UNITED
STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549  FORM 10-Q/A  þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period endedSeptember
30, 2007  OR  o
TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to
___________.  Commission file number:000-1321559      Jpak
Group, Inc. (Exact name of Registrant as specified in
its charter)       Nevada

20-1977020(State or Other Jurisdiction of
Incorporation or Organization)

(I.R.S. Employer
Identification
Number)  15 Xinghua Road
Qingdao, Shandong Province
Peoples Republic of
China

266401(Address of Principal Executive
Offices)

(ZIP Code)  (86-532) 84616387 (Registrants telephone number, including area code)      (Former name, former address and former fiscal year, if changed
since last report)  Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports) and (2) has been subject
to such filing requirements for the past 90 days.  Yesx Noo  Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer or a
non-accelerated filer. See definition of accelerated filer and large
accelerated filer in Rule 12b-2 of the Exchange Act. (Check one)  Large accelerated filero Accelerated Filero Non-accelerated filerx  Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).  Yeso Nox    Indicate the
number of shares outstanding of each of the issuers classes of common stock, as
of the latest practicable date.  On May 22, 2008, there
were 24,505,000 shares of the issuer's common stock, par value $.0001 per share,
outstanding. The issuer also has 5,608,564 shares of Series A Preferred Stock,
per value $.0001 per share, outstanding, which shares are convertible into on
aggregate of 11,217,128 shares of common stock and 5,000,000 shares of our
Series B Preferred Stock, par value $.001 per share outstanding, which are
convertible into an aggregate of 8,333,333 shares of our common stock.        JPAK GROUP, INC.  INDEX  Page
NumberPART I - FINANCIAL INFORMATIONItem 1.

Financial StatementsCondensed Consolidated Balance SheetsSeptember 30, 2007 (unaudited)
and June 30, 2007

3Condensed Consolidated Statements of Operations
(unaudited)Three months ended September
30, 2007 and 2006

4Condensed Consolidated Statements of Cash Flows
(unaudited)Three months ended September
30, 2007 and 2006

5Notes to Condensed Consolidated Financial
Statements

6Item 2.

Managements Discussion and Analysis of Financial
Condition and Results of Operations

16Item 3.

Quantitative and Qualitative Disclosure About
Market Risks

21Item 4.

Controls and Procedures

21PART II - OTHER INFORMATIONItem 1.

Legal Proceedings

23Item 1.A

Risk Factors

23Item 2.

Unregistered Sales of Equity Securities and Use of
Proceeds

35Item 3.

Defaults Upon Senior Securities

35Item 4.

Submission of Matters to a Vote of Security
Holders

35Item 5.

Other Information

35Item 6.

Exhibits

35     EXPLANATORY NOTE :On May 3,
2008, the Board of Directors of Jpak Group, Inc. (we, us, our or the
"Company") concluded that the Company is required to restate its previously
issued audited financial statements for the year ended June 30, 2007, and as a
result, its financial statements for the quarters ending September 31, 2007 and
December 31, 2007. Subsequent to the issuance of the June 30, 2007 financial
statements, management identified various errors in connection with its 2007
financial statements and determined that a restatement was necessary in respect
of the following: revision of reverse acquisition accounting
andrevision of capitalized costs relatedto financing
transaction.  As a result of the Boards decision and the aforementioned
revisions to our financial statements, our previously issued financial
statements for the year ended June 30, 2007 (which were included in our
Registration Statement on Form S-1), and the periods ended September 30, 2007,
and December 31, 2007, should no longer be relied upon.  Restated
financials for the quarter ending September 30, 2007 are included herein.        PART I. FINANCIAL INFORMATION   Item 1. Financial Statements    Report of Independent Registered
Public Accounting Firm   To the Board of Directors JPAK Group, Inc.   We have reviewed the
accompanying balance sheet of JPAK Group, Inc. as of September 30, 2007 and
2006, and the related consolidated statements of operations and other
comprehensive income and cash flows for the three months ended September 30,
2007 and 2006.  These financial statements are the responsibility of the
companys management.  We conducted our review
in accordance with the standards of the Public Company Accounting Oversight
Board (United States).  A review of interim financial information consists
principally of applying analytical procedures and making inquiries of persons
responsible for financial and accounting matters.  It is substantially less
in scope than an audit conducted in accordance with the standards of the Public
Company Accounting Oversight Board (United States), the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole.  Accordingly, we do not express such an opinion.  Based on our review, we
are not aware of any material modifications that should be made to the
accompanying interim financial statements for them to be in conformity with
accounting principles generally accepted in the United States of America.        /s/  Patrizio & Zhao, LLC Parsippany, New Jersey October 30, 2007 (Except for Note 14, as to which the date is May 12, 2008)            - 2 -


JPAK GROUP,
INC.  CONSOLIDATED BALANCE SHEETS  (UNAUDITED)   ASSETS  September 30,
June
30,2007
2007(Restated)
(Restated)CURRENT ASSETSCash and cash equivalents
$  2,189,799
$  4,938,200Restricted cash for trade notes
repayment
1,298,941
-Account receivables, net of
allowance for uncollectible accounts
7,613,343
8,583,396Inventory
2,544,263
3,393,896Prepaid expenses and other
current assets
75,584
772,792Deferred financing costs,
net
-
405,072Total Current
Assets
13,721,930
18,093,356PROPERTY AND EQUIPMENT, NET
8,164,227
7,935,920Total Assets
$21,886,157
$26,029,276LIABILITIES AND
STOCKHOLDERS EQUITYCURRENT LIABILITIESAccounts payable and accrued
expenses
$  2,041,290
$  4,634,457Trade notes payable
533,600
526,000Convertible notes
-
5,500,000Short-term bank loans
4,002,000
4,812,900Other payables
16,668
65,378Total Current
Liabilities
6,593,558
15,538,735LONG-TERM DEBT
1,834,350
2,008,893STOCKHOLDERS EQUITYSeries A
convertible preferred stock, $0.0001 par value, 5,608,564shares
authorized,5,608,564 shares issued and outstanding
561
-Common stock, $0.001 par value,
300,000,000 shares authorized24,505,000 shares
issued and outstanding
24,505
23,005Additional paid-in
capital
9,426,780
5,676,259Retained earnings
2,764,133
1,896,256Statutory reserves
348,009
348,009Accumulated other comprehensive
income
894,261
538,119Total
Stockholders Equity
13,458,249
8,481,648Total
Liabilities and Stockholders Equity
$21,886,157
$26,029,276     The accompanying notes are an integral part
of these financial statements.  - 3 -


JPAK GROUP,
INC.  CONSOLIDATED
STATEMENTS OF OPERATIONS  AND COMPREHENSIVE
INCOME  FOR THE THREE MONTHS ENDED SEPTEMBER
30,  (UNAUDITED) 2007
2006(Restated)
(Restated)REVENUE
$9,304,248
$7,676,485COST OF SALES
6,987,181
5,883,956GROSS PROFIT
2,317,067
1,792,529EXPENSESSelling, general and
administrative
1,351,533
1,060,180Depreciation expense
18,813
12,105Total Expenses
1,370,346
1,072,285INCOME FROM OPERATIONS
946,721
720,244OTHER INCOME (EXPENSES)Interest income
24,182
22,074Interest expense
(113,189)
(110,156)Other income (expense),
net
10,163
(8,632)Total Other Income
(Expenses)
(78,844)
(96,714)INCOME  BEFORE PROVISION FOR INCOME
TAX
867,877
623,530PROVISION FOR INCOME TAX
-
89,975NET INCOME
867,877
533,555OTHER COMPREHENSIVE INCOME (LOSS)Foreign currency translation
adjustment
356,142
(10,225)COMPREHENSIVE INCOME
$1,224,019
$
  523,330BASIC EARNINGS PER SHARE
$
          .04
$
         .02DILUTED EARNINGS PER SHARE
$
          .03
$
         .02WEIGHTED AVERAGE NUMBER OF COMMON
SHARESOUTSTANDINGBASIC
23,852,826
23,005,000DILUTED
34,413,574
23,005,000     The accompanying notes are an integral part
of these financial statements.  - 4 -


