UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON, D.C.
      20549




FORM 10-Q





þ
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**
              
              For
                the quarterly period ended December
                31, 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.




Yes x No o




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 filer o Accelerated
      Filer o Non-accelerated
      filer x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).




Yes o No x




Indicate
      the number of shares outstanding of each of the issuer’s classes of common
      stock, as of the latest practicable date.




On
      February 14, 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, par 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 Series B Convertible Preferred Stock, par value $.0001
      per
      share outstanding, which shares are convertible into an aggregate of 8,333,333
      shares of common stock.









JPAK
      GROUP, INC.





INDEX





**Page**
              **Number**PART
                I - FINANCIAL INFORMATIONItem
                1.
            
            Financial
                StatementsConsolidated
                Balance SheetsDecember
                31, 2007 (unaudited) and June 30, 2007
            
            3Consolidated
                Statements of Operations (unaudited)Three
                months ended December 31, 2007 and 2006
            
            4Consolidated
                Statements of Cash Flows (unaudited)Three
                months ended December 30, 2007 and 2006
            
            5Notes
                to Condensed Consolidated Financial Statements
            
            6Item
                2.
            
            Management’s
                Discussion and Analysis of Financial Condition and Results of Operations
            
            10Item
                3.
            
            Quantitative
                and Qualitative Disclosure About Market Risks
            
            16Item
                4.
            
            Controls
                and Procedures
            
            16PART
                II - OTHER INFORMATIONItem
                1.
            
            Legal
                Proceedings
            
            17Item
                1.A
            
            Risk
                Factors
            
            17Item
                2.
            
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            
            18Item
                3.
            
            Defaults
                Upon Senior Securities
            
            18Item
                4.
            
            Submission
                of Matters to a Vote of Security Holders
            
            18Item
                5.
            
            Other
                Information
            
            18Item
                6.
            
            Exhibits
            
            18




2





**PART
      I. FINANCIAL INFORMATION**




**Item
      1. Financial Statements**





**JPAK
      GROUP, INC.**





**CONSOLIDATED
      BALANCE SHEETS**





**(UNAUDITED)**





**ASSETS**





**December
                31,**
            
            **June
                30,****2007**
            
            **2007****CURRENT
                ASSETS**Cash
                and cash equivalents
            
            $
            7,029,604
            
            $
            4,938,200Account
                receivables, net of allowance $40,603 and $38,945
            
            
            6,976,926
            
            
            8,583,396Inventory
            
            
            2,849,813
            
            
            3,393,896Other
                receivables
            
            
            120,519
            
            
            -Prepaid
                expenses and other current assets
            
            
            72,645
            
            
            772,792Advanced
                payments
            
            
            2,048,889
            
            
            -Deferred
                placement agent warrant costs, net
            
            
            1,093,131
            
            
            -Deferred
                financing costs, net
            
            
            -
            
            
            405,072**Total
                Current Assets**
            
            
            **20,191,527**
            
            
            **18,093,356****PROPERTY
                AND EQUIPMENT, NET**
            
            
            **8,576,582**
            
            
            **7,935,920****LONG-TERM
                INVESTMENT**
            
            
            **104,882**
            
            
            **-****GOODWILL**
            
            
            **1,017,245**
            
            
            **953,283****Total
                Assets**
            
            **$**
            **29,785,354**
            
            **$**
            **26,982,559****LIABILITIES
                AND STOCKHOLDERS’ EQUITY****CURRENT
                LIABILITIES**Accounts
                payable and accrued expenses
            
            $
            1,937,200
            
            $
            4,634,457Trade
                notes payable
            
            
            -
            
            
            526,000Convertible
                notes
            
            
            -
            
            
            5,500,000Short-term
                bank loans
            
            
            4,113,000
            
            
            4,812,900Other
                payables
            
            
            -
            
            
            65,378**Total
                Current Liabilities**
            
            
            **6,050,200**
            
            
            **15,538,735****LONG-TERM
                DEBT**
            
            
            **1,730,339**
            
            
            **2,008,893****MINORITY
                INTEREST**
            
            
            **98,753**
            
            
            **800,039****STOCKHOLDERS’
                EQUITY**Series
                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
            
            
            24,505Series
                B convertible preferred stock, $0.001 par value, 5,000,000Shares
                authorized, 5,000,000 shares issued and outstanding
            
            
            500
            
            
            -Series
                A warrants
            
            
            1,540,000
            
            
            -Series
                B warrants
            
            
            1,155,000
            
            
            -Series
                C warrants
            
            
            833,333
            
            
            -Series
                D warrants
            
            
            458,333
            
            
            -Placement
                agent warrants
            
            
            1,127,313
            
            
            -Additional
                paid-in capital
            
            
            11,590,258
            
            
            5,885,595Retained
                earnings
            
            
            3,556,733
            
            
            1,815,309Statutory
                reserves
            
            
            371,364
            
            
            371,364Accumulated
                other comprehensive income
            
            
            1,248,162
            
            
            538,119**Total
                Stockholders’ Equity**
            
            
            **21,906,062**
            
            
            **8,634,892****Total
                Liabilities and Stockholders’ Equity**
            
            **$**
            **29,785,354**
            
            **$**
            **26,982,559**





The
      accompanying notes are an integral part of these financial
      statements.





