Product
        Purchase and Sale Contract (2)

       

      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

       

      
        	4  	
                Packing
                  specifications: 25 kilo/package;

              


      

      
        	 	 


      

      
        	5  	
                Formulas:
                  (see the first attached chart); 

              


      

      
        	 	 


      

      
        	6  	
                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.


       

      4 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

       

      
        	5  	
                All
                  packing materials should conform to the requirements of food sanitation;
                  

              


      

      
        	 	 


      

      
        	6  	
                25KG/package,
                  Packaging
                  bags are paper plastic compound packages with built-in plastics;
                  

              


      

      
        	 	 


      

      
        	7  	
                Parcel
                  label should be labeled: product name, specifications (net content),
                  date
                  of production and name of manufacturer;


              


      

      
        	 	 


      

      
        	8  	
                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
                    

                
	
                  
                    Rice
                      flour A

                  

                	 	
                  
                    25KG/
                      package

                  

                	 	
                  
                    1050
                      tons

                  

                	 	
                  21,000.00
                    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. 

                
	
                  
                    Formula
                      powder C

                  

                	 	
                  
                    25KG/
                      package

                  

                	 	
                  
                    520.5
                      tons 

                  

                	 	
                  
                    46,200.00yuan/ton

                  

                	 


        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Item
        Five: Method of Transportation and Place of delivery

       

      
        	3  	
                Method
                  of transportation: motor vehicle transportation


              


      

      
        	 	 


      

      
        	4  	
                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. 

       

      
        	9  	
                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; 

              


      

      
        	 	 


      

      
        	10  	
                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 May 1st,
        2005 to
December
        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: Aprils 26th, 2004