

                	
                  The
      other party has issued written consent in advance regarding such
      disclosure.

                


        



      10.3        
Notwithstanding the provisions in the above paragraph, the recipient of such
confidential information may still disclose it to its shareholders, employees,
directors and professional advisors, provided that such disclosure is made for
the reasonable need to achieve the objective of this Agreement.  The
recipient must ensure that its shareholders, employees, directors and
professional advisors are aware of and adhere to the confidentiality obligation
set forth herein.  If any law or competent court or regulatory agency
requires the disclosure of such information, the recipient may disclose it but
must take all necessary measures permitted by law to so that the relevant secret
information receive confidentiality protection allowed under the applicable law
and statutes.

      


      10.4        
Within 3 years after the Handover Date, the Transferor and its original
shareholders shall not, directly or indirectly (in its own name or through its
affiliates or agents), engage in any business that competes with the Target
Company's current business, or provide assistance to any entity that already
competes, or plans to compete, directly or indirectly, with the Target Company,
and shall not attempt, directly or indirectly, recruit any employee or agent of
the Target Company for service (whether or not the person is an employee,
advisor, agent, independent contractor or other service provider).

      


      10.5        
The Transferee and its original shareholders shall not conduct any activities
that are reasonably expected to interfere or harm the business relationship
between the Target Company and its employees, customers, suppliers, sales agents
and brokers or other major business relationship.

      


      


      
        
          	
                  Article
      11

                	
                  Amendment,
      Dissolution and Termination of this
Agreement

                


        



      
        
          	
                  11.1

                	
                  General
      Provisions

                


        

        


        The parties hereto shall not amend and
dissolve this Agreement unless there is prior unanimous consent or as required
by the circumstances specified by law and statutes and by the provisions
herein.  All amendments to and the dissolution of this Agreement must
be made in writing by all parties hereto and they shall become effective only
after they are signed or imprinted with seals by the both parties or their
respective representatives.

        


        
          	
                  11.2

                	
                  If
      the objective of this Agreement becomes impossible to be realized due to
      Force Majeure, either party hereto can dissolve this
      Agreement.

                


        

         

      

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      11.3        
If bankruptcy, disbandment, revocation by law or loss of capacity for civil
activities on the part of one party make it lose the ability to perform the
Agreement, such that the objective of this Agreement can not be realized, the
other party has the right to unilaterally dissolve this Agreement.

      


      
        
          	
                  11.4

                	
                  Transferor's
      Right to Dissolve This
Agreement

                


        



      If the Transferee fails to make
payments for the equity transfer consideration pursuant to the provisions herein
and the payments are more than one month past due, and the Transferee is at
fault, it shall be considered a material breach by the Transferee, and the
Transferor may unilaterally dissolve this Agreement and demand the Transferee to
bear all liabilities for the breach.

      


      
        
          	
                  11.5

                	
                  Transferee's
      Right to Dissolve This
Agreement

                


        



      11.5.1      If
the legal counsel engaged by the Transferee issues an investigation report
stating major defects about the Target Company, or if the conditions for
handover stipulated in Article 4.1 herein are not completed satisfied within one
month after the execution of this Agreement, it shall be considered a material
breach by the Transferor and its original shareholders, and the Transferee may
unilaterally dissolve this Agreement and demand the Transferor and/or its
original shareholders to bear all liabilities for the breach.

      


      11.5.2     
If the Target Company or the Transferor seriously violates the provisions of
Article 5.3 herein, such that such violation affects the realization of the
objective desired by the Transferee, it shall be considered a material breach by
the Transferor and its original shareholders, and the Transferee may
unilaterally dissolve this Agreement and demand the Transferor and/or its
original shareholders to bear all liabilities for the breach.

      


      11.5.3     
If the Transferor fails to complete all the AIC change registration procedures
for the equity transfer according to the schedule stipulated herein and such
delay is over one month, it shall be considered a material breach by the
Transferor and its original shareholders, and the Transferee may unilaterally
dissolve this Agreement and demand the Transferor and/or its original
shareholders to bear all liabilities for the breach.