3




**JPAK
      GROUP, INC.**





**CONSOLIDATED
      STATEMENTS OF OPERATIONS**





**AND
      COMPREHENSIVE INCOME**





**(UNAUDITED)**




**Three
                Months Ended**
            
            **Six Months
                Ended****December
                31,**
            
            **December
                31,********2007**
            
            ******2006**
            
            ******2007**
            
            ******2006****REVENUE**
            
            **$**
            **6,114,644**
            
            **$**
            **5,371,875**
            
            **$**
            **15,418,892**
            
            **$**
            **13,048,360****COST
                OF SALES**
            
            
            **4,319,117**
            
            
            **4,246,343**
            
            
            **11,306,299**
            
            
            **10,130,300****GROSS
                PROFIT**
            
            
            **1,795,527**
            
            
            **1,125,532**
            
            
            **4,112,593**
            
            
            **2,918,060****EXPENSES**Selling,
                general and administrative
            
            
            1,032,919
            
            
            1,315,884
            
            
            2,395,296
            
            
            2,429,019Depreciation
                expense
            
            
            22,241
            
            
            12,902
            
            
            41,054
            
            
            25,006**Total
                Expenses**
            
            
            **1,055,160**
            
            
            **1,328,786**
            
            
            **2,436,350**
            
            
            **2,454,025****INCOME
                FROM OPERATIONS**
            
            
            **740,367**
            
            
            **(203,254**
            **)**
            
            **1,676,243**
            
            
            **464,035****OTHER
                INCOME (EXPENSES)**Interest
                income
            
            
            8,113
            
            
            -
            
            
            32,295
            
            
            -Interest
                expense
            
            
            (104,566
            )
            
            (105,532
            )
            
            (217,755
            )
            
            (192,919
            )Other
                income (expense), net
            
            
            238,498
            
            
            133,016
            
            
            248,662
            
            
            126,254**Total
                Other Income (Expenses)**
            
            
            **142,045**
            
            
            **27,484**
            
            
            **63,202**
            
            
            **(66,665**
            **)****INCOME
                BEFORE PROVISION****FOR
                INCOME TAX**
            
            
            **882,412**
            
            
            **(175,770**
            **)**
            
            **1,739,445**
            
            
            **397,370****PROVISION
                FOR INCOME TAX**
            
            
            **-**
            
            
            **169,950**
            
            
            **-**
            
            
            **259,925****NET
                INCOME BEFORE MINORITY INTEREST**
            
            
            **882,412**
            
            
            **(345,720**
            **)**
            
            **1,739,445**
            
            
            **137,445****MINORITY
                INTEREST**
            
            
            **(1,980**
            **)**
            
            **(40,691**
            **)**
            
            **(1,980**
            **)**
            
            **22,108****NET
                INCOME (LOSS)**
            
            
            **884,392**
            
            
            **(305,029**
            **)**
            
            **1,741,425**
            
            
            **115,337****OTHER
                COMPREHENSIVE INCOME (LOSS)**Foreign
                currency translation adjustment
            
            
            **429,707**
            
            
            **(27,828**
            **)**
            
            **710,043**
            
            
            **(38,053**
            **)****COMPREHENSIVE
                INCOME**
            
            
            **1,314,099**
            
            
            **(332,857**
            **)**
            
            **2,451,468**
            
            
            **77,284****BASIC
                EARNINGS (LOSS) PER SHARE**
            
            **$**
            **.04**
            
            
            **($
                .01**
            **)**
            **$**
            **.07**
            
            **$**
            **.00****DILUTED
                EARNINGS PER SHARE**
            
            **$**
            **.01**
            
            
            **($
                .01**
            **)**
            **$**
            **.03**
            
            **$**
            **.00****WEIGHTED
                AVERAGE****SHARES
                OUTSTANDING****BASIC**
            
            
            **24,505,000**
            
            
            **24,505,000**
            
            
            **24,505,000**
            
            
            **24,505,000****DILUTED**
            
            
            **64,403,252**
            
            
            **24,505,000**
            
            
            **55,722,807**
            
            
            **24,505,000**




The
      accompanying notes are an integral part of these financial
      statements.




