Product
      Purchase and Sale Contract (1)

     

    Party
      A:
      Hei Longjiang Chang Xing Dairy Co., Ltd.

     

    Party
      B:
      Hei Longjiang Fei He Dairy Co., Ltd.

     

    It
      is
      hoped to fully make use of the dairy resources and advanced equipments of Party
      B, and to take full advantage of the complete market promotion system of Party
      A, so as to achieve the purpose of supplementing the advantages and developing
      together. According to certain regulations in “The Contract Law of People’s
      Republic of China”, after the negotiation between the two parties, Party A
      entrusts Party B to produce milk powder and rice flour with formulas for babies
      at Hei Longjiang Fei He Dairy Co., Ltd, which has the licence of manufacturing
      milk powder for babies. The two parties reach the following
      agreements:

     

    Item
      One: Packing specifications, formulas and computation

     

    
      	1  	
              Packing
                specifications: 25 kilo/package;

            


    

    
      	 	 


    

    
      	2  	
              Formulas:
                (see the first attached chart); 

            


    

    
      	 	 


    

    
      	3  	
              Computation:
                The
                standard is the weigh of goods after the acceptance check at the
                warehouse
                appointed by Party A; 

            


    

     

    Item
      Two: Standards of Quality and Techniques

     

    1
      The
      quality of products is to conform to the international standards as well to
      the
      restricted standards determined by both Party A and Party B. (The standards
      are
      provided by Party A. See the second attached chart). 

     

    2
      All
      auxiliary materials are to be wholly purchased by Party A and sent to Party
      B's
      factory. A large amount of raw materials should be purchased by Party B. If
      there are homogeneous products with equivalent quality, Party B can purchase
      from suppliers with a lower price, but no substitutes should be used.


     

    3 The
      production process is to be conducted according to the processing requirements
      of Party A. As for the unspecified part of Party A's requirements, it is to
      be
      conducted according to Party B's present manufacturing technique of baby formula
      milk powder. 

     

    Item
      Three: Specifications on Packaging of products

     

    
      	1  	
              All
                packing materials should conform to the requirements of food sanitation;
                

            


    

    
      	 	 


    

    
      	2  	
              25KG/package,
                Packaging
                bags are paper plastic compound packages with built-in plastics;
                

            


    

    
      	 	 


    

    
      	3  	
              Parcel
                label should be labeled: product name, specifications (net content),
                date
                of production and name of manufacturer;


            


    

    
      	 	 


    

    
      	4  	
              Packaging
                of products is not to be reclaimed and is without charge.
                

            


    

     

    Item
      Four: Lists of Product Purchase and Sale 

     

    
      	
              Items
                

            	 	
              Specifications
                

            	 	
              Amount
                (ton)

            	 	
              CIF
                including taxes (yuan/ton)

            	 	
              Remarks
                

            
	
              Formula
                powder A

            	 	
              25KG/package

            	 	
              169.4
                tons

            	 	
              61,000.00
                yuan/ton

            	 	
              The
                price of raw materials is to be verified by Party A's personnel at
                the
                factory. If the actual price of raw materials is different from that
                in
                the attached chart, or if the price of raw materials rises during
                the
                co-operation, both parties should re-negotiate the price in the form
                of
                supplementary clauses. This price contains all raw material costs,
                processing charges, cost of packing materials, transportation charges
                and
                so on. 

            
	
              Rice
                flour A

            	 	
              25KG/
                package

            	 	
              900
                tons

            	 	
              21,000.00
                yuan/ton

            	 
	
              Formula
                powder B

            	 	
              25KG/
                package

            	 	
              325.685
                tons 

            	 	
              50,310.00
                yuan/ton

            	 
	
              Rice
                flour B

            	 	
              25KG/
                package

            	 	
              188.3
                tons

            	 	
              42,000.00
                yuan/ton

            	 


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Item
      Five: Method of Transportation and Place of delivery

     

    
      	1  	
              Method
                of transportation: motor vehicle transportation


            


    

    
      	 	 


    

    
      	2  	
              Place
                of delivery: place of delivery specified by Party A.
                

            


    

     

    Item
      Six: Quality and Time Limit of Delivery 

     

    Party
      B
      ensures the requirement of Party A: a monthly provision of about 250 tons,
      with
      fluctuation of 20%. The specific delivered quantity and time limit should
      conform to the time of delivery in Party A's "factory order". On the factory
      order there should be the quantity, time of delivery and so on. Within ten
      days
      after Party B received the advance payment from Party A, Party B should produce
      the first batch of products. On 26th of every month, Party A gives the order
      of
      the next month, according to which Party B will produce and deliver goods
      according to the factory order. 

     

    Item
      Seven: Method of Acceptance Check

     

    The
      quality and quantity should be checked at the place of delivery. After Party
      B
      delivers the goods, that is, sends the bill of lading and product laboratory
      report in time to Party A, Party A should inform Party B by fax of the quantity
      of the milk powder on the day of receiving the milk powder. At the time of
      Party
      A's acceptance check, if there are differences in the quantity, breakage of
      product package and underweight, Party A should present the written form by fax
      to Party B on the day of warehousing. According to the undamaged product
      quantity, Party A is to warehouse according to the actual weight (take 10 sacks
      and take the mean value of net weight as the weight of each sack). The products
      with broken outer packs or inner packs should be retracted by the freight
      driver. Party A is not in charge of storage. The quality of products is to
      be
      checked according to Party A's internal quality standard. If there are quality
      problems, Party A should present in written form by fax to Party B within seven
      days after the arrival of goods. Two parties should negotiate specific method
      of
      disposition or go to quality-inspecting departments for inspection. If the
      goods
      are returned due to quality problems, Party B is to assume the back goods
      freight. If there is no demur seven days after the arrival of goods, the
      products of Party B is considered qualified at the acceptance check. Party
      B
      does not assume subsequent obligations. 