      


      
        
          	
                  11.6

                	
                  This
      Agreement will be terminated upon any of the
  following:

                


        

        


        
          	
                  11.6.1

                	
                  All
      the obligations hereunder have been fulfilled pursuant to the provisions
      herein;

                


        

        


        
          	
                  11.6.2

                	
                  This
      Agreement is dissolved.

                


        

        


        
          	
                  11.7

                	
                  Legal
      Consequences of the Termination of This
  Agreement

                


        



      11.7.1     
If due to dissolution or termination of this Agreement, the provisions herein
are not completely performed, the performance will be terminated; if they have
been performed, the abiding party may demand the defaulting party to bear
liabilities for the breach and responsibility for compensation.  The
Transferor must return to the Transferee all the consideration already paid by
the Transferee within 10 days upon the dissolution of this
Agreement.

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      11.7.2      On
the pre-condition of not affecting the other provisions herein, if any or some
of the provisions herein are determined to be invalid, illegal or unenforceable,
or in violation of public interests, the validity, legality and enforceability
of other provisions shall not be affected or harmed.  Each party must
negotiate in good faith to determine provisions satisfactory to both parties as
substitutes for the invalid ones.

      


      


      
        
          	
                  Article
      12

                	
                  Complete
      Agreement

                


        

        


        This
Agreement constitutes the complete agreement between the two parties hereto with
regard to the transaction contemplated herein and shall supersede all previous
written or oral agreements or understanding between the two
parties.

        


        


        
          	
                  Article
      13

                	
                  Liability
      for Breach

                


        



      13.1  
      The violation by any party of the provisions or
the representations, warranties and promises herein constitutes a
breach.  The defaulting party shall have the obligation to compensate
the abiding party in full for all the actual loss sustained as a result of the
breach.

      


      13.2        
If the Transferee fails to make payments for the equity transfer consideration
pursuant to the provisions herein and is at fault, the Transferee must pay a
penalty in the amount equal to 0.03% of the total that must be paid for each day
that the payment is past due and compensate the Transferor for all the resulting
loss.

      


      13.3        
If Transferor fails to complete all the equity transfer AIC change registration
procedures and is at fault, the Transferor must pay a penalty in the amount
equal to 0.03% of the total that must be paid for each day that the completion
of such procedure is delayed and compensate the Transferee for all the resulting
loss.

      


      13.4        
If the breach by the Transferor and/or its original shareholders causes the
transferee to dissolve this Agreement, the Transferor and/or its original
shareholders must return to the Transferee an amount equal to two times of the
deposit; if the breach by the Transferor causes the transferor to dissolve this
Agreement, the Transferor is not required to return the deposit.

      


      13.5        
The two parties specifically stipulate that the Transferor and/or its original
shareholders shall bear joint and several responsibility for compensation to the
Target Company and the Transferee for any loss, liability or expenses suffered
(directly or indirectly) or incurred (including but not limited to direct,
indirect and derived loss) caused by, directly or indirectly, or as the result
of, the failure to fulfill the following:

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  13.5.1

                	
                  The
      Transferor and/or its original shareholders violate any of the
      representations or warranties
hereunder;

                


        

        
           

          
            
              	
                      13.5.2

                    	
                      The
      Transferor and/or its original shareholders violate any of the warranties,
      promises herein or provisions
hereof;

                    


            

             

          

        

      

      13.5.3     
The Transferor and/or its original shareholders fail to perform any or several
rights and obligations after the handover date as specified by provision 4.2
herein;

      


      13.5.4     
The failure of the Target Company to make payments, before the handover date,
for pension insurance, unemployment insurance, medical insurance, work injury
insurance, family planning insurance and the housing fund for the Target
Company’s employees causes any liability, litigation, arbitration,
administrative penalty, compensation and loss suffered by the Target Company
and/or the Transferee at any time after the handover date; and

      


      13.5.5     
Any activity conducted by the Transferor or the Target Company before the
handover date causes or results in any litigation or arbitration against the
Transferor, its original shareholders, the Transferee or the Target
Company.