4





**JPAK
      GROUP, INC.**





**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**





**FOR
      THE SIX MONTHS ENDED DECEMBER 31,**





**(UNAUDITED)**





**2007**
            
            **2006****CASH
                FLOWS FROM OPERATING ACTIVITIES**Net
                Income
            
            $
            1,741,425
            
            $
            115,337Adjustments
                to reconcile net income to net cashprovided
                by operating activities:Minority
                interest
            
            
            (1,980
            )
            
            22,108Depreciation
                and amortization
            
            
            518,645
            
            
            346,145Gain
                on disposal of fixed assets
            
            
            
            
            
            (1,108,582
            )Changes
                in assets and liabilities:Account
                receivables
            
            
            1,937,765
            
            
            3,909,791Inventory
            
            
            676,659
            
            
            (1,022,024
            )Restricted
                cash for trade notes repayments
            
            
            -
            
            
            132,540Other
                receivables
            
            
            (118,427
            )
            
            (264,705
            )Prepaid
                expenses
            
            
            703,834
            
            
            (5,954
            )Advance
                payments
            
            
            (2,013,322
            )
            
            -Due
                from shareholders
            
            
            
            
            
            (50,000
            )Accounts
                payable and accrued expenses
            
            
            (2,780,763
            )
            
            (1,248,145
            )Other
                payables
            
            
            (66,978
            )
            
            (2,398,220
            )Other
                current liabilities
            
            
            -
            
            
            237,984**Total
                Adjustments**
            
            
            **(1,144,567**
            **)**
            
            **(1,449,062**
            **)****Net
                Cash Provided By (Used In) Operating Activities**
            
            
            **596,858**
            
            
            **(1,333,725**
            **)****CASH
                FLOWS FROM INVESTING ACTIVITIES**Acquisition
                of property and equipment
            
            
            (576,378
            )
            
            (121,407
            )Addition
                in construction in progress
            
            
            (155,702
            )
            
            -Acquisition
                of Qingdao
            
            
            (864,000
            )
            
            (5,268,500
            )Cash
                acquired from the subsidiary
            
            
            (99,019
            )
            
            -**Net
                Cash Used In Investing Activities**
            
            
            **(1,497,061**
            **)**
            
            **(5,389,907**
            **)****CASH
                FLOWS FROM FINANCING ACTIVITIES**Trade
                note payable
            
            
            (538,880
            )
            
            102,967Capital
                Contribution
            
            
            (452,462
            )
            
            5,406,695Exercise
                of J warrants
            
            
            5,000,000
            
            
            -Proceeds
                from short term bank loan
            
            
            -
            
            
            1,082,790Repayment
                of short term bank loan
            
            
            (889,152
            )
            
            -Repayment
                of long term debt
            
            
            (357,783
            )
            
            -**Net
                Cash Provided By Financing Activities**
            
            
            **2,761,723**
            
            
            **6,592,452****EFFECT
                OF FOREIGN CURRENCY TRANSLATION ON CASH**
            
            
            **229,884**
            
            
            **47,745****NET
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
            
            
            **2,091,404**
            
            
            **(83,435**
            **)****CASH
                AND CASH EQUIVALENTS AT BEGINNING OF YEAR**
            
            
            **4,938,200**
            
            
            **1,289,995****CASH
                AND CASH EQUIVALENTS AT END OF PERIOD**
            
            **$**
            **7,029,604**
            
            **$**
            **1,206,560**





The
      accompanying notes are an integral part of these financial
      statements.




5


**JPAK
      GROUP, INC.**





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





DECEMBER
      31, 2007 AND 2006





**(UNAUDITED)**





**NOTE
      1 - ORGANIZATION AND NATURE OF BUSINESS**





JPAK
      Group, Inc. is a Cayman Islands based holding company incorporated on June
      22,
      2006. In December 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. In
      October, Qingdao Renmin invested in Qingdao Delikang Packing Machinery Co.,
      Ltd., (“Qingdao Delikang”), a joint venture with Xi’an Heiniu Machinery, Co.
      Qingdao Renmin is the 51% owner of Qingdao Delikang.





**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 fiscal years ended June 30, 2007 and 2006.





**NOTE
      3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





The
      accompanying unaudited 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.





**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. All share and per share
      data
      have been adjusted to reflect the recapitalization of the Company after the
      share exchange agreement with Rx Staffing.