     

    Item
      Eight: Method of Payment

     

    1
      After
      the
      signing of the contract, Party A pays Party B 30% of payment for the first
      batch
      of goods in advance. Within seven days after the goods are accepted as
      qualified, the rest of the payment should be settled up. Party A will no longer
      pay advance payment for the batches of products. Within seven days after Party
      A
      receives and accepts the goods, the payment should be settled up. Party A is
      to
      send the receipt of remittance by fax to Party B. 

     

    2
      The
      type
      of payment is bank draft or cable transfer; 

     

    3
      The
      time
      of Party A's payment is the time on the bank receipt; 

     

    4
      Party
      B
      is to provide Party A with an invoice with 17% tax rate of value added tax.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Item
      Nine: Special Agreements

     

    1
      Party B
      has the obligation to fully maneuver its resource advantages, to cooperate
      as
      best as possible with the work of Party A's personnel, and to try to improve
      co-operation and investment environment so as to guarantee the successful
      progress of production; 

     

    2
      Party
      B
      should exert rigid control over the quality of products according to "Food
      Sanitation Law". Party B is to be responsible for any quality problems before
      the acceptance check of Party A's products and also the consequent losses.
      

     

    3
      Party
      B
      has the right to reject using unqualified materials ( including unqualified
      auxiliary materials from Party A's factories); 

     

    4 Party
      B
      has the right to reclaim and demand of payment on schedule; 

     

    5
      If
      there
      are disputes on the quality detection of products, Party B has the right to
      require quality-supervision departments above the province level to arbitrate;
      

     

    6
      Party
      B
      is to assume the losses due to its breach of contract or violation of operation,
      while Party A is not responsible; Party A is to compensate fully to Party B
      for
      its losses of product overstock due to Party A's failure of payment on time
      or
      sudden unilateral termination of the contract. 

     

    7 Party
      B
      is to cooperate actively with Party A in the regular checking and appraisal,
      as
      well as in the work of Party A's personnel at Party B's factory; 

     

    8 If
      either
      Party A or Party B requires amendments or suspends the contract, one should
      inform the other 30 days in advance; 

     

    9
      Party
      A
      and Party B can suspend the contract for un-resisted factors (such as war,
      disaster, great decline in market sales and so on); otherwise, the delinquent
      party will pay 5% of the sum in the contract as the liquidated damages and
      compensate for the economic losses of the other party. 

     

    10
      Party
      B
      will not assume responsibility for the normal production tasks due to the delay
      of payment from Party A. 

     

    Item
      Ten: Settlement of Disputes

     

    At
      the
      time of disputes, both parties should negotiate for a settlement. If thee
      negotiation fails, the disputes can be settled by instituting a law suit to
      the
      people's court at the defendant's location. 

     

    Item
      Eleven: Other Agreements

     

    1
      Party
      A
      will send managerial staff or technicians to assist Party B with guidance,
      supervision and coordination in production. They will be provided accommodation
      for free by Party B, and their diet expenses are to be disposed by Party A.
      

     

    2
      Party
      B
      is responsible for coordinating relations with local quality-inspection,
      industrial and commercial departments. The expenses will be assumed by Party
      B.


     

    3
      Party
      B
      provides: A repetition of enterprise business license, photocopies of toll
      registration certificate, baby formula milk powder of Party B's subsidiary
      companies, manufacturing licence of rice flour and sanitation license, as well
      as product test reports. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4
      Party
      B
      is to keep strict security on the formula and manufacturing technique provided
      by Party A. Party B is to compensate for any losses of Party A due to the leak
      of secrets. 

     

    5
      Time
      limit of co-operation: The time limit of co-operation between Party A and Party
      B is from January 1st,
      2005 to
      July 31st,
      2005.
      Refer to the date of signature between the two parties. After the contract
      expires, if both parties are willing to continue corporation, this contract
      can
      be signed continually. 

     

    6
      This
      agreement is in quadruplicate. Each party holds two copies (the faxes copies
      also have equivalent legal effects). The agreement takes effect on the date
      of
      signature. 

     

    
      Attached
        page


      
        	
                Party
                  A: Hei Longjiang Chang Xing Dairy Co., Ltd

              	
                Party
                  B: Hei Longjiang Fei He Dairy Co., Ltd

              
	
                Juristic
                  Person: 

              	
                Juristic
                  Person:

              
	
                Entrusted
                  agent: 

              	
                Entrusted
                  agent: Zhang Zhenjiang

              
	
                Bank:
                  

              	
                Bank:
                  Construction Bank at Keshan Town

              
	
                Bank
                  account: 

              	
                Bank
                  account: 23001627950050500102

              
	
                Tax
                  Registration Number: 

              	
                Tax
                  Registration Number: 230230736928960

              
	
                Address:
                  

              	
                Address:
                  Qing Xiang Street, Kedong Town, Hei Longjiang province

              
	
                Telephone:
                  

              	
                Telephone:
                  13706395987

              
	
                Fax:
                  

              	
                Fax:
                  0452-4312293

              


      

    

     

    Date
      of
      signature: December 26th, 2005