Employment
Contract

    


    Party A
(Employer):      
Caopu Arts
& Crafts Co.,
Ltd.                   


     

    Legal
Representative:            
Li
Jinliang                                     
      

     

    Party B
(Employee):                   
Zhong
Zhiqiang                           
  

     

    Gender:           
Male                  
  Date of Birth:   August 13, 1969 
        

     

    Nationality:        
Han                Educational
Background:                  
   

     

    ID
No.:             
372922196908133912                                                    
   

     

    Home
Address:                                                                                      
   

     

    Zip
Code:                                             Tel:                                              


    


    This
Contract is hereby concluded by and between Party A and Party B in accordance
with applicable laws and policies on the basis of equality, voluntariness and
consensus.

    


    
      
        	
                I. 

              	
                Term
      of Employment Contract

              


      

       

    

    This
contract is an open-ended employment contract commencing from   January 1, 2002  , unless
statutory or agreed conditions for contract discharge/termination
occur.

    


    
      
        	
                II. 

              	
                Post
      & Performance Indicator

              


      

       

    

    As
agreed, Party B shall hold the position of   Production  . Party B shall
accomplish his/her tasks according to the job duties.

    


    
      
        	
                III. 

              	
                Labor
      protection and Working Conditions

              


      

       

    

    Party A
shall provide Party B with necessary work environment consistent with the
national, provincial and municipal provisions in regard to production, safety,
labor protection, sanitation and health, and ensure Party B working in a safe
and healthy environment.

    


    
      
        	
                IV. 

              	
                Remuneration

              


      

       

    

    The
monthly base salary of Party B is RMB   3000   
during service period (Annual review may be made in consideration of performance
and general level of market prices).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                V. 

              	
                Rights
      & Obligations of Party A

              


      

       

    

    
      
        	
                A. 

              	
                Rights
      of Party A

              


      

       

    

    
      
        	
                1. 

              	
                In
      accordance with relevant state provisions, rules and regulations
      established by Party A, Party A shall exercise management right, appraisal
      right and the right to reward and
punishment.

              


      

       

    

    
      
        	
                2. 

              	
                Party
      A is entitled to adjust Party B’s post for business needs during service
      period.

              


      

       

    

    
      
        	
                3. 

              	
                Party
      A may inform Party B of terminating this employment contract at random
      with no limitation of 30-day advance notification under any of the
      following occasions:

              


      

       

    

    
      
        
          	
                  
                  

                	
                  (1)

                	
                  Party
      B is considered not meet the post requirements during the probationary
      period;

                


        

      

       

    

    
      
        	
                
                

              	
                (2) 

              	
                Party
      B is found engaged in production and business service activities for
      himself/herself or for his/her relatives or friends during the period of
      silk leave, personal leave, extended maternity leave, medical treatment
      period or full-time study period;

              


      

       

    

    
      
        	
                
                

              	
                (3) 

              	
                Party
      B severely violates work responsibility or regulations prescribed by Party
      A;

              


      

       

    

    
      
        	
                
                

              	
                (4) 

              	
                Party
      B has caused grave losses to Party A due to serious dereliction of duty or
      engagement in malpractice for selfish
ends;

              


      

       

    

    
      
        	
                
                

              	
                (5) 

              	
                Party
      B is investigated for criminal responsibilities in accordance with the
      law;

              


      

       

    

    
      
        	
                
                

              	
                (6) 

              	
                Party
      B has been reviewed incompetent for  six months in a
      role; and

              


      

       

    

    
      
        	
                
                

              	
                (7) 

              	
                Party
      B is unqualified for this post and refuses to accept other
      arrangement.

              


      

       

    

    
      
        	
                4. 

              	
                Party
      A is entitled to terminate this employment contract but a written
      notification shall be given to Party B 30 days in advance under any of the
      following occasions:

              


      

       

    

    
      
        	
                (1)

              	
                Where
      Party B is unable to take up his original work or any new work arranged by
      Party A after completion of his/her medical treatment for illness or
      injury not suffered at work;

              


      

       

    

    
      
        	
                (2)

              	
                Party
      B is unqualified for his/her work and remains unqualified even after
      receiving a training or an adjustment to any other work
    post;

              


      

       

    

    
      
        	
                (3) 

              	
                No
      agreement on modification of original employment contract can be reached
      through consultation by the parties involved when the objective conditions
      taken as the basis for the conclusion of the contract have greatly changed
      so that the original contract can no longer be carried out;
      and

              


      

       

    

    
      
        	
                (4) 

              	
                During
      the period of statutory consolidation when Party A comes to the brink of
      bankruptcy or runs into difficulties in production and management,
      reduction of its personnel becomes really
  necessary.

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

    

    
      
        	
                5. 

              	
                Where
      Party B causes any loss to Party A during the engagement period due to
      his/her violating law or discipline or other misconducts, Party A is
      entitled to demand Party B bearing corresponding compensation
      liabilities.

              


      

    

    


    
      
        	
                B. 

              	
                Obligations
      of Party A

              


      

       

    

    
      
        	
                1. 

              	
                Party
      A shall abide by state’ laws, provisions and policies, respect employees’
      mastership position, create an environment favorable for staff playing
      their enthusiasm and creativity;

              


      

       

    

    
      
        	
                2. 

              	
                Party
      A is responsible for offering in-house education and trainings concerning
      political ideology, professional ethics, technical know-how, business
      management, law and discipline, rule and
  regulation;

              


      

       

    

    
      
        	
                3. 