**Three
                  Months Ended December 31, 2007****Net
                  Income**
              
              **Shares**
              
              **Per
                  Share**Basic
                  EPS
              
              $
              884,392
              
              
              24,505,000
              
              $
              0.04Effect
                  of dilutive securities
              
              
              -
              
              
              39,898,252
              
              
              (0.03
              )Diluted
                  EPS
              
              $
              884,392
              
              
              64,403,252
              
              $
              0.01**Three Months
                  Ended December 31,
                  2006****Net
                  Income**
              
              
              **Shares**
              
              
              **Per
                  Share**Basic
                  EPS
              
              
              ($305,029
              )
              
              24,505,000
              
              
              ($0.01
              )Effect
                  of dilutive securities
              
              
              -
              
              
              -
              
              
              -Diluted
                  EPS
              
              
              ($305,029
              )
              
              24,505,000
              
              
              ($0.01
              )





6




**JPAK
      GROUP, INC.**





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





DECEMBER
      31, 2007 AND 2006





**(UNAUDITED)**





**NOTE
      3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**





**EARNINGS
      PER SHARE (continued)**


**Six
                  Months Ended December 31, 2007****Net
                  Income**
              
              **Shares**
              
              **Per
                  Share**Basic
                  EPS
              
              $
              1,741,425
              
              
              24,505,000
              
              $
              0.07Effect
                  of dilutive securities
              
              
              -
              
              
              31,217,807
              
              
              (0.04
              )Diluted
                  EPS
              
              $
              1,741,425
              
              
              55,722,807
              
              $
              0.03**Six
                  Months Ended December 31,
                  2006****N****et
                  Income**
              
              
              **Shares**
              
              
              **Per
                  Share**Basic
                  EPS
              
              
              115,337
              
              
              24,505,000
              
              $
              0.00Effect
                  of dilutive securities
              
              
              -
              
              
              -
              
              
              -Diluted
                  EPS
              
              $
              115,337
              
              
              24,505,000
              
              $
              0.00




**NOTE
      4 - INVENTORY**





Inventory
      at December 31, 2007 and June 30, 2007 consisted of the following:





**December****31,**
              **2007**
            
            **June
                30,**
              **2007**Finished
                products
            
            $
            111,924
            
            $
            571,357Raw
                materials
            
            
            2,562,009
            
            
            2,206,420Parts
                and supplies
            
            
            52,850
            
            
            41,280Work
                in process
            
            
            123,030
            
            
            574,839Total
            
            $
            2,849,813
            
            $
            3,393,896


**NOTE
        5 - DEFERRED PALCEMENT AGENT WARRANTS COST**
 
 In
        connection with the US$5,500,000 financing in May 2007, the Company also
        granted
        warrants to purchase 990,000 shares of common stock with an exercise price
        of
        US$0.50 per share to the placement agent in the Financing. The expiration
        date
        of this warrant is on May 17, 2011. Furthermore, in connection with the Series
        J
        warrants exercised in December 2007, the Company granted warrants to purchase
        750,000 shares of common stock with an exercise price of US$0.60 per share
        to
        the placement agent. 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, except that they contain a “cashless” exercise provision.
 
 The
        cost
        related to the two placement agent warrants are capitalized and amortized
        over
        the term of the warrants. Deferred financing costs at December 31, 2007 and
        June
        30, 2007 were as follows:
 
 **December
                  31,**
                **2007**
              
              **June
                  30,**
                **2007**Deferred
                  financing costs
              
              $
              1,127,313
              
              $
              -Less:
                  Accumulated amortization
              
              
              34,182
              
              
              -Net
                  deferred financing costs
              
              $
              1,093,131
              
              $
              -
 
 Amortization
        of deferred financing costs charged to operations for the six months ending
        December 31, 2007 and December 31, 2006 was $34,182 and $-0-,
        respectively.


**NOTE 6
      - 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 December 31, 2007 and June 30, 2007 were as
        follows:
 
 **December
                  31,**
              
              **June
                  30,****2007**
              
              **2007**Deferred
                  financing costs
              
              $
              460,017
              
              $
              460,017Less:
                  Accumulated amortization
              
              
              460,017
              
              
              54,945Net
                  deferred financing costs
              
              $
              -
              
              $
              405,072
 
 Amortization
        of deferred financing costs charged to operations for the six months ending
        December 31, 2007 and December 31, 2006 was $49,835 and $-0-,
        respectively.