JPAK GROUP,
INC.  CONSOLIDATED
STATEMENTS OF CASH FLOWS  FOR THE THREE MONTHS
ENDED SEPTEMBER 30,  (UNAUDITED)   2007
2006(Restated)
(Restated)CASH FLOWS FROM OPERATING ACTIVITIESNet Income
$
  867,877
$
  533,555Adjustments to reconcile net
income to net cashprovided by
operating activities:Depreciation and
amortization
271,377
168,288Loss on disposal of fixed
assets
-
66,682Changes in assets and
liabilities:Restricted cash
(1,289,788)
(410,240)Account receivables
1,086,362
2,582,172Inventory
892,338
(969,124)Prepaid expenses
698,464
43,637Accounts payable and accrued
expenses
(2,640,752)
(1,258,904)Other payables
(49,304)
-Income tax payable
-
(98,877)Total Adjustments
(1,031,303)
123,634Net Cash Provided (Used) By
Operating Activities
(163,426)
657,189CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of property and
equipment
(334,385)
(2,082,178)Disposal of fixed assets
-
1,029,368Acquisition of Qingdaos
equity
(864,000)
-Net Cash Used By Investing
Activities
(1,198,385)
(1,052,810)CASH FLOWS FROM FINANCING ACTIVITIESTrade note payable
-
470,952Additional capital
contribution
(452,463)
-Repayment of other loans
-
(46,836)Repayment of bank loan
(1,076,370)
(177,256)Net Cash Provided (Used) By
Financing Activities
(1,528,833)
246,860EFFECT OF FOREIGN CURRENCY TRANSLATION ON
CASH
142,243
14,102NET DECREASE IN CASH AND CASH
EQUIVALENTS
(2,748,401)
(134,659)CASH AND CASH EQUIVALENTS  BEGINNING
4,938,200
1,289,995CASH AND CASH EQUIVALENTS  ENDING
$2,189,799
$1,155,336    The accompanying notes are an integral part
of these financial statements.  - 5 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 1 
ORGANIZATION AND NATURE OF BUSINESS  JPAK Group, Inc. (Hereinafter JPAK) is a Cayman Islands based
holding company incorporated on June 22, 2006. In September 2006, the Company
acquired a 100% interest in Grand International Industrial Ltd. which was
incorporated on August 4, 2006, in the city of Hong Kong, the Peoples Republic
of China. In August 2006, Grand International acquired an 88.23% interest in
Qingdao Renmin Printing Co., Ltd., (Qingdao Renmin) which was incorporated in
May 2001 in the city of Qingdao, the Peoples Republic of China. In July 2007,
Grand International acquired the remaining 11.77% interest in Qingdao Renmin.
The consolidated financial statements reflect all predecessor statements of
income and cash flow activities from the inception of Qingdao Renmin in August
2006. Qingdao Renmins primary business is to print and produce packaging
products for sale to the beverage and other industries.  On August 9, 2007, the Company completed a reverse acquisition of
JPAK. Prior to the acquisition, Rx Staffing Inc. (Rx Staffing or The
Company) was a public shell company, as that term is defined in Rule 12b-2 of
the Exchange Act, established under the laws of Nevada on December 6, 2004. To
accomplish the share exchange The Company issued 23,005,000 shares of common
stock on a one to one ratio for a 100% equity interest in JPAK. In accordance
with the terms of the Share Exchange and Bill of Sale of assets of Rx Staffing
and Shaun Jones, Rx Staffing was delivered with zero assets and zero liabilities
at time of closing. Following the reverse acquisition, the Company changed the
name of Rx Staffing, Inc. to JPAK Group, Inc. The transaction was treated as a
reverse merger whereby JPAK was considered to be the accounting acquirer as its
shareholders retained control of RX Staffing after the exchange. Although the
Company is the legal parent company, the share exchange was treated as a
recapitalization of JPAK. Thus, JPAK is the continuing entity for financial
reporting purposes. The Financial Statements have been prepared as if JPAK had
always been the reporting company and then on the share exchange date, had
changed its name and reorganized its capital stock.  NOTE 2 
INTERIM FINANCIAL STATEMENTS  These interim financial
statements should be read in conjunction with the audited financial statements
for the years ended June 30, 2007 and 2006, as not all disclosures required by
generally accepted accounting principles for annual financial statements are
presented. The interim financial statements follow the same accounting policies
and methods of computations as the audited financial statements for the years
ended June 30, 2007 and 2006.  NOTE 3 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  The accompanying
un-audited financial statements have been prepared in accordance with generally
accepted accounting principles (GAAP) applicable to interim financial
information and with the requirements of Form 10-Q and Rule 10-01 of Regulation
S-X of the Securities and Exchange Commission. Accordingly, they do not include
all of the information and footnotes required by accounting principles generally
accepted in the United States of America for complete financial statements.
Interim results are not necessarily indicative of results for a full year. In
the opinion of management, all adjustments considered necessary for a fair
presentation of the financial position and the results of operations and cash
flows for the interim periods have been included.          - 6 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (UNAUDITED)   NOTE 4 
INVENTORY  Inventory at September 30, 2007 and June 30, 2007 consisted of the
following:  September
30,
June 30,2007
2007Finished
products
$   407,318
$   571,357Raw
materials
2,077,938
2,206,420Parts and
supplies
56,921
41,280Work in
process
2,086
574,839Total
$2,544,263
$3,393,896 NOTE 5 
DEFERRED FINANCING COSTS  Costs related to obtaining the convertible note are capitalized
and amortized over the term of the related debt using the straight-line method,
which is 12 months. The remaining balance was allocated to issuance costs and
netted with additional paid-in capital as the note was converted in August 2007
per Note 8.  Deferred financing costs at September 30, 2007 and June 30,
2007 were as follows:  September 30,
June 30,2007
2007Deferred
financing costs
$460,017
$460,017Less:
Accumulated amortization
104,780
54,945Issuance
costs
355,237
-Net
deferred financing costs
$
           -
$405,072  Amortization of deferred financing costs charged to operations for
the quarters ending September 30, 2007 and September 30, 2006 was $49,835 and
$-0-, respectively.  NOTE 6 
PROPERTY AND EQUIPMENT  Property
and equipment at September 30, 2007 and June 30, 2007 consisted of the
following:  September 30,
June 30,2007
2007Buildings
$  3,533,677
$  3,533,677Machinery
and equipment
10,378,749
9,848,634Subtotal
$13,912,426
13,382,311Less:
Accumulated depreciation
5,748,199
5,446,391Total
$  8,164,227
$ 7,935,920 Depreciation expense for the quarters ending September 30, 2007
and September 30, 2006 was $221,543 and $168,288, respectively.  NOTE 7 
ACCOUNTS PAYABLE AND ACCRUED EXPENSES  The carrying value of accounts payable and accrued expenses
approximate fair value due to the short-term nature of the obligations. As of
September 30, 2007, accounts payable and accrued expenses were $1,572,448 and
468,842, respectively. As of June 30 2007, accounts payable and accrued expenses
were $4,066,655 and 567,802, respectively.     - 7 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 8 
CONVERSION OF CONVERTIBLE NOTES  On August 9, 2007, the convertible notes converted to following
items: (i) 5,608,564 shares of the Companys Series A Convertible Preferred
Stock, par value $.0001 per share (the Preferred Stock), whose shares are
convertible into an aggregate of 11,217,128 shares of Common Stock, (ii) Class A
Warrants to purchase an aggregate of 5,500,000 shares of Common Stock (subject
to adjustment) at an exercise price of $.60 per share until August 2011 (the
Class A Warrants), (iii) Class B Warrants to purchase an aggregate of
5,500,000 shares of Common Stock (subject to adjustment) at an exercise price of
$.70 per share until August 2011 (the Class B Warrants) and (iv) Class J
Warrants to purchase (a) an aggregate of 5,000,000 shares of Series B Preferred
Stock, containing the same terms as the Series A Preferred Stock (other than
conversion price), whose shares are convertible into 8,333,333 shares of the
Companys Common Stock, (b) Class C Warrants to purchase an aggregate of
4,166,667 shares of Common Stock (subject to adjustment) at an exercise price of
$.72 per share (the Class C Warrants) and (c) Class D Warrants to purchase an
aggregate of 4,166,667 shares of Common Stock (subject to adjustment) at an
exercise price of $.84 per share (the Class D Warrants and together with the
Class A Warrants, Class B Warrants and Class C Warrants, the Warrants). The
Class J Warrants shall only be exercisable until 90 days following the effective
date of a registration statement registering for sale the shares of common stock
underlying the securities issued in the financing.  NOTE 9 
SHORT-TERM BANK LOANS  Short-term bank loans consist of the following: On February 2nd, 2007, the Company
obtained a loan from China Industrialand Commercial Bank, of which the principal is to
be paid in full by February11th 2008, The interest is to be
calculated using an annual fixed interest rate of6.732% and paid monthly. The loan is secured by the
Company's equipment.
$
  667,000On April 10th, 2007 the Company obtained
a loan from China Industrialand Commercial Bank, of which the principal is to
be paid in full by April 9th2008. The interest is to be calculated using an
annual fixed interest rate of7.029% and paid monthly. The loan is secured by the
Company's equipment.
$
  800,400On February 12th 2007, the Company
obtained a loan from Qingdao CityCommercial Bank, of which the principal is to be
paid in full by February 11th2008. The interest is to be calculated using an
annual fixed interest rate of6.732% and paid monthly. The loan is secured by the
Company's equipment.
$2,134,400On May 25th 2007, the Company obtained a
loan from China Merchant  Bank,of which the principal is to be paid in full by May
25th 2008.  The interest isto be calculated using an annual fixed interest
rate of 6.57% and paid monthly.The loan is secured by the Company's
equipment.
$
  400,200Total short-term bank
loans
$4,002,000  Short-term bank loans on June 30, 2007 consist of the
following:  On September 7th 2006, the Company
obtained a loan from China Industrialand Commercial Bank, of which the principal is to
be paid in full by August27th, 2008. The interest is to be
calculated using an annual fixed interest rate of6.732% and paid monthly. The loan is secured by the
company's equipment.
$
  867,900  - 8 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 9  SHORT
TERM BANK LOANS(continued):  On February 2nd, 2007, the Company
obtained a loan from China Industrialand Commercial Bank, of which the principal is to
be paid in full by February11th 2008, The interest is to be
calculated using an annual fixed interest rate of6.732% and paid monthly. The loan is secured by the
company's equipment.
$
  657,500On April 10th, 2007 the Company obtained
a loan from China Industrialand Commercial Bank, of which the principal is to
be paid in full by April 9th2008. The interest is to be calculated using an
annual fixed interest rate of7.029% and paid monthly. The loan is secured by the
company's equipment.
$
  789,000On February 12th 2007, the Company
obtained a loan from Qingdao CityCommercial Bank, of which the principal is to be
paid in full by February 11th2008. The interest is to be calculated using an
annual fixed interest rate of6.732% and paid monthly. The loan is secured by the
company's equipment.
$2,104,000On May 25th 2007, the Company obtained a
loan from China Merchant  Bank,of which the principal is to be paid in full by May
25th 2008.  The interest isto be calculated using an annual fixed interest
rate of 6.57% and paid monthly.The loan is secured by the company's
equipment.
$
  394,500Total short-term bank
loans
$4,812,900  NOTE 10 
LONG-TERM DEBT  As of September 30, 2007 and June 30, 2007, the Company had
long-term debt of $1,834,350 and $2,008,893 outstanding, respectively. These
loans represent borrowings from employees at an annual interest rate of 10%.
Interest payments are made semi-annually with no principal payments due until
the end of the two year period.  NOTE 11  RISK
FACTORS  In the three months ended September 30, 2007, five customers
accounted for approximately 66.8% of the Companys sales and five vendors
accounted for approximately 84% of the Companys purchases.  The Company's operations are carried out in the PRC. Accordingly,
the Company's business, financial condition and results of operations may be
influenced by the political, economic and legal environments in the PRC as well
as by the general state of the PRCs economy. The Company's business may be
influenced by changes in governmental policies with respect to laws and
regulations, anti-inflationary measures, currency conversion and remittance
abroad, and rates and methods of taxation, among other things.  NOTE 12 -
CONCENTRATIONS OF CREDIT RISK  Financial instruments which potentially subject the Company to
credit risk consist principally of cash on deposit with financial institutions
of $ 2,189,799 as of September 30, 2007 and
$4,928,904 as of June 30, 2007.       - 9 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 13 
SUPPLEMENTAL CASH FLOW DISCLOSURES  Three Months Ended
September2007
2006Cash paid
for interest
$113,189
$119,357Cash paid
for income taxes
-
$102,631 NOTE 14 
RESTATEMENT TO REFLECT REVERSE MERGER ACCOUNTING  In August 2007, Jpak Group Co., Ltd. (JPAK)  a private holding
company established under the laws of the Cayman Islands on June 22, 2006,
acquired an 88.23% equity interest in Qingdao Renmin through Grand
International, the 100% owned subsidiary of JPAK.  As a result of the
acquisition, Qingdao Renmin became the majority owned subsidiary of Grand
International and an indirect majority owned subsidiary of JPAK. Originally the
Company accounted the acquisition using the purchase method.  Grand
International and Qingdao Renmin were considered as the acquirer and acquiree
respectively both from the business and accounting perspectives.  The Company has changed its accounting method and the transaction
has been regarded as a reverse merger whereby Qingdao Renmin was considered to
be the accounting acquirer as both Grand International and JPAK were holding
companies with no significant operations and Qingdao Renmin continues as the
primary operating entity even after the exchange, although JPAK is the legal
parent company.  As such, Qingdao Renmin (and its historical financial
statements) is the continuing entity for financial reporting purposes and the
share exchange was treated as a recapitalization of JPAK. Thus, JPAK is the
continuing entity for financial reporting purposes. The Financial Statements
have been prepared as if JPAK had always been the reporting company and then, on
the share exchange date, had changed its name and reorganized its capital stock.
Accordingly, the Company has revised the financial statements to reflect reverse
merger accounting.  Pursuant to SEC Manual Item 2.6, 5.4 Reverse acquisitions, the
Company believes the statement of stockholders' equity in the Company's S-1 for
the fiscal years ended June 30, 2007 and 2006 should be revised to disclose the
effect of the reverse merger on a retroactive basis.  The SEC guidance
requires that "in a reverse acquisition the historical sharholder's equity of
the accounting acquirer prior to the merger is retroactively restated (a
recapitalization) for the equivalent number of shares received in the merger
after giving effect any difference in par value of the registrant's and the
accounting acquirer's stock by an offset in paid in capital.  "Based on
this statement, the Company believes the statement of stockholders' equity