      


      If any of
the events mentioned above causes any reduction of value to the Target Equity or
causes any material loss to the Transferee, the Transferee shall have the right
to demand the Transferor and/or its original shareholders to bear joint and
several responsibility for compensation; the Transferee shall also have the
right to demand the Transferor and/or its original shareholders buy back the
Target Equity as the Equity Transfer Price specified herein and pay a penalty
for breach in the amount equal to two times of the deposit stipulated
herein.

      


      


      
        
          	
                  Article
      14

                	
                  Force
      Majeure

                


        

        


        
          	
                  14.1

                	
                  General
      Provisions

                


        

        


        Force
Majeure means the occurrence of any events, after the execution of this
Agreement, that impede any party hereto in performing completely or in part the
provisions herein and that is not foreseeable, preventable or
surmountable.   Such events include earthquake, typhoon, flood,
fire, war and other foreseeable, preventable or surmountable
events.

        
          


          
            	
                    14.2

                  	
                    Obligation
      of Notice

                  


          

           

        

      

      The party
impacted by Force Majeure must immediately (if communication is broken, then at
the time that communication is resumed) notify in writing the other party and
the witness, and provide proof evidencing such event within 15 days of its
occurrence and statement of the detailed information regarding the duration of
its occurrence and the inability due to its impact to perform this Agreement or
to perform it completely or the reasons that such performance need to be
postponed.  Such document of evidence must be provided by the
certification organization at the location of the occurrence of Force
Majeure.

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  14.3

                	
                  Remedies
      and Waiver from Responsibility

                


        

        


        14.3.1     
In the event of Force Majeure, the party receiving written notice from the other
party must immediately begin consultation with the other party to find fair
solutions;

        


        
          	
                  14.3.2

                	
                  Both
      parties must make all reasonable efforts to alleviate the impact of any
      Force Majeure event mentioned
above;

                


        

        


        14.3.3     
If one party is not able, due to the impact of Force Majeure, to fulfill, either
completely or partially, its obligations hereunder, the fulfillment of the
obligations hereunder by the impacted party may be suspended during the delay
caused by Force Majeure, the term for fulfilling such obligation may be
extended, with the extension period being equal to suspension period, and the
impacted party will not bear the corresponding responsibility for
breach.

         

         

        
          
            	
                    Article
      15

                  	
                    Resolution
      of Disputes

                  


          

        

         

        
          	
                  15.1

                	
                  Resolution
      through Consultation

                


        

        


        All
disputes or conflicts arising from the execution and performance of this
Agreement must first be settled through friendly consultation, which must be
started immediately after any of the two parties delivers written request for
consultation to the other party.

        


        
          	
                  15.2

                	
                  Resolution
      through Litigation

                


        



      If the
parties hereto fail to reach written consensus within 30 days after the receipt
of the written notice described in Article 16.1 below, both parties have the
right to submit the dispute to the people’s court at the location where this
Agreement is executed for litigation.

      


      15.3        
During the period when the dispute is being resolved, the parties hereto must
continue to perform, with the exception of the item in dispute, all other
provisions hereunder and fulfill their corresponding obligations.

      


      


      
        
          	
                  Article
      16

                	
                  Notification
      and Delivery

                


        

        


        
          	
                  16.1

                	
                  Notification

                


        

         

        
          
            
            

          

          
            22

            
              

            

          

          
            
            

          

        

         

        
          	
                  16.1.1

                	
                  All
      notifications may be delivered by courier, express delivery or by
      facsimile to the following method:

                


        

        


        
          	
                   
      

                	
                  To:

                	
                  Chongqing
      Hua Neng Recycling for Old and Waste Materials
  Ltd.

                


        

        
          	
                   
      

                	
                  Address:

                	
                  Shitawu
      She, Longqiao Town, Fuling District, Chongqing City

                
	 	Postal
      Code:	408121
	 	
                  Telephone:

                	023
      72137888


        

        
        

        
        

        
          	
                   
      

                	
                  Fax:

                	
                  023
      72137888

                
	 	Recipient:	LI
      Chao


        

        
        

        


        
          	
                   
      

                	
                  To:

                	
                  Xi’an
      Baorun Enterprise Development Co.,
Ltd.