7


**JPAK
      GROUP, INC.**





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





JUNE
      30,
      2007 AND 2006, DECEMBER 31, 2007 AND 2006





**NOTE 7
      - PROPERTY AND EQUIPMENT**





Property
      and equipment at December 31, 2007 and June 30, 2007 consisted of the
      following:





**December
                31,**
            
            **June
                30,****2007**
            
            **2007**Buildings
            
            $
            3,842,612
            
            $
            3,533,677Machinery
                and equipment
            
            
            10,854,604
            
            
            9,848,634Subtotal
            
            $
            14,697,216
            
            
            13,382,311Less:
                Accumulated depreciation
            
            
            6,120,634
            
            
            5,446,391Total
            
            $
            8,576,582
            
            $
            7,935,920




Depreciation
      expense for the six months ending December 31, 2007 and 2006 was $434,628,
      and
      $346,145, respectively. Depreciation expense for three months ending December
      31, 2007 and 2006 was 213,086 and $177,857, respectively.





**NOTE 8
      - 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 December 31, 2007,
      accounts payable and accrued expenses were $1,521,913 and $415,287,
      respectively. As of June 30 2007, accounts payable and accrued expenses were
      $4,066,655 and $567,802, respectively.





**NOTE 9
      - CONVERSION OF CONVERTIBLE NOTES**





On
      August
      9, 2007, the Company 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”).





On
      December 28, 2007, the holders of the Company's outstanding Series J Warrants
      exercised in full such warrants for aggregate gross proceeds of US$5.0 million
      to the Company. Pursuant to the terms of the Series J Warrants, the Company
      issued to the holders of the Series J Warrants (a) an aggregate of 5,000,000
      shares of the Company's Series B Convertible Preferred Stock, which will be
      convertible into an aggregate of 8,333,333 shares of the Company's Common Stock,
      (b) Series C Warrants to purchase an aggregate of 4,166,667 shares of the
      Company's Common Stock at an exercise price of US$0.72 per share and (c) Series
      D Warrants to purchase an aggregate of 4,166,667 shares of the Company's Common
      Stock (subject to adjustment) at an exercise price of US$0.84 per share. The
      Series C Warrants and Series D Warrants have a term of six years from the date
      of issuance.





8




**NOTE 10
      - SHORT-TERM BANK**  **LOANS**





Short-term
      bank loans as of December 31, 2007 consist of the following:




On
                February 2nd,
                2007, the Company obtained a loan from China Industrialand
                Commercial Bank, of which the principal was paid in full by
                February11th2008, 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.
            
            $
            685,500On
                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.
            
            $
            822,600On
                February 12th2007, the Company obtained a loan from Qingdao CityCommercial
                Bank, of which the principal was 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.
            
            $
            2,193,600On
                May 25th2007, the Company obtained a loan from China Merchant Bank,of
                which the principal is to be paid in full by May 25th2008. 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.
            
            $
            411,300Total
                short-term bank loans
            
            $
            4,113,000




**NOTE
      11 - LONG-TERM DEBT**





As
      of
      December 31, 2007 and June 30, 2007, the Company had long-term debt of
      $1,730,339 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
      12 - RISK FACTORS**





In
      the
      six months and three months ended December 31, 2007, three customers accounted
      for approximately 71% of the Company’s sales, four vendors accounted for
      approximately 94% 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
      13 - CONCENTRATIONS OF CREDIT RISK**





Financial
      instruments which potentially subject the Company to credit risk consist
      principally of cash on deposit with two financial institutions of
      $7,029,604


**NOTE
      14 - SUPPLEMENTAL CASH FLOW DISCLOSURES**





**Six
                Months Ended****December****2007**
            
            **2006**Cash
                paid for interest
            
            $
            217,755
            
            $
            192,919Cash
                paid for income taxes
            
            $
            -
            
            $
            259,925




**NOTE
      15 - SUBSEQUENT EVENTS**





None.




9





**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”). The Share Exchange has been accounted for as a reverse acquisition
      under the purchase method of accounting for business combinations in accordance
      with generally accepted accounting principles in the United States of America,
      or “U.S. GAAP.” Reported results of operations of the combined group reflect
      Jpak’s operations. As a result, 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 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.




10




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 December 31, 2007 and 2006*** ****





**Three
                Months Ended December 31**
            
            **2007**
            
            **2006**Sales
            
            $
            6,114,644
            
            $
            5,371,875Cost
                of sales
            
            $
            4,319,117
            
            $
            4,246,343Selling,
                general and administrative expenses
            
            $
            1,055,160
            
            $
            1,328,786Other
                income (expense)
            
            $
            142,045
            
            $
            27,484Income
                taxes
            
            $
            -
            
            $
            169,950Minority
                Interest
            
            $
            (1,980
            )
            $
            (40,691
            )Net
                income
            
            $
            884,392
            
            $
            (305,029
            )Foreign
                currency translation adjustment
            
            $
            429,744
            
            $
            (27,828
            )Comprehensive
                income
            
            $
            1,314,136
            
            $
            (332,857
            )




**Sales** .
      Total
      sales were approximately US$6.1 million for the three months ended December
      31,
      2007 as compared to approximately US$5.4 million for the three months ended
      December 31, 2006, an increase of approximately US$0.7 million, or 13.8%. The
      increase resulted from increased sale of our products and services to numerous
      new customers in 2007. The increase of new customers was mainly due to shifting
      of the product lines from traditional printing and packaging to aseptic liquid
      food and beverage cartons. Monetary sales amount for the products have been
      treated as the key performance indicators that management utilizes to assess
      operations.