should be revised to properly disclose the effects of the reverse merger by
retroactively restating the 23,005,000 shares given to JPAK (accounting acquirer
in the reverse merger with Rx Staffing).  In addition, the Company has
revised the financial statements for the fiscal year ended June 30, 2007 to
disclose the effect of the recapitalization on a retroactive basis.               - 10 -   JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 14 
RESTATEMENT TO REFLECT REVERSE MERGER ACCOUNTING(continued)  The effect of restatement is as follows:  CONSOLIDATED BALANCE SHEETS  ASSETS  As reported under Acquisition Accounting
As reported under Reverse Merger
   Accounting
Effect of ChangeSeptember 30,
September 30,2007
2007CURRENT
ASSETSCash
and cash equivalents
$  2,189,799
$  2,189,799
$
              -Restricted
cash for trade notes repayment
1,298,941
1,298,941
-Account
receivables, net of allowance $39,507
7,613,343
7,613,343
-Inventory
2,544,263
2,544,263
-Prepaid
expenses and other current assets
75,584
75,584
-Total
Current Assets
13,721,930
13,721,930
-PROPERTY AND
EQUIPMENT, NET
8,164,227
8,164,227
-GOODWILL
1,017,245
-
(1,017,245)Total
Assets
$22,903,402
$21,886,157
($1,017,245)LIABILITIES AND STOCKHOLDERS EQUITYCURRENT
LIABILITIESAccounts
payable and accrued expenses
$  2,041,290
$  2,041,290
$
              -Trade
notes payable
533,600
533,600
-Short-term
bank loans
4,002,000
4,002,000
-Other
payables
16,668
16,668
-Total
Current Liabilities
6,593,558
6,593,558
-LONG-TERM
DEBT
1,834,350
1,834,350
-STOCKHOLDERS
EQUITYSeries
A convertible preferred stock, $0.0001 par value, 5,608,564shares
authorized,5,608,564 shares issued and outstanding
561
561
-Common
stock, $0.001 par value, 300,000,000 shares authorized24,505,000
shares issued and outstanding
24,505
24,505
-Additional
paid-in capital
10,577,424
9,426,780
(1,150,644)Retained
earnings
2,683,185
2,764,133
80,948Statutory
reserves
371,364
348,009
(23,355)Accumulated
other comprehensive income
818,455
894,261
75,806Total
Stockholders Equity
14,475,494
13,458,249
(1,017,245)Total
Liabilities and Stockholders Equity
$22,903,402
$21,886,157
($1,017,245)               - 11 -  JPAK
GROUP, INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)   NOTE 14 
RESTATEMENT TO REFLECT REVERSE MERGER ACCOUNTING(continued)  CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME As
reported under  Acquisition    Accounting for the
three months
ended
As
reported under Reverse Merger    Accounting for the three
months ended
Effect of ChangeSeptember
30,2007
September
30,2007REVENUE
$9,304,248
$9,304,248
$
           -COST OF
SALES
6,987,181
6,987,181
-GROSS
PROFIT
2,317,067
2,317,067
-EXPENSESSelling,
general and administrative
1,351,535
1,351,535
-Depreciation
expense
18,813
18,813
-Total
Expenses
1,370,346
1,370,348
-INCOME FROM
OPERATIONS
946,721
946,719
-OTHER INCOME
(EXPENSES)Interest
income
24,182
24,182
-Interest
expense
(113,189)
(113,189)
-Other
income (expense), net
10,163
10,163
-Total
Other Income (Expenses)
(78,844)
(78,844)
-INCOME
 BEFORE PROVISION FOR INCOME TAX
867,877
867,877
-PROVISION FOR
INCOME TAX
-
-
-NET INCOME
867,877
867,877
-OTHER
COMPREHENSIVE INCOMEForeign
currency translation adjustment
280,336
356,142
75,806COMPREHENSIVE
INCOME
$1,148,213
$1,224,019
($75,806)           - 12 -  JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)   NOTE 14 
RESTATEMENT TO REFLECT REVERSE MERGER ACCOUNTING(continued)  CONSOLIDATED
STATEMENTS OF CASH FLOWS As reported under  Acquisition
   Accounting for the three months ended
As reported under Reverse Merger
   Accounting for the three months ended
Effect of ChangeCASH FLOWS
FROM OPERATING ACTIVITIES
September 30,2007
September 30,2007Net
Income
$   867,877
$   867,877
$
          -Adjustments
to reconcile net income to net cashprovided
by operating activities:Depreciation
and amortization
271,377
271,377
-Changes
in assets and liabilities:Restricted
cash
(1,289,788)
(1,289,788)
-Account
receivables
1,086,362
1,086,362
-Inventory
892,338
892,338
-Prepaid
expenses
698,464
698,464
-Accounts
payable and accrued expenses
(2,640,752)
(2,640,751)
-Other
payables
(49,304)
(49,304)
-Total
Adjustments
(1,031,303)
(1,031,301)
-Net
Cash Provided By (Used In) Operating Activities
(163,426)
(163,426)
-CASH FLOWS
FROM INVESTING ACTIVITIESAcquisition
of property and equipment
(334,385)
(334,385)
-Acquisition
of Qingdaos equity
(864,000)
(864,000)
-Net
Cash Used In Investing Activities
(1,198,385)
(1,198,385)
-CASH FLOWS
FROM FINANCING ACTIVITIESCapital
contribution
(452,463)
(452,463)
-Repayment
of bank loan
(1,076,370)
(1,076,370)
-Net
Cash Provided By (Used In) Financing Activities
(1,528,833)
(1,528,833)
-EFFECT OF
FOREIGN CURRENCY TRANSLATION ON CASH
142,243
142,243
-NET DECREASE
IN CASH AND CASH EQUIVALENTS
(2,748,401)
(2,748,401)
-CASH AND CASH
EQUIVALENTS  BEGINNING
4,938,200
4,938,200
-CASH AND CASH
EQUIVALENTS  ENDING
$2,189,799
$2,189,799
$
          -              - 13 -  JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)  NOTE 15 
EARNINGS PER SHARE  The Company presents earnings per share on a basic and diluted
basis.  Basic earnings per share has been computed by dividing net earnings
by the weighted average number of shares outstanding.  Diluted earnings per
share has been computed by dividing net earnings by the weighted average number
of shares outstanding including the dilutive effect of equity securities on the
if converted method. All share and per share data have been adjusted
retroactively to reflect the recapitalization of the Company pursuant to the
Securities Exchange Agreement with Rx Staffing.  3 Months Ended September 30,
2007Net Income
Shares
Per ShareIncome from operations
$946,721
23,852,826
$0.04Basic EPS
$867,877
23,852,826
$0.04Effect of dilutive securities
$
          -
10,560,748
($0.01)Diluted EPS
$867,877
34,413,574
$0.033 Months Ended September 30,
2006Net Income
Shares
Per ShareIncome from operations
$720,244
23,005,000
$0.03Basic EPS
$533,555
23,005,000
$0.02Effect of dilutive securities
$
          -
-
$    -Diluted EPS
$533,555
23,005,000
$0.02  NOTE 16 
ALLOCATION OF PROCEEDS OF CONVERTIBLE PROMISSORY NOTES  On August 9, 2007, the Company became a party to the NPA (Note
Purchase Agreement dated  May 17,2007 by and
among Jpak, Grand International Industrial Limited and in certain identified investors)by and among
the Company, Jpak, Grand International and the Investors. Under the NPA
 Jpak issued Convertible Promissory Notes in the aggregate principal amount
of US$5.5 million to the Investors. As a result of the Share Exchange, the Notes
automatically converted into 5,608,564 shares of Series A Convertible Preferred
Stock outstanding. The shares of Series A Convertible Preferred Stock are
convertible into an aggregate of 11,217,128 shares of common stock. Under the
terms of the Notes, the company also issued (i) Series A Warrants to purchase an
aggregate of 5,500,000 shares of common stock (subject to adjustment) at an
exercise price of US$.60 per share until August 2013 (the Series A Warrants),
(ii) Series B Warrants to purchase an aggregate of 5,500,000 shares of common
stock (subject to adjustment) at an exercise price of US$.70 per share until
August 2013 (the Series B Warrants) and (iii) Series J Warrants to purchase
(a) an aggregate of 5,000,000 shares of Series B Convertible Preferred Stock,
which preferred stock shall contain the same terms as the Series A Convertible
Preferred Stock (other than conversion price), which shares will be convertible
into 8,333,333 shares of the Company common stock, (b) Series C Warrants to
purchase an aggregate of 4,166,667 shares of common stock (subject to
adjustment) at an exercise price of US$.72 per share (the Series C Warrants)
and (c) Series D Warrants to purchase an aggregate of 4,166,667 shares of common
stock (subject to adjustment) at an exercise price of US$.84 per share (the
Series D Warrants). The Series J Warrants contain an exercise price of US$1.00
per warrant and shall only be exercisable until 90 days following the effective
date of the applicable registration statement and prospectus. Finally, the
Company also granted warrants to purchase 990,000 shares of common stock with an
exercise price of US$.50 per share to the placement agent in the financing
transaction. These warrants have the same terms as the Series A and Series B
Warrants, except that they contain a cashless exercise provision.       - 14 -  JPAK GROUP,
INC.  NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS   (UNAUDITED)   NOTE 16 
ALLOCATION OF PROCEEDS OF CONVERTIBLE PROMISSORY NOTES(continued)  The Company allocated the proceeds received in the financing
transaction including convertible instruments and any other detachable
instruments included in the exchange (such as detachable warrants) on a relative
fair value basis.  As the Series A Convertible Preferred Stock was in-the-money, the
Company used the intrinsic value to calculate the fair value based on the
conversion price. The Company also calculated the fair value of Series A, Series
B, Series J warrants and placement agent warrants using the Black-Scholes model.
The risk-free interest rate was 4.57%, the interest rate of treasury instruments
with the same maturity.  Volatility under the Black-Scholes mosel was based
on the historical volatility of the Companys derivatives up to September 30,
2007.  The total value of warrants and the value of Series A Preferred
shares on the date of conversion were $4,709,891 and $8,076,397 respectively.
 Therefore, the Company allocated $2,025,952 and $3,474,048 to the
additional paid-in capital of common stocks and the additional paid-in capital
of preferred stocks respectively from the $5,500,000 proceeds of Convertible
Promissory Notes.  NOTE 17 
RELATED PARTY TRANSATIONS  Viewed from the perspective of the financial statements
of the reporting entity, a related party may be any of the following: ·Affiliates  ·Principal owners and close
kin  ·Management and close kin  ·Parents and subsidiaries  ·Equity method investors and
investees  ·Trusts for the benefit of
employees  ·Any other party that has the
ability to influence the management or operating policies of the reporting
enterprise significantly, to the extent that it may be prevented from fully
pursuing its own separate interests.  ·De facto agents of the
entity  The Companydid not have any related party transactions
accordingly.   NOTE 18 
SUBSEQUENT EVENTS  No material transactions or events occurring after the balance
sheet date required disclosure in the quarterly financial statements for
September 30, 2007.              - 15 -  Item
2. Managements Discussion and Analysis of Financial Condition and
Results of Operations  We did not conduct any operations during periods up
through the date of the share exchange (the Share Exchange) which was
completed in August 2007 pursuant to which we acquired all of the outstanding
shares of capital stock of Jpak Group Co., Ltd., an exempted company organized
under the laws of the Cayman Islands (Jpak). Previously, in September 2006,
Jpak acquired an 88.23% equity interest in Qingdao Renmin, our primary operating
subsidiary located in the city of Qingdao in Shandong Province in the Peoples
Republic of China, through Grand International, a Hong Kong company, which is
the wholly owned subsidiary of Jpak.  In July 2007, Grand International
acquired the remaining 11.77% state-owned equity interest in Qingdao Renmin and
now owns 100% equity interest in Qingdao Renmin.  The Share Exchange has
been accounted for as a reverse acquisition under the reverse merger method of
accounting for business combinations in accordance with generally accepted
accounting principles in the United States of America, or U.S. GAAP. As a
result, Qingdao Renmin is considered to be the accounting acquirer as both Grand
International and Jpak were holding companies with no significant operations and
Qingdao Renmin continues as the primary operating entity even after the Share
Exchange, although Jpak is the legal parent company.  As such, Qingdao
Renmin (and its historical financial statements) is the continuing entity for
financial reporting purposes and the Share Exchange will be treated as a
recapitalization of Jpak.  Thus, Jpak is the continuing entity for
financial reporting purposes., We have included elsewhere in this Quarterly
Report on Form 10-Q the consolidated financial statements of Jpak, our
subsidiary which indirectly owns Qingdao Renmin Printing Co., Ltd. our operating
subsidiary (Qingdao Renmin). Jpak owns 100% equity interest in Qingdao Renmin
through its wholly owned subsidiary Grand International Industrial Limited, a
company organized under the laws of Hong Kong (Grand International).  The following discussion and analysis of our financial
condition and result of operations contains forward-looking statements and
involves numerous risks and uncertainties, including, but not limited to, those
described in the "Risk Factors" section of this Quarterly Report on Form 10-Q
and in the other reports we file with the Securities and Exchange Commission.
Actual results may differ materially from those contained in any forward-looking
statements.  The following discussion and analysis of our financial
condition and result of operations should be read in conjunction with our
condensed consolidated financial statements and related notes appearing
elsewhere in this Quarterly Report on Form 10-Q.  Overview  We are engaged primarily in the
development, manufacture, and distribution of aseptic liquid food and beverage
cartons for milk, fruit juices, soy milk, yogurt drinks, iced tea, coffee,
sauces and other liquid foods and beverages in China. Since 2004, we have
started and focused on the research and development, and we believe we are the
largest and leading domestic supplier of aseptic liquid food and beverage
cartons in China. Our business is primarily in China, but we have recently begun
contract manufacturing products for export primarily to Southeast Asia.  Our growth strategy consists of consolidating our market
leader position among domestic liquid food and beverage aseptic carton suppliers
and to pursue expansion in the China market as well as selective Asian and
Middle Eastern markets. We intend to achieve our goal by pursuing the following
strategies:  ·
Increasing output to further penetrate the China
market;  ·
Offering bundled packaging materials and filling
machines;  ·
Increasing sales to selective Asian and other
markets; and  ·
Establishing brand names and brand awareness.  Company History  Jpak commenced operations in China in
1958 as a state-owned, traditional printing and packaging company. Management
completed the buyout of 88.23% of the state-owned equity interest in 2004, and
in the same year started the development of aseptic liquid food and beverage
cartons which was launched in the China market in 2005.  On June, 22, 2006, Jpak was
incorporated in the Cayman Islands as Winner Dragon Limited. Winner Dragon
Limited was renamed Jpak Group Co., Ltd. on September 18, 2006. Additionally,
during September 2006, Jpak completed the acquisition of 88.23% of the equity
interest in Qingdao Renmin, a company located in Qingdao, Shandong Province of
the Peoples Republic of China, through Grand International, the 100% owned
subsidiary of Jpak. Currently, substantially, all of our operations are
conducted in China through Qingdao Renmin.    - 16
-    In July 2007, Grand International
completed the acquisition of the remaining 11.77% of the state-owned equity
interest and now owns 100% of the equity interest of Qingdao Renmin.  In August 2007, we acquired all of the
outstanding capital stock of Jpak.  Results of Operations  The following table shows the results
of operations of our business.   Comparison of the Three Months Ended September 30,
2007 and 2006  Three Months Ended September 30