                


        

        
          	
                   
      

                	
                  Address:

                	
                  Room
      10720, East New Century Plaza, 7 Huoju
Road

                


        

        
          	
                   
      

                	
                  Beilin
      District Xi’an

                


        

        
        

        
          	 	Telephone:	029
      82683920
	
                   
      

                	
                  Fax:

                	
                  029
      82683629

                
	 	Recipient:	GAO
      Xincheng


        

        
        

        


        
          	
                  16.1.2

                	
                  If
      one party changes the delivery method listed in 16.1.1 above, it must
      notify the other party in writing within 3 days upon any such
      change.

                


        

        


        
          	
                  16.2

                	
                  Receipt

                


        



      Without
affecting the above provision, any notification delivered in accordance with the
method listed in 16.1.1 shall be considered received upon the following: if by
courier, at the actual time when the delivery is made at the corresponding
address and is signed and accepted by the recipient or any other person
acknowledged by the recipient; if by express delivery, within 3 business days
after the mail is posted; if by facsimile, when the recipient or any other
person acknowledged by the recipient confirms its receipt.

      


      


      
        
          
            	
                    Article
      17

                  	
                    Other
      Provisions

                  


          

        

        


        
          	
                  17.1

                	
                  Execution
      of This Agreement and Its
Effectiveness

                


        

        


        This
Agreement becomes effective on the date first stated above when it is signed or
imprinted with seals by both parties or their respective
representatives.

        


        
          	
                  17.2

                	
                  Original
      Agreement

                


        

        


        This
Agreement is made in four originals with one to the Transferor, one to the
Transferee and the rest to be used in the AIC change
registration.  All of them have the same legal effect.

         

        
          
            
            

          

          
            23

            
              

            

          

          
            
            

          

        

         

        
          	
                  17.3

                	
                  Severability

                


        

        


        If any of
the provisions herein is determined by competent authorities to be invalid or
unenforceable, other provisions herein shall not be affect and must continue to
be fully and effectively performed.

        


        
          	
                  17.4

                	
                  Waiver
      of Rights

                


        

        


        The
non-exercise, or partial exercise, or the delay to exercise, of any of the
rights hereunder by any party shall not be considered a waiver of such right or
any other rights hereunder, unless one party expressly indicate in writing its
waiver of such right.

        


        
          	
                  17.5

                	
                  Transfer
      of Rights and Obligations

                


        

        


        17.5.1     
Before the handover date, the Transferee has the right to, upon receiving
consent from the Transferor, transfer its rights and obligations specified
herein to a third party, and make the main entity of the Transferee become the
third party; and the Transferee guarantees that the third party will perform
this Agreement and the Transferee’s obligations provided in the attachment
hereto.

        


        
          	
                  17.5.2

                	
                  With
      the exception stated above, neither party can transfer its rights and
      obligations provided herein.

                


        

        
          


          
            	
                    17.6

                  	
                    Continuation
      of Effectiveness

                  


          

        

        


        The
confidentiality provisions, notification provisions and resolution of dispute
provisions shall continue to remain in effect alter this Agreement is dissolved
or terminated.

        


        
          	
                  17.7

                	
                  Others

                


        



      Other
matters not covered herein must be handled in accordance with the relevant
provisions of the laws and statutes, if any, or settled, if not, through signing
a supplemental agreement by the parties hereto.  All supplemental
agreements shall have the same legal effect of this Agreement.

      


      (There is
no text below)

       

       

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

       

      In
witness hereof, the authorized representatives of the respective parties hereto
hereby sign this Agreement on the date first indicated above.

       

      
        
          	
                  Transferor:

                	
                  /seal/
      Chongqing Hua Neng Recycling for Old and Waste Materials
    Ltd.

                


        

        
          	
                  Legal
      Representative:

                	
                  /s/
      LI Chao

                


        

        


        
          	
                  Transferee:

                	
                  /seal/
      Xi’An Baorun Industrial Development Limited

                
	Legal
      Representative: 	/s/
      GAO Xincheng


        

      

      


      /s/ LIAO
Xiaozhong

       

      /s/ XIE
Hui

      


      /s/ WANG
Xiaoyong

       

    

    
      
        
        

      

      
        25