**Cost
      of Sales** .
      Cost of
      sales for the three months ended December 31, 2007 was approximately US$4.3
      million, or 70.6% of sales, as compared to US$4.2 million, or 79.1% of sales,
      for the three months ended December 31, 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 significant decrease in cost of sales to sales % was
      primarily due to gradual shifting of the product lines from traditional printing
      and packaging to aseptic liquid food and beverage cartons which have higher
      profit margins.




**Selling,
      general and administrative expenses** .
      Selling, general and administrative expenses were approximately US$1.1 million
      for the three months ended December 31, 2007 as compared to approximately US$1.3
      million for the three months ended December 31, 2006, a decrease of
      approximately US$0.2 million, or 20.8%. The decrease was mainly due to the
      decrease of research and development expenses incurred in gradual shifting
      of
      the product lines from traditional printing and packaging to aseptic liquid
      food
      and beverage cartons. Substantial research and development expenses were
      incurred during 2006 in order to shift the product lines.


**Minority
        Interest**  In
        October 2007, Qingdao Renmin invested in Qingdao Delikang Packing Machinery
        Co.,
        Ltd., (“Qingdao Delikang”), a joint venture with Xi’an Heiniu Machinery, Co.
        Qingdao Renmin is the 51% owner of Qingdao Delikang. The minority interest
        relates to that subsidiary.


**Net
      income** .
      Net
      income was approximately US$0.9 million for three months ended December 31,
      2007
      as compared to net loss of approximately US$0.3 million for the three months
      ended December 31, 2006, an increase of US$1.2 million. The increase in net
      income was primarily due to increase of sales, increase of profit margin of
      products and decrease of selling, general and administrative
      expenses.




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.




11




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$ 430,000 as of December 31, 2007 as compared to
      loss
      of US$28,000 as of December 31, 2006. The balance sheet amounts with the
      exception of equity at December 31, 2007 were translated at 7.29395 RMB to
      1.00
      US dollar as compared to RMB7.80031 at December 31, 2006. The equity accounts
      were stated at their historical rate. The average translation rates applied
      to
      income statement accounts for the three months ended December 31, 2007, and
      December 31, 2006 were RMB7.44345 and RMB7.87384, respectively.





The
      comprehensive income, which adds the currency adjustment to net income, was
      US$1.3 million for the three months ended December 31, 2007 as compared to
      US$0.3 million loss for the three months ended December 31, 2006, an increase
      of
      $1.6 million. The increase was primarily due to increase of foreign currency
      translation adjustment US$0.4 million and increase of net income by US$1.2
      million. There was an appreciation of RMB to US$ during the three months ended
      December 31, 2007 as compared to that of 2006.





***Comparison
      of the Six Months Ended December 31, 2007 and 2006*** ****





**Six
                Months Ended December 31**
            
            **2007**
            
            **2006**Sales
            
            $
            15,418,892
            
            $
            13,048,360Cost
                of sales
            
            $
            11,306,299
            
            $
            10,130,300Selling,
                general and administrative expenses
            
            $
            2,436,350
            
            $
            2,454,025Other
                income (expense)
            
            $
            63,202
            
            $
            (66,665
            )Income
                taxes
            
            $
            -
            
            $
            259,925Minority
                Interest
            
            $
            (1,980
            )
            $
            (22,108
            )Net
                income
            
            $
            1,741,425
            
            $
            115,337Foreign
                currency translation adjustment
            
            $
            710,643
            
            $
            (38,053
            )Comprehensive
                income
            
            $
            2,451,468
            
            $
            77,284




**Sales** .
      Total
      sales were approximately US$15.4 million for the six months ended December
      31,
      2007 as compared to approximately US$13.0 million for the six months ended
      December 31, 2006, an increase of approximately US$2.4 million, or 18.5%. The
      increase resulted from increased sale of our products and services to numerous
      new customers in 2007. The increase of new customers was mainly due to shifting
      of the product lines from traditional printing and packaging to aseptic liquid
      food and beverage cartons. Monetary sales amount for the products have been
      treated as the key performance indicators that management utilizes to assess
      operations.