2007

2006Sales

$
9,304,248

$
7,676,485Cost of sales

$
6,987,181

$
5,883,956Total expenses

$
1,370,348

$
1,072,285Other income (expense)

$
(78,844
)
$
(96,714
)Income taxes

$
-

$
89,975Net income

$
867,877

$
533,555Foreign currency translation adjustment

$
356,142

$
(10,225
)Comprehensive income

$
1,224,019

$
523,330  Sales. Total sales were
approximately US$9.3 million for the three months ended September 30, 2007 as
compared to approximately US$7.7 million for the three months ended September,
2006, an increase of approximately US$1.6 million, or 20.8%. The increase
resulted from increased sale of our products and services to numerous new
customers in 2007.  Cost of Sales. Cost of sales for the
3 months ended September 30, 2007 was approximately US$7.0 million, or 75.1% of
sales, as compared to US$5.9 million, or 76.6% of sales, for the 3 months ended
September 30, 2006. Our cost of sales are primarily composed of the costs of
direct raw materials (mainly paper materials, polyethylene materials, aluminum
materials, printing materials), labor, depreciation and amortization of
manufacturing equipment and facilities, and other overhead. The slight decrease
of cost of sales to sales % was primarily due to a slight decrease in prices of
direct raw materials.  Selling, general and administrative
expenses. Selling, general and administrative expenses were approximately
US$1.4 million for the three months ended September 30, 2007 as compared to
approximately US$1.1 million for the three months ended September 30, 2006, an
increase of approximately US$0.3 million, or 27.8%. The increase was mainly due
to an increase in our sales force, sales related marketing activities and
support staff. Selling expenses primarily consist of advertising, promotional
and other sales and marketing expenses, salaries, commissions, and benefits for
our sales and marketing personnel. We expect that our selling expenses will
increase in absolute terms in the near term as we increase our sales efforts,
expansion of the markets to more markets, hire additional sales personnel, and
initiate additional marketing programs. We also expect to incur additional
general and administrative expenses as a result of being listed as a public
company in the United States.  Net income. Net income was
approximately US$0.9 million for three months ended September 30, 2007 as
compared to net income of approximately US$0.5 million for the three months
ended September 30, 2006, an increase of US$334,000. The increase in net income
was primarily due to increase of sales during the period.  Our reporting currency is the US dollar.
Our local currency, Renminbi (RMB), is our functional currency. Results of
operations and cash flow are translated at average exchange rates during the
period, and assets and liabilities are translated at the unified exchange rate
as quoted by the Peoples Bank of China at the end of the period. Translation
adjustments resulting from this process are included in accumulated other
comprehensive income in the statement of shareholders equity. Transaction gains
and losses that arise from exchange rate fluctuations on transactions
denominated in a currency other than the functional currency are included in the
results of operations as incurred.     - 17
-    Currency translation adjustments resulting
from this process are included in accumulated other comprehensive income in the
consolidated statement of shareholders' equity and amounted to gain of US$
280,000 as of September 30, 2007 as compared to loss of US$10,000 as of
September 30, 2006. The balance sheet amounts with the exception of equity at
September 30, 2007 were translated at 7.51760 RMB to 1.00 US dollar as compared
to RMB7.91680 at September 30, 2006. The equity accounts were stated at their
historical rate. The average translation rates applied to income statement
accounts for the 3 months ended September 30, 2007, and September 30, 2006 were
RMB7.56906 and RMB7.97711, respectively.  The comprehensive income, which adds the
currency adjustment to net income, was approximately US$1.1 million for the
three months ended September 30, 2007 as compared to US$0.5 million for the
three months ended September 30, 2006, an increase of $0.6 million. The increase
was primarily due to increase of foreign currency translation adjustment US$0.3
million. There was an appreciation of RMB to US$ during the three months ended
September 30, 2007 as compared to that of 2006.  Income Taxes  We are not subject to any income taxes in
the United States or the Cayman Islands. Under the Interim Regulations of the
People's Republic of China on Enterprises Income Tax effective from January 1,
1994 to December 31, 2007 and the Income Tax Law of the People's Republic of
China for Foreign Investment Enterprises and Foreign Enterprises effective from
July 1, 1991 to December 31, 2007, a company is generally subject to an income
tax at an effective rate of 33% (30% state income taxes plus 3% local income
taxes) on income reported in the statutory financial statements after
appropriate tax adjustments with the following tax holidays: If the enterprise
is a manufacturing related joint venture with a foreign enterprise or a wholly
owned subsidiary of a foreign enterprise, with an operation of 10 years or more,
it enjoys a two-year income tax exemption from the year that it is profitable
and a 50% income tax reduction for the following three years ( the 2-3 tax
holiday).  Our subsidiary, Qingdao Renmin has been a
domestic limited liability company since May 24, 2001 and has been subject to an
income tax at an effective rate of 33%. However, since September 7, 2006, as a
result of our acquisition, Qingdao Renmin is now a foreign investment enterprise
and started to enjoy the 2-3 tax holidays.  On March 16, 2007, the PRC promulgated a
new income tax law for enterprises that will become effective on January 1,
2008. Under the new income tax law, a company incorporated in the PRC will be
generally subject to an income tax at an effective rate of 25%. In accordance
with the new tax law, Qingao Renmin may continue to enjoy the 2-3 tax holidays
that it currently enjoys as a foreign investment enterprise subject to the
regulations to be promulgated by the State Council of the PRC.  Liquidity and Capital Resources  As of September 30, 2007, we had working capital totaling
approximately US$7.1 million, including cash and cash equivalents of US$2.2
million.  Net cash used in operating activities was US$163,000 for
the three months ended September 30, 2007. This net cash used was primarily due
to reduction of accounts payable offsetting with decrease of account receivables
and the net income generated during the three months ended September 2007. Net
cash provided US$657,000 for the three months ended September 30, 2006 was
primarily related to decrease of account receivables offsetting with reduction
of accounts payables and inventory increase.  Net cash used in investing activities for the three
months ended September 30, 2007 totaled US$1.2 million and related primarily to
the purchase of property and equipment and the acquisition of the outstanding
equity of Qindao Renmin not owned by us. Net cash used in investing activities
for the three months ended September 30, 2006 totaled US$1.1 million was related
to the purchase of property and equipment offsetting with the sales proceeds of
some obsolete machines.  Net cash used in financing activities for the three
months ended September 30, 2007 was US$1.5 million and related primarily to
repayment of some of the bank loans. Net cash provided in financing activities
for the three months ended September 30, 2006 totaled US$247,000 and related
mainly to the increase of trade note payable.    - 18
-    We have entered into several loan agreements with our
primary lenders, Industrial and Commercial Bank of China and Qingdao City
Commercial Bank, under which we have term loans. As of September 30, 2007, we
had and aggregate principal amount of US$4.0 million outstanding under the loan
agreements, which amounts mature from February 2008 to May 2008 and accrue
interest at a rate from 7.029% per annum to 6.57% per annum. The loan agreements
contain customary affirmative and negative covenants. As of September 30, 2007,
we were in material compliance with the terms of our loan agreements.  On August 9, 2007, we became a party
to that certain Note Purchase Agreement (the NPA) by and among Jpak, Grand
International Industrial Limited, a company organized under the laws of Hong
Kong (Grand International) and the investors named therein (collectively, the
Investors). The NPA was originally entered into in May 2007 pursuant to which
Jpak issued Convertible Promissory Notes in the aggregate principal amount of
US$5.5 million (the Financing) to the Investors (the Notes). As a result of
the Share Exchange, under the terms of the NPA and the Notes, the Notes have
been converted into (i) 5,608,564 shares of our Series A Convertible Preferred
Stocks, par value $.001 per share (the Preferred Stock), which shares are
convertible into an aggregate of 11,217,128 shares of common stock, (ii) Series
A Warrants to purchase an aggregate of 5,500,000 shares of common stock (subject
to adjustment) at an exercise price of US$.60 per share until August 2011 (the
Series A Warrants), (iii) Series B Warrants to purchase an aggregate of
5,500,000 shares of common stock (subject to adjustment) at an exercise price of
US$.70 per share until August 2011 (the Series B Warrants) and (iv) Series J
Warrants to purchase (a) an aggregate of 5,000,000 shares of Series B Preferred
Stock, which preferred stock shall contain the same terms as the Series A
Preferred Stock (other than conversion price), which shares will be convertible
into 8,333,333 shares of our common stock, (b) Series C Warrants to purchase an
aggregate of 4,166,667 shares of common stock (subject to adjustment) at an
exercise price of US$.72 per share (the Series C Warrants) and (c) Series D
Warrants to purchase an aggregate of 4,166,667 shares of common stock (subject
to adjustment) at an exercise price of US$.84 per share (the Series D
Warrants). The Series J Warrants shall be exercisable at an exercise price of
US$1.00 per warrant and shall only be exercisable until 90 days following the
effective date of the registration statement of which this prospectus forms a
part. In connection with the Financing, we also granted warrants to purchase
990,000 shares of common stock with an exercise price of US$.50 per share to the
placement agent in the Financing. These warrants have the same terms as the
Series A and Series B Warrants, except that they contain a cashless exercise
provision.  Although we expect that the net
proceeds of the private placement described above, together with our available
funds and funds generated from our operations, will be sufficient to meet our
anticipated needs for 12 months, we may need to obtain additional capital to
continue to operate and grow our business. Our cash requirements may vary
materially from those currently anticipated due to changes in our operations,
including our marketing and distribution activities, product development,
expansion of our personnel and the timing of our receipt of revenues. Our
ability to obtain additional financing in the future will depend in part upon
the prevailing capital market conditions, as well as our business performance.
There can be no assurance that we will be successful in our efforts to arrange
additional financing on terms satisfactory to us, if at all.  Off-Balance Sheet Arrangements  We do not have any off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that is material to investors.  Critical Accounting Policies and Estimates  Our consolidated financial information
has been prepared in accordance with generally accepted accounting principles in
the United States, which requires us to make judgments, estimates and
assumptions that affect (1) the reported amounts of our assets and liabilities,
(2) the disclosure of our contingent assets and liabilities at the end of each
fiscal period and (3) the reported amounts of revenues and expenses during each
fiscal period. We continually evaluate these estimates based on our own
historical experience, knowledge and assessment of current business and other
conditions, our expectations regarding the future based on available information
and reasonable assumptions, which together form our basis for making judgments
about matters that are not readily apparent from other sources. Since the use of
estimates is an integral component of the financial reporting process, our
actual results could differ from those estimates. Some of our accounting
policies require a higher degree of judgment than others in their
application.    - 19
-    When reviewing our financial
statements, you should consider (1) our selection of critical accounting
policies, (2) the judgment and other uncertainties affecting the application of
those policies, and (3) the sensitivity of reported results to changes in
conditions and assumptions. We believe the following accounting policies involve
the most significant judgment and estimates used in the preparation of our
financial statements.  Revenue recognition.  We derive our revenues primarily from
sales of printing packaging products which are recognized at the point of
sale.  Accounts Receivable.  Our terms of sales allow for payments
to be made for up to one year. Our management reviews customer credit
worthiness, current economic trends and changes in customer payment patterns to
evaluate the need for reserves.  Inventory.  Inventory is stated at the lower of
weighted average cost or market, which takes into account historical prices on a
continuing basis.  Property and Equipment.  Property and equipment are stated at cost and depreciated
using the straight-line method, over 5 and 40 years. The carrying value of long
lived assets is evaluated whenever changes in circumstances indicate the
carrying amount of such assets may not be recoverable. If necessary, we
recognize an impairment loss for the difference between the carrying amount of
the assets and their estimated fair value. Fair value is based upon current and
anticipated future undiscounted cash flows. Expenditures for maintenance and
repairs are charged to operations as incurred; additions, renewals and
betterments are capitalized. Based upon our most recent analysis, we believe
that no impairment of property and equipment existed for the 3 months ended
September 30, 2007.  Foreign Currency Translation and
Transactions.  The
financial position and results of operations of our foreign subsidiaries are
determined using local currency (Chinese Yuan) as the functional
currency. Assets and liabilities of the subsidiaries are translated at the
exchange rate in effect at each year end. Contributed capital accounts are
translated using the historical rate of exchange when capital is injected.
Income statement accounts are translated at the average rate of exchange during
the year. Translation adjustments arising from the use of different exchange
rates from period to period are included in the cumulative translation
adjustment account in shareholders equity. Gains and losses resulting from
foreign currency transactions are included in operations. Due to the volatile
nature of the Chinese Yuan, the results of operations and financial condition
could be materially impacted.  Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure  On October 2, 2007, we appointed
Patrizio & Zhao, LLC, as our independent registered public accounting firm
to replace Bagell, Josephs, Levine & Company, LLC following their dismissal
on October 2, 2007. This action was ratified by our board of directors on
October 2, 2007. During our fiscal years ended December 31, 2006 and 2005 and
the subsequent interim period through October 2, 2007, we had no disagreements
with Bagell, Josephs, Levine & Company, LLC on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedures, which disagreements, if not resolved to the satisfaction of Bagell,
Josephs, Levine & Company, LLC would have caused it to make reference to the
subject matter of the disagreements in its report. Bagell, Josephs, Levine &
Company, LLCs report on our financial statements for the fiscal years ended
December 31, 2006 and 2005 did not contain an adverse opinion or disclaimer of
opinion, and was not qualified or modified as to uncertainty, audit scope or
accounting principles. A letter addressed to the SEC from Bagell, Josephs,
Levine & Company, LLC stating that it agrees with the above statement was
attached as an exhibit to our Current Report on 8-K filed with the SEC on
October 8, 2007.    - 20
-    Item 3. Quantitative and Qualitative Disclosure About
Market Risk  Not applicable.   Item 4. Controls and Procedures   We maintain disclosure controls and procedures that are designed
to ensure that information required to be disclosed in our reports under the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the time periods specified in the Securities and Exchange
Commissions rules and forms, and that such information is accumulated and
communicated to our management, including our Chief Executive Officer and Acting
Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosures. Any controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives. Our management, with the participation of our Chief
Executive Officer and Acting Chief Financial Officer, has evaluated the
effectiveness of our disclosure controls and procedures as of March 31, 2008 .
Based upon that evaluation and subject to the foregoing, our Chief Executive
Officer and Acting Chief Financial Officer concluded that our disclosure
controls and procedures were deficient.  A material weakness is a significant deficiency in one or more of
the internal control components that alone or in the aggregate precludes our
internal controls from reducing to an appropriately low level the risk that
material misstatements in our financial statements will not be prevented or
detected on a timely basis. Due to staffing and resource constraints, a material
weakness became evident to management regarding our inability to simultaneously
close the books on a timely basis each month and quarter and to generate all the
necessary disclosure for inclusion in our filings with the Securities and
Exchange Commission.  In addition, this lack of staffing and resources has led to a
misstatement in our financial statements.  On May 4, 2008, the Board of
Directors of Jpak Group, Inc. (we, us, our or the "Company") concluded
that the Company is required to restate its previously issued audited financial
statements for the year ended June 30, 2007 and the periods ended September 30,
2007, and December 31, 2007.  Subsequent to the issuance of these financial
statements, management identified various errors in connection with its 2007
financial statements and determined that a restatement was necessary in respect
of the following:  1. Revision of reverse acquisition accounting.On August
9, 2007, we completed a reverse acquisition of Jpak Group Co., Ltd. (Jpak
Ltd), a Cayman Islands Company.   As a result, Jpak Ltd became our
wholly owned subsidiary.  Previously, in September 2006, Jpak Ltd acquired
an 88.23% equity interest in Qingdao Renmin, our primary operating subsidiary
located in the city of Qingdao in Shandong Province in the Peoples Republic of
China, through Grand International, a Hong Kong company, which is the wholly
owned subsidiary of Jpak Ltd.  In July 2007, Grand International acquired
the remaining 11.77% state-owned equity interest in Qingdao Renmin and now owns
100% equity interest in Qingdao Renmin.  The acquisition of Qingdao Renmin
was initially accounted for using the purchase method. Subsequent to the
issuance of the June 30, 2007, financial statements, management revisited the
acquisition and deemed the transaction to be a reverse acquisition for
accounting purposes. Qingdao Renmin was considered to be the accounting acquirer
as both Grand International and Jpak Ltd were holding companies with no
significant operations and Qingdao Renmin continues as the primary operating
entity even after the exchange, although Jpak Ltd is the legal parent company.
 As such, Qingdao Renmin (and its historical financial statements) is the
continuing entity for financial reporting purposes and the share exchange will
be treated as a recapitalization of Jpak Ltd.  Thus, Jpak Ltd is the
continuing entity for financial reporting purposes.  Accordingly, we will
prepare the financial statements as if Jpak Ltd. had always been the reporting
company and then on the share exchange date, changed its name and reorganized
its capital stock.  Accordingly, we shall revise our financial statements
to reflect reverse merger accounting by eliminating the goodwill and adjusting
the additional paid-in capital.  2. Revision of capitalized costs related to financing
transaction. In connection with the US$5,500,000 financing that we completed in
August 2007, we granted warrants, with an exercise price of US$0.50 per share,
to purchase up to 990,000 shares of common stock to the placement agent of the
Financing. The expiration date of this warrant is May 17, 2011. Furthermore, as
a result of the investors exercise of their Series J warrants in December 2007,