              	
                Party
      A shall not terminate this contract according as Subparagraph 3 of
      Paragraph 1 of Article 5 hereof under any of the following
      conditions:

              


      

       

    

    
      
        	
                
                

              	
                (1) 

              	
                Party
      B is confirmed to have lost the ability to work due to occupational
      diseases or injuries suffered at
work;

              


      

       

    

    
      
        	
                
                

              	
                (2) 

              	
                Party
      B is receiving medical treatment for diseases or injuries within the
      prescribed period of time; and

              


      

       

    

    
      
        	
                
                

              	
                (3) 

              	
                Other
      circumstances stipulated by laws, administrative rules and
      regulations.

              


      

    

    


    
      
        	
                VI. 

              	
                Rights
      & Obligations of Party B

              


      

       

    

    
      
        	
                A. 

              	
                Rights
      of Party B

              


      

       

    

    
      
        	
                1. 

              	
                Party
      B may enjoy the rights of taking part in democratic management, winning
      political honor and material
incentive;

              


      

       

    

    
      
        	
                2. 

              	
                Party
      B is entitled to enjoy labor protection, labor insurance,
      welfare treatment;

              


      

       

    

    
      
        	
                3. 

              	
                Party
      B may apply for extension of medical treatment if needed;
    and

              


      

       

    

    
      
        	
                4. 

              	
                Party
      B may notify at random Party B of revoking this contract in any of the
      following occasions:

              


      

       

    

    
      
        	
                
                

              	
                (1) 

              	
                Where
      Party A forces Party B to work by resorting to violence, intimidation or
      illegal restriction of personal freedom;
or

              


      

       

    

    
      
        	
                
                

              	
                (2) 

              	
                Party
      A fails to pay Party B remuneration or to provide working conditions as
      agreed upon in the employment
contract.

              


      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                B. 

              	
                Obligations
      of Party B

              


      

       

    

    
      
        	
                1. 

              	
                Party
      B shall accomplish tasks or targets on time, with high quality and
      agreed quantity and accept assessment performed by Party
  A;

              


      

       

    

    
      
        	
                2. 

              	
                Party
      B shall consciously maintain the image and benefits of Party A and shall
      not expose misconducts detrimental to the image and benefits of Party
      A.

              


      

       

    

    
      
        	
                3. 

              	
                Party
      B shall carry out business in the name of an employee of Party A and obey
      the management of Party A.

              


      

       

    

    
      
        	
                4. 

              	
                Party
      B may inform Party A in written form 30 days in advance of terminating
      this employment contract for his/her personal reasons. Otherwise, Party B
      shall bear the corresponding legal
  responsibility.

              


      

    

    


    
      
        	
                VII. 

              	
                Labor
      Insurance, Welfare and Benefits

              


      

       

    

    Both
Party A and Party B shall participate in social insurance and pay social
insurance premiums monthly in accordance with the law. Party A may deduct
premiums of the individual part from Party B’s salary on behalf of the
latter.

    


    
      
        	
                VIII. 

              	
                Liability
      for Breach of Contract

              


      

       

    

    
      
        	
                1. 

              	
                Upon
      concluded, both parties concerned shall strictly exercise this contract
      and shall bear breach liabilities by paying the other party a compensation
      of RMB
      10,000 . Where losses are caused, compensation shall depend on
      consequences and liabilities.

              


      

       

    

    
      
        	
                2. 

              	
                During
      the service period, where Party B has received vocational training funded
      by Party A or has been introduced with compensation, if he/she intends to
      terminate this contract before the service period expires, he/she shall
      pay a compensation according as the factual training fee or
      introduction fee, with a 20% decrease progressively
      year-on-year.

              


      

       

    

    
      
        	
                3. 

              	
                The
      economic damages and economic compensation for breach or termination of
      this contract may comply with applicable state’s provisions. Party A shall
      make one-off payment to Party B on the condition that both parties
      terminate this contract.

              


      

       

    

    
      
        	
                4. 

              	
                Due
      to the force majeure, causing the non-performance or the damages to either
      party, the other party may not undertake the breach
    liability;

              


      

    

    


    
      
        	
                IX. 

              	
                Procedures
      for Terminating This Employment
Contract

              


      

       

    

    As
agreed, both parties deem the following procedures fair and
rational.

     

    
      
        	
                1. 

              	
                Submit
      a written notice;

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

    

    
      
        	
                2. 

              	
                Fill
      in Notice of Employee Termination;

              


      

       

    

    Return
back all kinds of documentation, materials, communications equipment, labor
tools, housing, transportation means, and other properties owned by Party A.
Make compensations for loss or damage.

    
       

      
        	
                3. 

              	
                Handover;

              


      

       

    

    
      
        	
                4. 

              	
                Pay
      penalty and compensation;

              


      

       

    

    
      
        	
                5. 

              	
                Party
      A may issue certification of termination or discharge of this
      contract;

              


      

       

    

    
      
        	
                6. 

              	
                Go
      through transfer of household filing, personnel file and social
      insurance.

              


      

       

    

    The
employment relationship between both parties shall be terminated on the 31st day
commencing from the written notification of Party B. Where Party B fails to
undergo dismissal formalities for personal reasons, the time for transaction may
be postponed, while Party B shall undertake the corresponding
losses.

     

    However,
where the delay is caused by Party A, Party A shall go through relevant
formalities and compensate for Party B’s losses.

    


    
      
        	
                X. 

              	
                For
      matters not covered by this contract, decisions shall be made by reference
      to applicable laws, provisions, regulations and
  policies

              


      

    

    


    Party A
(Seal):     
Caopu Arts & Crafts Co.,
Ltd.          

     

    Representative (Seal):      
Li
Jinliang                       


     

        
January 1,
2002                                                              


     

    Party B
(Signature):      
Zhong
Zhiqiang                       


     

    ___ January 1,
2002