**Cost
      of Sales** .
      Cost of
      sales for the six months ended December 31, 2007 was approximately US$11.3
      million, or 73.4% of sales, as compared to US$10.1 million, or 77.7% of sales,
      for the six months ended December 31, 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 decrease in cost of sales to sales % was primarily due
      to
      gradual shifting of the product lines from traditional printing and packaging
      to
      aseptic liquid food and beverage cartons which have higher profit
      margins.




**Selling,
      general and administrative expenses** .
      Selling, general and administrative expenses were approximately US$2.4 million
      for the six months ended December 31, 2007 as compared to approximately US$2.5
      million for the six months ended December 31, 2006, the decrease of
      approximately US$0.1 million, or 4.0%. There was no significant difference
      between the six months ended December 31, 2007 vs. 2006.


**Minority
        Interest**  In
        October 2007, Qingdao Renmin invested in Qingdao Delikang Packing Machinery
        Co.,
        Ltd., (“Qingdao Delikang”), a joint venture with Xi’an Heiniu Machinery, Co.
        Qingdao Renmin is the 51% owner of Qingdao Delikang. The minority interest
        relates to that subsidiary.


**Net
      income** .
      Net
      income was approximately US$1.7 million for six months ended December 31, 2007
      as compared to net income of approximately US$0.1 million for the six months
      ended December 31, 2006, an increase of US$1.8 million. The increase in net
      income was primarily due to increase of sales and increase of profit margin
      of
      products.




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.




12




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$710,000 as of December 31, 2007 as compared to loss
      of US$38,000 as of December 31, 2006. The balance sheet amounts with the
      exception of equity at December 31, 2007 were translated at 7.29395 RMB to
      1.00
      US dollar as compared to RMB7.80031 at December 31, 2006. The equity accounts
      were stated at their historical rate. The average translation rates applied
      to
      income statement accounts for the six months ended December 31, 2007, and
      December 31, 2006 were RMB7.50626 and RMB7.92547, respectively.





The
      comprehensive income, which adds the currency adjustment to net income, was
      US$2,451,000 for the six months ended December 31, 2007 as compared to US$77,000
      for the six months ended December 31, 2006, an increase of $2.4 million. The
      increase was primarily due to increase of foreign currency translation
      adjustment US$0.7 million and increase of net income by US$1.7 million. There
      was an appreciation of RMB to US$ during the six months ended December 31,
      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 became
      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, Qingdao 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
      December 31, 2007, we had working capital totaling approximately US$14.1
      million, including cash and cash equivalents of US$6.8 million.





Net
      cash
      provided in operating activities was US$597,000 for the six months ended
      December 31, 2007. This net cash provided was primarily due to the net income
      generated during the six months ended December 2007. Net cash used US$1.3
      million for the six months ended December 31, 2006 was primarily related to
      reduction of account receivables offsetting with decrease of accounts payables
      and other payables and increase of inventory.





Net
      cash
      used in investing activities for the six months ended December 31, 2007 amounted
      to US$1.5 million and related primarily to the purchase of property and
      equipment and the acquisition of the outstanding equity of Qingdao Renmin not
      owned by Jpak. Net cash used in investing activities for the six months ended
      December 31, 2006 amounted to US$5.4 million was related to acquisition of
      the
      outstanding equity of Qingdao Renmin not owned by Jpak.




Net
      cash
      provided in financing activities for the six months ended December 31, 2007
      was
      US$2.8 million and related primarily to exercise of J warrants. Net cash
      provided in financing activities for the six months ended December 31, 2006
      totaled US$6.6 million and related mainly to capital contribution.




13




We
      have
      entered into several loan agreements with our primary lenders, Industrial and
      Commercial Bank of China, Qingdao City Commercial Bank and China Merchant Bank,
      under which we have term loans. As of December 31, 2007, we had an aggregate
      principal amount of US$4.1 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 December 31, 2007, we were in material
      compliance with the terms of our loan agreements.





Since
      the
      principal amount of US$4.1 million will fall due between February 2008 to May
      2008, we will either repay the term loan or renew the loan according to the
      financial position and cashflow position as at the maturity date of the term
      loan. Since the financial and cashflow position is strengthening as compared
      for
      the six months ended December 31, 2007 vs. 2006, we will repay some of the
      term
      loan provided that that there is no additional working capital requirement.





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 $.0001 per share (the “Preferred
      Stock”), which shares are convertible into an aggregate of 11,217,128 shares of
      common stock, (ii) Series A Warrants to purchase an aggregate of 5,500,000
      shares of common stock (subject to adjustment) at an exercise price of US$.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”).