we granted the placement agent an additional warrant to purchase up to 750,000
shares of common stock with an exercise price of US$0.60 per share; the
expiration date of this warrant is December 28, 2011. These placement agent
warrants have the same terms as the Series A and Series B Warrants we issued to
the investors.  The cost related to the two placement agent warrants - 21 -  were originally capitalized and amortized over the term of the
warrants.    However, after further  discussion  and
research, we  believe  the  warrants  issued to  the
placement  agents  are directly attributable to raising capital; if we
had not issued the warrants to the placement agent, we would have paid the same
amount of cash as the fair value of the warrants.  Therefore, we will
allocate the proceeds received in a financing transaction to the preferred
shares and warrants on a relative fair value basis to the additional paid-in
capital of preferred shares and common shares, respectively.  This control deficiency resulted in a misstatement to
substantially all of our financial statements and disclosures covering the year
ended June 30, 2007 and onward, which resulted in a material misstatement to
such annual and interim financial statements (September 30, 2007 and December
30, 2007) that was not prevented or detected. Accordingly, management has
concluded that this control deficiency constitutes a material weakness.  Remediation Plan for Material Weaknesses  The
material weaknesses described above in Evaluation of Disclosure Controls and
Procedures comprise control deficiencies that we discovered in the third
quarter of fiscal year 2008 as we were preparing responses to SEC comments
regarding the registration statement on Form S-1 that we filed on February 29,
2008.  Pursuant to this discovery, we formulated a remediation plan and
initiated remedial action to address those material weaknesses. The elements of
the remediation plan are as follows:  
Appoint a new Acting Chief Financial Officer.On May
8, 2008, we appointed Dongliang (Frank) Su as our Acting Chief Financial
Officer; Ming Qi resigned as our Chief Financial Officer, although he will
maintain his position as a director on our Board on that same day.
 Mr. Su has extensive US GAAP and regulatory experience and maintains
a deep understanding of GAAP and financial statements.  Mr. Su is
highly skilled in analyzing and evaluating various financial issues and in
preparing financial statements.  
Restate Financial Statement:We are restating our
financial statements for the year ending June 30, 2007 and our interim
financial statements for the quarters ending September 30, 2007 and
December 31, 2007 so that the correct accounting treatment is reflected in
those statements and flows through them accordingly.
Seeking and Recruiting Additional Accounting
Professionals.We are seeking to recruit experienced
professionals to augment and upgrade our financial staff to address issues
of timeliness and completeness in financial reporting when we are
preparing filings for the Securities and Exchange
Commission. Although we believe that these corrective steps will enable
management to conclude that our disclosure controls are effective and these
measures will remediate the material weaknesses discussed above when all of the
additional financial staff positions are filled, we cannot assure you that this
will be sufficient. We may be required to expend additional resources to
identify, assess and correct any additional weaknesses in disclosure or internal
control.  Changes in Internal Controls Over Financial Reporting  Except
as described above, there have been no changes in our internal controls over
financial reporting that occurred during our last fiscal quarter to which this
Quarterly Report on Form 10-QSB relates that have materially affected, or are
reasonably likely to materially affect our internal controls over financial
reporting.   - 22
-   PART II - OTHER INFORMATION   Item 1. Legal Proceedings  Not applicable.   Item 1A. Risk Factors  Risks Related To Our Business.  The price increase of raw materials,
such as paper materials, polyethylene materials, and aluminum materials, could
increase the cost of our products and reduce our profit margin.
 Paper materials, polyethylene materials, and aluminum materials are the
major materials for our aseptic packaging products. In the last two years, the
prices of paper materials, polyethylene materials and aluminum materials have
fluctuated substantially, as have other raw materials, due to the increasing
demand in China resulting from its rapid economic development. Although we have
managed to minimize the impact of such fluctuation in the past, there is no
assurance that we will be able to do so in the future. If the price for paper
materials, polyethylene materials, aluminum materials, and other necessary raw
materials increases significantly, our profit margin could decrease considerably
and we may not be able to maintain our profitability.  We may not be able to secure
financing needed for future operating needs on acceptable terms, or on any terms
at all. From time to time, we may seek additional financing to provide
the capital required to maintain or expand our production facilities, implement
research and development and equipment and/or working capital initiatives, as
well as to repay outstanding loans if cash flow from operations is insufficient.
We cannot predict with certainty the timing or account of any such capital
requirements. If such financing is not available on satisfactory terms, we may
be unable to expand our business or develop new business at the desired rate.
Consequently, our operating results may suffer. If we are able to incur debt, we
may be subject to certain restrictions imposed by the terms of the debt and the
repayment of such debt may limit our cash flow and our ability to grow. If we
are unable to incur debt, we may be forced to issue additional equity, which
could have a dilutive effect on our current stockholders.  Expansion of our business may put
added pressure on our management and operational infrastructure impeding our
ability to meet any increased demand for our products and services and possibly
hurting our operating results . Our business plan is to significantly
grow our operations to meet anticipated growth in demand for our products and
services. Our planned growth includes the increase of our line of products and
expansion of sales in our existing markets as well as new markets over the next
few years. Growth in our business may place a significant strain on our
personnel, management, financial systems and other resources. The evolution of
our business also presents numerous risks and challenges, including, but not
limited to:  ·
the continued acceptance of our products and
services by the packaging industries;·
our ability to successfully and rapidly expand
sales to potential customers in response to potentially increasing
demand;  ·
the costs associated with such growth, which are
difficult to quantify, but could be significant;·
rapid technological change; and·
the highly competitive nature of the packaging
industries.  If we are successful in
obtaining rapid market growth of our products and services, we will be required
to deliver large volumes of quality products and services to customers on a
timely basis at a reasonable cost to those customers. Meeting any such increased
demands will require us to expand our manufacturing facilities, to increase our
ability to purchase raw materials, to increase the size of our work force, to
expand our quality control capabilities and to increase the scale upon which we
provide our products and services. Such demands would require more capital and
working capital than we currently have available and we may be unable to meet
the needs of our customers, this could adversely affect our relationship with
customers, leading to a reduction in our revenues.   - 23
-    We have a history of operating
losses, and there can be no assurance that we can sustain or increase
profitability and, as a result, may not operate as a going concern.
 While we recently achieved an operating profit, we have had operating
losses in some of the years since our inception and there can be no assurance
that we can sustain or increase profitability. Unanticipated problems, expenses,
and delays are frequently encountered in developing and marketing products.
These include, but are not limited to, competition, the need to develop
customers and market expertise, market conditions, sales, marketing, increases
in the cost of raw materials and governmental regulation. Our failure to meet
any of these conditions would have a materially adverse effect upon us and may
force us to reduce or curtail our operations. Revenues and profits, if any, will
depend upon various factors. We may not achieve our business objectives and the
failure to achieve such goals would have an adverse impact on our business and
results of operations. In addition, we expect to incur additional general and
administrative expenses as a public company in the United States which could
also have a negative impact on our profitability.  Our existing indebtedness may
adversely affect our ability to obtain additional funds and may increase our
vulnerability to economic or business downturns.  Our indebtedness
aggregated approximately US$5.8 million as of September 30, 2007. As a result,
we are subject to the risks associated with significant indebtedness,
including:  ·
we must dedicate a portion of our cash flows from
operations to pay debt service costs and, as a result, we have less funds
available for operations and other purposes;·
it may be more difficult and expensive to obtain
additional funds through financings, if available at all;·
we are more vulnerable to economic downturns and
fluctuations in interest rates, less able to withstand competitive
pressures and less flexible in reacting to changes in our industry and
general economic conditions; and·
if we default under any of our existing credit
facilities or if our creditors demand payment of a portion or all of our
indebtedness, we may not have sufficient funds to make such
payments.  We have pledged substantially all of
our assets to secure our borrowings and are subject to covenants that may
restrict our ability to operate our business.  Our borrowings under
our existing loan agreements are secured by substantially all of our assets. If
we default under the indebtedness secured by our assets, those assets would be
available to the secured creditor to satisfy our obligations to the secured
creditor. In addition, our loan agreements impose certain restrictive covenants,
including financial covenants. Failure to satisfy any of these covenants could
result in all or any of the following:  ·
acceleration of the payment of our outstanding
indebtedness;·
cross defaults to and acceleration of the payment
under other financing arrangements;·
our inability to borrow additional amounts under
our existing financing arrangements; and·
our inability to secure financing on favorable
terms or at all from alternative sources.  Any of these consequences could adversely affect our
ability to acquire consumer receivable portfolios and operate our business.  The failure to maintain our
relationships with our existing customers or the failure to obtain new customers
could negatively affect our revenues and decrease our earnings or have an
adverse impact on our business.  We maintain purchase orders for
the sales of our products to our customers. Although we have entered into
agreements to supply our customers, we cannot assure that such agreements will
be renewed when the terms of such agreements expire or that our relationships
with our customers will be maintained on satisfactory terms, if at all. The
failure to maintain our relationships with our customers or the failure to
obtain new customers could (i) negatively affect our revenues and decrease our
earnings or (ii) adversely impact our business.   - 24
-    We rely on a limited number of
suppliers and the loss of any of our suppliers, or delays or problems in the
supply of materials used in our products, could materially and adversely affect
our business, financial condition, results of operations and growth
prospects.  We generally rely on one or two suppliers for each of
the primary materials used in our products, including paper, polyethylene and
aluminum, and otherwise rely on a limited number of suppliers for the other
materials used in our products. Our suppliers may not be able to supply the
necessary materials without interruption. We may not have adequate remedies for
their failure to supply us which could result in a shortage of our products. If
one of our suppliers fails or refuses to supply us for any reason, it could take
time and expense to obtain a new supplier. In addition, our failure to maintain
existing relationships with our suppliers or to establish new relationships in
the future could negatively affect our ability to obtain the materials used in
our products in a timely manner. The search for new suppliers could potentially
delay the manufacture of our products, resulting in shortages in the marketplace
and may cause us to incur additional expense. Failure to comply with applicable
legal requirements subjects our suppliers to possible legal or regulatory
action, including shutdown, which may adversely affect their ability to supply
us with the materials we need for our products. Any delay in supplying, or
failure to supply, materials for our products by any of our suppliers could
result in our inability to meet the commercial demand for our products, and
could adversely affect our business, financial condition, results of operations
and growth prospects.  We may not be able to adequately
protect our intellectual property, which could harm our competitive
advantage. We rely on a combination of patent,
copyright, trademark and trade secret laws and restrictions on disclosure to
protect our intellectual property rights. Piracy of intellectual property is
widespread in China and despite our efforts to protect our intellectual
proprietary rights, unauthorized parties may attempt to copy or otherwise obtain
and use our technology. Monitoring unauthorized use of our technology is
difficult and costly, and we cannot be certain that the steps we have taken will
prevent misappropriations of our technology, particularly in countries where the
laws may not protect our intellectual property rights as fully as in other
countries such as the United States of America. In addition, third parties may
seek to challenge, invalidate, circumvent or render unenforceable any
intellectual property rights owned by us. From time to time, we may have to
resort to litigation to enforce our intellectual property rights, which could
result in substantial costs, diversion of our managements attention and
diversion of our other resources.  The failure to increase our current
manufacturing capacity could materially and adversely affect our business,
financial condition, results of operations and growth prospects.
 We currently manufacture our products at a single facility with two
production lines. Manufacturing products at a single site presents risks because
a disaster, such as a fire or hurricane, may interrupt our manufacturing
capability. In such an event, we will have to resort to alternative sources of
manufacturing that could increase our costs as well as result in significant
delays. Any increase in costs, slowdowns or shutdowns could have a material
adverse affect on our business, financial condition, results of operations and
growth prospects.  Our use of a single
manufacturing facility with two production lines may restrict our ability to
attract large customers who require certainty in the production process. We
intend to expand our manufacturing operations by adding additional production
lines, but there is no assurance that we will have the financial resources
required for this planned expansion or that any such expansion will be
successful or completed in a timely fashion or within budget. We may encounter
difficulties and significant unexpected costs and delays in scaling up our
manufacturing operations. The failure to scale-up manufacturing operations in a
timely and cost-effective way may adversely affect our income. In the event the
demand for our products rapidly increases or spikes in a certain period, we may
not have the manufacturing ability to fulfill demand, either in our own
facilities or through agreements with third parties. This lack of manufacturing
capacity could have a material adverse affect on our business, financial
condition, results of operations and growth prospects.  Our failure to successfully develop
new business segments could have a material adverse affect on our business,
financial condition, results of operations and growth prospects.
 We are currently pursuing and in the future may pursue new technologies
and businesses segments internally or through acquisitions or combinations which
involve significant risks. Any such acquisition or combination may involve,
among other things, the payment of cash, the incurrence of contingent
liabilities and the amortization of expenses related to goodwill and other
intangible assets, and transaction costs, which may adversely affect our
business, financial condition, results of operations and growth prospects. Our
ability to integrate and organize any new businesses and/or products, whether
internally developed or obtained by acquisition or combination, will likely
require significant expansion of our operations. There is no assurance that we
will have or be able to obtain the necessary resources to satisfactorily effect
such expansion, and the failure to do so could have a material adverse effect on
our business, financial condition, results of operations and growth prospects.
In addition, future acquisitions or combinations by us involve risks of, among
other things, entering markets or segments in which we have no or limited prior
experience, the potential loss of key employees or difficulty, delay or failure
in the integration of the operations of any such new business with our current
business and operating and financial difficulties of any new or newly combined
operations, any of which could have a materially adverse effect on our business,
financial condition, results of operations and growth prospects. Moreover, there
can be no assurance that the anticipated benefits of any internally developed
new business segment or business combination will be realized.  - 25 -    The loss of one or more members of
our management team or other key employees could affect our
ability to successfully grow our business . Our success and future
growth depends to a significant degree on the skills and continued services of
our management team and other key employees, including but not limited to, Yijun
Wang, our Chairman, Chief Executive Officer and President (and Chairman and
Chief Executive Officer of Qingdao Renmin) and Qingjun Yang, the President of
Qingdao Renmin. Qingdao Renmin currently has employment agreements with its
named executive officers but does not currently maintain key person life
insurance. If one or more members of our management or other key employees were
to resign or no longer be able to serve as our employees, it could impair our
revenue growth, business and future prospects. Further, our ability to execute
our business plan is dependent on our ability to attract and retain additional
highly skilled personnel.  We do not have a majority of
independent directors serving on our board of directors, which could present the
potential for conflicts of interest.  We do not have a majority of
independent directors serving on our board of directors and we cannot guarantee
that our board of directors will have a majority of independent directors in the
future. In the absence of a majority of independent directors, our executive
officers could establish policies and enter into transactions without
independent review and approval thereof. This could present the potential for a
conflict of interest between us and our stockholders, generally, and the
controlling officers, stockholders or directors.  We may be exposed to risks relating
to our disclosure controls and our internal controls and may need to incur
significant costs to comply with applicable requirements. Based on the evaluation done by our management at December 31,
2007, our disclosure controls were deemed deficient, in that we could not assure
that information required to be disclosed in our SEC reports is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commissions rules and forms, and communicated to our
management, so as to allow timely decisions regarding required
disclosures.  Due to staffing and resource constraints, a material weakness
became evident to management regarding our inability to simultaneously close the
books on a timely basis each month and quarter and to generate all the necessary
disclosure for inclusion in our SEC filings. This material weakness caused us to
be late in the filing of our Quarterly Report on Form 10-Q for
the quarter ended December 31, 2007. In our quarterly report for the
quarter ending September 30, 2007, we did not have sufficient resources to
discover and correctly account for the impact of the issuance of certain
warrants on our financial statements.  In addition, this lack of staffing
and resources led to a misstatement in our financial statements.  Based on the evaluation done by our
management as of March 31, 2008, our internal controls were deemed deficient, in
that we did not accurately account for the Share Exchange and related
transactions so as to avoid a material misstatement in our financial statements
that would not be prevented or detected in a timely manner.  Due to SEC
comments we received concerning our registration statement on Form S-1, we
conducted further research about how to account for the share exchange and
related activities and only then did management recognize the material weakness.
This material weakness caused an error in our financial statements regarding how
we accounted for the share exchange and the placement agent warrants issued in
the financing that closed simultaneously with the share exchange.  These
mistakes flowed through to our financial statements for the quarters ending
September 30, 2007 and December 31, 2007.  On May 4, 2008, the Board of
Directors concluded that we are required to restate our previously issued
audited financial statements for the year ended June 30, 2007 and the periods
ended September 30, 2007 and December 31, 2007.  Subsequent to the issuance
of these financial statements, management identified various errors in
connection with its 2007 financial statements and determined that a restatement
was necessary.  Restated financial statements for the year ending June 30,
2007 will be included in an amendment to our Registration Statement on
Form S-1,  restated financials for the quarter ending December 31, 2007 are
included in an amendment to the quarterly report for such period, which we filed
on this same date and restated financials for the quarter ending September 30,
2007 are included in this amendment.  We are seeking to recruit experienced
professionals to augment and upgrade our financial staff to address issues of
timeliness and completeness in financial reporting when we are
preparing SEC filings.  No assurances can be given that we will be
able to adequately remediate existing deficiencies in disclosure controls and
not have deficiencies when we report on internal controls.  Although we
believe that these corrective steps  restating our financial statements and
hiring a new Acting CFO  will enable management to conclude that our disclosure
controls are effective and these measures will remediate the material weaknesses
discussed above when all of the additional financial staff positions are filled,
we cannot assure you that this will be sufficient. We may be required to expend
additional resources to identify, assess and correct any additional weaknesses
in disclosure or internal control and to otherwise comply with the internal
controls rules under Section 404 of the Sarbanes-Oxley Act which will be newly
applicable to us for the fist time at the end of this fiscal year   If we are unable to establish
appropriate internal financial reporting controls and procedures, it could cause
us to fail to meet our reporting obligations, result in the restatement of our
financial statements, harm our operating results, subject us to regulatory
scrutiny and sanction, cause investors to lose confidence in our reported
financial information and have a negative effect on the market price for shares
of our common stock.  Effective internal controls are necessary for
us to provide reliable financial reports and effectively prevent fraud. We
maintain a system of internal control over financial reporting, which is defined
as a process designed by, or under the supervision of, our principal executive
officer and principal financial officer, or persons performing similar
functions, and effected by our board of directors, management and other
personnel, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles.  - 26 -  As a public company, we will have significant additional
requirements for enhanced financial reporting and internal controls. We will be
required to document and test our internal control procedures in order to
satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002, which
requires annual management assessments of the effectiveness of our internal
controls over financial reporting and a report by our independent registered
public accounting firm addressing these assessments. The process of designing
and implementing effective internal controls is a continuous effort that
requires us to anticipate and react to changes in our business and the economic
and regulatory environments and to expend significant resources to maintain a
system of internal controls that is adequate to satisfy our reporting
obligations as a public company.  We cannot assure you
that we will not, in the future, identify additional areas requiring improvement
in our internal control over financial reporting. We cannot assure you that the
measures we will take to remediate any areas in need of improvement will be
successful or that we will implement and maintain adequate controls over our
financial processes and reporting in the future as we continue our growth. If we
are unable to establish appropriate internal financial reporting controls and
procedures, it could cause us to fail to meet our reporting obligations, result
in the restatement of our financial statements, harm our operating results,
subject us to regulatory scrutiny and sanction, cause investors to lose
confidence in our reported financial information and have a negative effect on
the market price for shares of our common stock.    - 27
-    We face significant competition in
each product we offer and each geographic market in which we operate, and if we
fail to compete effectively, we may lose our market share and our profitability
may be adversely affected.  The aseptic liquid food and beverage
carton market in China is rapidly evolving and highly competitive. We expect
competition in this market to persist and intensify. We face competition in each
major product line we offer and each geographic market in which we operate. We
face nationwide competition primarily from Tetra Pack and SIG Cambibloc (SIG),
both multi-national companies which currently have an estimated combined 90% of
the aseptic carton market. We also face competition from domestic aseptic carton
suppliers in China. Existing or future competing products may provide (i) better
quality and technology, (ii) greater utility, lower cost or other benefits from
their intended uses than our products, or (iii) may offer comparable performance
at lower cost. Many of these companies are well-established, have substantially
greater financial and other resources, and have more experience in manufacturing
and marketing than we do. There can be no assurance that we will be able to
compete successfully with such competitors. If our products fail to capture and
maintain market share, we may not achieve sufficient product revenues, and our
business could suffer.  High margins for the aseptic liquid
food and beverage cartons business will attract more businesses to enter this
field. Our business could suffer as a result of more competition.
 Our business has enjoyed relatively high profit margins so far due to the
fact that we have concentrated in the aseptic liquid food and beverage carton
business. Such high margins will attract more businesses to enter into this
field. As a result, competition may intensify and our profits may drop
significantly.  Risks Related To Doing Business in
China  Changes in Chinas political or
economic situation could harm us and our operational results. Economic
reforms adopted by the Chinese government have had a positive effect on the
economic development of the country, but the government could change these
economic reforms or any of the legal systems at any time. This could either
benefit or damage our operations and profitability. Some of the things that
could have this effect are:  ·
level of government involvement in the
economy;·
control of foreign exchange;·
methods of allocating resources;·
balance of payments position;·
international trade restrictions; and·
international conflict.  The Chinese economy
differs from the economies of most countries belonging to the Organization for
Economic Cooperation and Development, or OECD, in many ways. The economic
reforms in China have been conducted under a tight grip of the Chinese
government. As a result of these differences, we may not develop in the same way
or at the same rate as might be expected if the Chinese economy were similar to
those of the OECD member countries.  Our business is largely subject to
the uncertain legal environment in China and your legal protection could be
limited. The Chinese legal system is a civil law system based on written
statutes. Unlike common law systems, it is a system in which precedents set in
earlier legal cases are not generally used. The overall effect of legislation
enacted over the past 20 years has been to enhance the protections afforded to
foreign invested enterprises in China. However, these laws, regulations and
legal requirements are relatively recent and are evolving rapidly, and their
interpretation and enforcement involve uncertainties. These uncertainties could
limit the legal protections available to foreign shareholders, such as the right
of foreign invested enterprises to hold licenses and permits such as requisite
business licenses. Because most of our officers and directors reside outside of
the United States, it may be difficult, if not impossible, to acquire
jurisdiction over those persons if a lawsuit is initiated against us and/or its
officers and directors by a shareholder or group of shareholders in the United
States. Also, because our officers will likely be residing in the PRC at the
time such a suit is initiated, achieving service of process against such persons
would be extremely difficult. Furthermore, because the majority of our assets
are located in the Peoples Republic of China (PRC) it would also be extremely
difficult to access those assets to satisfy an award entered against us in
United States court. Moreover, we have been advised that the PRC does not have
treaties with the United States providing for the reciprocal recognition and
enforcement of judgments of courts.    - 28
-    Recent PRC regulations relating to
mergers and acquisitions of domestic enterprises by foreign
investors may increase the administrative burden we face and
create regulatory uncertainties . On August 8, 2006, six PRC regulatory
agencies, namely, the PRC Ministry of Commerce (MOFCOM), the State Assets
Supervision and Administration Commission (SASAC), the State Administration
for Taxation, the State Administration for Industry and Commerce, the China
Securities Regulatory Commission (CSRC), and the State Administration of
Foreign Exchange, (SAFE), jointly adopted the Regulations on Mergers and
Acquisitions of Domestic Enterprises by Foreign Investors (New M&A Rule),
which became effective on September 8, 2006. The New M&A Rule purports,
among other things, to require offshore special purpose vehicles (SPVs),
formed for overseas listing purposes through acquisitions of PRC domestic
companies and controlled by PRC companies or individuals, to obtain the approval
of the CSRC prior to publicly listing their securities on an overseas stock
exchange.  On September 21, 2006,
pursuant to the New M&A Rule and other PRC laws and regulations, the CSRC,
in its official website, promulgated relevant guidance with respect to the
issues of listing and trading of domestic enterprises securities on overseas
stock exchanges (the Administrative Permits), including a list of application
materials with respect to the listing on overseas stock exchanges by SPVs.  Based on our
understanding of current PRC Laws, we believe that the New M&A Rule does not
require us or our Chinese shareholders or our entities in China to obtain the
CSRC approval in connection with the transaction contemplated by the share
exchange agreement, by and among the Company, Jpak and the shareholders of Jpak
named therein, dated as of August 9, 2007 (the Securities Exchange Agreement
or SEA), in connection with the Share Exchange because Grand International
completed the approval procedures of the acquisition of the 88.23% equity
interest in Qingdao Renmin at MOFCOM before September 8, 2006 when the New
M&A Rule became effective.  There are, however,
substantial uncertainties regarding the interpretation and application of
current or future PRC laws and regulations, including the New M&A Rule.
Accordingly, we cannot assure you that PRC government authorities will not
ultimately take a view contrary to our understanding that we do not need the
CSRC approval, and PRC government authorities may impose some additional
approvals and requirements.  Further, if the PRC
government finds that we or our Chinese shareholders did not obtain the CSRC
approval, which CSRC may think we should have obtained before our executing the
Securities Exchange Agreement, we could be subject to severe penalties. The New
M&A Rule does not stipulate the specific penalty terms, so we are not able
to predict what penalties we may face, and how such penalties will affect our
business operations or future strategy.  The Chinese government exerts
substantial influence over the manner in which we must conduct our business
activities. China only recently has permitted provincial and local
economic autonomy and private economic activities and, as a result, we are
dependent on our relationship with the local government in the province in which
we operate our business. Chinese government has exercised and continues to
exercise substantial control over virtually every sector of the Chinese economy
through regulation and state ownership. Our ability to operate in China may be
harmed by changes in its laws and regulations, including those relating to
taxation, import and export tariffs, environmental regulations, land use rights,
property and other matters. We believe that our operations in China are in
material compliance with all applicable legal and regulatory requirements.
However, the central or local governments of these jurisdictions may impose new,
stricter regulations or interpretations of existing regulations that would
require additional expenditures and efforts on our part to ensure our compliance
with such regulations or interpretations. Accordingly, government actions in the
future, including any decision not to continue to support recent economic
reforms and to return to a more centrally planned economy or regional or local
variations in the implementation of economic policies, could have a significant
effect on economic conditions in China or particular regions thereof, and could
require us to divest ourselves of any interest we then hold in Chinese
properties.  Future inflation in China may inhibit
our activity to conduct business in China. In recent years, the Chinese
economy has experienced periods of rapid expansion and high rates of inflation.
During the past ten years, the rate of inflation in China has been as high as
20.7% and as low as -2.2%. These factors have led to the adoption by Chinese
government, from time to time, of various corrective measures designed to
restrict the availability of credit or regulate growth and contain inflation.
While inflation has been more moderate since 1995, high inflation may in the
future cause Chinese government to impose controls on credit and/or prices, or
to take other action, which could inhibit economic activity in China, and
thereby harm the market for our products.   - 29
-    Restrictions on currency exchange may
limit our ability to receive and use our revenues effectively. The
majority of our revenues will be settled in RMB (RMB) and, any future
restrictions on currency exchanges may limit our ability to use revenue
generated in RMB to fund any future business activities outside China or to make
dividend or other payments in U.S. dollars. Although the Chinese government
introduced regulations in 1996 to allow greater convertibility of the RMB for
current account transactions, significant restrictions still remain, including
primarily the restriction that foreign-invested enterprises may only buy, sell
or remit foreign currencies after providing valid commercial documents, at those
banks in China authorized to conduct foreign exchange business. In addition,
conversion of RMB for capital account items, including direct investment and
loans, is subject to governmental approval in China, and companies are required
to open and maintain separate foreign exchange accounts for capital account
items. We cannot be certain that the Chinese regulatory authorities will not
impose more stringent restrictions on the convertibility of the RMB.  The value of our securities will be
affected by the foreign exchange rate between U.S. dollars and RMB. The
value of our common stock will be affected by the foreign exchange rate between
U.S. dollars and RMB, and between those currencies and other currencies in which
our sales may be denominated. For example, to the extent that we need to convert
U.S. dollars into RMB for our operational needs and should the RMB appreciate
against the U.S. dollar at that time, our financial position, the business of
the company, and the price of our common stock may be harmed. Conversely, if we
decide to convert our RMB into U.S. dollars for the purpose of declaring
dividends on our common stock or for other business purposes and the U.S. dollar
appreciates against the RMB, the U.S. dollar equivalent of our earnings from our
subsidiaries in China would be reduced.  Government regulations and
environmental matter in China may adversely impact on our business. Our
manufacturing operations are subject to numerous laws, regulations,  rules and specifications relating to human
health and safety and  the environment.
These laws and regulations address and regulate, among other  matters, wastewater discharge, air quality and
the generation, handling,  storage,
treatment, disposal and transportation of solid and hazardous wastes  and releases of hazardous substances into the
environment. In addition, third  parties
and governmental agencies in some cases have the power under such laws  and regulations to require remediation of
environmental conditions and, in the  case
of governmental agencies, to impose fines and penalties. We make capital
expenditures from time to time to stay in compliance with  applicable laws and regulations.  We have obtained all
permits and approvals and filed all registrations required for the conduct of
its business, except where the failure to obtain any permit or approval or file
any registration would not have a material adverse effect on our business,
financial condition and results of operations. We are in compliance in all
material respects with the numerous laws, regulations,  rules, specifications and permits, approvals and
registrations relating to human health and safety and the environment except
where noncompliance would not have a material adverse effect on our business,
financial condition and results of operations.  The PRC governmental
authorities have not revealed any material environmental liability that would
have a material adverse effect on us. We have not been notified by any
governmental authority of any continuing noncompliance, liability or other claim
in connection with any of our properties or business operations, nor are we
aware of any other material environmental condition with respect to any of our
properties or arising out of our business operations at any other location.
However, in connection with the ownership and operation of our properties
(including locations to which we may have sent waste in the past) and the
conduct of our business, we potentially may be liable for damages or cleanup,
investigation or remediation costs.  No assurance can be
given that all potential environmental liabilities have been identified or
properly quantified or that any prior owner, operator, or tenant has not created
an environmental condition unknown to us. Moreover, no assurance can be given
that (i) future laws, ordinances or regulations will not impose any material
environmental liability or (ii) the current environmental condition of the
properties will not be affected by the condition of land or operations in the
vicinity of the properties (such as the presence of underground storage tanks),
or by third parties unrelated to us. State and local environmental regulatory
requirements change often.   - 30
-    It is possible that
compliance with a new regulatory requirement could impose significant compliance
costs on us. Such costs could have a material adverse effect on our business,
financial condition and results of operations.  We may have difficulty establishing
adequate management, legal and financial controls in the PRC. The PRC
historically has been deficient in Western style management and financial
reporting concepts and practices, as well as in modern banking, computer and
other control systems. We may have difficulty in hiring and retaining a
sufficient number of qualified employees to work in the PRC. As a result of