On
      December 28, 2007, the holders of the Company's outstanding Series J Warrants
      exercised in full such warrants for aggregate gross proceeds of US$5.0 million
      to the Company. Pursuant to the terms of the Series J Warrants, the Company
      issued to the holders of the Series J Warrants (a) an aggregate of 5,000,000
      shares of the Company's Series B Convertible Preferred Stock, which will be
      convertible into an aggregate of 8,333,333 shares of the Company's Common Stock,
      (b) Series C Warrants to purchase an aggregate of 4,166,667 shares of the
      Company's Common Stock at an exercise price of US$0.72 per share and (c) Series
      D Warrants to purchase an aggregate of 4,166,667 shares of the Company's Common
      Stock (subject to adjustment) at an exercise price of US$0.84 per share. The
      Series C Warrants and Series D Warrants have a term of six years from the date
      of issuance.





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.




14




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. We generally
      recognize product revenue when persuasive evidence of an arrangement exists,
      delivery has occurred, the fee is fixed or determinable, and the collectibility
      is probable. In instances where final acceptance of the product is specified
      by
      the customer, revenue is deferred until all acceptance criteria have been met.
      We are generally not contractually obligated to accept returns.





***Accounts
      Receivable and allowance for Doubtful Accounts.***




Trade
      accounts receivable are stated at the amount management expects to collect
      from
      balances outstanding at the end of the period. An allowance is estimated based
      upon (i) management’s assessment of the credit history with customers having
      outstanding balances and (ii) the current status of the relationship with the
      customer. It is possible the allowance for doubtful accounts could materially
      differ than management’s estimate.




***Inventory.***




Our
      provision for inventory write-downs are based on our best estimates of (i)
      product sale prices, (ii) customer demand patterns, and (iii) our plan to
      transition products. However, due to the fact that we operate in a highly
      competitive industry that is characterized by aggressive pricing practices,
      downward pressures on gross margins, and rapid technological advances it is
      foreseeable that the estimates used by us to determine its provisions for
      inventory write-downs will be materially different from the actual amounts
      or
      results. Such differences could result in higher than expected inventory
      provisions and related costs, which could have a materially adverse effect
      on
      our results of operations and financial condition in the near term.




***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 December 31, 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.




15





**Item
      3. Quantitative and Qualitative Disclosure About Market
      Risk**




Not
      applicable.




**Item
      4. Controls and Procedures**





**Evaluation
      of Disclosure 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 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 Chief Financial Officer, has evaluated the effectiveness of our
      disclosure controls and procedures as of December 31, 2007. Based upon that
      evaluation and subject to the foregoing, our Chief Executive Officer and 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. This material weakness caused us to be late in our filing this
      quarter.





In
      addition, this lack of staffing and resources has led to a misstatement in
      our
      financial statements. In our quarterly report for the September 30, 2007
      quarter, we did not have sufficient resources to discover and correctly account
      for the impact of the issuance of certain warrants on our financial statements.
      See Note 15 to our financial statements for the period ended December 31, 2007
      included elsewhere in this report. We anticipate that we will be required to
      file an amendment to our quarterly report of Form 10-Q for the quarter ended
      September 30, 2007 to correct the accounting treatment for such warrants.




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 this corrective step will enable management
      to conclude that our disclosure controls are effective 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.





16





**PART
      II - OTHER INFORMATION**




**Item
      1. Legal Proceedings**





Not
      applicable.




**Item
      1A. Risk Factors**





Except
      as
      set forth below, there have been no changes to the risk factors set forth in
      our
      filings with the Securities and Exchange Commission.





**Risks
      Related To Our Business.**




***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 December 31, 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.




***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.





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 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.




***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 our filing this quarter.
      In addition, this lack of staffing and resources has led to a misstatement
      in
      our financial statements. In our quarterly report for the September 30, 2007
      quarter, we did not have sufficient resources to discover and correctly account
      for the impact of the issuance of certain warrants on our financial
      statements.




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.  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.  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.




17




**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**





Not
      applicable.




**Item
      6. Exhibits**





See
      Exhibit Index on page 20 for a description of the documents that are filed
      as Exhibits to this report on Form 10-Q or incorporated by reference
      herein.




18





**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 Wang**Yijun
                Wang**
              **Chief
                Executive Officer**By:
            /s/
                Ming Qi**Ming
                Qi**
              **Chief
                Financial Officer**




Date:
      February 20, 2008




19





**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
            
            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 January 4,
                2008).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
            
            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 January 8, 2008).4.7
            
            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 January 8, 2008).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).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).




20




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).




21




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




22