these factors, we may experience difficulty in establishing management, legal
and financial controls, collecting financial data and preparing financial
statements, books of account and corporate records and instituting business
practices that meet Western standards.  Changes in foreign exchange
regulations in the PRC may affect our ability to pay dividends in foreign
currency or conduct other foreign exchange business.  RMB is not a
freely convertible currency currently, and the restrictions on currency
exchanges may limit our ability to use revenues generated in RMB to fund our
business activities outside the PRC or to make dividends or other payments in
United States dollars. The PRC government strictly regulates conversion of RMB
into foreign currencies. Over the years, foreign exchange regulations in the PRC
have significantly reduced the governments control over routine foreign
exchange transactions under current accounts. In the PRC, the State
Administration for Foreign Exchange, or the SAFE, regulates the conversion of
the RMB into foreign currencies. Pursuant to applicable PRC laws and
regulations, foreign invested enterprises incorporated in the PRC are required
to apply for Foreign Exchange Registration Certificates. Currently, conversion
within the scope of the current account (e.g. remittance of foreign currencies
for payment of dividends, etc.) can be effected without requiring the approval
of SAFE. However, conversion of currency in the capital account (e.g. for
capital items such as direct investments, loans, securities, etc.) still
requires the approval of SAFE.  In addition, on October
21, 2005, SAFE issued the Notice on Issues Relating to the Administration of
Foreign Exchange in Fundraising and Reverse Investment Activities of Domestic
Residents Conducted via Offshore Special Purpose Companies (Notice 75), which
became effective as of November 1, 2005. Notice 75 replaced the two rules issued
by SAFE in January and April 2005.  According to Notice 75:  ·
prior to establishing or assuming control of an
offshore company for the purpose of obtaining overseas equity financing
with assets or equity interests in an onshore enterprise in the PRC, each
PRC resident, whether a natural or legal person, must complete the
overseas investment foreign exchange registration procedures with the
relevant local SAFE branch;·
an amendment to the registration with the local
SAFE branch is required to be filed by any PRC resident that directly or
indirectly holds interests in that offshore company upon either (1) the
injection of equity interests or assets of an onshore enterprise to the
offshore company, or (2) the completion of any overseas fund raising by
such offshore company; and·
an amendment to the registration with the local
SAFE branch is also required to be filed by such PRC resident when there
is any material change in the capital of the offshore company that does
not involve any return investment, such as (1) an increase or decrease in
its capital, (2) a transfer or swap of shares, (3) a merger or division,
(4) a long term equity or debt investment, or (5) the creation of any
security interests.  Moreover, Notice 75
applies retroactively. As a result, PRC residents who have established or
acquired control of offshore companies that have made onshore investments in the
PRC in the past are required to complete the relevant overseas investment
foreign exchange registration procedures by March 31, 2006. Under the relevant
rules, failure to comply with the registration procedures set forth in Notice 75
may result in restrictions being imposed on the foreign exchange activities of
the relevant onshore company, including the payment of dividends and other
distributions to its offshore parent or affiliate and the capital inflow from
the offshore entity, and may also subject relevant PRC residents to penalties
under PRC foreign exchange administration regulations.    - 31
-    In addition, SAFE issued
updated internal implementing rules (Implementing Rules) in relation to Notice
75. The Implementing Rules were promulgated and became effective on May 29,
2007. Such Implementing Rules provide more detailed provisions and requirements
regarding the overseas investment foreign exchange registration procedures. The
Implementing Rules permits retroactive registration for PRC residents who have
established or acquired control of offshore companies that have made onshore
investments in the PRC in the past but did not complete the relevant overseas
investment foreign exchange registration procedures before March 31, 2006. But
there may be penalties on the relevant PRC residents and the relevant onshore
company if any foreign exchange transactions were paid out from the relevant
onshore company to the relevant offshore company between April 21, 2005 and the
date of the application for the registration. However, even after the
promulgation of Implementing Rules there still exist uncertainties regarding the
SAFE registration for PRC residents interests in overseas companies. It remains
uncertain whether PRC residents shall go through the overseas investment foreign
exchange registration procedures under Notice 75 or Implementing Rules, who may
indirectly hold our shares through the participation and exercise of incentive
stock option granted by Joyrich Group Limited and Fabregas Group Limited,
shareholders of our company.  As a result, we cannot
predict how they will affect our business operations following our business
combination. For example, our ability to conduct foreign exchange activities
following a business combination, such as remittance of dividends and
foreign-currency-denominated borrowings, may be subject to compliance with the
SAFE registration requirements by such PRC residents, over whom we have no
control. In addition, we cannot assure you that such PRC residents will be able
to complete the necessary approval and registration procedures required by the
SAFE regulations. We will require all our shareholders, following a business
combination, who are PRC residents to comply with any SAFE registration
requirements, if required by Notice 75, Implementing Rules or other applicable
PRC laws and regulations, although we have no control over either our
shareholders or the outcome of such registration procedures. Such uncertainties
may restrict our ability to implement our business combination strategy and
adversely affect our business and prospects following a business
combination.  Our future employee stock option plan
or stock ownership plan involving any PRC domestic individual will be subject to
the administration of foreign exchange in the PRC . In accordance with
the Measures of Administration on Foreign Exchange of Individuals promulgated on
December 25, 2006 (the Measures) and the Implementing Rules of the Measures of
Administration on Foreign Exchange of Individuals (the Implementing Rules of
Measures), which became effective in February 2007, a PRC domestic individual
(i.e., a Chinese citizen as defined) who participates in the employees stock
option plan or stock plan of an overseas listed company shall conduct foreign
exchange related affairs upon the prior approval of SAFE and/or its local branch
through its employer or a PRC agency. The dividends of the shares or proceeds
received from sale of shares under the stock option plan or stock ownership plan
in foreign exchange by such PRC domestic individual shall be remitted and
deposited into the special onshore foreign currency bank account in the PRC
opened by the employer or the PRC agency. Furthermore, following the
Implementing Rules of Measures, SAFE issued the Operating Procedures for
Administration of Domestic Individuals Participating in the Employee Stock
Ownership Plan or Stock Option Plan of An Overseas Listed Company (Hui Zong Fa
[2007] No. 78, the Circular 78) on April 6, 2007. Circular 78, which
introduces a number of new and highly restrictive requirements, applies to any
employee stock option plan or stock ownership plan offered by a PRC or non-PRC
company whose shares are listed on an overseas stock exchange. Given these PRC
regulations, if we approve and implement any employee stock option plan or stock
ownership plan which will involve any PRC domestic individual, the SAFE
registration for such PRC domestic individual participating in the employee
stock ownership plan or stock option plan shall apply and be required.
Nevertheless, Circular 78 only applies to the overseas listed company other than
an overseas private company and as a result, the incentive stock option granted
by Joyrich Group Limited and Fabregas Group Limited, shareholders of our company
and private companies, to PRC residents do not fall into such SAFE registration
under Circular 78. Currently it is silent in terms of PRC statutory requirements
with respect to the PRC domestic individuals participating in employee stock
ownership plan or stock option plan of an overseas private company, since there
are no applicable PRC laws or regulations. It is unclear how future regulations
will impact the incentive stock options granted by Joyrich Group Limited and
Fabregas Group Limited.    - 32
-    Risks Relating to Our Securities  Insiders have substantial control
over us, and they could delay or prevent a change in our corporate control even
if our other stockholders wanted it to occur.  Our executive
officers, directors, and principal stockholders who hold 5% or more of our
outstanding common stock own, in the aggregate, approximately 96% of our
outstanding common stock. These stockholders are able to control all matters
requiring stockholder approval, including the election of directors and approval
of significant corporate transactions. This could delay or prevent an outside
party from acquiring or merging with us even if our other stockholders wanted it
to occur.  There is no active public trading
market for our common stock and there can be no assurance that one will develop
in the future.  There is no active public trading market for our
common stock. Our common stock is quoted on the OTC Bulletin Board. There can be
no assurance that a regular trading market will develop or that if developed,
will be sustained. The development of an active trading market will depend on
the existence of willing buyers and sellers, the presence of which is not within
our control, or the control of any market maker or specialist. The number of
active buyers and sellers of our common stock at any particular time may be
limited. Under such circumstances, our shareholders could have difficulty
selling our shares on short notice, and, therefore, our common stock should not
be viewed as a short-term or liquid investment. In the absence of a trading
market, a shareholder will be unable to liquidate his investment except by
private sale.  If we fail to remain current on our
reporting requirements, we could be removed from the OTC Bulletin Board which
would limit the ability of broker dealers to sell our securities and the ability
of stockholders to sell their securities in the secondary market.
 Companies trading on the OTC Bulletin Board must be reporting issuers
under Section 12 of the Securities Exchange Act of 1934, as amended, and must be
current in their reports under Section 13, in order to maintain price quotation
privileges on the OTC Bulletin Board. If we fail to remain current on our
reporting requirements, we could be removed from the OTC Bulletin Board. As a
result, the market liquidity for our securities could be severely adversely
affected by limiting the ability of broker-dealers to sell our securities and
the ability of stockholders to sell their securities in the secondary market. In
addition, we may be unable to get re-listed on the OTC Bulletin Board, which may
have an adverse material effect on our company.  Any market that develops in shares of
our common stock will be subject to the penny stock regulations and
restrictions, which could impair liquidity and make trading difficult.
 SEC Rule 15g-9, as amended, establishes the definition of a "penny stock"
as any equity security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to a limited number
of exceptions. It is likely that our shares will be considered to be penny
stocks for the immediately foreseeable future. This classification severely and
adversely affects the market liquidity for our common stock.  For any transaction
involving a penny stock, unless exempt, the penny stock rules require that a
broker or dealer approve a persons account for transactions in penny stocks and
the broker or dealer receive from the investor a written agreement to the
transaction setting forth the identity and quantity of the penny stock to be
purchased.   To approve a persons account for transactions in penny
stocks, the broker or dealer must obtain financial information and investment
experience and objectives of the person and make a reasonable determination that
the transactions in penny stocks are suitable for that person and that that
person has sufficient knowledge and experience in financial matters to be
capable of evaluating the risks of transactions in penny stocks.  The broker or dealer
must also deliver, prior to any transaction in a penny stock, a disclosure
schedule prepared by the SEC relating to the penny stock market which, in
highlight form, sets forth:  ·
the basis on which the broker
or dealer made the suitability determination, and·
that the broker or dealer
received a signed, written agreement from the investor prior to the
transaction.  Disclosure also has to
be made about the risks of investing in penny stock in both public offerings and
in secondary trading and commissions payable to both the broker-dealer and the
registered representative, current quotations for the securities and the rights
and remedies available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements must be sent disclosing recent price
information for the penny stock held in the account and information on the
limited market in penny stocks.     - 33
-    Because of these
regulations, broker-dealers may not wish to engage in the above-referenced
necessary paperwork and disclosures and/or may encounter difficulties in their
attempt to sell shares of our common stock, which may affect the ability of
selling stockholders or other holders to sell their shares in any secondary
market and have the effect of reducing the level of trading activity in any
secondary market. These additional sales practice and disclosure requirements
could impede the sale of our securities, if and when our securities become
publicly traded. In addition, the liquidity for our securities may decrease,
with a corresponding decrease in the price of our securities. Our shares, in all
probability, will be subject to such penny stock rules for the foreseeable
future and our shareholders will, in all likelihood, find it difficult to sell
their securities.  The market for penny stocks has
experienced numerous frauds and abuses which could adversely impact investors in
our stock.  OTC Bulletin Board securities are frequent targets of
fraud or market manipulation, both because of their generally low prices and
because OTC Bulletin Board reporting requirements are less stringent than those
of the stock exchanges or NASDAQ.  Patterns of fraud and abuse
include:  ·
Control of the market for the
security by one or a few broker-dealers that are often related to the
promoter or issuer;·
Manipulation of prices through
prearranged matching of purchases and sales and false and misleading press
releases;·
Boiler room" practices
involving high pressure sales tactics and unrealistic price projections by
inexperienced sales persons;·
Excessive and undisclosed
bid-ask differentials and markups by selling broker-dealers; and·
Wholesale dumping of the same
securities by promoters and broker-dealers after prices have been
manipulated to a desired level, along with the inevitable collapse of
those prices with consequent investor losses.  Our management is aware of the abuses that have occurred
historically in the penny stock market.  In the event that we raise additional
capital through the issuance of equity securities, or securities exercisable for
or convertible into our equity securities, our stockholders could experience
substantial dilution.  If we raise additional capital by issuing
equity securities or convertible debt securities, our existing stockholders may
incur substantial dilution. Further, any shares so issued may have rights,
preferences and privileges superior to the rights, preferences and privileges of
our outstanding securities.  The market price of our common stock
may be volatile. The market price of our common stock will likely be
highly volatile, as is the stock market in general, and the market for OTC
Bulletin Board quoted stocks in particular. Some of the factors that may
materially affect the market price of our common stock are beyond our control,
such as changes in financial estimates by industry and securities analysts,
conditions or trends in industries in which we operate, announcements made by
our competitors or sales of our common stock. These factors may materially
adversely affect the market price of our common stock, regardless of our
performance.  In addition, the public
stock markets have experienced extreme price and trading volume volatility. This
volatility has significantly affected the market prices of securities of many
companies for reasons frequently unrelated to the operating performance of the
specific companies. These broad market fluctuations may adversely affect the
market price of our common stock.  We have not paid dividends in the
past and do not expect to pay dividends in the future, and any return on
investment may be limited to the value of our stock.  We have never
paid any cash dividends on our common stock and do not anticipate paying any
cash dividends on our common stock in the foreseeable future and any return on
investment may be limited to the value of our stock. We plan to retain any
future earnings to finance growth.    - 34
-    Anti-takeover provisions of Nevada
law, our articles of incorporation and our bylaws may prevent or delay an
acquisition of us that shareholders may consider favorable or attempts to
replace or remove our management that could be beneficial to our
shareholders.  Our articles of incorporation and bylaws contain
provisions which could make it more difficult for a third party to acquire us
without the consent of our board of directors. Our bylaws impose restrictions on
the persons who may call special shareholder meetings. Furthermore, the Nevada
Revised Statutes contain an affiliated transaction provision that prohibits a
publicly-held Nevada corporation from engaging in a broad range of business
combinations or other extraordinary corporate transactions with an interested
stockholder unless, among others, (i) the transaction is approved by a majority
of disinterested directors before the person becomes an interested shareholder
or (ii) the transaction is approved by the holders of a majority of the
corporations voting shares other than those owned by the interested
shareholder. An interested shareholder is defined as a person who together with
affiliates and associates beneficially owns more than 10% of the corporations
outstanding voting shares. This provision may have the effect of delaying or
preventing a change of control of our company even if this change of control
would benefit our shareholders.   Item 2. Unregistered Sales of Equity Securities and
Use of Proceeds  Not applicable.   Item 3. Defaults Upon Senior
Securities  Not applicable.   Item 4. Submission of Matters to a Vote
of Security Holders  Not applicable.   Item 5. Other Information   We filed a Current Report on Form 8-K on
May 8, 2008, to disclose that our previously issued financial statements for the
year ended June 30, 2007 (which were included in our Registration Statement on
Form S-1), and the quarters ended September 30, 2007, and December 31, 2007,
should no longer be relied upon because management identified various errors in
connection with its 2007 financial statements and determined that a restatement
was necessary.  We disclosed that this material weakness caused an error in
our financial statements regarding how we accounted for the share exchange and
the placement agent warrants issued in the financing that closed simultaneously
with the share exchange and the cash flow translation in our June 30, 2007
financial statements.  However, since filing our Quarterly Report on Form
10-Q for the quarter ending March 31, 2008, we believe that we did not err
in our cash flow translation and therefore we are not changing our translation
method.  Other than as stated hrein, no other changes were made to the 8-K
and all of the other information contained therein remains accurate.  Item 6. Exhibits  See Exhibit Index on
page 31 for a description of the documents that are filed as Exhibits to this
report on Form 10-Q or incorporated by reference herein.    - 35
-    SIGNATURES   Pursuant to the
requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.  JPAK GROUP, INC.By:
/s/ Yijun WangYijun Wang
Chief Executive OfficerBy:
/s/ Dongliang (Frank) SuDongliang (Frank) Su
Acting Chief Financial
Officer  Date: May 23, 2008    - 36
-    EXHIBIT INDEX  Exhibit No.

Description2.1

Securities Exchange Agreement by and among Jpak
Group, Inc., Jpak Group Co., Ltd., the shareholders of Jpak Group Co.,
Ltd. named therein and the selling party named therein, dated as of August
9, 2007 (incorporated by reference to Exhibit 2.1 of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).3.1

Articles of Incorporation of Jpak Group, Inc.
(f/k/a Rx Staffing, Inc.), filed with the Secretary of State of Nevada on
December 6, 2004 (incorporated by reference to Exhibit 3 of Rx Staffing,
Inc.s Form SB-2 filed on June 10, 2005).3.1(a)

Certificate of Amendment to Articles of
Incorporation, filed with the Secretary of State of Nevada on November 29,
2006 (incorporated by reference to Exhibit 3.1(a) of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).3.1(b)

Certificate of Amendment to Articles of
Incorporation, filed with the Secretary of State of Nevada on July 27,
2007 (incorporated by reference to Exhibit 3.1(b) of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).3.2

By-laws of Jpak Group, Inc. (f/k/a Rx Staffing,
Inc.), adopted on December 10, 2004 (incorporated by reference to Exhibit
3 of Rx Staffing, Inc.s Form SB-2 filed on June 10, 2005).3.2(a)

First Amendment to By-laws adopted on July 27, 2007
(incorporated by reference to Exhibit 3.2(a) of Rx Staffing, Inc.s Form
8-K filed on August 15, 2007).4.1

Certificate of Designation of the Relative Rights
and Preferences of the Series A Convertible Preferred Stock of Jpak Group,
Inc., filed with the Secretary of State of Nevada on August 9, 2007
(incorporated by reference to Exhibit 4.1 of Rx Staffing, Inc.s Form 8-K
filed on August 15, 2007).4.1(a)

Amendment to the Certificate of Designation of the
Relative Rights and Preferences of the Series A Convertible Preferred
Stock of Jpak Group, Inc., filed with the Secretary of State of Nevada on
October 1, 2007 (incorporated by reference to Exhibit 4.1(a) of the
Companys Form 8-K filed on October 9, 2007).4.2

Form of Certificate of Designation of the Relative
Rights and Preferences of the Series B Convertible Preferred Stock of Jpak
Group, Inc. (incorporated by reference to Exhibit 4.2 of Rx Staffing,
Inc.s Form 8-K filed on August 15, 2007).4.3

Series A Warrant to Purchase shares of common stock
of Jpak Group, Inc., issued on August 9, 2007 (incorporated by reference
to Exhibit 4.3 of Rx Staffing, Inc.s Form 8-K filed on August 15,
2007).4.4

Series B Warrant to Purchase shares of common stock
of Jpak Group, Inc., issued on August 9, 2007 (incorporated by reference
to Exhibit 4.4 of Rx Staffing, Inc.s Form 8-K filed on August 15,
2007).4.5

Series J Warrant to Purchase shares of the Series B
Convertible Preferred Stock, Series C Warrants to Purchase common stock
and Series D Warrants to Purchase common stock, issued August 9, 2007
(incorporated by reference to Exhibit 4.5 of Rx Staffing, Inc.s Form 8-K
filed on August 15, 2007).4.6

Form of Series C Warrant to Purchase shares of
common stock of Jpak Group, Inc. (incorporated by reference to Exhibit 4.6
of Rx Staffing, Inc.s Form 8-K filed on August 15, 2007).4.7

Form of Series D Warrant to Purchase shares of
common stock of Jpak Group, Inc. (incorporated by reference to Exhibit 4.7
of Rx Staffing, Inc.s Form 8-K filed on August 15, 2007).10.1

Note Purchase Agreement by and among Jpak Group
Co., Ltd, Grand International Industrial Limited and the investors
identified therein, dated as of May 17, 2007 (incorporated by reference to
Exhibit 10.1 of Rx Staffing, Inc.s Form 8-K filed on August 15,
2007). - 37 -   10.2

Joinder Agreement executed by Jpak Group, Inc.,
dated as of August 9, 2007 (incorporated by reference to Exhibit 10.2 of
Rx Staffing, Inc.s Form 8-K filed on August 15, 2007).10.3

Registration Rights Agreement by and among Jpak
Group, Inc. and the purchasers named therein, dated as of August 9, 2007
(incorporated by reference to Exhibit 10.3 of Rx Staffing, Inc.s Form 8-K
filed on August 15, 2007).10.4

Securities Escrow Agreement by and among Jpak
Group, Inc., the purchasers named therein, the principal stockholders of
Jpak Group, Inc. named therein and the escrow agent named therein, dated
as of August 9, 2007 (incorporated by reference to Exhibit 10.4 of Rx
Staffing, Inc.s Form 8-K filed on August 15, 2007).10.5

Lock-Up Agreement by and among Jpak Group, Inc. and
the shareholders of Jpak Group, Inc. named therein, dated as of August 9,
2007 (incorporated by reference to Exhibit 10.5 of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).10.6

Working Capital Loan Contract, effective as of
August 27, 2006, by and between Qingdao Renmin Printing Co., Ltd., as
borrower, and Industrial and Commercial Bank of China, Qingdao Branch, as
lender (incorporated by reference to Exhibit 10.6 of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).10.7

Working Capital Loan Contract, effective as of
February 12, 2007, by and between Qingdao Renmin Printing Co., Ltd., as
borrower, and Qingdao City Commercial Bank, Yongping Branch, as lender
(incorporated by reference to Exhibit 10.7 of Rx Staffing, Inc.s Form 8-K
filed on August 15, 2007).    - 38
-    10.8

Working Capital Loan Contract, effective as of
February 12, 2007, by and between Qingdao Renmin Printing Co., Ltd., as
borrower, and Industrial and Commercial Bank of China, Qingdao Branch, as
lender (incorporated by reference to Exhibit 10.8 of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).10.9

Working Capital Loan Contract, effective as of
April 10, 2007, by and between Qingdao Renmin Printing Co., Ltd., as
borrower, and Industrial and Commercial Bank of China, Qingdao Branch, as
lender (incorporated by reference to Exhibit 10.9 of Rx Staffing, Inc.s
Form 8-K filed on August 15, 2007).10.10

Employment Agreement, effective June 1, 2001, by
and between Qindgao Renmin Printing Co., Ltd., as employer and Yijun Wang,
as employee (incorporated by reference to Exhibit 10.10 of Rx Staffing,
Inc.s Registration Statement on Form S-1 filed on November 9,
2007).10.11

Employment Agreement, effective June 1, 2001, by
and between Qindgao Renmin Printing Co., Ltd., as employer and Ming Qi, as
employee (incorporated by reference to Exhibit 10.11 of Rx Staffing,
Inc.s Registration Statement on Form S-1 filed on November 9,
2007).31.1

Certification of the Chief Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2

Certification of the Acting Chief Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1

Certification of the Chief Executive Officer
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.32.2

Certification of the Acting Chief Financial Officer
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.                 - 39 -